Friday, April 23, 2010

Is A Blank Ad Better Than A Standard Ad

I gave a presentation and tasting on Monday night at a private party for the 40-under-40 group. I gave this presentation in conjunction with Nick VanCourt, one of the brewers for Milwaukee Brewing Company. It was a fun and educational event and everyone seemed to learn a lot. The event (which has provided the impetus for both posts this week, strangely enough, is not the subject of this post.

At the event, I met a gentleman who is the CEO of a mobile application development company called perBlue. As I was writing a thank-you email to him, I checked out his company site, the products they create (including a pretty badass free iPhone and Android game called ParallelKingdom), and the company blog.

I will tell you, that I completely expected to spend exactly .0001 seconds on his company blog. Most corporate blogs are crap. Marketing material and press release outlets that provide little insight into the company itself. I did not expect to find the most recent blog post to be about federal legislation affecting angel investment. I mean, I understand why perBlue is interested in it, but I did not expect them to be blogging about it. So, as loyal readers will probably guess, my interest was piqued. The previous post had been about the Google Fiber project, a public meeting I had actually attended; again, interesting.

But it was the post of February 1, 2010 that really caught my attention. In this post, the author recaps a social experiment that perBlue performed on an unwitting public and, humorously, an unsuspecting advertising agency. I'll wait here while you read it. But here's the gist:
But what if all this arguing over increasing click through or conversion rates by a tenth of percent doesn't really matter? What if there was a bigger influence that made these click through statistics insignificant? Introducing: accidental clicks. How many ads are actually clicked in error? Being good engineers, we did a little experiment in an attempt to do a bit of error analysis. ... Yes, that is a blank ad. Our ad rep was a bit confused when we tried to start running the ad. ... That's right, our blank ad (the "mystifying and curiosity invoking" one) had a 4x higher click through rate than the real ad.
That is awesome in so many ways. The conversation with the ad rep is pure comic gold. And the result, a 4x increase in click-through rate, is completely unexpected.
how is it possible that a blank ad has a higher click through rate than a real ad? Maybe we just stumbled on a new paradigm in display advertising.
They conclude, as I would, that this is doubtful. One conclusion could be that the vast majority of the clicks were accidental. A good thought, but really a 4x increase is entirely accidental? Again, I find that rather hard to believe. The other option is curiosity surrounding what would be behind a blank ad. To isolate the "accidental" from the "curious" it might be useful to run a blank ad that is not white (although, really, what percentage of backgrounds are white?).

So, I imagine, you're wondering why the hell I'm writing about this on a beer website. Well, that would be a good question. But, breweries advertise. Some of them quite a bit. Indeed, it is hard to drive anywhere right now without seeing at least 3 billboards for Supper Club.

But, it seems that perBlue's experiment might suggest that there is ad fatigue. All but the interested are completely ignoring the ad. But, it also might be that metrics that are now technologically possible are revealing what has been the case all along. That people don't like "ads" but are willing to engage their curiosity.

I would doubt that this is much of a surprise to advertising agencies. It's why metrics like GRP exist at all. It's an unabashadly shotgun approach where "good" means that 1% of the total audience is even paying attention.

So, here's a question to craft brewers. If you had, say, $50,000 for customer acquisition, would you give it to an advertising agency to make a six-month billboard and radio ad campaign that might get you, let's say, one million eyeballs. 1% (assuming your ad agency is even "good") of 1,000,000 is 10,000, over the course of three months that are even paying attention. According to perBlue's number only 2% of those interested eventually purchase. 2% of 10,000 is 200 people. So, a $50,000 ad campaign nets you, maybe, 200 new customers? You are spending $250 per customer.

Frankly, you'd probably be better off eating $50,000 in product, and giving away 1000 cases of free beer.

1 comment:

  1. Ha! Do you think the blank ad got more hits because ads are perceived negatively and blank spaces are therefore a step up in boredom-reducing potential? If so, it probably won't take people long to figure out that blank spots are ads. As a cynical bastard, that would have been my first guess anyway.


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