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Mad Men in the Mirror

Tom Sullivan

November 1, 2016
Tom Sullivan

What Would Don Draper Think About Digital?

 

What would an 85 year old Don Draper think about last week’s headlines?  Would he be lamenting the passing of the Golden Age of advertising when the 30-second commercial could reach 60% of the population and build the marble foundations of Madison Avenue on the 15% media commission?  Would he be agitated by the unfeeling, machine-driven, programmatic digital advertising platforms run by the geeks who invented the modern-day stock trading systems?  Or would he reminisce contentedly that he was fortunate to have lived and worked in the sepia-toned age of imagery?

 

The advertising industry has been undergoing a swirl of accelerating disruption and innovation since 2000. The affects are seen in the headlines and news stories that our aged Mr. Draper would be consuming today:

 

“The Wall Street Journal is making buyouts available to a ‘substantial number of employees’ as the news company reviews its operations amid a continued slide in print advertising.” (Wall Street Journal, Oct. 21, 2016)

 

“Spending on newspaper advertising in the United States is projected to fall 11 percent this year, to about $12.5 billion, according to the Interpublic Group’s Magna.” (New York Times, Oct. 26, 2016)

 

“Digital Ads to Overtake Traditional Ads in U.S. Local Markets by 2018”

(Ad Age, Oct. 26, 2016)

 

The rapid growth of digital advertising on local mobile platforms and social channels will place digital in the leading share position by 2018 because of the slow but persistent ad share declines in print and direct mail.

 

However, Draper can still take solace in the fact that advertisers will support the established effectiveness of using a media mix (traditional and digital) to achieve communications objectives and thus ensuring the viability of traditional for many years to come.

 

These headlines that warn of the decline of print media are not particularly shocking to a modern audience. It is other news, such as that of AT&T’s bid to buy Time Warner, that is more unexpected. Is this the madness of greedy conglomerates to achieve dominance, scale and the approval of Wall Street?

 

It is my view that this is a play by AT&T to escape the legacy box of distribution so that it can survive and create new value over the long term.  For instance, AT&T owns landlines which are declining in value as consumers disconnect and go wireless.  However, AT&T also owns mobile-wireless distribution as well as cable TV and Direct TV which are needed by content providers and advertisers to reach consumers.

 

Now consider that Time Warner owns lots of valuable content and the desire to monetize that content through highly targetable and addressable advertising via Cable and Direct TV and mobile platforms. The rationale that the respective CEOs are pitching is that by integrating content and distribution and innovating ad targeting models leveraging big data, they can provide more value to advertisers.

 

“The combined company will be positioned to expand distribution options to disrupt traditional models by making content available on every device and innovating with more ad-supported content,” according to an AT&T spokesperson.  “We’ll still have big screen TVs at home, but wide-scale mobile video viewing is what customers want. As a single company, we are uniquely positioned to deliver on this mobile experience, and disrupt the traditional entertainment model by pushing the boundaries on mobile content availability for the benefit of customers. (Ad Age, October 24, 2016)

 

I think Draper would see through all the hype swirling around the changing industry to conclude what he already knew – that it’s about the story; it’s about the content.  In the famous Carousel Speech, Draper pitches and enraptures Kodak by taking attention off the technology and putting it on the story:

 

“It’s called a carousel.  It lets us travel the way a child travels, around and around and back home again to a place where we know we are loved.”