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Advertising is becoming less effective, bringing product quality and service to the fore

This chart (data from Comscore, published on Vator.tv) shows that younger people are more ‘ad-blind’ than their elders, as shown by immediate recall. To me this is evidence that advertising works less well than it used to. It is interesting that delayed recall is better for millenials, and I think that probably reflects greater loyalty to brands that have genuinely impressed. Millenials are people born in the 1980s and 1990s, now aged 13-31.

If advertising is less effective then companies will be forced to turn more to product quality and service to build their brands and drive sales. This is clearly good news for us as consumers, but there are a couple of interesting business trends that come too. Firstly there is a call for innovations to improve product quality and customer service, most obviously using social media and leveraging mobile, and secondly there is a call for innovation that will help reverse the decline in advertising effectiveness (better targeting, more relevance etc.).

Two of our recent investments at DFJ Esprit play to these trends. Conversocial helps major brands like Groupon and ITV leverage improve their customer service using social media, and StrikeAd allows for real time targeting and campaign optimisation for mobile ads.

 

(our portfolio company Conversocial helps h

  • Innovative service plays – like Conversocial
  • Advertising will have to get more effective – StrikeAd
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  • Ben

    Hello Nic,
    This is something that we at Samba are keenly aware of. We are a video advertising value exchange – targeting customers on both real and claimed behaviour. We have seen CTRs of 6-7x market norms and v positive qual feedback (after a 3 month trial). In short we have engaged customers, which drives premium CPEs. Don’t take my word for it! Check out our FB page: http://www.facebook.com/SambaMobile.
    FYI we launch soon…

  • http://www.theequitykicker.com brisbourne

    Thanks Ben. I will take a look.

    Sent from my Android phone using TouchDown (www.nitrodesk.com)

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