If a friend asked for your advice on the best way to be happy, what would you say?
Would you suggest they succumb to every fleeting whim and live in the moment? Beer for breakfast, sickies on a sunny day, a line of coke as a teatime pick-me-up? Probably not.
Most people recognise that happiness needs balance. Immediate pleasures should be complemented with long-term purpose. Learning a sport, raising children, advancing a career. Activities that bring contentment often involve short-term sacrifices.
But why are the self-evident lessons about balance ignored in marketing? Why are we increasingly fixated on short-term promotions and immediate sales?
It’s not that we lack evidence for the power of a balanced marketing approach. Les Binet and Peter Field, in their study The Long and Short of It, analysed 996 campaigns from 70 categories and found that the most successful brands invested in both long and short term activity. In fact, they found the optimum mix prioritised the long term, taking 60 per cent of budget, over the short term.
So if we have such rich evidence why are our marketing horizons getting shorter each year? There are two reasons.
The principal-agent problem
The first problem is the shortening tenure of senior marketers. Sir Martin Sorrell has claimed that the time senior clients remain in their roles is shrinking: a CEO on average now lasts five years, a CFO four to five years and a CMO two years. CMOs risk making Premiership managers look like a model of stability.
The shortening tenure creates what economists call the principal-agent problem: what is in the interest of the brand (the principal) is not in the interests of agent (the marketer). If a CMO moves every couple of years then the best thing for their career is to generate immediate results.
Unfortunately, Binet and Field have shown that the most effective short-term marketing is ineffective in the long term. Direct approaches outperform brand approaches by 50 per cent over one to two years but the brand approach is six times more effective when judged on a three year-plus time scale.
The data mirage
The second issue is the deluge of real-time data. It’s simpler than ever to collect campaign data in real time: clicks, views, dwell time, tweets, site visits. However, in the excess of data it’s easy to miss the scarcity. There may be plenty of data monitoring what’s driven immediate actions but there’s a dearth of live data showing the biggest longer-term effects.
This is problematic as once you start tracking data it becomes hard to ignore. So, if the majority of data collected is short term then planning becomes unbalanced. To re-work communication theorist Marshall McLuhan’s famous phrase: we shape our data, then our data shapes us.
We become what we measure
It’s hard to change the tenure of CMOs, so let’s focus on data collection. We must become better at filtering out data – not just analysing information because it’s available. Pare down the short term data to just one or two key metrics. Then, crucially, invest more budget in collecting harder to measure long-term data so that there’s as much data on long-term metrics as the short.
Marketing happiness comes from a balanced view of the world.
Newsworks and PwC are unveiling new research on the value of attention on Tuesday, 26 April. Find out more at newsworks.org.uk