Marketers are increasingly becoming trapped between a rock and a hard place. If you want to get noticed on traditional channels, your audience is shrinking.
And, if you want to get noticed on digital channels, you face a lot of stiff competition from everything else on the internet; the amount of content produced in one second is more than someone can consume in a lifetime, and there’s no shortage of channels and platforms to tailor content for.
Plus, “advertising” has a bit of a bad rap among audiences on digital, judging by the recent uptick in ad blocking. The economic cost of ad blockers reached $21.8 billion in 2015 and the most common trigger for ad blocking is simply the realization that ad blockers exist.
The most straightforward answer to captivating an audience that’s fleeing to newer media, more easily distracted by a deluge of content, or actively trying to block your communications: improving the creative itself. As digital Renaissance man Tim Hwang said at our Transition 2015 conference, “If advertising were better, it would become known to us as information.” As a result, about two-thirds (64%) of marketers said they have devoted more resources to creative production to improve ad quality, according to Celtra.
Content Creation Costs: Rising for the Worse
But as we position ourselves for the year and rise to meet the challenge of grabbing audience’s attention and building mental availability, there’s a large risk that we don’t use our content creation spend wisely.
An entire 40% of the average advertising bucket is tied up in production costs, according to our survey of over 300 enterprise U.S. CMOs, VPs, and Marketing Directors. (We discuss those findings in this presentation).
But that 40% is projected to grow quickly — almost two-thirds of marketers said they saw growth in the share of media expenses that are non-working last year. Non-working spend is the amount departments spend on the production of content, as opposed to its distribution to audiences.
The majority expect it to grow even more; in fact, just 17% think they’ll see a decrease in those non-working costs in 2016.
Unfortunately, those expenses aren’t actually growing to improve the quality of content. Rather, they’re being driven largely by process inefficiencies:
As we said, issues like process and briefing are avoidable — not reasons for accepting higher production costs.
There’s little indication that we as a whole have a handle on these costs; the channels for which non-working spend has grown the fastest in 2015 will continue to grow the fastest this year.
And the growth of content creation expenses gets worse as your marketing budget scales:
This is likely because if you have a larger budget, you’re trying to reach out to audiences in more regions; you have more products and more brands to manage; you’re working with more people; and you have more process steps slowing you down. It’s easy for inefficiency to happen when you’re working with a department of that scale.
For an example of how large the opportunity is when you remove the friction between all those moving parts, look to Unilever, the company behind health and beauty brands like Dove and Axe — and the second-largest advertiser in the world.
When we first spoke with Unilever in 2013, 1,000 employees creating content for 400 brands all over the world on Facebook. The responsibility for creating that content was dispersed across regions. The organization had limited oversight over everyone involved—internal and external marketers alike. It was all compounded by a fragmented technology stack.
But after Percolate brought order to the chaos and streamlined the content creation process, the company saved an estimated $10 million a year on producing media for just Facebook.
All marketing teams can afford to trim the fat in content creation. To get noticed, we want to invest that money better — whether that means spending more on promoting our content and buying better ad space, or significantly improving the content of an advertisement.
We’ll be writing more soon about how can remove the cost of process inefficiency. In the meantime, tune in this Tuesday, January 26, at 1:00 pm EST with Ad Age for a discussion on what 300 leading marketers said about budget spend and content creation costs.