Picture the scene. You are a dynamic, experienced CMO parachuted into a major ecommerce brand to overhaul its marketing strategy. The budget’s bigger than the Gross Domestic Product of a small country. Offline and online, out of home mixed with every digital acquisition channel going.
But when it comes to revamp this chunky yet inefficient marketing strategy, where do you start and how do you model an appropriate marketing strategy?
While this situation presents a plethora of options, our ambitious CMO actually has just one of two possible starting points. These ultimately reflect the way all digital strategies are built and set.
Owned, Earned, Paid
A common phrase in marketing departments throughout the land over the past few years – “what is our Owned, Earned and Paid media strategy” has become the go-to nomenclature when businesses look to stitch together a cohesive marketing plan.
In case you have been marooned in the Antarctic for a while:
Owned media is any property or content that is controlled and unique to a brand. One of the most common examples is a website, although blogs, social media channels and in-store messaging are other examples
Earned media is essentially word of mouth, usually seen in the form of 'viral' tendencies, mentions, shares, reposts, reviews, recommendations, or content picked up by third parties. Offline it could take the form of newspaper interviews, mentions or a celebrity talking about your brand on TV without any prompting (you’ll notice that TV and radio presenters go to extensive lengths to prevent accidental generation of Earned media, e.g. “that popular soft-drinks brand”). ‘Shared’ media is sometimes used to refer specifically to the digital part of Earned media
Paid media is marketing that you pay third-parties for to drive traffic and engagement to Owned media. Digital disciplines like Paid Search, Display and Email are obvious examples, but any above-the-line advertising would also be included
These concepts effectively replaced the old four P’s of marketing to help form a marketing architecture fit for the digital age. It tantalised marketers around the world with the promise of unlocking customer engagement while reducing paid media costs.
The premise of this model was to promote the virtues of Owned media as an important marketing tool – because it’s controlled – and set out a strategy that utilises those owned assets to generate Earned media traction. The cost-effectiveness point came in because a strategy that put Owned/Earned media at its heart lessened the reliance on Paid media as a route to market, promoting the benefits of free advocacy over paid reach.
By Channel
The other option is for our CMO to take a ‘channel first’ approach. “What marketing channels are performing the best for us?” This approach lays out a marketing strategy based on spend and return in different channels like Search, Display, Out of Home, Email etc.
The difference in meaning between the two questions may be subtle, yet it’s crucially important. This approach thinks in terms of acquisition; “where/how are our customers finding us and what type of marketing is most important to our business”.
While this way of thinking might sound crude for those used to building integrated marketing strategies from scratch, it’s actually the way a large number of businesses think about their marketing, particularly time-poor small businesses that don’t have the resources to employ specific marketing expertise. The Planners among you will say it’s very bottom up, but it makes a lot of sense for people focused on the practical outcome rather than the conceptual journey.
The channel centric approach is very measurable and accountable. Thinking about marketing in terms of Paid, Display, Social means a business can easily use an Analytics or Attribution service to effectively measure the results per channel that engaged the customer. Measuring the results of Earned media vs Paid media is inherently more difficult. On a practical level LinkedIn doesn’t allow you to measure the effectiveness of inbound traffic generated by a share of an article vs a view of your company’s page. When Earned media gets even more indirect, such as unprompted mentions of your business in social media the idea of effective measurement becomes very…ineffective.
So…if you were in our CMOs shoes, where would you start?
For those of you able to quickly identify a route…congratulations. You have solved one of marketing’s greatest enigmas. For those of you who aren’t sure, fear not…because like the old chicken/egg thing – this isn’t straightforward.
With Influencers, content marketers and native advertising some of digital’s most beloved buzzwords it’s tempting to say thinking in terms of Owned, Earned, Paid makes complete sense. It has allowed businesses of all shapes and sizes to develop their ‘story’, using Owned media as the catalyst to create interest, intrigue and excitement about their products at low-to-no cost.
AirBnB is a perfect example of a business that’s used a vast amount of Owned and Earned media to build faith and advocacy in the ultimate trust product – renting your house to a stranger! Owned, and then Earned, were really the critical types of media that;
- Built the narrative of such a new concept in AirBnB’s own words (Owned)
- Established trust and advocacy through third-parties (Earned)
Paid media has of course been used, but as a growth accelerator.
But there is something quite specific about AirBnB’s business that made thinking in terms of Owned, Earned, Paid perfect for their marketing strategy. AirBnB were creating a new market. Their business established not only a brand, but also a new way of finding accommodation. Although it’s subjective, using a channel approach would have still likely created a lot of reach and exposure for their brand, but the message would have been disjointed and most people would have responded with: “other people in my house; that’s just weird”.
This doesn’t make the channel centric approach wrong, less creative, less effective or less cost-effective. In fact, a marketing strategy delivered by channel can be all of these things. The difference is when to use it. In businesses
Owned media might be cost-effective but it’s a drain on time and resource to create and maintain. In businesses that sell commoditised products like affordable washing machines, basic office space or car-parts marketing does not need to establish need. The need exists. The challenge is to get the brand in front of as many of the right customers at the right time as possible. Outcome focused marketing strategies are built around channels.
An effective channel-centric marketing strategy will layout the key digital and offline channels that are available, assess them by potential reach, cost and historical performance. The only concession to Owned media will be ensuring the brand’s destinations are as set-up to convert traffic to customers as effectively as possible.
Currys are a great example of a brand that has been built on a succession of large and very effective paid media campaigns that are delivered across a range of online and offline marketing channels.
So, what advice do we now have for our CMO?
If the business is breaking new ground, entering new markets, delivering a new product or service or innovating in an established industry – Owned, Earned, Paid must be the model that underpins the marketing strategy because engagement will be driven by advocacy
If the business operates in a well-established market that is already commoditised or highly recognised by consumers, a channel approach is the way to go. An intricate Owned, Earned, Paid dripping with original content and ways to discover the company would be wasting time better spent on working the different marketing channels to generate as much effective reach as possible
You don’t agree? Try this exercise
Now you’ve read this article, try to forget it. Hopefully it’ll be difficult! But give it a few weeks. Then come back to this exercise, get together with a marketing friend/colleague and do this:
Pretend you have set-up two businesses:
- An B2B online technology business that has developed a new way of tracking and recording customer behaviour on mobile devices
- An online e-commerce business selling hairdryers that you are bulk importing, at low-cost with a 65% margin
Build a one-page marketing strategy for both. I’ll challenge anybody not to use an Owned, Earned, Paid strategy for the first and a channel-centric strategy for the second. Like many things in business, common sense dictates it.