As marketers attempt to better understand how to best harness brands, as well as how to most effectively use their resources, the term ROI – Return On Investment – has skyrocketed in popularity and cliché uses.
Many salivate at the prospects of being able to drill down to zip codes, neighborhoods, and individual households in order to surgically target advertising campaigns and then provide an accurate measure of the response. This has been the appeal of platforms and brands like Pandora, Google, and others that promise no wasted impressions, as well as the ability to laser focus on key prospects.
But none of that takes into account brand engagement or audience relationships – key factors in advertising and marketing effectiveness.
This topic was recently the centerpiece of an AdAge article that challenged the notion of ROI because of its inherent limitations. While metrics are a way to measure the impact of a single campaign, a more meaningful connection with brands goes to the heart of engagement and the fan experience.
The CEO of Epsilon and author of Igniting Customer Connections, Andy Frawley, effectively makes the case that marketers may be missing the boat. Frawley’s substitute for ROI is ROE2 which stands for return on experience x engagement. His claim is that evaluating campaigns based on basic ROI data – ex: how many car owners in zip code 60601 saw an ad – fails to take into account how consumers feel about brands. And variables like service, responsiveness, connection, and those little extras are simply not accounted for in ROI metrics.
This goes to the heart of why consumers often favor brands even where price points are less competitive, and barriers are higher. But the payback is the brand experience. We pay more and even stand in longer lines at Whole Foods, Starbucks, and Apple Stores. We tend to forgive them when they stub their toe by coming out with a product that is perhaps not up to their standards. The benefit is in knowing these brands know you.
It’s not that these companies have more money, staff, research, and resources than you do. It’s that they are obsessed with providing an emotional experience that speaks to this notion that they know you. At yesterday’s spring Apple event, there was a series of announcements about new MacBooks, a partnership with HBO, and of course, the debut of the long-awaited Apple Watch. While this new revolution in smartwatches is loaded with exciting features, CEO Tim Cook got to the heart of why consumers are going to stand in line for this next product in a long line of Apple successes:
And radio brands have this same ability create that higher level of engagement – online, on social media platforms, in person at events, and while consuming content on the air, in podcasts, and via videos. A station that matters in the lives of its listeners can make you happy, elevate your mood, surprise you at times, and provide a local connection you can’t get anywhere else.
Radio has brands that offer these Technicolor experiences, and when they’re on their games, they’re providing much more than a music format and a playlist. The combination of personality, social interactivity, community involvement, and a reflection of one’s lifestyle are all factors where radio can provide that ROE2 – all factors that play a role in heightening the experience and the engagement. This is what more radio stations used to be about. And it’s the stuff that radio stations need to be about again in order to navigate the competitive ROI waters that dominate marketing-speak.
In the next couple of days, we’ll take a deeper dive into what ROE2 can mean for radio on both the sales marketing and social engagement fronts and why it is so crucial for the industry to focus on its strengths rather than being hounded by its inherent challenges. Pandora, satellite radio, and other competitive threats have taken advantage of radio’s baggage, while the industry has done very little to position and capitalize on its core strengths.
Andy Frawley has it right. Radio can make your day, it can stir you up, it can remind you of the first time you heard that song, and it can reinforce why you live in the greatest town in the world. We’ve referred to these qualities as “emotional triggers” in our Techsurveys that have helped quantify radio’s true ROI – the ability to move a listener, and not just play the hits.
Radio will forever be more repetitive musically and will always play more commercials than the other guys. Those are givens. But what radio brings to the table in the form of experiences, emotions, and engagement cannot be duplicated even in this dynamic media environment.
We’ll look at radio from the sales and social angles over these next couple of days to truly understand the medium’s ROE2 and how your station can unleash it.
Your comments, as always, are welcome.
Jacobs Media has consistently walked the walk in the digital space, providing insights and guidance through its well-read national Techsurveys.
In 2008, jacapps was launched - a mobile apps company that has designed and built more than 1,000 apps for both the Apple and Android platforms. In 2013, the DASH Conference was created - a mashup of radio and automotive, designed to foster better understanding of the "connected car" and its impact.
Along with providing the creative and intellectual direction for the company, Fred consults many of Jacobs Media's commercial and public radio clients, in addition to media brands looking to thrive in the rapidly changing tech environment.