Tuesday, December 1, 2009

ROI and Measurement: the future of activation & events

All of us compare benefit and cost of almost everything we do everyday. And not just in matters of money. But particularly, any kind of expense or investment is first-up analyzed in terms of the value equation. The specific analysis that is done may well be done in qualitative terms or quantitatively, that is often the only difference. Historically, Marketing communication has been an area in which the qualitative and subjective evaluation rules the roost. Even today, large parts of the established advertising industry is evaluated subjectively and at awards functions and processes the creative is given considerably more importance than the return in business terms.

As the activation and events business has developed over the past decade and a half, the qualitative and subjective evaluation process has been the primary path. Till a few years back very few clients (and even fewer agencies) felt the need to evaluate the activities that they were investing in, in ROI terms. To add to this the economy was booming and the question was not whether / how much you were spending but where you were spending. Most clients simply looked for agencies that would ‘efficiently’ get the job done rather than be concerned about the results of the job. This was never going to last, it was a myopic approach to the business and many a fly-by-night operator made money and has now fled the industry.

This has very quickly turned upside down in the past year or so. This has hastened the need for justifying spends for all concerned. Most clients are now being forced to ask some very uncomfortable questions off themselves and their agencies. “What do I get for the money I spend on an event /activation?”. Add to this, the fact that the industry itself has gone through a metamorphosis and as a result today the leading agencies are in a position to answer the question, something that may not have been possible a few years back.

The time is right. The time is right to develop a measurement / ROI tool for our industry. While the time is right, the path ahead is not entirely clear. This is primarily because our industry is a highly competitive and fragmented one. Unless a strong centrifugal force is created, the natural tendency is a strong centripetal force. And therein lies the problem. It is absolutely crucial that the industry stand together in the development of the tool so as to create a common platform.

A common platform is even more important in our industry because of the complexity of our industry. While we keep referring to the Events / Experiential Marketing / Activation industry as one industry, the reality is that the industry is actually an amalgamation of 4-5 mini-industries. Consequently, the process of developing a measurement tool becomes an even more complex business. Each particular business segment has very different drivers and thus measurement of outcomes needs to be approached differently. The challenge is to go down to the core of the process to understand what makes it tick and then develop the tool around that core. The process is complex – but not impossible, far from it. At the end of the day, a process-based tool developed by the industry for itself will take into account all the intricacies and complexities and prove the efficacy of events and Activation to clients / investors. This process of development of such a tool has been taken by EEMA, which is the national body for the Events and Activation industry in India. EEMA is already well on the way to developing such a tool which will deliver and ROI analysis and evaluation for clients to be able to measure results.

It is inevitable that an objective tool or rating system will come into being that will assess, measure and report the efficacy of events and activation to clients from a neutral stand-point. The neutrality of the stand-point is a no-brainer. Several agencies in the industry have attempted developing and implementing proprietary tools but I think such a move is inherently flawed. Having an agency evaluate and measure its own projects is a bit like making students evaluate their own examination papers. And while we would all have loved to do that when we were in school, it was never going to be! The neutrality of the tool is the reason EEMA took it upon itself to develop and eventually implement the ROI measurement process.

Moving forward, a neutral rating system developed by the industry as a whole is crucial to the growth of the Events and Activation Industry to prove itself as a viable and often better marketing communication option to advertising.

Wednesday, July 15, 2009

The Importance of Chaos, Cash and Karma

Management by definition is the science of minimising disorder and maximising predictability. Unfortunately, life, business and especially startups are anything but predictable. Chaos is not only inevitable; I'd say it’s important, desirable even, to the process of starting up an enterprise.

After completing my MBA, I had to do my fair share of unlearning to adapt to the real world. Very often my ‘instinctive response’, based on my education, to situations would be the wrong one. A response which would further complicate the situation rather than resolve matters. In the same situation an 'innovative (or I dare say, ‘Jugaad’) response' would be more appropriate.

After doing this several times over in the early years, I realised that my responses based on education would probably bring better results in the long term as compared to the ‘Jugaad’ decisions. But then "in the long term we're all dead"... Often, startups are about getting through the here and now. If one was to implement the long-term-friendly-educated-response, one wouldn't survive long enough to see if it was a good call.

To a typical corporate-minded outsider this gives the appearance of chaos in a startup. Someone who is not involved in a series of ‘Jugaad’ decisions taken to manage the short-term would not see the order in the chaos. The long-term outcome is often a hugely positive and desirable result of a series of such short-term events.

The same often applies to managing cash, real cash. Cashflow management is a crucial part of management education but the way it is imbibed is to treat cash at a very theoretical or esoteric level.

Life teaches you otherwise. It’s a proven fact that the single biggest reason enterprises fail is because they run out of cash. This element is more important than marketing, operations, HR, sales, or anything else. Day-to-day management decisions in a startup enterprise are often guided by keeping your cash-head afloat rather than looking at long term profitability, organisational or financial health (Remember.... in the long term, we're all dead).

This brings me to Karma. Doing all that one can, doing one’s duty, to the best of one’s ability and aptitude without 'attachment' to the results and rewards of such actions. This nature of approach to one’s work is pretty much an anathema to classical management theory which would focus strongly on goal-orientation. But I have found this to be one of the most crucial aspects of building a business. And I don't just mean this in a spiritual sense only, I believe that keeping a karmic approach to everyday work, projects and business allows one to focus better and achieve higher productivity and results.

Management education taught me a lot and brought me the distance but left me tantalisingly close... I had to learn a few crucial life-lessons to truly apply myself to the challenge of building Candid Marketing into the No.1 Brand Promotion Agency in India.

Tuesday, January 13, 2009

Is BTL booming as a result of the economic slowdown?

I believe that the slowdown is mostly in the mind. Unfortunately, what’s in the mind has a profound impact on everyday action. Consumers and customers alike are reacting to sentiment and there is an overall sense of “hold is gold”.

In this scenario, it is key to get the buyer to make decisions, influence the buyer at the key moment when he or she is taking the plunge either by impacting their experience or enhancing it. This could lead to either the consumer succumbing to temptation, need or greed. Or even better, simply switching brand choice.

As a BTL evangelist for the past 15 years, I have seen it proven time and again that what Activation can achieve and deliver for a brand, advertising and mass media is not capable of. BTL as a discipline and marketing communication tool has been growing relentlessly for the past 15 years, at first in spurts and now in leaps and bounds.

In the economic slowdown, more and more brands are shifting money to BTL to influence buyer decision making. The process of growth of BTL has been given an almighty heave, where BTL was already growing in credibility and delivery, the economic slowdown is going to prove to be a major turning point in this growth.