So the question remains: is advertising an art form meant to entertain the masses? Or is it meant to sell soap (or deodorant, as the case may be)?

In this troubled economic times, I vote for sales.

You?

For example, in a controversial article in AdAge late last week entitled ‘Why Digital Agencies Aren’t Ready to Lead’, Ana Andjelic, a freelance strategist whose Ph.D. dissertation was on digital branding, presents a model that separates digital from traditional agencies based on organizational theorist James March’s Exploration vs. Exploitation dichotomy.

(In case you, like me, aren’t up to speed on this subject, here is a handy definition of Exploration vs. Exploitation: |n essence, discovering new possibilities, conducting research, varying product lines, risk taking, innovation all fall under the realm of Exploration. On the other hand, Exploitation involves the refinement of current procedures: efficiency, production, execution, and so forth… Exploration is a long-term process, with a risky, uncertain outcome. Exploitation by contrast is short-term, with immediate, relatively certain benefits. Organizations face the problem of allocating resources between Exploration and Exploitation. Based on this model, the best companies have the optimal balance between Exploration and Exploitation; those less successful are doing too much of either.)

Using this model, digital agencies are considered as excelling at Exploration (i.e., impress clients with their passion, drive and technology know-how but cannot follow through) and traditional agencies as thriving on Exploitation (i.e., are risk-averse, accountable and systematic, but able to deliver).

What the troops are saying

What made this online article so interesting for me were the over 92 comments posted as of the time of me writing this post (worth reading here. There is passion as well as bile in those comments!).

The comments were posted mostly (I am guessing from the tone and content) by representatives of traditional agencies as well as digital, and range from well articulated and thoughtful to fringe and faltering.

However, they all missed the point: the comments are mostly self-serving and focus on who is more deserving of the client’s attention (and budget) and not on who delivers most value to the client.

This is wrong because deserving to be at the table and leading the marketing charge should only be a function of who delivers most value to the client.

As long as both digital and traditional agencies continue to recommend strategies that align with their own profitability model and not their client’s, there will be no resolution of the debate.

And the client’s role?

The client is only too often silent. The job of delivering greater value is enabled by the client’s understanding of its own business model and value proposition. And this means that the Marketing suite needs to move beyond “brand obsession” to a deep understanding of the company’s business model, as well as an understanding of the agency’s own profitability model.

As we have blogged in the past:

• Marketing has no real say within most top organizations

• There exists a big disconnect between what advertisers and what consumers believe works when it comes to marketing

In our experience, we see it as the marketing client’s role to define the business objectives in order to optimize profitability and then hire the right agency or agencies to deliver on those objectives.

Plus, clients need to be vigilant about aligning their needs with the right service suppliers who can not only service them properly but remain in business doing so for the long haul.

Only this way will the right agency type be ready to lead.

Apparently, there are researchers questioning the value of the click as a metric of success.

comScore and Starcom USA have followed up a July 2007 study conducted with Tacoda that segments Internet users into heavy, moderate and light clickers and found that a decreasing percentage of users are making up an increasing portion of all click-throughs.

Here are the researchers’ findings:

• Heavy clickers only accounted for 4% of all Internet users in March 2009, but they were responsible for more than two-thirds of click-throughs that month.

• Both moderate and light clickers decreased in number and in share of clicks.

• Non-clickers rose as a proportion of all Internet users by 16 percentage points.

As a result, researchers asked themselves, ‘With just 16% of Web users clicking on ads in March, how informative are click-through rates?’

And answer themselves they did: “A click means nothing, earns no revenue and creates no brand equity. Your online advertising has some goal—and it’s certainly not to generate clicks,” said John Lowell, Starcom USA SVP and director, research and analytics, in a statement.

Are these people for real?

These researchers have suggested other metrics, such as the view-through rate, gross ratings points (GRPs) and dwell time as more appropriate gauges of success.

This is certainly not what we are seeing happening today.

Especially in this economic environment, marketers desperate to create demand for their products and services are relying very heavily on click-throughs as well as conversion rate (the “post click experience”) as key metrics.

It seems to me these researchers should have spoken to actual marketers, right down in the trenches, working hard and succeeding under very difficult conditions.

What we are seeing is that now, more than ever, click-through and conversion rate are the key metrics driving decisions around advertising and marketing spend.

While I acknowledge these researchers are talking mostly about advertising metrics and not direct-response metrics, it seems to me irresponsible of eMarketer to decry “More Trouble for the Click-Through” at a time when click-through as a metrics is more important than ever to marketers.

Perhaps the real question these researchers should be asking is, “What is the future of Advertising?”

In essence, the two groups pretty much disagree on everything.

Basically, advertisers and consumers both agree that “amusing ads are effective and scary and guilt-inducing ads are not,” but they don’t see eye-to-eye on the efficacy of other types of advertising appeals.

But that is not all, the two groups also clash when it comes to online ad formats – prompting the report writers to ‘warn’ that the growing trend toward internet advertising in the face of large numbers of frustrated consumers “may eventually cause a backlash.”

Here are a few examples of ad types and their perceived efficacy:

• While more than half of advertisers believe ads that make people stop and think (53%) and ads that give people new information (51%) are very effective, just three in ten consumers (30% and 29% respectively) feel the same.

• 26% of advertisers think ads that are integrated into the feel of the program, that is has the same tone as the program it is based in, are very effective compared with just 7% of consumers.

• When it comes to ads that show before/after, 24% of advertisers say they are very effective while 13% of consumers say they are very effective.

• One in five advertisers (21%) say ads that reinforce a message already known are very effective, compared with only 10% of consumers.

• Consumers and advertisers both like ads that amuse.

• More than one-third (34%) of consumers and 41% of advertisers say entertaining ads are very effective, and one-third of both consumers (33%) and advertisers (32%) say funny ads are very effective.

• However, there is a fine line in amusement as just one in ten consumers (11%) and 14% of advertisers say ads that don’t take themselves seriously are very effective. Almost one in five consumers (18%) say these ads are not at all effective.

• 41% of consumers (41%) 32% of advertisers believe that scary ads are not at all effective.

• 27% of consumers and 18% of advertisers say ads about a serious topic that make people feel guilty are not at all effective.

And what about messaging? Apparently, there is a huge disconnect here too:

• Two in five advertisers (39%) are using empathy approaches, attempting to convey that companies understand what consumers are going through. But only one-quarter of consumers (24%) say empathy works very or somewhat well, and one-third (33%) say it does not work at all.

• One-fourth of advertisers (25%) say they are using cheerleading (”we’ve made it through tough times before, we’ll do it again, and we can help you do it.”) Almost two in five (38%) of consumers, however, say that these types of ads do not work at all.

What do Recession Consumers Like? Value Propositions

The study also examined the perceived effectiveness of ads currently being used to address the economic crisis, and revealed that value proposition strategies and “luxuries for less” approaches resonate most with consumers.

• Three in five advertisers (61%) say they are using a value proposition strategy, promoting sales, coupons and discounts and almost three in five consumers (57%) say that this strategy is working very well or well to help them sell their products or services.

• But less than one in five advertisers (18%) say they are using the “luxuries for less” proposition, while more than one-third of consumers (34%) say these types of ads work very well or well in selling products or services

As if this wasn’t bad enough, there is more.

While compared to last year, advertisers now rely less on print ads and more on Internet and Digital ads – but they are taking ads in the wrong direction.

According to another LinkedIn/Harris Poll, consumers are frustrated with many characteristics of Internet advertising.

So what do consumers dislike? The list is long:

Most hated:
• Pop-ups
• Ads that are “moused over”
• Difficult-to-close ads
• Musical ads

Next come…

• Ads that spread across the page and cover the content beneath them are the most vexing for consumers, with 80% of respondents in the study deeming these types to be very frustrating.

• Ads on which consumers can’t find the skip or close button are a close second, with 79% of respondents similarly annoyed, the survey found.

The study concluded the growing trend toward internet advertising in the face of large numbers of frustrated consumers may eventually cause a backlash and suggests that advertisers who come up with more engaging ways to connect with consumers will ultimately be the most successful.

There is lots of food for thought here for advertisers unleashing agencies to create ads.

Leaving aside the issue of how you as a businessperson define “what works” — especially in the context of branding and not conversions — these finding suggest a tremendous need to corral creativity to deliver on what the consumer will respond to and not to what the creative powers-that-be desire to create.