Quo vadis, branding money? Review of IAB Interact Conference 10

Here are a few insights garnered from the IAB Interact Congress, which took place last week  in Barcelona.

Once per year, more than twenty representatives from the Interactive Advertising Bureau gather from all over Europe to share their views on general market development – quite a sound reason for 300+ players from all parts of the digital marketing industry to jump on a plane to this networking opportunity. And of course it doesn’t hurt that this year’s Interact took place in sunny Barcelona. The stage was set in the beautiful Casa Llotja de Mar, the corporate headquarters of the Official Chamber of Commerce of Barcelona.

La Casa Llotja de Mar | photo by Press Cambrabcn on Flickr

What could be clearly identified as the hot topic on everyone’s mind was the big worry about how to maintain high gross profits and growth in the online branding world amidst the “threats” of direct-response-addicted advertisers and game-changing volumes of social media traffic. The question tickling everyone’s brains: how to sell branding when advertisers have been told for years to watch their CTRs (and increasingly tougher online marketing metrics, like CPA)?

Randall Rothenberg (President, IAB U.S.) described this backfire best by speaking of the “tyranny of the click.” Media agencies, sales houses, and inventory owners seem to go round in circles talking about new KPIs and technologies to better their value proposition; meanwhile, advertisers develop a life of their own, bypassing the existing structures.  Not for nothing did Patrick Rona (President, European Operations Tribal DBB) preach caution when pointing to Unilever, who took their board to the Valley looking for new ways to reach out to customers.

Most impressive was Jef Vandercuys (Digital Marketing Head, Anheuser-Busch InBev), who managed to become one of the biggest global budget owners leaving TV with a pitiful 20% of the Anheuser-Busch marketing budget for this year — an enormous plunge from the 70% they spent on TV  in the previous year. You could feel that this guy was already far ahead of most of the people in the room: focusing on customer dialogue in social media, managing conversations via individual high-tech dashboards. His interest in social media was not because he was impressed by the massive traffic in that area, but because of his understanding that he reaches his target group at that exact point of time when they decide on their favorite brand of beer for the rest of their lives. For Vandercuys, large-scale branding campaigns increasingly become the trigger for the Anheuser-Busch social media activities.

This attitude goes hand-in-hand with the absolute shocker presentation of the conference: Darin Brown (President Global Accounts and Innovation, Razorfish) dared to look two steps ahead by proclaiming that the concept of campaigning is going to become increasingly outdated. Apart from individual marketing success stories (e.g., Marmite and Evian, see below), he sees a strategic shift toward customer-centric marketing strategies  in which continuous, bilateral advertiser streams of content and information (called “brand narratives”) play the central role that has previously been played by individual campaigns.

So following that idea, who will be the future money makers in digital marketing? According to Brown, it’s going to be creative content providers and technology companies that provide services in the field of conversation analytics.

You could see the branding guys who paid close attention leaving with dropped jaws, having realized – after Jef and Darin’s decks – that time is not on their side.