Wednesday, August 24, 2011

Taking The Subjectivity Out Of Creativity

Perhaps the most difficult thing a CMO has to do is evaluate the creative the agency presents.

The agency, of course, is promising that the work is fantastic. The CMO doesn’t really have a clue. Neither does the agency, for that matter, but they’re not going to admit that.

So, how does the CMO determine the actual worth of the commercial?

What if the CMO allows the viewer to decide? Viewers won’t keep watching a commercial that isn’t interesting to them. Digital data now tells us when viewers stop watching a commercial.

So, why not allow viewers to decide a commercial’s worth?

In other words, why not take the subjectivity out of the creativity?

How does this benefit the CMO? In a word, financially. Either due to paying the agency less. Or, through increased sales.

The way it works is that the CMO trusts the agency completely, running whatever they say is going to work so fantastically. Then the CMO checks to see if viewers thought the work was as fantastic as the agency said it was.

Did most viewers watch most of the spot? If so, then sales should increase. Pay the agency well.

Did most viewers watch very little of the spot? If so then sales should be less, so the agency makes less. As well they should. After all, they were obviously wrong as to how fantastic the damn commercial was.

This payment model is called View Duration Compensation. Basically, it allows agency compensation, along with a portion of the production budget, to be a variable cost dependant on view duration.

The longer viewers are engaged with the commercial, the more the agency and production company make. Which seems only fair as the marketer will also be making more through increased sales.

If nothing else, it would certainly make those creative presentations less nerve-racking for the CMO.

Which, by itself, should make View Duration Compensation something to look into.

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