5 major illusions in the marketing and advertising circles

In the past two years, the crisis awareness of marketing colleagues has become unprecedentedly severe. Under the pressure of survival, they have created many new marketing methods and concepts, many excellent advertising cases and works have emerged, and several articles discussing the marketing industry have gone viral on WeChat Moments.

Here I will briefly sort out and review with you:

1. Popular new marketing methods and concepts: private domain traffic, KOC, live broadcast/short video sales, grass-roots economy, growth, stock competition, full scene, blind box marketing, sand sculpture advertising, national trend, etc.

2. Popular articles discussing marketing: "Stop updating Weibo, WeChat and Douyin", "Marketing department skills sinking", "KOL is old, KOC is in fashion", "The lesson learned by Adidas at a cost of 3 billion: why is it so difficult to build a brand", "Integrated marketing is gone, the era of links is here", "Scold, Platinum Travel Photography's roaring advertisement, I give it 200 points" etc.

3. Impressive advertising cases and works:

1. Videos: China UnionPay's "The Last Transfer in the Northern Tang Dynasty", Jack Jones' "8,000 km T-stage Show", Peppa Pig's New Year's "What is Peppa", OPPEIN's "Shared Dad", Tencent Weicun's "Waiting for Homecoming", etc.

2. Graphic design: Tourism Australia, “Super!” "The Endless Australia", "Want Want" "56 Ethnic Cans", "Twelve Hours of "Traveling" in the Streets and Alleys of Xi'an" by IKEA, "Others Are Sentimental During the Spring Festival, but JD Wants to Make You Smile", "Four Types of High-Waisted Autumn Pants" by 999 Cold Relief, etc.

3. Cross-border categories: "UNIQLO x kaws", "People's Daily x Li Ning "Payment", "Hero x RIO Cocktail", "P&G x Zhihu Summer 100,000 Whys", "LV x League of Legends Joint Clothing", etc.

4. Interactive: NetEase Cloud Music's "2019 Annual Listening Report", the game "Memory Reconstruction", Tencent News' "New Look for National Day", Taobao's "Taobao Life Bill", Nestle's "Solving Problems Theater", etc.

In the context of a poor market environment, although there is no shortage of excellent cases and practical methodologies, it cannot conceal the fact that the overall marketing industry is extremely difficult this year; whether it is the client's marketing department, advertising and public relations companies, or advertising media, the days are not as prosperous as in previous years.

The marketing and advertising circles have been selling misery one after another, and the media has been exaggerating it, resulting in a lot of negative information being infinitely magnified, and the anxiety in the industry is also continuing to heat up;

However, a lot of negative information is not as serious as everyone claims. It is just a one-sided statement made after seeing the superficial illusion.

As 2019 is coming to an end, we would like to expose the five industry illusions we have observed to help you better recognize the essence behind some phenomena and find a better way to survive in your career, rather than blindly following the trend of selling misery and anxiety.

Illusion 1: Party A is poor and has no money for marketing?

The main sources of income for advertising companies come from two types of clients: companies that sell goods and Internet companies that build platforms.

First of all, it is enterprises. Goods are becoming increasingly difficult to sell, profit margins are becoming smaller and smaller, and with labor and operating costs remaining high, it seems difficult for enterprises to come up with more money for marketing and promotion.

Let's talk about Internet companies. Everyone knows that Internet companies have always been more generous and particular about pomp and brainwashing; however, most Internet companies lack the ability to generate revenue and are highly dependent on capital and large companies such as BAT; when everyone is tightening their belts, financing for many Internet companies has become extremely difficult, so Internet companies do not seem to have extra money for marketing.

The above two situations seem to make sense and are logical, but the cruel fact is that many CMOs of client companies have large budgets but don’t know how to spend them. There will be no more big trends in 2019. Business management will be more rational than before, and marketing strategies will become more cautious and conservative. Marketing activities based on pure brand exposure are unlikely to bring a sense of security to companies, so corporate marketing places great emphasis on advertising ROI and conversion rates.

After trying marketing and advertising, many companies have found that the conversion effects are not ideal. Due to security considerations and survival pressure, the budgets originally intended for marketing and advertising have to be used to subsidize users, incentivize partners and channel partners, or for product research and development and optimization.

On the surface, it seems that Party A has cut its marketing budget due to the overall environment, but in reality, the company's marketing decisions have become more conservative . If the money spent does not achieve the desired results, the budget will not be spent indiscriminately. After all, all companies are tightening their belts to survive the winter, and overly radical decisions may bring unimaginable consequences.

Illusion 2: Consumption in first- and second-tier cities is stronger than in lower-tier markets?

The strong presence of Internet giants such as Pinduoduo, Kuaishou, Qutoutiao, Meituan, and 58.com in third-tier and lower cities has shifted the battle for traffic in the Internet industry from first- and second-tier cities to third-, fourth-, and fifth-tier towns. The sinking market has begun to receive attention from merchants and has become a new blue ocean after the growth bottleneck.

When it comes to the sinking market, people are more likely to have the impression that it is cheap, low-end, rustic in aesthetics, and has backward infrastructure. With the popularization of e-commerce and the disappearance of information asymmetry, the so-called "sinking market" or "people outside the fifth ring road" now seems to be more appropriately defined as an "emerging market". This market not only contains huge business opportunities, but the gap in consumption power between this group of people and first- and second-tier white-collar workers is also gradually being filled.

There are two main consumer groups in emerging markets: "small town youth" born after 1990 and "leisure aunts" over 50 years old.

The consumption power of high-end products among young people in small towns is gradually catching up with that in first- and second-tier cities. Compared with white-collar workers in big cities, they have less pressure from mortgage loans, higher disposable income, and more leisure time. They are what we call people with both free time and money.

"The research report of Qutoutiao Research Institute shows that among the young people aged 25 to 30, in the online consumption range of more than 1,001 yuan, second-tier cities account for 16.66%, and emerging markets account for 13.98%. In other words, in the range of higher consumption levels, young people in small towns in emerging markets are already very close to those in second-tier cities.

Dr. Sun Jinyun's offline survey at Fudan University showed that more than half of young people in small towns use high-end models of Apple and Huawei.

Official data from Tmall's Double Eleven in 2019 showed that 50,000 electric toothbrushes and 50,000 sweeping robots priced at RMB 1,000 were sold in small towns. Smart products have entered the lives of young people in small towns. 38,000 treadmills were sold, and 71% of the consumers were from third- and fourth-tier cities. They care about their health and are willing to pay for it.

Nearly 20,000 young people from small towns attended the liquor ordering conference, and they were not reluctant to place orders with a minimum order amount of 5,000 yuan. ”

Leisurely middle-aged women are another consumer gold mine that needs to be developed urgently. This group has huge consumption potential. Data from the Penguin Intelligence report shows that more than 70% of middle-aged and elderly people have an income of more than 1,500 yuan, and more than 40% have an income of more than 3,000 yuan.

(Online consumption power of middle-aged and elderly people aged 50 and above)

Illusion 3: Is the advertising industry dying?

If I remember correctly, this year there would be an article popping up from time to time that criticized the advertising industry, which triggered a wave of heated discussions among the public; 4A transformation is difficult, creativity is dead, traditional advertising is ineffective, integrated marketing is gone, KOL is dead, strategies are useless, designers will be replaced by AI, social marketing cannot bring goods, advertising companies will be replaced by MCN, and so on.

Anyway, basically every profession or field you can think of that is related to advertising companies has been forced to die.

The reasons to support these statements seem sufficient: with the elimination of information barriers and the flow of personnel, the theories and tools of advertising companies can no longer fool brand owners. In the Internet era, users' needs have become more diversified, self-media has made the media more fragmented, and market changes have made the old routines of advertising companies "ineffective."

Some brands have even set up special user research centers to conduct big data analysis based on user behavior data and user feedback. The brands conduct detailed research on user behavior and needs. In comparison, the user research methods used by advertising companies pale in comparison.

All of the above statements are correct, but any industry will face updates and iterations; with the changes in the market and the development of society, advertising companies only need normal upgrades and iterations, including service upgrades of advertising companies and skill upgrades of advertising practitioners.

Just like in previous years, the rise of the Internet and big data gave birth to a group of digital marketing companies, the rise of social media gave birth to a group of interactive advertising companies, and the rise of short videos and live broadcasts in the past two years gave birth to a group of MCN agencies.

The advertising industry is dependent on social commerce. As long as commerce exists in this world, advertising will exist. What will be eliminated is definitely not the advertising industry itself, but those advertising companies and practitioners who do not know how to keep up with the pace of the times.

So for those articles that keep shouting that the advertising industry is dying, just think of them as deliberately creating anxiety and attracting attention.

Illusion 4: Selling goods through live streaming, competing for fan loyalty?

For marketing practitioners, the biggest excitement of Double 11 in 2019 definitely came from video live streaming; when it was still difficult to sell goods after trying all kinds of tricks, Taobao Live's ability to sell goods and its growth effect really surprised everyone.

“On November 11, Taobao Live’s transaction volume reached nearly 20 billion yuan, and more than 50% of brand merchants achieved new growth through live streaming.

There are more than 10 live broadcast rooms with transaction volume exceeding 100 million yuan, and more than 100 live broadcast rooms with transaction volume exceeding 10 million yuan.

Wei Ya, the number one anchor of Taobao live streaming, and Li Jiaqi, the number one live streaming e-commerce seller, both achieved sales of billions on that day. ”

(From Tmall official data)

The popularity of live streaming e-commerce is of course inseparable from three important factors: the personal influence of the anchor, the sense of shopping immersion in the live streaming format, and the quality of the products themselves.

Those who are engaged in marketing know that most consumers follow a link model when purchasing goods. For example, Alibaba’s marketing also has a set of consumer links AIPL (Awareness - Interest - Purchase - Loyalty).

The personal influence of the anchor solves the problem of Awareness, and the live broadcast format and products solve the problem of Interest; however, "the anchor's influence, live broadcast format and products" cannot ultimately lead to consumers' purchasing behavior, or in other words, consumers' reasons for buying are still lacking the finishing touch.

After watching a few more Taobao live broadcasts, you will find that when the anchor introduces the product and officially releases the purchase link, there is a common routine, which is to sell it at a low price. Including the top live streaming e-commerce anchor Viya and top live streaming anchor Li Jiaqi, despite their high popularity and huge fan base, they are also trying hard to create the persona of "the lowest price on the entire network".

During a live broadcast, Li Jiaqi even lost his temper, urged fans to return the products, and terminated his cooperation with the brand after learning that the price given to him by a certain brand was 5 yuan higher than that given to him by Viya. Li Jiaqi once said: After becoming famous, he dared not rest for even a day, because as soon as he rested, his fans would run to other people’s live broadcast rooms to shop.

It is conceivable that fans of e-commerce live broadcasts do not have strong loyalty to the anchors. What they care about is who has lower prices and who can allow them to buy more cost-effective products. Therefore, the "lowest price on the entire network" is the real killer behind the crazy sales of e-commerce anchors.

Illusion 5: Is it harder for marketers to find jobs than in previous years?

Yes, this is absolutely true! But!

After the rise of mobile Internet, wave after wave of dividends have emerged, and all companies want to grab users, markets, and traffic in the shortest possible time; with the lavish spending of financial sponsors, many digital advertising companies and interactive advertising companies can be said to be making a lot of money.

At that time, the market demand for Internet advertising talents was huge, which led to a sharp increase in salaries offered by advertising companies. The phenomenon of becoming a senior employee in two years and a director in five years was very common in the industry.

When companies are all chasing the trend and scrambling for human resources, and advertising companies are making considerable profits, companies will try their best to meet requirements regarding salary and title as long as employees can endure overtime and get the job done.

However, when the wind subsided, the pigs could no longer fly. Many people with inflated salaries and titles could no longer rely on job hopping to get promotions and salary increases without restraint. I have seen many cases around me of people quitting their jobs for a while and then having to look for a job for half a year.

Of course, as long as you have solid skills and can create enough value for the company, you can still be successful in the workplace; after the boom has subsided, although many pigs on the boom have been eliminated, truly capable people have been able to shine.

Five major illusions in the marketing and advertising circles. The industry is actually not as terrible as you think!

Author: Lao Pao

Source: Laopao OG (laopaostrategy)