President of Global Advertising and Strategy
What are some of the lessons that you’ve learned from Google?
Conceptually what I learned is that winning in marketing isn’t [only] about big budgets, it’s about creative ideas with [sometimes] very small budgets. At Google (and AOL), advertisers try and do big things with small budgets. The key is: don’t change your goal because of your budget. Traditional marketing [wisdom] says you can only do as much as the budget you have.
The challenge for marketers today is to do more with less (especially given the economy). Think about the whole supply chain of marketing and find ways to do what you want without sacrificing ROI [return on investment]. [For example,] outsource or crowdsource production. Don’t use stock photos, take them yourself. That’s what we did at Google. You have to find the scrappiest, most clever ways to solve marketing programs.
You have to change the marketing culture to change marketing.
How have you applied these lessons at AOL?
[AOL CEO, Tim Armstrong and I] brought many principles of Google over to AOL and changed the marketing culture. If you’ve been to AOL.com lately, you’ve seen the focus on content and the constantly changing identity. The fact that stilettos are on the homepage of AOL is something that surprises lots of people.
[What we’ve done is create an] expressive way to let people create experiences around content. It’s less about the brand and more about the content. AOL is the background. Yahoo spent $100 million to explain what they do. AOL spent much less than seven figures. [Like I said earlier,] you don’t have to spend big.
This is definitely something learned from Google. Google didn’t invest big in its brand.
Thoughts on Google’s multi-million dollar investment in a SuperBowl commercial?
Someone [at Google] did the math. 100 million (or whatever the number is) people watching globally. They know what that equates to in terms of ROI. If they spent $3 million on the ad, they made $50 million back. They also didn’t spend big on creative. They used a video they had produced a few months earlier showing lots of different searches. I was not surprised to hear that Google was running a SuperBowl ad. It’s very consistent with their marketing. They know what they’re doing.
How does AOL decide what content to produce?
We built an algorithmic approach to sourcing content. We have journalists on staff doing “traditional” journalism. [But] we also have demand algorithms for what people are looking for. This ensures the most relevant approach to journalism. When creating our editorial calendar, we know what people want, we don’t have to guess.
How is this new strategy paying off for AOL?
We’ve made more progress in the past six months than the last six years. Anyone who says that content is not important is not familiar with the space. The first decade of the Internet was all about access — getting people online. The second decade was about platforms — getting people to what they want. There were platforms for navigation like search, platforms for community like Facebook, and platforms for megaphones like Twitter [and blogs]. The next decade will focus on content — what to put online. We need to fill the pipes with massive scale.
AOL is creating a model for the future of digital journalism. It’s a model for a free, open web. Don’t meter it and make people pay subscription fees. It needs to scale. No-one’s focused on this right now.
Is this model ad-supported?
Yes. [But] the technology to match context is not the answer for display [advertising]. You need to understand how people navigate point to point. [But] the lessons from search [advertising] don’t work for display. You must understand who the consumer is and what they’re interested in.
When [like AOL] you have content at mass scale, you start to understand what [consumers] like. You can infer things about their behavior. It’s not about targeting a demographic like adult males aged 25-54 in Oklahoma and showing them an ad for a truck. [And] it’s not about contextual like seeing the keyword “truck” three times in an article. It’s about understanding people at the individual level [as opposed to at the segment level]. Technology can help you build patterns and make inferences and target at the individual level rather than 1,000 people at a time.
If you get [targeting] right, consumers win. If someone has been looking at travel sites, just because [he or she] is at a sports site, doesn’t mean [he or she] is not still an in-market travel buyer. You need the right format [to serve the ad].
The challenge for marketers is to send the right message to the right person at the right time. Dymanic creative can help. AOL has a banner builder product currently and is releasing a new product in the Spring. We also accept third-party dynamic creative tools.
One of the lessons I discuss is, “Act like Content.” Is that essentially the story of AOL going forward?
I’d change it to “Ads are Content.” Advertising is relevant and advertising is interesting when presented in the right way to the right person at the right time.
Everyone knows what works in search. The key is how do those principles extend to all forms of marketing.
What does it take to create a test-and-learn culture?
To have an effective test and learn culture, you have to also introduce the notion of “failure means success.” It can’t just be lip service, but it must be embraced from the top down — and even celebrated. Nearly everyone says, “We do lots of testing,” but the organizations that get it right are the ones that have built failure into their models and are willing to not only allocate budget to ideas that will go no where, but will also spend as much time on understand what didn’t work, as the spend of what did work.
The importance of trust can’t be underestimated in highly functioning test and learn culture. There has to be trust at all levels and the trust then empowers people to take risk, which inevitably leads to rewards that exceed that of your peers who just “play it safe.”