Romanian online: Strong ideas, low budget

Mobile internet and social networking sites will lead the world in 2010, says Wim Vermeulen, Director of Innovation at Ogilvy Group, Central and Eastern Europe, who has only one advice for Romanian marketing managers: “Don’t ignore the two. If you’re not yet ready to go digital, at least give it a try, it’s the only way to learn about this medium”.

With over 20-year experience in the media industry, Wim Vermeulen (photo), his career in the field took off in 1989 as junior media planner at Vanderkerckhove&Co. He then worked at Young&Rubicam for four years as account executive, and as account director for 3 years at Lowe Troost. During 1997-2000, he served as marketing manager/head of consultancy group at Net it Be/E-corporation, one of Belgium’s largest online companies.

After a sabbatical period, Vermeulen returned in 2002 as client service director at Ogilvy. In 2004, he took up the chief executive role at OgilvyInteractive. As of January 2007, he heads the digital division of Ogilvy Group Central & Eastern Europe.

Wall-Street: Has the financial crisis changed to any extent the meaning of innovation in the digital medium?

Wim Vermeulen: First of all, the media spend went down in every medium except online. There is a number of reasons for that and the first is price (in some countries, TV is much more expensive than other media). Advertisers needed to get their sales, and have been more attentive to the results of their campaigns, to details. If you see that your campaign doesn’t bring you the sales, you go somewhere else, right? And because the online is very countable, you get the ROI. And if you are a marketing manager and you want to spend €2 million, it’s time you go to your CEO and say «I am going to invest this money here, this is the ROI I am going to get out of it». It’s much more difficult in the traditional media to get that number, in the online is very easy to get the ROI.

Wall-Street: How can you explain the fact that, despite being so countable, the online medium is losing ground to TV, from a CEO’s perspective?

Wim Vermeulen: What’s the average age of a CEO? Around 50. They are the generation before the digital era, and they are still living in that world. It’s a normal decision, of course. I compare with the generation that’s now digital. I also sometimes think why do you spend so much time on Facebook? Don’t you have something else to do? A CEO that’s now 50 or more grew up with the TV. Why would I go with the internet when I can go with the TV which is the mainstream medium most powerful?

Wall-Street: What major trends will the market follow this year?

Wim Vermeulen:
Mobile internet and social networking sites will take hold of the market in 2010. Mobile internet because it’s a platform, it’s really a paradigm change, and it’s going to be way big than what we’ve seen before. There was a campaign on a social networking site about breast cancer, and all women across the world answered the question about the color of their bras . This is how you do campaigns. If you want to create awareness, your campaign has to spark interest, you need to get people talking about you, be on home screen. It’s the same objective as for a TV commercial. That’s when I understood the value of Facebook for advertising. And it’s so huge that it’s the third country in the world with over 400 million users.

The problem with the social networking sites is that it’s very different from what we knew before, as traditional marketers. A marketer that spent 20 years in advertising must reinvent himself in case of social networking sites, where old rules don’t apply anymore. It’s a new territory and it’s scary.

Wall-Street: What do you think works best: a strong idea with a mediocre budget, or a mediocre idea with a high budget?

Wim Vermeulen: I strongly believe in ideas. In my career I’ve seen a lot of strong ideas with small budgets that made a difference in the advertising landscape and changed how consumers think about it. So you don’t need a huge budget. You need a strong idea. If you have a mediocre idea, you might need a really huge budget to make it work. So there’s no choice!

Wall-Street: How much would a marketer need to make a campaign work?

Wim Vermeulen: It’s a wrong question. Because if you start with what’s the minimum investment to make an online campaign you got it all wrong. It’s easy to put a number, but then you don’t question what Internet can do. The way to do that is to look at the total budget and then decide what you want to achieve. You have an objective, you have money, and you have to decide what to do with it. The agencies in the beginning wanted to get market share by buying clients. And they fixed prices. Digital has been cheap and took the market by storm. So a good idea in digital has to be as cheap as an idea for a 30-second commercial. I would argue that coming up with an idea for digital is more difficult than for a TV commercial, because you have a framework, you really have to know social before going social.

Wall-Street: How long would it take for the online to surpass TV?

Wim Vermeulen: That’s very hard to predict. You don’t have a problem with the TV. The change comes when marketers with experience invest an amount each year in TV and when the sales go down they start to question their vision and go to a different medium. There are a thousand reasons I can give you why I think It’s important to take the money from TV and invest it in online, but as long as the marketers don’t feel they have a problem, they will never do it. Why would they go digital if that is risk for them, they don’t have the confidence that they would get the same results out of digital than out of TV.

But then again it’s wrong to see the online as a “hip” medium. It is wrong, you have to review your objectives, the tools you have, and then invest. Digital depends on the target audience. In UK for example, where online ad revenues exceeded the TV ad revenues for the first time, and you have a target audience aged 17, it’s clearly that you should drop out TV and use it just for the background.

Wall-Street: How would you describe the Romanian online industry?

Wim Vermeulen: Well, mainly, we’re seeing strong ideas but too low budgets. It’s a pity to create a very strong idea for just $5,000 when everybody knows it won’t return any long-term results. It’s a problem we have to deal with in many other markets, and things shouldn’t be like that.

Wall-Street: Do you think that a “give TV for online” approach is wrong?

Wim Vermeulen: Generally, it could be a good idea if the target audience of the campaign is youngster. In Romania, I think it’s a bit too soon for this switch. No advertiser would risk it, if his career were at stake. If it’s too soon, you would need some courage to tell your CEO you would give TV for online.

Wall-Street: What a marketer should never do in 2010?

Wim Vermeulen: That’s easy. To ignore the online. If you are not ready to go digital, at least give it a try, it’s the only way to learn about the medium. What marketer are you, if you don’t come to grips with a phenomenon that is already big?

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