Optimising paid, owned and earned media

By Nimal Gunewardena

The region’s influential media magazine Campaign Asia-Pacific recently released a noteworthy report in collaboration with ZenithOptimedia that provided an update on how marketers in the region were traversing the new media landscape and provided a number of useful insights into the issues marketers continue to grapple with in using marketing communications and the integration of new media into the communications mix.

This article seeks draw attention to the new classification of paid, owned and earned media and raise some questions for local marketers and agencies on how much in sync we are with regional trends or whether we remain doing what we have been doing for years without innovating.

Marketing communications evolves

There was a time when everything was called advertising. And marketers put all their money in it, even though it was believed that half of it was wasted and nobody could figure out which half. Marketing communications and our understanding of it and has changed dramatically over the years but still a lot of Sri Lankan marketers continue to put most of their money in broadcast advertising and hammer away with their 30 second commercials, despite changing trends elsewhere.

Marketing communications changed with the advent of direct marketing, PR, digital and other forms of promotion, and the terms ATL and BTL (above and below the line) came to be used, though some of these newer forms of communication remained less understood and utilised.

As media was redefined with the advent of digital media, from the internet to the mobile phone and social media that created a networked world, and consumers themselves became information sharers, content generators, bloggers, broadcasters and wielders of the most powerful of all communications forms – WOM (word of mouth) now also disseminated instantly, globally and virally through social media, a new categorization and evaluation of media has now come into play.

“Everything communicates” said Silicon Valley marketing guru Regis McKenna and the many varied forms of marketing communications that we have come to recognise today can now be more insightfully categorised as paid, owned and earned media.

Paid, owned and earned media

Paid media is what we have known and still use in the main, carrying over from the last century. We pay for and buy TV and radio spots, or print and outdoor ads and put a lion’s share of marketing investments in what we call advertising.

In the new age, businesses have also started to buy ads on-line such as banner and Facebook ads or may even pay for going up the ladder in an on-line search. Despite the increasing downsides of traditional paid media, of fragmented and smaller audiences due to the proliferation of channels and publications, high costs, its interruptive nature with resultant ad avoidance, and changes in viewing habits from family to more individualistic times, they still deliver on mass audiences or targeted ones, full message control and ability to measure – albeit eyeballs.

With the advent of the internet, the ability to communicate widely shifted from media owners alone to anyone who wanted to start a website or blog, open a Facebook page and link these with other own social media sites on YouTube, Twitter etc. Owned media depends on the ability to draw and accumulate fans but also requires the ability to create and maintain interest for them to keep coming back and interacting frequently.

Owned media has the benefit being your very own with 24x7 exposure, and allowing you to create entertainment and brand experiences and includes off-line sites such as experience centres, entertainment and events. Owned media importantly provides the ability to interact with and collect data from visitors to one’s sites.

Earned media is thought to be the most credible and influential because it involves others communicating about your brand, and such word-of-mouth from peers, colleagues and those whose opinions consumers respect (KOLs) has been seen over and over again in research to be highly influential in brand adoption.

But marketers trained in controlled messaging through advertising have fought shy of buying fully into earned media. Despite controls available and the ability to interact with and get feedback from consumers, Sri Lankan marketers have only very hesitantly embraced social media. Earned media includes planned efforts to generate positive editorial coverage through public/media relations efforts and the generation of brand conversations on-line.

What the report covers

The latest study published by Campaign Asia-Pacific and ZenithOptimedia evaluates the extent of consumer experience and influence of each of these forms of marketing communications, and compares this against trends in their adoption and changing trends in marketing expenditure as owned and earned media are integrated into the equation.

Trends in Asia-Pacific are benchmarked against the global picture. What is important for us in Sri Lanka is to see how far behind we are in effectively creating and using owned media and seeking to generate valuable earned media to combine with paid media, where our marketers have tended to put most of their marketing funds.

At first glance, it may seem that owned and earned media provide a lower cost alternative to paid media.  The study indicates that while there are definite qualitative advantages these have over paid media, paid media will still have a significant role to play, and the task is rather to see how to combine all three forms in an optimum, synchronised and synergistic way to deliver on the essential elements in the consumer’s decision making on the purchase, adoption and recommendation of product and service brands.

In today’s networked and peer influenced world, this process is not a linear progression that marketers previously believed they could follow in leading consumers to buy their brands. Nor can we persist in our old beliefs that if we bombard consumers heavily enough with repetitive and interrupting ads run through broadcast media, that would continue to work in the new scenario.

The study underscores the fact that today’s brands have to do more that blast away on their superiority. They have to be a friend, and provide useful guidance, value, comfort and entertainment to be considered, adopted and recommended.

A significant aspect of the study is that it shows today’s marketers in Asia-Pacific  increasing investments in owned and earned media and now spending half of the marketing budget in these forms, a trend that is projected to grow even further in the next few years.

Sri Lankan marketers, who in my estimation, have not come anywhere close to these figures, will progress in this direction once there is a deeper understanding of the value, potential and significant roles in the consumer’s decision and influence making that earned and owned and paid media in all its forms can play, and begin to combine these effectively with paid media.

Adding owned and earned media into the marcom mix

One of the persistent challenges to marketing people from their boards and top management is on accountability in terms of return on marketing investment. One of the barriers to the use of new media and communication forms has been the difficulty to assess its value, compare it against paid media and shift marketing budgets to experiment with these. So marketers may play safe with established ways rather than innovate.

What ZenithOptimedia has provided in this study is a measure of the ‘share of brand experience’ that each of these media forms command. While this would change between countries and product categories, the APAC chart given here for all categories is an eye-opener. This together with the reality that paid, owned, earned media play important complementary roles in brand adoption gives the evidence and justification that brand managers need to bring a greater use of owned and earned media into their marketing communications mix.  

While paid media may still play a vital role in emerging Asian markets like Sri Lanka, where presence on TV and use of celebrity endorsers give credence to brands, the trend that this report highlights is difficult to ignore.  Though on-line is still the smaller but growing part of the paid, owned and earned media, there a clear incentive to consider off-line options while experimenting with on-line.

Campaign Asia-Pacific reports that APAC marketers are equally divided between paid and earned media, as the most important. The case for investment in generating earned media is its important role in brand adoption. Word of mouth and recommendation by friends and relatives remains the most influential source of brand adoption.

In today’s world of social media, brands could benefit from consumer generated brand conversations. Yet marketers who have protected their brands and themselves by sticking to the ‘total control’ of the message that paid-for advertising provides, are averse to getting into the more public conversation of their brands that opens up in earned media.

While ad agencies here may have been happy to work in the traditional paid media arena, far-thinking agencies should however work with their clients to create owned media and content across social media, interest-based blogs and branded entertainment which will generate high levels of consumer engagement and feedback, and be rewarded for their ideas and work.

Agencies with PR and social media capability should convince their clients to let them help generate valuable earned media for their brands. This may range from strategies to generate positive editorial media presence and endorsement as well as KOL and peer recommendations both on-line and off-line.

(The writer is the Chairman and CEO of Bates Strategic Alliance)