For most of Fred Bertino’s two decades in advertising, the only way to gauge job performance was in sales by his clients. That meant waiting long after a commercial hit the air or went to print to measure its success. And even that was inexact.
These days, the evaluations are coming faster and with greater precision. Armed with the sorts of real-time, high-tech tools employed by stock brokers, businesses can often count the return on every marketing dollar.
“There is more of a focus by our clients on accountability,” said Bertino, president of MMB Communications in Boston, which works with Subway, ESPN, and Jiffy Lube.
Local ad executives got a reminder of companies’ increasingly watchful eyes last month when Procter & Gamble Co., one of the world’s biggest advertisers, said it planned a thorough review of its ad spending on products ranging from Gillette razors to Pampers diapers. P&G said that it may trim as much as $500 million from a $9.2 billion marketing budget, paring its roster of ad agencies in the process.
The announcement followed similar declarations by other corporate giants, including Coca-Cola Co., L’Oreal SA, and S.C. Johnson.
Several of Boston’s major ad agencies said they do not work with those companies and thus would not be affected directly by the cuts. But they acknowledged businesses, in general, are scrutinizing their work more closely than ever.
“Our clients are not cutting their spend[ing], but the business environment is actually more competitive than ever, so everyone is looking for ways to be smarter and more efficient,” said Hill Holliday vice president Tracy Brady, whose firm works with Cadillac, Dunkin’ Donuts, and Major League Baseball. “What’s evolved in our industry is that media is more measurable now, so we can prove effectiveness more readily and with more transparency.”
As businesses dedicate larger shares of their marketing budgets to digital efforts — vying for the next viral video or Internet meme instead of the next TV hit — they are also demanding more evidence of a campaign’s worth. Technology makes it easy to track how often viewers click through to a company’s website and how frequently those site visits lead to sales.
Even consumer reactions to print and broadcast ads can be quickly measured through online surveys and social media analyses. The result is a heightened level of oversight and added pressure at a time when many agencies are under review by cost-conscious clients.
In February, Hill Holliday rolled out a new subscription-based service called BrandFeed that allows clients to monitor social media campaigns in real time. When an ad urges customers to use a certain hashtag, for instance, are the ensuing tweets positive or negative? Are people even using the hashtag at all? BrandFeed helps answer those questions.
While some agencies are developing evaluation tools in-house, other firms are carving out a niche as third-party auditors. Needham-based Extreme Reach Inc., best known as a middleman that distributes TV commercials to broadcasters, has a growing business telling the likes of Walmart, Google, and Heineken which of their spots are working and which are not.
During this year’s March Madness college basketball tournament, Extreme Reach conducted online surveys asking roughly 800,000 people how likely they were to purchase various companies’ products and services. By looking for changes in consumer attitudes before and after commercials aired, Extreme Reach drew conclusions about the impact of ad campaigns — and did it just days after the national championship game.
Based on its findings, the agencies who conceived ads for the Apple Watch and for AT&T, which featured Shaquille O’Neal and other hoops legends in commercials promoting its cellular network, could pat themselves on the back. Surveys showed people who saw the ads rated the companies significantly higher than those who did not.
Meanwhile, the agencies behind commercials for Toyota and the Amazon Fire HD delivered smaller lifts for their brands.
‘Procurement departments are evaluating ad agencies, making sure that we’re delivering value for the client.’Pam Hamlin, Arnold Worldwide global president
The score-keeping that’s become so prevalent throughout the advertising industry can be traced, in part, to an unlikely source, said Pam Hamlin, global president of Boston-based
Arnold Worldwide. In their eternal quest to find savings, corporate procurement officers — the same people who are responsible for securing the best deals on office supplies and cafeteria food — have turned their attention to advertising budgets in recent years, she has noticed.
“A large corporation like Procter probably has overlapping services performed by multiple agencies, so that’s where they’d look for cuts,” Hamlin said. “Procurement departments are evaluating ad agencies, making sure that we’re delivering value for the client.”
Even when the numbers indicate a successful campaign, the victory is shorter now than ever.
Andrew Graff, the chief executive of Allen & Gerritsen in Boston, said clients are anxious about constant changes in the media landscape.
They may be happy with his agency’s work, but it’s not long before they come back for something fresh.
“We’re finding the longevity of an idea has gotten shorter and shorter,” Graff said. “Brands that used to think about things yearly now are coming to us every quarter.”Callum Borchers can be reached at email@example.com. Follow him on Twitter @callumborchers.