The Verklin theorem

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Q’s with…
David Verklin
CEO, Carat North America/Asia Pacific

When David Verklin delivered his keynote, ‘Crackle of change,’ at the Media in Canada Forum in Toronto last month, you could have heard a pin drop. And no wonder: The CEO of Carat North America – not to mention Asia Pacific – has developed quite a rep in media and marketing circles.
So what does he foresee in the next 36 months? The rise of a digitally centric direct marketing company, an increase in segmentation and targeting (specifically in TV), the materialization of on-demand analytics, and the emergence of communications planning.
Strategy sat down with this ‘media maven’ a day before the event, to hear more.

What will the average media plan look like in 2010?
Digital spend will increase from 8% to 20%. TV will drop from about two-thirds, to about 50%. You’ll see outdoor increase two to three percentage points to 6%. Billboards will convert from static to video screens, and a picture on a stick feels pretty good to me in the age of TiVo. One to 2% will go to experimentation of new technologies, 1% on search engine marketing, and the remaining 20% will be split among print, radio and sponsorship/sales promotion.

How will that improve ROI?
There’s something I call the Verklin theorem: ROI = number of components x degree of interactivity/engagement. We’ve studied about 1,000 brand media plans. As audiences become more elusive, you have to put more bets on the field to reach them. The other thing driving ROI is interactivity and engagement. It could be search engine marketing or creative that drives to the Web for a free sample.

What work by Carat is closest to the new media plan?
Adidas. We used really interesting TV, the campaign was
Web-centric, and there was a breakthrough use of O-O-H (shown above) executed on a global basis. It was a glimpse of what advertising will look like in the future.