Why eBay is doing more brand advertising in the UK
As more advertisers try to bring agency capabilities in-house, eBay is recognizing the limits of that approach. After years of moving programmatic and creative work in-house, the online marketplace is thinking about reversing course.
Three years ago, eBay spent 90 percent of its ad spend on performance marketing, all done internally. That came at the expense of the brand, he said. Building the brand offline has been a big focus this year. To that end, eBay has started to do some offline advertising, and it thinks agencies can help with creative ideas and measuring the impact of that spending.
“You can drink too much of your own Kool-Aid,” said Gareth Jones, CMO for eBay in the U.K said at an event hosted by agency network TIPi Group. “We’ve got some amazing agencies that we use, so we’re increasingly thinking about how we out-house some of the work we do.”
In TV, eBay is using insight from its agencies to create media plans based on ones that performed well in certain U.K. regions and run them in other parts of the U.K. Some tests have had 200,000 models running at any one time, said Jones. EBay plans to track those trends globally to inform media plans in its key countries.
It will take time for the benefits of offline ads to be felt, as eBay acknowledged this year when it told financial analysts that its latest campaign had yet to move the needle.
“The big challenge we’re grappling with is how to measure offline ads with the same sort of pseudo-precision as we do our performance,” said Jones. “It becomes very difficult to move budget to the offline space and still have the same types of conversations with stakeholders because you don’t know the efficiency, you haven’t got the margin ROIs and you haven’t got the efficacy of spend in terms of cause and effect.”
Jones said the company is looking at creating teams that balance the performance-driven side of the brand with its ambitions to create memorable ads.
EBay’s stance on agencies contrasts with that of many marketers that are questioning the value those businesses provide. A recent survey of 412 ANA members showed 78 percent of marketers in the U.S. have some form of an in-house agency, compared to 58 percent who said they did in 2013.
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