RBR/TVBR recently asked David Verklin, CEO of Carat Americas, What is the future of ROI measurement?

"There are a number of companies - - IFX, Avista, probably Bearing Point, Veridium - - all of us have the same vision on ROI, which is to make it real time, and on-demand. I want to know what's working, but I want to know it's working right now. So right now the ROI techniques give us a backwards look. You ran a schedule, we do the analytics and you're able to say, 'OK, here's what you've got for that spending, but it's a bit of a rear-view mirror.' You want a terminal on your desk with your sales data coming in and your media schedule as it's running, coming in and analytics being done in real time that gives you the ability to have some sense of what's working and what's not working in the marketplace in real time so you can make adjustments. That's the future of ROI as sure as the nose on my face."

---

What are your clients' biggest concerns? Is it just ROI?

"No, I think it's a concern about television. Clients love the old model, people don't want to talk about it publicly but everybody loved the old 30-second TV model - - it was great. I mean what was the basic business model of the American advertising industry? You make three to five TV commercials a year. You shoot them in the Bahamas. You edit them in Los Angeles, you stay at a really nice hotel while you do it. You run them for a year to 18 months, hopefully you come up with a campaign that's refreshable and feasible over a number of different years or seasons. You can make five or six ads you run the heck out of them. I mean it was great.

The challenges the traditional 30 second TV model has creates a lot of problems for clients. One is it takes more knowledge or time from their perspective to manage. I mean if you go back to the Verklin's Law, now you're talking about media planning. There used to be a real premium on the simplicity and elegance of what we call uni-vehicular media plans. Let's focus our efforts on TV. You can't do it anymore, you have to have a Hispanic effort, a digital effort, you have to look at search engine marketing and optimization and event marketing, experiential marketing. Don't forget about ethnic marketing and analytics. It bodes well for companies like Carat for navigation companies and guidance companies, which is what I really think Carat is. But from a client perspective the challenge of the old TV model is no question their biggest concern. It's actually not return on investment. Because we actually have some metrics on return on investment, it's that the existing TV model was a wonderful way to do business from a client perspective. They could commodotize the business; it was a great way to drive out cost. The purchasing people, in my opinion, procurement had much more power in the old model. So the biggest concern of the clients it's the challenge of the traditional TV model and what we're going to substitute it with.

I'm not saying the 30 second TV commercial is going to go away - - I'm just saying we're getting to the point at Carat where you need my approval if you're going to put more than 50% of the media plan into television. The Carat media plan of the future, which as you know has less TV than any other agency has no more than 50% in television, 15 to 20 percent into digital and interactive. It has search engine marketing or search built into every media plan. I'm a huge, huge believer that that's an enormously important. And the media plan should have at least four elements into it at minimum."