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  • Effectiveness in Context - Preliminary Findings

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    There are two types of marketing - sales activation which provides short-term sales uplifts, and brand building which leads to long-term sales and profits. Effective marketing requires balancing both. While TV advertising is still an important brand building medium with high reach and emotion, consumers are now more rational in their decision making and do more online research. The rules for effective marketing have changed and are different depending on factors like the distribution channel, purchase model, and whether the brand is innovative. Both acquisition and loyalty marketing strategies can be effective, but loyalty strategies may provide greater annual growth. Despite claims that new digital channels have replaced TV, broadcast TV still has very high weekly reach among adults.

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    There are two types of marketing - sales activation which provides short-term sales uplifts, and brand building which leads to long-term sales and profits. Effective marketing requires balancing both. While TV advertising is still an important brand building medium with high reach and emotion, consumers are now more rational in their decision making and do more online research. The rules for effective marketing have changed and are different depending on factors like the distribution channel, purchase model, and whether the brand is innovative. Both acquisition and loyalty marketing strategies can be effective, but loyalty strategies may provide greater annual growth. Despite claims that new digital channels have replaced TV, broadcast TV still has very high weekly reach among adults.

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    72 views18 pages

    Effectiveness in Context - Preliminary Findings

    Uploaded by

    Jonathan Jones
    There are two types of marketing - sales activation which provides short-term sales uplifts, and brand building which leads to long-term sales and profits. Effective marketing requires balancing both. While TV advertising is still an important brand building medium with high reach and emotion, consumers are now more rational in their decision making and do more online research. The rules for effective marketing have changed and are different depending on factors like the distribution channel, purchase model, and whether the brand is innovative. Both acquisition and loyalty marketing strategies can be effective, but loyalty strategies may provide greater annual growth. Despite claims that new digital channels have replaced TV, broadcast TV still has very high weekly reach among adults.

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    © All Rights Reserved
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    of 18

    EFFECTIVENESS

    IN CONTEXT
    PRELIMINARY FINDINGS
    Sales uplift over base There are two kinds of marketing

    Sales activation
    Short term sales uplifts

    Time
    Source: Binet & Field 2013
    There are two kinds of marketing
    Brand building
    Long term sales & profit
    Sales uplift over base

    Sales activation
    Short term sales uplifts

    Time
    Source: Binet & Field 2013
    You need both, in balance
    1,6
    large business effects

    1,4
    Number of very

    1,2
    1,0
    0,8
    0,6
    0,4
    0,2
    0,0
    <50% 50-70% >70%
    % of budget allocated to brand building
    Source: IPA Databank, 2014-16 cases
    TV is the best brand medium
    Brand activity TV advertising

    Broadest High
    Reach Emotion
    Reach Emotion

    Most
    Fame talked
    about
    “But the rules have changed”
    “Consumers are more rational now”
    100%
    90%
    33% 29%
    80%
    % Communications budget

    70%
    60%
    Activation
    50%
    Brand
    40%
    67% 71%
    30%
    20%
    10%
    0%
    Emotional Rational
    Decision is primarily
    Source: IPA Databank, 1998-2016 for-profit cases
    “Consumers do more research now”
    100%
    90%
    26%
    80%
    % Communications budget

    45%
    70%
    60%
    Activation
    50%
    Brand
    40%
    74%
    30%
    55%
    20%
    10%
    0%
    Low High
    Online research
    Source: IPA Databank, 1998-2016 for-profit cases
    “The rules are different for online brands”
    100%
    90%
    26%
    80%
    % Communications budget

    45%
    70%
    60%
    Activation
    50%
    Brand
    40%
    74%
    30%
    55%
    20%
    10%
    0%
    Offline Online
    Primary distribution channel
    Source: IPA Databank, 1998-2016 for-profit cases
    “Subscription models change everything”
    100%
    90%
    26%
    80%
    % Communications budget

    43%
    70%
    60%
    Activation
    50%
    Brand
    40%
    74%
    30% 57%
    20%
    10%
    0%
    Repeat purchase model Subscription model

    Source: IPA Databank, 1998-2016 for-profit cases


    “Innovators don’t need to advertise”
    100%
    90%
    28%
    80% 39%
    % Communications budget

    70%
    60%
    % Actvation
    50%
    % Brand
    40%
    72%
    30% 61%
    20%
    10%
    0%
    No innovation Any innovation

    Source: IPA Databank, 1998-2016 for-profit cases


    “Loyalty marketing is more efficient”
    2,0%
    1,8%
    Annual mkt. share growth

    1,6%
    1,4%
    1,2%
    1,0%
    0,8%
    0,6%
    0,4%
    0,2%
    0,0%
    Loyalty strategy Acquisition strategy Reach strategy

    Base: 2008-16 IPA cases


    “Nobody watches TV now”
    100 Broadcast TV
    OOH
    90
    Radio
    80 Email
    Weekly Reach (% Adults)

    70 Other online Texting


    Newsbrands Social networking
    60 Search

    50 Messaging
    Shopping/
    40 transacting
    Online video Internet for work
    30
    Subscriber VoD
    20
    Cinema
    10

    0
    0,00 1,00 2,00 3,00 4,00 5,00 6,00
    Average Hours Per Day (Across All Adults)
    Source: IPA Touchpoints 2016
    The Media Landscape in 2016
    2017
    100 Broadcast TV
    OOH
    90
    Radio
    80 Email
    Weekly Reach (% Adults)

    70 Other online Texting


    Newsbrands Social networking
    60 Search

    50 Messaging
    Shopping/
    40 transacting
    Online video Internet for work
    30
    Subscriber VoD
    20
    Cinema
    10

    0
    0,00 1,00 2,00 3,00 4,00 5,00 6,00
    Average Hours Per Day (Across All Adults)
    Source: IPA Touchpoints
    “Mass media are becoming less effective”
    45%
    40%
    business effects from adding

    40%
    % increase in avg. no. VL

    35%
    30% 27% 27% 27%
    25% 22% 22%
    20%
    13% 14%
    15%
    10%
    5%
    0%
    TV Press Radio Outdoor

    Source: IPA Databank


    *Outdoor = 2012 - 2016
    Web 1.0 (1998 - 2006) Web 2.0 (2008* - 2016)
    “But what about tech firms?”
    Major tech firms spend on traditional ad media
    £200.000.000

    £190.000.000
    Audited adspend (UK)

    £180.000.000

    £170.000.000

    £160.000.000

    £150.000.000

    £140.000.000 Source: Nielsen


    Brands: Amazon, Google, Apple, Facebook, Twitter, AirBnB, Uber, Spotify
    £130.000.000
    Jan

    Jan

    Jan

    Jan

    Jan
    Nov

    Nov

    Nov

    Nov
    Sep

    Sep

    Sep

    Sep
    May

    May

    May

    May

    May
    Mar

    Jul

    Mar

    Jul

    Mar

    Jul

    Mar

    Jul

    Mar

    Jul
    2013 2014 2015 2016 2017
    Year ending
    Mass marketing is alive and well
    EFFECTIVENESS
    IN CONTEXT
    PUBLISHED 9th OCTOBER 2018

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