EFFECTIVENESS

IN CONTEXT
PRELIMINARY FINDINGS
 Marketing works in two ways
Brand building
Long term sales growth
Sales uplift over base

Sales activation
Short term sales uplifts

Time
Source: Binet & Field 2013
 The 60:40 rule
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
How do the rules vary
by marketing context?
 Nature of the purchase decision
100%
90% 19% 24% 26%
32%
80% 41% 41%
% Communications budget

70%
60%
Activation
50%
Brand
40% 81% 76% 74%
68%
30% 59% 59%
20%
10%
0%
Low High Emotional Rational Low High
Consideration Primary System Online research
Source: IPA Databank, 1998-2016 for-profit cases
 Mechanics of the purchase
100%
90% 22% 26%
80% 42% 39%
% Communications budget

70%
60%
Activation
50%
Brand
40% 78% 74%
30% 58% 61%
20%
10%
0%
Offline Online Repeat Subscription

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

 Product innovation
100%
90% 20%
80% 35%
% Communications budget

70%
60%
% Actvation
50%
% Brand
40% 80%
30% 65%

20%
10%
0%
No innovation Any innovation

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

 Brand size
100%
90% 17%
33% 30% 27%
80%
% Communications budget

70%
60%
50%
83% % activation
40%
67% 70% 73%
30% % brand
20%
10%
0%
Small brands Bottom 50% Top 50% Leader brands
(avg SOM = 3%) (avg. SOM = 7%) (avg SOM = 31%) (avg SOM = 33%)

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

Excludes new and niche brands
 Pricing strategy
Strategies for increasing price Brand-building is the key
12%
12%
10.0%

% campaigns with VL price fx

10%
10%
% campaigns with VL price fx

8% 8%
7.0%

6% 6%

4% 3.0% 4%

2% 2%

0% 0%
Continue with Launch new Reposition 0 1 2 3 4+
existing range sub-brand brand No. VL brand effects

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

 Brand development
100%
90% 16%
22%
32% 31%
80% 38%
% Communications budget

70%
60%
% Actvation
50%
84% % Brand
40% 78%
68% 69%
30% 62%
20%
10%
0%
Range Repositioning Relaunch / New sub- Into new
unchanged Rebranding brand category
Source: IPA Databank, 1998-2016 for-profit cases
 Penetration vs loyalty
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

Penetration is always the main driver. Loyalty strategies always under-perform.

Base: 2008-16 IPA cases

 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
 Digital makes mass media more 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?

UK adspend – 12 month rolling (Nielsen)

Mass marketing is alive and well
EFFECTIVENESS
IN CONTEXT
PRELIMINARY FINDINGS