How Consumers REACT to Marketing. Understanding Marketing Effectiveness

How do consumers REACT to Marketing?
Understanding Marketing Effectiveness

Peter Nguyen
Nielsen Online

Copyright © 2010 The Nielsen Company. Confidential and proprietary.

2012 Yahoo! Marketing Summit

1

#ybali

The marketer‟s challenge

Marketers held accountable for making decisions more
quickly in a changing business landscape that sees
retailers wielding greater influence

Proliferation of digital, viral, and experiential vehicles
causing audience fragmentation and an environment
where the consumer is in control

Ability to make timely adjustments based upon real
time measured effects

How do you make more confident and timely
marketing investments within a proliferating
media environment? 3


Clearly there is a missing link in the equation.

Missing Link
Does advertising
attract shoppers to
store and increase
sales?

4


Improving marketing performance requires
comprehensive, consistent & analytical approach
DISCOVER
WHAT WORKS
• Decompose sales
impacts for each key
marketing element
• Calculate effectiveness
and return on investment
MONITOR
AND
ADJUST PLAN
SMARTER
• Track results versus • Create insights to drive
plan to identify gaps marketing plans
• Identify actions to • Optimize spending
close gaps allocation 5


DISCOVER
WHAT WORKS

6


Using Statistical analysis, we have been able to
understand sales drivers for 1000s of brands worldwide
Align sales with marketing
Sales

Promos

TV
Time

7


Measuring the impact of over $10bn of media
investment each year
Align sales with marketing
Sales

Promos

TV
Time

Attribute to activities corresponding to peaks and dips

Core Volume Total Print TPR Only Quality Merchandising Total TV FSI
8


How are my marketing executions ROI performing?
1 Marketing Factors Considered

Media Advertising In-store Activity Other*

+ +

2 Volume Decomposition 3 Incremental Revenue 4 ROI

50

40

30 $1.41
Spending $1.26
20 $0.82

10
Online Magazine TV
0

Base Trade TV Halo TV Print Radio
9
* Can be many things different by country/category/industry


A TV Channel wanted to know
how to best guide their
advertisers on a range of
topics…
We looked over 100s of brands

10


Which type of Laydown strategy is the most
effective?
ROI
Burst
0.29

ROI
Pulse
0.34

ROI
Continuous
0.38
11


Is a fully integrated ATL campaign really
adding anything?

Campaign Direct
Mail
Campaign
Cellular
with 1-3 e-Mail Pager
with 3+ media
Outbound
media types Website PDA
Telemarketing
Sales Force
Fax
types
Retail
Point of Sale
Face-to-Face

ROI Delivery
Fulfillment
Customers
Radio
ROI
0.34 Phone
Ordering Television
0.18
ATM
Magazines

Event / Placement/
Sponsorships Product
Outdoor Sampling

Newsprint

12


A media campaign consisting of TV + Internet
increases ROI in comparison with a single TV
campaign Average short term TV ROI
(Incremental $ Sales per $ Spent)

+6%
Nielsen
Benchmarks

Strong
>$0.5/$ $0.35
$0.33

Weak
<$0.2/$ ROI calculation based
on Gross TV Spend
Single TV TV + Internet 13
campaign campaign


Nielsen Brand Effect Metrics and Business Results
• BE has 5 syndicated ad effectiveness metrics:
– General Recall
– Brand Recall
– Message Recall
– Likeability
– Purchase Intent
• Correlated BE metrics with MMM Sales Response coefficients
• Global CPG Company Y Summary:

MMM Sales
Correlation Between: Response
General Recall 0.55
Brand Recall 0.75
Message Recall 0.81
Likeability 0.72
Purchase Intent Top 2 Box 0.61

BE Metrics are Leading Indicators of MMM Sales Response 14


Dual-platform ad exposure greatly enhances TV ad
performance

TV Ad Performance – A18+
TV + Online Exposed TV Only Exposed

56% +22%

46% +50%
42%
+67%
35%
+67%
28%
25%
21%
15%

General Recall Brand Recall Message Recall Likeability
15

Nielsen Brand Effect (IAG), 9.20.10 – 7.31.11, A18+
Green arrows indicate a positive difference and red arrows indicate a negative difference at >90% confidence
Dual Platform is limited to those exposed within the previous 7 days to TV + Online Video; Limited to same campaigns for both TV +
Online Exposed and TV Only Exposed; TV+ Online Exposed sample:18,165; TV Only Exposed sample: 4,587,549

Incremental online exposures further improve TV ad
performance
TV Ad Performance by Online Exposure Level – A18+


62% 62%

53% 53% 54%

49% 50%

41% 42%
39%
37% 37%

32% 31%
30% 31% 30%

23% 24%
21%

1-2 3-4 5-7 8-10 11+
Online Exposures 16

Nielsen Brand Effect (IAG), 9.20.10 – 7.31.11, A18+
Green arrows indicate a positive difference and red arrows indicate a negative difference at >90% confidence
Limited to those exposed within the previous 7 days to the same campaigns up to the first five exposures to TV + Online Video;
Online Exposure Sample Sizes: 1-2 = 8,402; 3-4 = 1.516, 5-7 = 636, 8-10 = 357, 11+ = 464

TV ads for this advertiser were more effective among those viewers
who were previously exposed to online ads, particularly video ads

TV Advertisement Brand Recall by Prior Online Ad Exposure Type
52
48

39
35

TV Only TV + Rich Media Only TV + Online Video Only TV + Display + RM
+Online Video

17

Source: Nielsen Brand Effect, A18+, 11.18.09 – 03.14.10; Based on online ad exposure in 30 days prior to TV ad exposure.


Higher Engagement in long form online content relative to
TV is evident across age groups

Online Full Episode Norm (Next Day) Broadcast TV Norm (Next Day)

84% 86% +26%
82% +46% +38%

68%
61%
56%

A18-34 A18-49 A35-64
18

Source: Nielsen Brand Effect (IAG) 9.20.10 – 7.31.11;
Lifts shaded in green are significant at a >90% confidence.


Long-form online video ads significantly outperform TV ads
Ad Performance by Platform – A18+
Online Video TV
65%
+41%

52% +86%

46%
43%
+205%

+87%
28% 28%

21%
15%

19

Source: Nielsen Brand Effect (IAG) 9.20.10 – 7.31.11; A18+
TV & Online Measurement limited to people 1 day post exposure to same campaigns on Online Video and TV.
Lifts shaded in green are significant at a >90% confidence; Online Video sample: 32,031; TV sample: 4,998,658.
Online Video is inclusive of full episode player sites.

Short Form Video breaks through just as well as TV ads

Short Form Video vs. Broadcast/Cable TV Ad Performance

Short Form Video (77,903) Broadcast/Cable TV (2,967,042)

48% 48%

29% 29%

22% 22%

15% 16%


20

Nielsen Brand Effect (IAG), January 1, 2011 – December 31, 2011, A18+
Broadcast Cable Norm Limited to Primetime and Non-Sports programming
Limited to Same Brands

Even when measuring online impact of ads,
clickthrough does not reflect the full value…
80%
Brand A
Have not been exposed/ to
conducted any Visit activity
40%
24%

2%

Display Display Display <=1 Week
Clickthrough: 5 Clickthrough:
seconds* Same Session

71% 52%
Brand B Brand C
Have not been exposed/ to Have not been exposed/ to
conducted any Visit activity
12% conducted any Visit activity
46%
27%
14%
9% 5%

Display Display Display <=1 Week Display Display Display <=1 Week
Clickthrough: 5 Clickthrough: Clickthrough: 5 Clickthrough:
21
seconds* Same Session seconds* Same Session

Base: Those that visited the brand site after exposure to display campaign


…And there is no correlation between online
click through and offline ROI
1400%

Correlation = -.07
Campaign ROI%

900%

400%

Breakeven
-100%
0.00% 0.10% 0.20% 0.30%

22
Ad Click Thru Rate

Source : Nielsen Online Analysis of 300+ Online Campaigns: U.S.

But we can show that online campaigns do
deliver ROI at the checkout

126

100 99
78 76

Online TV Trade Print Couponing

Source: The Nielsen Company, TMG Meta Analysis, 2009, n=300 CPG
client brands: U.S.
•ROI = (incremental sales driven by
campaign/cost of campaign) -1
23


Which Digital Media types are the most effective?
(at driving sales)

Highest
1. Brand Website/MicroSite ROI
2. Online Registration Email

3. Email
4. Paid Search Banner Ads

5. Registration-Influencer
6. Content Syndication Brand Website/MicroSite

7. Banner Ads
8. Internet Sampling Paid Search

24
*Based on Global Averages


We conducted a global “Meta-
Analysis” across 300+ Marketing
Effectiveness studies

25


Where do you think Asian Markets rank vs. other
countries on media effectiveness??
Americas Western Europe Asia-Pac CEEMEA
Index of Media Effectiveness
2.33
Argentina Belgium Australia Greece
Brazil France China Poland
2.09 2.07
Canada Germany India Saudi
Mexico Italy Indonesia South Africa
1.59 USA Spain Japan Turkey
Venezuela UK Philippines
1.24 1.20 1.20
1.18 1.15 S-Korea
1.11
0.99 0.99 0.97 Thailand
0.90 0.87
0.84 0.83 0.83
0.75 0.75 0.74
0.59 0.59 0.54
0.42

26


Where do you think Asian Markets rank vs. other
countries on media effectiveness??
Americas Western Europe Asia-Pac CEEMEA
2.33
Argentina Belgium Australia Greece
Brazil France China Poland
2.09 2.07
Canada Germany India Saudi
Mexico Italy Indonesia South Africa
1.59 USA Spain Japan Turkey
Venezuela UK Philippines
1.24 1.20 1.20
1.18 1.15 S-Korea
1.11
0.99 0.99 0.97 Thailand
0.90 0.87
0.84 0.83 0.83
0.75 0.75 0.74
0.59 0.59 0.54
0.42

27


Which Media type is most effective
……IN ASIA??


TV 100

Magazine 147

Radio 108

Out of Home 66

Digital 244

28


PLAN
SMARTER
29


Custom optimizations identify best possible
investment options given budget constraints

Analysis Optimized
Plan
Marketing TV

Costs and Print

Product Margins Online

By Activity
Business By Week
Rules By Brand
By Channel

30


An example of spending optimisation from a small car
company with a growing share…
52 Weeks (1 Year)

Scenario Change in Incremental
[unit: 1,000 $ ] Last 52 Weeks Change in Investment
Investment Value

TV 3,094 5,664 2,570 7,555
TV Sponsorship 881 881 0 0
Newspaper 2,277 1,594 -683 -1,203
Magazine 296 0 -296 -437
Online 286 583 296 470
OOH 2,175 665 -1,509 -1,633
Price Related Discount 2,978 1,922 -1,056 -1,748
Dealer Incentive 1,972 2,651 679 2,515
Total 13,889 13,889 0 5,520

+$ 5,520,121 Incremental Sales Value
31


Measurement comparability with other Media

All Adults Women 25-44
Total Audience: 24.9m Total Audience: 4.1m
TV TV
Active Internet Individual Universe: Online
Online
38,144,000
Observed Ad Impressions:
24,007,000
Delivery 1.6m 2.9m 20.4m 0.4m 0.5m 3.2m
Audience Reach: 4,120,000
Audience Reach: 11%
Average Exposure: 5.8
Online GRPs: 62.9 36% of those exposed to 44% of those exposed to
the online campaign did the online campaign did
not see the TV campaign not see the TV campaign

12% saw both the Online 12% saw both the Online
and TV campaign and TV campaign 32

Source: Nielsen Incremental Reach
Note: Figures may not add up to Total Audience due to rounding
Base („000): All Adults (49,206), Women 25-44 (8,293)


SUMMARY

33


Key Take-Aways
• It is now possible to understand the ROI of digital as part
of the media mix
• Don‟t just rely on click-thru
• Online is a great compliment to traditional media and
works hard to reinforce the branding message
• Having solid measurement and comparability with
traditional media gives confidence for investment
• There is no silver bullet to budget reallocation – depends
on category, BTL mix etc… BUT
– ALL analysis so far shows advertisers could – and should – go
further with their digital investments

34


• “Half the money I spend on
advertising is wasted; the trouble
is I don't know which half.”

John Wanameker: Retail
magnate, considered a
pioneer in advertising

He would have known that today !! 35


For questions, please contact:

Peter Nguyen
Manager, Nielsen Online, NM Incite
CENTRE POINT - 106 Nguyen t: + 84 8 3997 8088 x: 8174
Van Troi St. f : + 84 8 3845 5348
Phu Nhuan Dist. HCM. City, m: +84 977 550 665
Vietnam e: son.nguyen@nielsen.com

Peter Nguyen
fiickdotcom

Peter Nguyen

2

AdSolutions 2011

37


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