This presentation to Fionn Downhill's Digital Marketing class at the Thunderbird School of Global Management uses ads from Super Bowl 2015 to demonstrate how to calculate your return on marketing investment.

1. Video Marketing Workshop for
Fionn Downhill’s Class
Greg Jarboe
President of SEO-PR
April 21, 2015

2. First video on YouTube was uploaded
almost 10 years ago on April 23, 2005
Source: https://youtu.be/jNQXAC9IVRw

3. Fionn Downhill’s Irish stepdancing
video uploaded on March 8, 2008
Source: https://youtu.be/M1vFOvGt4_c

4. YouTube has more than 1 billion users,
making it #2 largest social media site
• Every day people watch
hundreds of millions of hours
on YouTube and generate
billions of views.
• 300 hours of video are
uploaded to YouTube every
minute.
• YouTube is localized in 75
countries and available in 61
languages.
• Half of YouTube views are on
mobile devices.
Source: https://www.youtube.com/yt/press/statistics.html

5. Would you spend $4.5 million to reach
114.4 million viewers for 30 seconds?
Source: http://money.cnn.com/2015/01/30/media/super-bowl-viral-ads/

6. Most ad agencies measure the inputs,
not the outcomes of their advertising
• In the late 1980s, my father
was the director of marketing
at Oldsmobile.
• He launched the classic ad
campaign, “This is not your
father’s Oldsmobile.”
• But sales fell from 900,000 in
1987 before the ad campaign
to under 450,000 in 1991.
• So, he asked his ad agency, Leo
Burnett, how they were
measuring results.
• “GRPs”, they replied.
• Dad asked, “How many GRPs
do we need to sell a car?”
Source: http://www.amazon.com/YouTube-Video-Marketing-Hour-Day-ebook/dp/B002MZUPTW

7. How do you calculate your return on
marketing investment (ROMI)?
• Return on marketing investment (ROMI) is the contribution to
profit attributable to marketing (net of marketing spending),
divided by the marketing invested.
– It is not like the other “return on investment” metrics because
marketing is not the same kind of investment.
– Instead of moneys that are “tied” up in plants and inventories,
marketing funds are typically “risked.”
– Usually marketing spending will be deemed as justified if the return is
positive.
• The purpose of the ROMI metric is to measure the rate at which
spending on marketing contributes to profits.
• Return on marketing investment (%) = 100 x [{Incremental revenue
attributable to marketing ($) x Contribution margin (%) - Marketing
spending ($)} ÷ Marketing spending ($)]
– Note: Marketing spending is typically expensed in the current period.
Source: http://www.commonlanguage.wikispaces.net/Return+on+Marketing+Investment

8. If a VW Passat sells for $29,310, then
how many cars do you need to sell?
• Return on marketing
investment of 10% = 100
x [{$379,300,710 in
incremental revenue
attributable to marketing
(12,941 more cars) x 2.9%
contribution margin
($850) - $10 million for
60-second Super Bowl
spot and ad production} ÷
$10 million for marketing
spending]
Source: http://www.bloomberg.com/bw/articles/2014-03-13/volkswagen-pockets-23-000-when-you-buy-that-new-porsche

9. Volkswagen needed 2,957 views and
254 shares to sell a car back in 2012
• Volkswagen’s “The Force” is
the most shared ad of all time,
with more than 61.8 million
views and close to 5.3 million
shares.
• This Super Bowl ad generated
a 127% uplift in website traffic
and drove the sale of 20,902
units.
• The price range for a new
Passat in 2012 was $19,995 to
$32,950, so “The Force” drove
from $417,935,490 to
$688,720,900 in incremental
sales back when margins were
higher.
Source: Unruly White Paper, November 2012

10. VW’s Super Bowl 2014 ad, “Wings,”
didn’t get as many views or shares
Source: http://www.thesempost.com/marketing-lessons-learned-2014-vw-super-bowl-commercial-wings/

11. So, Volkswagen decided it wouldn’t
advertise during Super Bowl 2015
Source: http://www.autonews.com/article/20141120/RETAIL03/141129979/volkswagen-wont-advertise-during-2015-super-bowl

12. All the Super Bowl 2015 ads that did
run on NBC also appeared on YouTube
Source: https://www.youtube.com/user/adblitz

13. Some plays in the marketer’s playbook
for winning the big game are classics
• The Kick Return: This is one of
the most basic plays in the
playbook, but it generates
results again and again.
• Budweiser’s “Lost Dog” was
the most-shared Super Bowl
ad of 2015.
• Budweiser's “Puppy Love” was
the most-shared Super Bowl
ad of 2014
• Budweiser’s “Brotherhood”
was the most-shared Super
Bowl ad of 2013.
Source: http://www.momentology.com/4725-best-super-bowl-ads-of-2015-put-new-plays-in-marketers-playbook/

14. Other plays in the marketer’s playbook
for winning big games are brand new
• Half-Back Pass: This trick play
has high risks, but high
rewards.
• But “Aubrey Plaza Prepares
America for Newcastle’s Band
of Brands Ad” demonstrates
that you don’t need to be an
official Super Bowl advertiser
to steal the show.
• And Newcastle Brown Ale
didn’t pay NBC $4.5 million to
air a 30-second spot during
the Big Game?
Source: http://www.momentology.com/4725-best-super-bowl-ads-of-2015-put-new-plays-in-marketers-playbook/

15. YouTube delivered more views, but
Facebook videos got more shares
Source: http://www.clickz.com/clickz/news/2394454/facebook-videos-pull-upset-over-favored-youtube-at-super-bowl-2015

16. Facebook videos got a share rate
almost 5 times higher than YouTube
• When comparing campaigns that ran on both YouTube and
Facebook, the versions run on Facebook got an average share rate
of 6.1% – almost 5 times higher than the 1.3% rate on YouTube.
• Why are share rates higher on Facebook?
• Facebook is a social networking service, while YouTube is video-
sharing website.
• What’s the difference?
• Facebook is a place where people scroll through their News Feed
and may be more likely to check out content that their friends,
family, and colleagues have enjoyed.
• YouTube is a place where people search for content from creators
and then share some of it with their friends, family, and colleagues.
Source: http://www.clickz.com/clickz/news/2394454/facebook-videos-pull-upset-over-favored-youtube-at-super-bowl-2015

17. Video content related to Super Bowl
2015 broke the 1 billion view mark
• According to Tubular Labs,
80,000 videos from 49,000
creators got close to 1.1 billion
views.
• And the digital video universe
is far more segmented than I
suspected.
• I use the term “segmented”
instead of “fragmented”
because each of these worlds
has its own language, its own
culture and customs, as well as
its own folk heroes.
Source: http://www.reelseo.com/super-bowl-1-billion-online-views/
368.1
321.8
226.0
128.7
11.2
Views (Million)
YouTube Facebook Instagram
Vine Other

18. Top 5 videos on YouTube were ads, but
3 of top 5 on Facebook were trailers
Source: http://www.reelseo.com/super-bowl-1-billion-online-views/

19. 3 of top 5 Instavids by Victoria’s Secret,
but top 5 Vines are all user-generated
Source: http://www.reelseo.com/super-bowl-1-billion-online-views/

20. Were the folks at Unruly, YouTube, and
Pixability watching the same game?
• It’s clear to everyone who
watched Super Bowl 2015 that
the New England Patriots beat
the Seattle Seahawks by a
score of 28 to 24.
• But which Super Bowl ads won
the Big Game?
• Well, only 3 ads – Budweiser’s
“Lost Dog”, Supercell’s “Clash
of Clans”, and Snickers’ “The
Brady Bunch” – made all 3 of
the key lists.
• Were the marketers at Unruly,
YouTube, and Pixability
watching the same game?
Source: http://www.business.rutgers.edu/executive-education/blogs/which-ads-won-super-bowl-2015-it-depends-metrics-you-use

21. They were watching the same game,
but they were using different metrics
• Pixability’s list of the top Super
Bowl ads was based on views.
• YouTube’s list of top ads was
determined by an algorithm
that factors in paid views,
organic views and audience
retention (how much of a
video people watched).
• And Unruly’s list of top ads
was based on the number of
times video content was
shared on Facebook, Twitter
and in the blogosphere.
Source: http://www.business.rutgers.edu/executive-education/blogs/which-ads-won-super-bowl-2015-it-depends-metrics-you-use

22. So, which metrics should marketers
use? The answer is: All of the above!
• Measurement is essential, both for defining success and optimizing
towards it.
• Most marketers find it useful to select 1 metric for each of the
following 3 buckets that measure engagement with their content:
– Audience. Are you reaching the right audience? How well?
– Expression. Is your target audience engaging with your content? How
much?
– Participation. Is your audience endorsing and sharing your content?
How much?
• The number of views is a key metric for the first bucket.
• Watch time is a key metric for the second bucket.
• And the number of shares is a key metric for the third bucket.
Source: http://www.business.rutgers.edu/executive-education/blogs/which-ads-won-super-bowl-2015-it-depends-metrics-you-use

23. Please, don’t rush out and buy my
book, YouTube and Video Marketing
• When it was published in
November 2011, the second
edition legitimately claimed to
be “Fully updated with new
information, including the
latest changes to YouTube!”
• But the only chapter that isn’t
out-of-date today is Chapter 1:
A Short History of YouTube.
• So, if you want up-to-date
information, read my posts on
ReelSEO, ClickZ, The SEM Post,
or Momentology.
Source: http://www.amazon.com/YouTube-Video-Marketing-Hour-Day/dp/047094501X