Previous research and this - The Power of TV Advertising ... · Why TV? “We could find compelling...

Previous research and this

How does the context the brand operates in influence strategy?

500 digital era for-profit cases120 not-for-profit cases

Two ways marketing worksShort-term sales activation Long-term brand building

Sale

s upl

ift o

ver b

ase

TimeSource: Binet & Field 2013

Two ways marketing works

Sales activationShort term sales uplifts

Brand buildingLong term sales growth

Short term effects dominate ~6 months

Why do we still need brand building advertising?

You need brand and activation

0.8

1.5

2.0

2.4

0.0

0.5

1.0

1.5

2.0

2.5

Low Brand, LowActivation

Low Brand, HighActivation

High Brand, LowActivation

High Brand, HighActivation

Num

ber o

f ver

y la

rge

busi

ness

fx

Balance of brand and activation effectsSource: IPA Databank, 1998-2016 for-profit cases, based on scale of activation effects and number of brand effects

Brand building boosts short-term effects

17%

36%

42%

0%

5%

10%

15%

20%

25%

30%

35%

40%

45%

0 1 ≥2

% R

epor

ting

very

larg

e ac

tivat

ion

fx.

Number of very large brand effects reportedSource: IPA Databank, 1998-2016 for-profit cases

The power of brand building: Direct Line insurance

Direct Line TVC

https://vimeo.com/312982179



Direct Line growth

Source: Direct Line IPA case study 2016

Why TV?

“We could find compelling evidence for both the long-term and short-term effectiveness of media lines such as TV and radio. By contrast, our research did not support continued investment in a number of programmatic digital media lines even on a short-term basis.”

Direct Line 2018 IPA case study

The principles of balance

Brand-Activation balance matters

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

Peak at 62% brand

20% loss of effectivenessBrand remains strong

56% loss of effectivenessBrand weakens

When activation is easy, up-weight brand

61 69

39 31

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

Low consideration High consideration

Opt

imum

Bra

nd/a

ctiv

atio

n sp

lit

Nature of purchase decision

Activation

Brand


When brand building is easy, up-weight activation

7655

2445

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

Low High

Opt

imum

Bra

nd/a

ctiv

atio

n sp

lit

Role of emotions in purchase decision

Activation

Brand


Flexing the rules by context

Online research makes activation easier


27%

32%

0%

5%

10%

15%

20%

25%

30%

35%

Low research High research

V La

rge

Activ

atio

n fx

55

74

45

26

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

Low research High research

Brra

nd/a

ctiv

atio

n op

timum

Brand Activation

Online selling makes activation easier


30%

40%

0%

5%

10%

15%

20%

25%

30%

35%

40%

45%

Offline brand Online brand

V La

rge

Activ

atio

n fx

.

55

74

45

26

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

Offline brand Online brand

Brra

nd/a

ctiv

atio

n op

timum

Brand Activation

What about Big Tech?

£130,000,000

£140,000,000

£150,000,000

£160,000,000

£170,000,000

£180,000,000

£190,000,000

£200,000,000

Jan Mar May Jul Sep Nov Jan Mar May Jul Sep Nov Jan Mar May Jul Sep Nov Jan Mar May Jul Sep Nov Jan Mar May Jul

2013 2014 2015 2016 2017

Audi

ted

adsp

end

(UK)

Year ending

Major tech firms spend on traditional brand media

Source: NielsenBrands: Amazon, Google, Apple, Facebook, Twitter, AirBnB, Uber, Spotify

Innovation makes activation easier


28%

40%

0%

5%

10%

15%

20%

25%

30%

35%

40%

45%

No innovation Any innovation

V La

rge

Activ

atio

n fx

.

6172

3928

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

No innovation Any innovation

Brra

nd/a

ctiv

atio

n op

timum

Brand Activation

Brand building is easier for new brands


1.9

1.6

0.0

0.5

1.0

1.5

2.0

New brand Established brand

Num

ber o

f Bra

nd fx

.

56 63

44 37

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

New brand Established brand

Brra

nd/a

ctiv

atio

n op

timum

Brand Activation

Beware the inflection point with launches

3557

6543

0

10

20

30

40

50

60

70

80

90

100

Launches in the first two years Launches after the first year

Opt

imum

bud

get s

plit

%

Activation

Brand


Brand is the key to premium pricing

57 64

43 36

0%10%20%30%40%50%60%70%80%90%

100%

Value/mid-market Premium

Brra

nd/a

ctiv

atio

n op

timum

% brand % activation


0%

2%

4%

6%

8%

10%

12%

0 1 2 3+

% R

epor

ting

very

larg

e pr

ice

sens

itivi

ty re

duct

ion

Number of very large brand effects recorded

How does this affect sectors?

Brand building always drives long-term effectiveness

0.9 0.90.8

1.0

0.7

1.31.2

1.6 1.6 1.6

2.5

2.0 2.11.8

2.6

0.0

0.5

1.0

1.5

2.0

2.5

3.0

Durables FMCG Financial services Other services Retail

Num

ber o

f ver

y la

rge

busi

ness

fx.

Sector

Number of brand effects reported0 1 ≥2


Brand & Activation potential vary widely

31%26%

36%

44%

30%

0%5%

10%15%20%25%30%35%40%45%50%

Durables FMCG Financialservices

Otherservices

Retail

Very

larg

e ac

tivat

ion

fx.

Short-term activation effects


2.1

1.7 1.61.8

1.0

0.0

0.5

1.0

1.5

2.0

2.5

Durables FMCG Financialservices

Otherservices

Retail

Num

ber o

f ver

y la

rge

bran

d fx

.

Brand effects

Up-weight brand in Financial Services, down-weight brand in Other Services

58 6080

5164

42 4020

4936

0

10

20

30

40

50

60

70

80

90

100

Durables FMCG Financial services Other services Retail

Opt

imum

bud

get s

plit

% Activation

Brand


What about the NFP sector?

43 44 44

57 56 56

0%10%20%30%40%50%60%70%80%90%

100%

Charities Government All NFP

Opt

imum

bud

get s

plit

Activation

Brand

Source: IPA Databank, 2012-2016 not-for-profit cases

The optimum balance is shifting

55 57 6376

45 43 3724

0102030405060708090

100

98 to 10 00 to 12 02 to 14 04 to 16

Opt

imum

bud

get s

plit

%

Period

Activation

Brand


The Activation Tide

Short-termism has risen, especially amongst online brands

0%

5%

10%

15%

20%

25%

30%

35%

40%

2002 2004 2006 2008 2010 2012 2014 2016

% c

ampa

igns

that

wer

e sh

ort t

erm

6 years ending

Online

Offline


Short-termism has grown most in high online research categories

0%

5%

10%

15%

20%

25%

30%

35%

40%

2002 2004 2006 2008 2010 2012 2014 2016

% c

ampa

igns

that

wer

e sh

ort t

erm

6 years ending

High research

Low research


As short-termism took off, effectiveness fell

0%

5%

10%

15%

20%

25%

30%

1.1

1.2

1.3

1.4

1.5

1.6

1.7

1.8

1.9

2.0

2002 2004 2006 2008 2010 2012 2014 2016

% c

ases

shor

t-te

rm

Avg.

no.

VL

busi

ness

effe

cts

6 years ending

Effectiveness

% short-term


Sectors that went short lost out

-80%

-70%

-60%

-50%

-40%

-30%

-20%

-10%

0%

10%

20%

0% 50% 100% 150% 200% 250% 300% 350%

Loss

of e

ffect

iven

ess 2

014-

16 v

s. 2

006-

08

Growth of short-termism 2014-16 vs. 2006-08

76% Correlation

Other services

Financial services

Durables

FMCG

Retail


Brand-building media are becoming more important

Established brand media are working harder

27%22%

13% 14%

40%

27%22%

27%

0%5%

10%15%20%25%30%35%40%45%

TV Press Radio Outdoor

% in

crea

se in

avg

. no.

VL

busi

ness

effe

cts f

rom

add

ing

Web 1.0 (1998 - 2006) Web 2.0 (2008* - 2016)Source: IPA Databank*Outdoor = 2012 - 2016

TV is still best for market share growth

1.1%

1.8%2.1%

2.6%

0.0%

0.5%

1.0%

1.5%

2.0%

2.5%

3.0%

No TV TV sponsorship DRTV Brand TV

Avg.

mar

ket s

hare

poi

nts

gain

ed p

er a

nnum

Source: IPA Databank, 2014-16 cases

Reach and Viewability drive growth

2.6%

3.1%

1.1%

0.0%

0.5%

1.0%

1.5%

2.0%

2.5%

3.0%

3.5%

TV only Both Online video only

Avg.

mar

ket s

hare

ga

in p

er a

nnum

Source: IPA Databank, 2014-16 cases

TV consistently outperforms online video across 2017 research studies

2.4 x2.6 x

2.4 x

0.0

0.5

1.0

1.5

2.0

2.5

3.0

Share growth - IPA Short-term sales - KarenNelson-Field

Long-term ROI -Ebiquity/Gain Theory

TV p

erfo

rman

ce v

s. O

nlin

e vi

deo

Sources: IPA Databank ‘Media in Focus’ , Professor Karen Nelson-Field PhD ‘Media Attributes that (really) Matter’ ,Ebiquity ROI campaign database & Gain Theory ‘Profit Ability: the business case for advertising’

Reversing the activation tide

The AA case study

The AA focus on ‘hard working’ activation

Impressive profit growth

Case study: AA Roadside Assistance• Brand activity cut in favour of “hard working” activation• Initial discounts used to entice new members• Renewal price hikes used to make up profit• Highly profitable in the short term

BUT…

Source: AA 2018 IPA case study

AA brand metrics in free fall

Commoditisation: AA branded search

Unsustainable AA pricing model

Case study: AA Roadside Assistance• Brand activity cut in favour of “hard working” activation• Initial discounts used to entice new members• Renewal price hikes used to make up profit• Highly profitable in the short term

BUT…• Brand metrics in free fall• Whole category becoming commoditised• Angry customers, churn increasing• Bigger and bigger discounts required• Market share declining• Complete collapse predicted in five years

Source: AA 2018 IPA case study

42%42%

40%

40%

39%

39%

2011 2012 2013 2014 2015 2016 2017

Shar

e of

mem

bers

hip

(%)

Year

AA market share decline

SOURCE: AA

Complete collapse predicted in five years

AA Roadside Assistance

https://www.youtube.com/watch?v=vNVO-0aE7tw



42%42%

40%

40%

39%

39%

42%

2011 2012 2013 2014 2015 2016 2017 YTD

Shar

e of

mem

bers

hip

(%)

Year

AA market share recovered rapidly

SOURCE: AA

2017 ads

Brand metrics improvedBranded searches increased

Acquisition increasedRetention increased

Despite less discounting

Conclusions

• Invest more in brand building where it is difficult• Invest more in activation where it is difficult• Brand building is becoming more important: the 60:40

rule is shifting further to brand• This is making brand-building media more important• We need to restore balance to budget deployment:

allocate the recommended balance for your brand’s context

Thank you

Date post:	09-Jun-2020
Category:	Documents
Upload:	others
View:	0 times
Download:	0 times

Previous research and this - The Power of TV Advertising ... · Why TV? “We could find compelling...

Documents