ROI in a fragmented media world

ABA ROI Conference

April 27, 2010

Peter Kloprogge

Media planning: then and now

• Then: How do I use media to optimize the reach and frequency in my target audience? Television’s contribution was to deliver 75% at 2+.

• Now: How do I use media to influence the behavior of consumers? Television’s contribution was to increase awareness with

10% and to increase sales with 1.5%.

Coupons or Price message?

Outdoor or Happy message

Television of Healthy message

Media or message?

Coupons Outdoor TV

Price / snack

Happy / fun

Healthy

1.5%

Modeling could show a 1.5% effect due to television

Media or message?

Coupons Outdoor TV

Price / snack

Happy / fun

Healthy 1.5%

1.5%

Or should this be contributed to the “Healthy” message?

Media or message?

Coupons Outdoor TV

Price / snack

Happy / fun

Healthy 1.5%

1.5%

Media mix

Messa

ge m

ix

Three generations of optimization

Optimize Reach & Frequency

Optimize ‘Ability to influence’

We’re launching Compose

Brazil!

Scope of Compose: The survey

• Research partner: Ipsos

• National sample of 2000 respondents 1300 interviews were conducted face-to-face 700 interviews online

• Universe Class A, B and C Age 15-64 9 Markets: Grande São Paulo, Grande Rio de Janeiro,

Grande Porto Alegre, Grande Curitiba, Grande Belo Horizonte, Grande Salvador, Grande Recife, Grande Fortaleza, Grande Brasília

Scope of Compose: around 30 channels

TelevisãoIndicação de amigos, colegas, parentes

Canal de Vendas na TV 'Outdoors'TV participação com celebridades AeroportoExposição de produto Transporte públicoRádio Propaganda dentro das lojasPropaganda na Internet JornaisSites de busca RevistasSite da web da companhia / fabricante Mala direta Redes sociais online (ex: Orkut) Revistas feitas por lojas ou marcas Portais online (ex. UOL) Encartes soltosE-mail de mala direta Celular: sms, torpedosPatrocínio de times esportivos CinemaPatrocínio de grandes eventos esportivos Amostras grátis de produtos

Scope of Compose: 8 drivers

Preços

Informações detalhadas

Qualidade

Influenciar meus sentimentos

Passar status

Conhecer pela primeira vez

Motivar uma conversa

Buscar informações

Scope of Compose: around 40 product categories

Cerveja, vinho ou bebida destilada Comprou calçados Apólices de Seguros

Xícara de bebida quente Comprou produtos de tratamento para cabelo ou pele Outros produtos financeiros

Refrigerante ou água mineral (garrafa/galão)

Comprou produtos de papel para uso doméstico (ex: rolo de papel de cozinha, guardanapos de papel)

Comprou serviços educativos/auxílio de aprendizagem (cursos, livros ou revistas educativas)

Leite Comprou produtos de higiene Frequentou algum evento esportivo (ex: jogo de futebol)

Comprou doces, sorvetes, bolachas e outras sobremesas

Plano de serviço com operadora de celular (pós pago, pré pago) Foi ao cinema

Comprou comida pronta, enlatada ou congelada

Provedor de serviços de acesso a Internet Alugou/comprou DVDs/vídeos

Comprou lanches

Comprou aparelhos eletrônicos (ex: TV, aparelho de som estéreo, tocador de mp3, computadores) Comprou brinquedos e jogos

Veículos (carros, motocicletas, caminhonetes)

Telefone Celular (aparelho convencional, blackberry, Iphone) Foi em restaurantes

Comprou passagens aéreas (uso pessoal para lazer)

Acessou alguma loja virtual na internet

Comprou produtos de limpeza doméstica

Comprou combustível (gasolina, álcool, diesel) ou óleo de motor Cartões de Crédito

Eletrodomésticos e equipamentos de limpeza (ex: geladeira, aspirador de pó)

Comprou cosméticos Contas Bancárias Foi em algum hipermercado (ex: Extra, Carrefour, Wall-Mart)

Comprou jóias/relógios Financiamentos Foi em algum supermercado ou farmácia

Comprou roupas

The ability of media to influence

© Pointlogic / Compose Brazil 2010

The ability of media to influence

© Pointlogic / Compose Brazil 2010

The ability of media to influence

© Pointlogic / Compose Brazil 2010

The ability of media to influence

© Pointlogic / Compose Brazil 2010

What’s important to consumers

© Pointlogic / Compose Brazil 2010

Compose Case Study

Using Compose USA 2010

Product category

Consumer tasks

Overall ranking

Optimized plan

Last Year’s Plan

Optimized

Reach versus influential reach

© Pointlogic / Compose USA 2010

The mixed media plan is based on 50% TV, 30% Newspapers and 20% Radio

Three generations

Optimize Reach & Frequency

Optimize ‘Ability to influence’

Optimize Brand ROI

Optimize Brand ROI

• With Compose we have a consumer centric tool to optimize the media mix based on its ability to influence your KPI’s

• However, Compose doesn’t provide an ROI projection based on a communication plan

• Some clients need a clear ROI projection or need to manage ROI for other purposes

Managing ROI

The six ingredients you need to cover

1 How will brand perceptions affect market share?

How will brand perceptions affect market share?

What is important to consumers?

What is their perception of your brand?

What are they hearing and where?

Which brands are they buying?

We need to know what consumers

think of your brand and

your competitors

We need to know what consumers

think of your brand and

your competitors

We need to know which

purchase stimulators sells in your

category

We need to know which

purchase stimulators sells in your

category

Mathematical models link

the perceptions to

brand preference

Mathematical models link

the perceptions to

brand preference

We need to know where

consumers see you and what

they’re hearing

We need to know where

consumers see you and what

they’re hearing

Validation with automotive

• The M3 model using these metrics explained Most Likely to Purchase (MLTP) with 94% accuracy

• MLTP has a greater than 90% correlation with current levels of market share

• CONCLUSION: WE KNOW HOW PERCEPTION CHANGES INFLUENCE BEHAVIOR!

2How to brief creative and media based on brand strategy?

Consumer centric approach to the brand’s landscape

Consumer centric approach to the brand’s landscape

What happens when what‘s important changes?

What happens when what‘s important changes?

Consumer centric approach to the brand’s landscape

Consumer centric approach to the brand’s landscape

What happens when brand perceptions change?

What happens when brand perceptions change?

Consumer centric approach to the media landscape

Consumer centric approach to the media landscape

3How will creative + channel influence perceptions?

Result: Campaign with high synergy

Together with our partner OTX (recently acquired by Ipsos), we test creative copy within the setting of the overall campaign.

© OTX / MediaCEP™

4How to optimize a media plan based on actual creative material?

The ability of media to influence

Perhaps radio doesn’t influence perception of price

The ability of media to influence

Or perhaps TV and Cinema gets a boost when used together

With data from cross-media copy testing, the planner will add reports to understand synergetic

effects.

5What did the advertising budget deliver in return?

The econometric modeling allows for closing the ROI loop. What are the brand effects for a certain communication plan.

The econometric modeling allows for closing the ROI loop. What are the brand effects for a certain communication plan.

6 How to connect the dots?

Connecting the dots

• Clearly define your target segments

• Clearly define your KPI’s

• Assure that all research programs remain consistent with the segments and KPI’s

• Data integration, dashboards and planning tools can assure: Consistency with all involved (“common goal”) Easy distribution of learnings Accountability and improved ROI!

To summarize: the ingredient for managing ROI

• How will brand perceptions affect market share?

• How to brief creative and media based on brand strategy?

• How will creative + channel influence perceptions?

• How to optimize a media plan based on actual creative material?

• What did the advertising budget deliver in return?

• And how to connect the dots?

kloprogge@pointlogic.com