How Consumers REACT to Marketing. Understanding Marketing Effectiveness

Copyright © 2010 The Nielsen Company. Confidential and proprietary.

How do consumers REACT to Marketing? Understanding Marketing Effectiveness Peter Nguyen

Nielsen Online

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Copyright © 2011 The Nielsen Company. Confidential and proprietary.Copyright © 2011 The Nielsen Company. Confidential and proprietary.

2012 Yahoo! Marketing Summit

#ybali

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Marketers held accountable for making decisions more

quickly in a changing business landscape that sees

retailers wielding greater influence

The marketer‟s challenge

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

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How do you make more confident and timely

marketing investments within a proliferating

media environment?

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Missing LinkDoes advertising

attract shoppers to

store and increase

sales?


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Clearly there is a missing link in the equation.

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Improving marketing performance requires

comprehensive, consistent & analytical approach

WHAT WORKS• Decompose sales

impacts for each key

marketing element

• Calculate effectiveness

and return on investment

SMARTER• Create insights to drive

marketing plans

• Optimize spending

allocation

MONITORAND

• Track results versus

plan to identify gaps

• Identify actions to

close gaps

PLANADJUST

DISCOVER

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WHAT WORKS

DISCOVER

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Using Statistical analysis, we have been able to

understand sales drivers for 1000s of brands worldwide

Sales

Promos

TV

Time

Align sales with marketing

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Measuring the impact of over $10bn of media

investment each year

Sales

Promos

TV

Time

Align sales with marketing

Attribute to activities corresponding to peaks and dips

Core Volume Total Print TPR Only Quality Merchandising Total TV FSI

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In-store Activity

0

10

20

30

40

50

Base Trade TV Halo TV Print Radio

Media Advertising Other*

+ +

Incremental Revenue

Spending

Volume Decomposition

1

2 3 4

$1.41 $1.26

$0.82

Online Magazine TV

How are my marketing executions ROI performing?

ROI

Marketing Factors Considered

* Can be many things different by country/category/industry

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A TV Channel wanted to know how to best guide their

advertisers on a range of topics…

We looked over 100s of brands

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Burst

Continuous

Which type of Laydown strategy is the most

effective?

Pulse

ROI

0.29

ROI

0.34

ROI

0.38

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Is a fully integrated ATL campaign really

adding anything?

PDA

Pager

Cellular

DirectMail

OutboundTelemarketingSales Force

Fax

e-Mail

Website

RetailPoint of SaleFace-to-Face

PhoneOrdering

ATM

Event /Sponsorships

Outdoor

Placement/ProductSampling

Newsprint

Magazines

Television

RadioDelivery

FulfillmentCustomers

Campaign

with 1-3

media types

ROI

0.34

Campaign

with 3+ media

types

ROI

0.18

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A media campaign consisting of TV + Internet

increases ROI in comparison with a single TV

campaign

$0.33$0.35

Single TV

campaign

TV + Internet

campaign

Average short term TV ROI(Incremental $ Sales per $ Spent)

Weak

<$0.2/$

Strong

>$0.5/$

Nielsen

Benchmarks

+6%

ROI calculation based

on Gross TV Spend

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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:

Correlation Between:

MMM Sales

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

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56%

42%

35%

25%

46%

28%

21%

15%

General Recall Brand Recall Message Recall Likeability

TV Ad Performance – A18+

TV + Online Exposed TV Only Exposed

+67%

+22%

Dual-platform ad exposure greatly enhances TV ad

performance

+50%

+67%

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

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Incremental online exposures further improve TV ad

performance

53% 53% 54%

62% 62%

37% 37%39%

49% 50%

30% 31%32%

41% 42%

21%23% 24%

30%31%

1-2 3-4 5-7 8-10 11+

Online Exposures

TV Ad Performance by Online Exposure Level – A18+


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

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35

39

48

52

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

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

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

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Higher Engagement in long form online content relative to

TV is evident across age groups

82% 84% 86%

56%61%

68%

A18-34 A18-49 A35-64

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

Source: Nielsen Brand Effect (IAG) 9.20.10 – 7.31.11;

Lifts shaded in green are significant at a >90% confidence.

+46%+26%

+38%

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Long-form online video ads significantly outperform TV ads

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.

65%

52%

43%

28%

46%

28%

21%

15%


Ad Performance by Platform – A18+

Online Video TV

+41%

+86%

+205%

+87%

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Short Form Video breaks through just as well as TV ads

48%

29%

22%

15%

48%

29%

22%

16%


Short Form Video vs. Broadcast/Cable TV Ad Performance

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

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

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

Brand A

2%

24%

80%

Display

Clickthrough: 5

seconds*

Display

Clickthrough:

Same Session

Display <=1 Week

40%Have not been exposed/ to

conducted any Visit activity

9%

27%

71%

Display

Clickthrough: 5

seconds*

Display

Clickthrough:

Same Session

Display <=1 Week



5%

14%

52%

Display

Clickthrough: 5

seconds*

Display

Clickthrough:

Same Session

Display <=1 Week



Brand B Brand C

Even when measuring online impact of ads, clickthrough does not reflect the full value…

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…And there is no correlation between online

click through and offline ROI

-100%

400%

900%

1400%

0.00% 0.10% 0.20% 0.30%

Breakeven

Ad Click Thru Rate

Ca

mp

aig

n R

OI%

Correlation = -.07

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

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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

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

1.

2.

3.

4.

5.

6.

7.

8.

Highest ROIBrand Website/MicroSite

Online Registration

Email

Paid Search

Registration-Influencer

Content Syndication

Banner Ads

Internet Sampling

Email

Banner Ads

Brand Website/MicroSite

Paid Search

*Based on Global Averages

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

Effectiveness studies

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Where do you think Asian Markets rank vs. other

countries on media effectiveness??

2.33

2.09 2.07

1.59

1.24 1.20 1.20 1.18 1.15 1.110.99 0.99 0.97

0.90 0.87 0.84 0.83 0.830.75 0.75 0.74

0.59 0.59 0.54

0.42

Index of Media EffectivenessAmericas Western Europe Asia-Pac CEEMEAArgentina Belgium Australia Greece

Brazil France China PolandCanada Germany India Saudi

Mexico Italy Indonesia South Africa

USA Spain Japan Turkey

Venezuela UK Philippines

S-Korea

Thailand

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Where do you think Asian Markets rank vs. other

countries on media effectiveness??

2.33

2.09 2.07

1.59

1.24 1.20 1.20 1.18 1.15 1.110.99 0.99 0.97

0.90 0.87 0.84 0.83 0.830.75 0.75 0.74

0.59 0.59 0.54

0.42

Index of Media EffectivenessAmericas Western Europe Asia-Pac CEEMEAArgentina Belgium Australia Greece

Brazil France China PolandCanada Germany India Saudi

Mexico Italy Indonesia South Africa

USA Spain Japan Turkey

Venezuela UK Philippines

S-Korea

Thailand

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Which Media type is most effective

……IN ASIA??

244

66

108

147

100

Digital

Out of Home

Radio

Magazine

TV

Index of Media Effectiveness

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SMARTERPLAN

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Optimized

Plan

TV

Print

Online

Analysis

Custom optimizations identify best possible

investment options given budget constraints

By Activity

By Week

By Brand

By Channel

Marketing

Costs and

Product Margins

Business

Rules

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An example of spending optimisation from a small car company with a growing share…

+$ 5,520,121 Incremental Sales Value

Last 52 Weeks Scenario

Investment Change in Investment

Change in Incremental 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

[unit: 1,000 $ ]

52 Weeks (1 Year)

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Measurement comparability with other Media

Note: Figures may not add up to Total Audience due to rounding

All Adults Women 25-44

Total Audience: 24.9m Total Audience: 4.1m

1.6m 2.9m 20.4m 0.4m 0.5m 3.2m

TV TV

36% of those exposed to

the online campaign did

not see the TV campaign

12% saw both the Online

and TV campaign

Online

44% of those exposed to

the online campaign did

not see the TV campaign

12% saw both the Online

and TV campaign

Online

Source: Nielsen Incremental Reach

Base („000): All Adults (49,206), Women 25-44 (8,293)

Active Internet Individual Universe:

38,144,000

Observed Ad Impressions:

24,007,000

Delivery

Audience Reach: 4,120,000

Audience Reach: 11%

Average Exposure: 5.8

Online GRPs: 62.9

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SUMMARY

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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

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• “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 !!

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AdSolutions 2011

Peter Nguyen Manager, Nielsen Online, NM Incite

CENTRE POINT - 106 Nguyen

Van Troi St.

Phu Nhuan Dist. HCM. City,

Vietnam

For questions, please contact:

Peter Nguyen

fiickdotcom

Peter Nguyen

t: + 84 8 3997 8088 x: 8174

f : + 84 8 3845 5348

m: +84 977 550 665

e: [email protected]

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How Consumers REACT to Marketing. Understanding Marketing Effectiveness

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