Making the most of in-market formats

Whilst it makes sense that targeting in-market consumers should lead to a strong uplift, we have proved this makes sense from a budgeting and cost efficiency point of view too.

For this Automotive client, we tested the impact of online display ads across premium automotive sites and compared this to ads run on non-automotive sites.  Whilst there is a higher cost premium for this specific targeting we found there remained a 70% cost efficiency improvement on the targeted sites.

This does not mean we should put our entire budget into premium automotive display though - they experience different response rates and there is limited inventory available.  As a general rule, we recommend around half of the display budget should be allocated to premium automotive sites.

 

INSIGHTS: PR

FOUR things you need to know about PR:

1.PR will impact BRAND METRICS which in turn will drive the future demand for the brand

2.PR will have a DIRECT impact on response

3.PR will have an INDIRECT impact on other comms by improving their efficiency

4.PR will drive online engagement

ON THE PLUS SIDE: POSITIVE PR IMPROVES MEDIA EFFICIENCY BY 1.4%

A recruitment client found that PR not only had a direct effect on applications, but the combination of media and PR simultaneously improved media efficiency by 1.4%.

A retail client saw an even stronger impact on it’s media activity. While running a media campaign, the brand drove strong PR activity which backed up the claims in their campaign, leading to media efficiency improving dramatically and ROI increasing by 50%. 

 

 

 

 

An entertainment brand found PR was the most efficient channel at driving awareness and intent to purchase. 

By increasing these metrics, the demand pool for the product grew.

As a result, increasing awareness by 1% increased sales by an average 2.5% across different products and increasing intent to purchase by 1% increased sales by an average of 1.3%.

 

 

ON THE FLIP SIDE: NEGATIVE PR RESULTS IN ALMOST £2MN LOST REVENUE

1.3%.

A wide ranging industry scandal impacted on a retailer experiencing a loss of revenue in both the short term and long term. 

Immediately they lost £1.5mn due to a reduction of visitors to the stores.This reduction of visitors continued for a period equating to an additional loss of £150k.

They also saw consideration for the brand to drop by 4ppt. It took 2 years to recover to the original level , resulting in an additional longer term loss of £230k.

 

 

Media Synergy: The multiplicative effect of a cross media campaign

The concept of media synergy has been around for years. Media synergy arises when the combined effect or impact of a number of media activities is greater than the sum of their individual effects on consumers. Thus, synergy is a phenomenon in which the whole is greater than the sum of the parts.

A number of factors will influence which media channels fit the job for the campaign. The impact of the media in combination with other media is one of these key factors. Using a statistical approach, we detected this synergy for a major healthcare brand by demonstrating that when TV is aligned with other media channels the combination drives additional sales uplift above their individual contributions. However, this “synergistic bonus” is different depending on the combination in question: TV/Digital gets the highest boost followed by TV/OOH, TV/Radio, TV/Press and TV/mags respectively. This allows us to choose the combination with the biggest impact on sales. 

The synergistic effect can extend beyond just combinations of two channels. When we build in diminishing returns we can optimise the right combinations to maximise the return from the marketing investment.

Optimising the Pricing Strategy: Credit Cards

When a product has a number of different attributes, it is important to understand the importance that the consumer puts on each one and how this informs their decision making when deciding on which brand to buy. We worked with a credit card provider to optimise their product proposition and delivered a 30% improvement in cost per sale.

Credit card marketers often find themselves struggling to select the most attractive proposition for new customers, as each card carries a broad range of attributes. Understanding which attributes are important to consumers are important as it impacts on the messaging and offer positioning.

Business Science used Conjoint analysis (a research based tool) for this credit card provider to determine how customers judged each attribute of their product offering, thereby allowing marketing to promote the optimal proposition.

Over 1000 consumers were asked which offer would they would pick, out of 2 options, given all the attributes listed. This was asked to each respondent 20 times giving a large robust sample of which to understand the strength of each attribute. 

THE RESULTS

The APR was identified as being the most important attribute in the decision making process, followed by the number of balance transfer months and level of fee. 

The credit card was launched focusing on the APR as its USP. By building this into the econometric study, we identified that this made the media more efficient, delivering a 30% improvement on cost per sale.

Systems measurement: TV Response: New Rules, New Roles

By applying systems thinking, we were able to identify the impact that media drives at all stages of the consumer journey. 

In 2015, we undertook a 10 month project for Thinkbox to define the role of response in the world of the multi-device, always connected consumer. Due to the far reaching impact of advertising we knew that it was important to measure response over 3 time horizons, immediate, short term and long term. This meant we captured the impact from the moment an ad aired right up until 2 years after the campaign. This is the only way to ensure we are measuring the full ROI from the marketing investment. 

Our findings were exciting and backed up all of our initial thoughts: media really does drive response at every stage of the consumer journey. 

Lets take TV as an example. TV on its own will drive consumers to purchase within the retail stores and online. However, it will also drive consumers through the online channels. Consumers will search for a brand after seeing a TV ad; it will lead them to click on a display ad or click through an affiliate. And it doesn't end there, TV will still drive sales up to 2 years after the campaign has aired. It isnt just TV driving response in this way, other offline media does the same job as illustrated in our systems diagram above. 

No media can be planned in isolation. We need to plan and measure in systems and not silos.

Optimising the Marketing Budget for a Major High Street Retailer

One of the countries largest retailers required help with their budget setting process, including how much to spend, which products to support and against which media channels. Over a two year period, by implementing our recommendations from the Econometric and Optimisation analysis, they were able to more than double their ROI.

First and foremost, to understand the key drivers of sales, Business Science built 50 econometric models, covering their key product areas and sales channels. The results of the models were then fed into a bespoke optimisation tool which allowed the client to optimise the marketing budget against short and long term sales targets.

The client was spending £30m a year on media. Through a series of workshops, the tool demonstrated that much of this budget was supporting sub-optimal product areas, leading to significant inefficiencies.

THE RESULT

Over 2 years, through implementing the recommendations from the optimisation, the client has improved the ROI by 242%, more than doubling their return from marketing investment, both in the short term and the long term.

Budget setting for a major insurance brand

The marketing director felt that marketing of the brand should be moved away from the traditional, short term 'direct response' focus to a more long term 'brand' approach.

A major insurance brand, being a subsidiary of a much larger multinational insurance house historically had its marketing budget set by its parent company. Whilst the brand had historically performed very well, the marketing director of the brand wished to push performance even further by optimising both the budget level it received and the way in which this budget was allocated across marketing lines. 

The major insurance brand therefore wished to understand how its current marketing strategy was working both in terms of creating a short term uplift in insurance sales and in terms of altering longer term brand perceptions. The marketing director wished to use these learnings to both optimise the way in which the existing marketing budget was used in terms of marketing line and product split, as well as use it to build a case for increased investment in the brand.

Business Science used the insurance brand's data to create a series of models geared toward measuring both the short term and long term impact of marketing spend. Models were therefore constructed to measure marketing spend performance right through the 'purchase funnel' by measuring the impact of spend on upper funnel metrics such as awareness and consideration through to quotes (the 'attraction' role of marketing) and ultimately sales (the 'conversion' role of marketing). Moreover, through analysis of how historical responses have varied as the level of investment has varied, Business Science were able to develop a series of response curves for the different marketing investment types by sales channel and product. These marketing response curves were brought together to create a marketing optimiser that allowed the insurance brand to examine how spend should be allocated across the different products, channels and marketing initiatives. The marketing optimiser also enabled the insurance brand to examine what level of budget would be required to reach the brand performance targets that had been set.

THE RESULT

Business Science's work enabled the insurance brand to optimise their current investment strategy by allocating budgets in the most efficient way across the different product, channel and marketing investment lines, thus boosting the profitability of the brand. In addition, the marketing director was able to use the work to prove a case for additional investment in the brand, something which resulted in a 19.2% increase in budget allocation from the parent insurance house.

Understanding the effect of marketing communications on brand perceptions

An energy company wanted to understand the effect of its corporate campaigns on key tracked consumer metrics such as spontaneous awareness, brand perceptions and a series of image statements geared toward measuring the 'environmental' image of the brand.

In line with the recent growth in corporate and social responsibility, a major multinatonal energy company invests in a range of communications aimed at raising awareness and perceptions of its brand through its sustainable energy policies. Whilst such an investment is not aimed at boosting sales of its core energy products, the energy company nonetheless needed a way of measuring the success of its corporate campaigns.

Business Science developed a series of statistical models aimed at establishing a correlation between the key metrics and spend on the different media elements of the corporate campaign, a measure of the brand's public relations presence and any major news events that had taken place over the past two years. Given the multinational footprint of the brand, these models were developed for a number of markets across the globe, selected on the basis that they would be representative of the wider markets the energy company operate in.

THE RESULT

The results of the modelling have given the energy company a much deeper view of the factors which most strongly influence the performance of key consumer metrics. They can now understand what communications channels they can leverage to improve metric performance. The modelling forms the basis of setting performance targets for corporate spend in subsequent years, and as a means of setting budgets for the different markets the energy company operates in.

Boosting sales growth within a High street retailer

A retailer wished to know exactly what was driving sales performance for its given product lines in any given week. This meant explaining why sales had stagnated for certain product lines and how this situation might be improved by investment in the most appropriate marketing activities.

A well known high street retailer, having seen sales for some of its core product lines stagnate, wished to understand how it might boost sales growth by determining which factors had historically helped sales performance and which factors had detracted away from it. This was no easy task given that sales of the retailer could have been influenced by a range of factors such as the retailers marketing activity, the highly competitive nature of the marketplace, seasonality or indeed the health of the economy as a whole.

Business Science developed a series of marketing mix models for each of the core product lines by overlaying factors such as pricing, seasonality, distribution, marketing activity, economic health and competitor activity against weekly sales. These models allowed Business Science to attribute product sales in any given week to each factor considered so that an incremental sales benefit could be attached to each (i.e. how much of sales in a week were down to marketing, how much to pricing, how much to seasonality etc). In addition to determining which factors had had the biggest impact on sales, this facilitated calculation of the ROI of each element of marketing activity so the retailer could establish which activities were working best.

THE RESULT

The retailer used the information provided by Business Science to overhaul its marketing strategy and re-invest its marketing budgets in the most efficient marketing activities. Moreover, the analysis provided by Business Science is now seen as an integral component of the marketing planning process, with Business Science providing updated analysis four times a year to help the retailer understand what has worked well, what hasn't and to ensure the best marketing investment strategy is implemented each time.