OUTSMART Why Out-of-Home is a clever investment

Transcription

1 OUTSMART Why Out-of-Home is a clever investment

2 Program Introduction Econometric Methodology Econometric Global Results Australian Case Studies Summary

3 Overview of Econometric Methodology

4 BrandScience Global Econometrics Consultancy

5 Return On Investment ROI = Incremental Sales Revenue generated for each $1 of media cost

6 BrandScience Results Vault The BrandScience Results Vault is a collation of data from over 600 econometric studies. With this, we can provide a unique quantitative insight via meta-analysis into how different media drive sales independently and in combination with other media. We are able to use these to provide learnings on how Out-of- Home advertising works; relative to other media independently and in synergy with other media trends in effectiveness over time

7 How does BrandScience work? Step 1 Data Brainstorm and Collection Identification and collection of key data. Sales All data is cleaned, aggregated, harmonised and transformed into variables that can be modelled.

8 How does BrandScience work? Step 2 Multivariate Regression Analysis Determines which factors are statistically significant and the magnitude of each factor s impact on sales.

9 How does BrandScience work? Step 3 Model to quantify impact of each factor Turning results from statistics into marketing insight. TV Out-of-Home Direct Mail Radio Press Can be used to determine more effective marketing spend. S a l e s Price discount impact Base level Weeks

10 10 Global overview of ROI

11 Media Categories and Inclusions TV Commercials Pay TV and Regional Programme Sponsorship PRINT Magazines and Newspapers Advertising Advertorials Inserts RADIO Commercials Promotional / Sponsorship Campaigns ONLINE Websites / Content Banner Ads Sponsorship Competitions CINEMA Commercials OUT-OF- HOME Billboards Street Furniture Transit Retail Airport

12 Sales ROI Global ROI across media Global TV Print Radio Online Cinema Out-of-Home Average % media mix

13 Sales ROI Out-of-Home is highly effective in Telco Telco TV Print Radio Online Cinema Out-of-Home Average % media mix

14 Sales ROI Out-of-Home is a standout performer in Media Media TV Print Radio Online Cinema Out-of-Home Average % media mix

15 Sales ROI Out-of-Home supports direct response channels for Finance Finance TV Print Radio Online Cinema Out-of-Home Average % media mix

16 Sales ROI Out-of-Home provides strong support for Leisure & Entertainment Leisure & Entertainment TV Print Radio Online Cinema Out-of-Home Average % media mix

17 Sales ROI Out-of-Home is highly effective in Retail despite under representation in budget Retail TV Print Radio Online Cinema Out-of-Home Average % media mix

18 Sales ROI Out-of-Home performs strongly for Travel Travel TV Print Radio Online Cinema Out-of-Home Average % media mix

19 FMCG Findings

20 Sales ROI Global findings show Out-of-Home is the second most efficient media TV Print Radio Online Cinema Out-of-Home Average % media mix Sample Set: All FMCG Results Vault studies ( ) with measured Out-of-Home ROI

21 Sales ROI Out-of-Home improves ROI of other media Without Out-of-Home With Out-of-Home TV Print Radio Online

22 Sales ROI Higher Proportion of budget spend on Out-of-Home increases ROI Low (Under 8%) Medium (8-15%) High (15%+) Sample Set: All FMCG Results Vault studies ( ) with measured Out-of-Home ROI

23 Sales ROI In contrast, higher TV spend reduces TV ROI Low (Under 70%) Medium (70-85%) High (85%+) Sample Set: All FMCG Results Vault studies ( ) with measured Out-of-Home ROI

24 Sales ROI Out-of-Home is effective and efficient 2nd 2nd 2nd 1st 2nd TV Print Online Out-of-Home Sample Set: All FMCG Results Vault studies ( ) with measured Out-of-Home ROI

25 Out-of-Home delivers powerful results Out-of-Home delivers a high ROI across all categories It is an effective and efficient media channel in its own right Multiplies and expands the ROI of other media channels The more you spend in Out-of-Home the more it returns versus TV where the more you spend the lower the return

26 Memorable Campaigns

27 Out-of-Home is the second most memorable media 70% 49% 53% 53% 55% 35% TV Print Radio Online Cinema Out-of-Home For each week after an Out-of-Home campaign 55 percent is retained on average Sample Set: All FMCG Results Vault studies ( ) with measured Out-of-Home ROI

28 Message half life (Days) Out-of-Home extends the half life of your campaign Online TVC 30% longer Without Out-of-Home With Out-of-Home Sample Set: All FMCG Results Vault studies ( ) with measured Out-of-Home ROI

29 Out-of-Home delivers memorable campaigns Using Out-of-Home in combination with other media arrests the decay rates of a campaign This works particularly well for TV and online campaigns where we see a 30% increase in the half life

30 Out-of-Home as we work as we run errands as we travel as we socialise as we shop part of our everyday lives day and night weekdays and weekends

31 31

32 32 Combining econometric modelling with MOVE what do we see?

33 Australian Case Studies New Product Development

34 Australian Case Study: New Product Development Background: An established brand New range launch in an expanding market Creative goal to distinguish the brand from others Campaign: Multi-media approach TV, Out-of-Home and online Three week top heavy TVC followed one week later by two week Out-of-Home and online element

35 Australian Case Study: New Product Development Campaign Delivery: Budget ($000s) Audience Reach (%) TV Out-of-Home TV Out-of-Home Source: Oztam and MOVE

36 Australian Case Study: New Product Development Econometric results: Out-of Home delivered much greater reach efficiency than TV Out-of-Home delivered ROI two times greater than TV Synergies between the TVC, Out-of-Home and online campaigns increased the overall campaign ROI The multi-media platform established for this launch resulted in the brand going on to perform as a leader in its market

37 Australian Case Studies Spend Diversification

38 Australian Case Study: Spend Diversification Background: Historically brand had used 100% TV to drive sales Found diminishing returns when TV expenditure goes above $2m

39 Australian Case Study: Spend Diversification Actual Response

40 Australian Case Study: Spend Diversification Campaign: Shifted 20% of spend to Out-of-Home and radio in the second year Year 1 100% TV Year 2 80% TV 20% Out-of-Home + radio

41 Sales ROI Australian Case Study: Spend Diversification Campaign Delivery: % $2.40 $2.67 Year 1 (100% TV) Year 2 (80% TV)

42 Australian Case Study: Spend Diversification Econometric results: Spend diversification generated additional sales Moving 20% of funds out of TV into Out-of-Home and radio produced a large increase in the overall Sales ROI

43 Australian Case Studies Out-of-Home Synergy

44 Australian Case Study: Out-of-Home Synergy Background: Launch of new line extension Significant spend allocated to drive high awareness Campaign: Multi-media campaign with strong synergies Out-of-Home used from start along with TV and online

45 Australian Case Study: Out-of-Home Synergy Campaign Delivery: Budget ($000s) Audience Reach (%) TV Out-of-Home TV Out-of-Home Source: Oztam and MOVE

46 Sales ROI Australian Case Study: Out-of-Home Synergy Campaign Delivery: TV Print Radio Online Cinema Out-of-Home Average % media mix

47 Australian Case Study: Out-of-Home Synergy Econometric results: Out-of-Home provided very good support to the TVC during the launch Out-of-Home worked in 3 key ways to provide strong payback for the client; 1. Strong direct ROI 2. Increased the memory of the TVC 3. This Out-of-Home/TV synergy accounted for 10% of the TVC ROI

48 48 UV Tripleguard s case for avoiding the sea of sameness

49 49 Recency Research The Last Window of Influence

50 Any Ad Recall vs 30 mins Ad Recall by Media The Last Window of Influence All Shoppers 79% 76% % Recall % Recall 30 mins 40% 53% 51% 48% 43% 4% 3% 8% 4% 2% Source: Helen Harrison Associates, July 2011, 604 intercept shopper interviews, 4 UK locations

51 30 mins Ad Recall by Media The Last Window of Influence Outdoor TV Newspaper Radio Internet Magazines 88% 10% 6% 18% 8% 5% Base: All aware any advertising any media last 30 mins

52 The Outdoor Ad Aware 30 minutes Shopper - Likelihood to Visit Retailers INDEX vs. All Shoppers Mobile phone / telecom stores 112 Banks / building society 111 Fast Food outlet 111 News agent / convenience store 110 Fashion/clothes shops 98 Supermarket 97 Chemist 91 Travel Agents 85 Base: Outdoor Ad Aware 30 mins (240)

53 Retail Visitors Outdoor in last window of Influence has potential to be highly effective % More likely to find out more about a brand having seen Outdoor in past 30 mins % More likely to buy having seen Outdoor in past 30 mins Chemist 81% 56% Newsagent / convenience store 75% 55% Mobile phone / telecom stores 74% 71% Fashion/clothes shops 69% 62% Fast Food outlet 69% 51% Supermarket 68% 60% Banks / building society 67% 65%

54 Attitudes to Shopping: only 13% not susceptible to last window of influence All Shoppers (604) (366) Men (294) Women (310) I usually plan in advance everything I want to buy and only buy things on my list I sometimes make unplanned purchases but mostly stick to my shopping list I often buy something that's not on my shopping list I usually don t make a shopping list or plan, and just buy spontaneously 13% 9% 17% 8% 29% 26% 28% 30% 18% 21% 16% 20% 39% 43% 37% 41%

55 Summary Outdoor Key Points Outdoor is the key medium to reach shoppers in the 30 mins prior to purchase. 40% of shoppers see outdoor in the last window of influence. Next highest is radio with 8% Outdoor dominates ad exposure in last 30 minutes, reaching 88% of those exposed to any ad Only 13% of adults not susceptible to last minute influence, and only 8% of women and 9% of s Awareness of outdoor advertising during this pre purchase period increases the likelihood to find out more about a product and to buy a product

56 Summary "I know that half of our advertising is wasted. The trouble is that I don't know which half. Lord Leverhulme

57 Key take outs 1. Out-of-Home delivers ROI and memory as a stand-alone medium and a media multiplier 2. The higher the budget spend on Out-of-Home the larger the return on investment

58 Questions Questions

59 Questions Appendix

60 Measuring media impact with diminishing return To take into account the longer memory of advertising campaign, media variables are adstocked. i.e. TARPs with the following pattern are included in the model as continuous series similar to the one below The exact shape of selected time series depends on the retention rate. To calculate this we test models with a variety of retention rates to see which best fits the memory of a given campaign. This gives up the longevity of all advertising campaigns.

61 % Carryover With the retention rates of advertising we can estimate the half life of the campaigns. 100% 90% 80% 70% 60% 50% 40% 30% 20% HALF LIFE 4 Days 6 Days 7 Days 10 Days 10% 0% DAYS The half life explains the gradual decay of memory until the advertising impact is half that of the initial impact.

62 Production costs are included in outdoor ROI calculation but not other channels. An approximate average outdoor production cost is 10 percent. This tends to be included into the calculation of the ROI. However for other media channels such as TVC the production cost is excluded from the calculation. As a rough guide these are generally between 5 to 10 percent of total costs. By estimating ROI with and without these costs at a global scale the ROI s for outdoor and TVC change accordingly: With production costs Without production costs Outdoor Global FMCG results With production Without costs production costs TVC By accounting for production costs in both TVC and outdoor in the global results we see outdoor becomes 10 to 15 percent more efficient than TVC; increased from the earlier calculation of 6 percent. Extra costs often excluded in ROI calculation include licensing fees, insurance fees, creative and production costs.

63 OUTSMART Why Out-of-Home is a clever investment