Profit Ability: the business case for advertising

Transcription

1 Profit Ability: the business case for advertising

2 TV creates 62% of short-term profit at the highest efficiency (all categories) SHORT-TERM PROFIT ROI EFFICIENCY Radio: 5% Online Video: 5% Online Display: 2% OOH: 3% Print: 22% 0% 10% 20% 30% 40% 50% 60% 70% Ebiquity ROI campaign database (Feb 14-May 17). Campaign obs: 1954 % OF BUDGET TV: 62% Bubble size represents % of short-term return BREAK EVEN

3 TV delivers 85% of short-term profit for FMCG brands SHORT-TERM PROFIT ROI EFFICIENCY Radio: 1% Print: 3% Online Video: 3% OOH: 7% 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% Ebiquity ROI campaign database (Feb 14-May 17). FMCG. Campaign obs: 606 % OF BUDGET TV: 85% Bubble size represents % of short-term return

4 TV drives short-term profit for Financial Services brands SHORT-TERM PROFIT ROI EFFICIENCY Radio: 6% Online Video: 5% Online Display: 1% OOH: 3% Print: 20% 0% 10% 20% 30% 40% 50% 60% 70% Ebiquity ROI campaign database (Feb 14-May 17). Financial Services. Campaign obs: 371 % OF BUDGET TV: 66% Bubble size represents % of short-term return BREAK EVEN

5 Radio, TV & Print are key to Retail brands short-term profit SHORT-TERM PROFIT ROI EFFICIENCY Radio 7% OOH: 2% Online Video: 4% Online Display: 3% Print: 24% 0% 10% 20% 30% 40% 50% 60% 70% Ebiquity ROI campaign database (Feb 14-May 17). Retail. Campaign obs: 625 % OF BUDGET TV 59% Bubble size represents % of short-term return BREAK EVEN

6 TV creates half of all the short-term profit for Travel brands SHORT-TERM PROFIT ROI EFFICIENCY Online Video: 8% Radio: 4% OOH: 7% 0% 5% 10% 15% 20% 25% 30% 35% 40% 45% 50% Ebiquity ROI campaign database (Feb 14-May 17). Travel. Campaign obs: 156 Print: 22% Online Display: 8% % OF BUDGET TV: 52% Bubble size represents % of short-term return BREAK EVEN

7 Short-term profit ROI delivered by channel and category FINANCIAL SERVICES FMCG RETAIL TRAVEL TV RADIO PRINT ONINE VIDEO OUT OF HOME ONLINE DISPLAY ALL MEDIA Ebiquity ROI campaign database (Feb 14-May 17). Campaign obs: 1954

8 TV s unrivalled scalability INCREMENTAL PROFIT RETURN 18,000,000 16,000,000 14,000,000 12,000,000 10,000,000 8,000,000 6,000,000 4,000,000 TV Radio Press Online Video Online Display OOH 2,000, ,000,000 4,000,000 6,000,000 8,000,000 10,000,000 Ebiquity ROI campaign database. Financial Services example SPEND LEVEL

9 TV is the most efficient channel at low levels of spend MARGINAL PROFIT RETURN TV Radio Press Online Video Online Display OOH ,000,000 4,000,000 6,000,000 8,000,000 10,000,000 Ebiquity ROI campaign database (Feb 14-May 17). Financial Services example. Campaign obs: 371 SPEND LEVEL

10 TV is the safest investment in the short term MAX Inter-quartile range SHORT-TERM PROFIT ROI BREAK EVEN ALL TV RADIO PRINT OOH ONLINE DISPLAY Ebiquity ROI campaign database (Feb 14-May 17) Campaign obs: 1954 ONLINE VIDEO 0.00

11 THE PROPORTION OF TOTAL PROFIT REVEALED BY ATTRIBUTION MODELLING AND ECONOMETRICS 18% ATTRIBUTION MODELLING 42% SHORT-TERM ECONOMETRICS The majority of advertising returns (58%) occur in the long term. 100% LONG-TERM STUDIES Gain Theory Long Term ROI study. 29 Advertisers, 504 campaigns

12 TV has the largest long-term multiplier (all categories) Average longterm multiplier LONG-TERM MULTIPLIER ALL TV RADIO PRINT OOH ONLINE DISPLAY ONLINE VIDEO There are no examples in the data of PPC driving long-term response Gain Theory Long Term ROI study. 29 Advertisers, 504 campaigns

13 OOH, TV & Online Video deliver high long-term multipliers for FMCG FMCG longterm multiplier LONG-TERM MULTIPLIER ALL TV RADIO PRINT OOH ONLINE DISPLAY ONLINE VIDEO Average longterm multiplier There are no examples in the data of PPC driving long-term response Gain Theory Long Term ROI study. FMCG. 5 Advertisers, 31 campaigns

14 TV and Online Video deliver significantly higher longterm multipliers for Retail brands Retail longterm multiplier LONG-TERM MULTIPLIER ALL TV RADIO PRINT OOH ONLINE DISPLAY ONLINE VIDEO Average longterm multiplier There are no examples in the data of PPC driving long-term response Gain Theory Long Term ROI study. Retail. 8 Advertisers, 204 campaigns

15 OOH & TV have the highest long-term multiplier for Financial Services brands Financial Services longterm multiplier LONG-TERM MULTIPLIER ALL TV RADIO PRINT OOH ONLINE DISPLAY ONLINE VIDEO Average longterm multiplier There are no examples in the data of PPC driving long-term response Gain Theory Long Term ROI study. Financial Services. 5 Advertisers, 219 campaigns

16 TV is the safest investment in the long-term (all categories) LONG TERM MULTIPLIER ALL TV ONLINE VIDEO DISPLAY PRINT OOH RADIO Inter-quartile range (25% to 75% of LTM) There are no examples in the data of PPC driving long-term response Gain Theory Long Term ROI study. 29 Advertisers, 504 campaigns

17 Proportion of advertising-generated profit by medium TOTAL PROFIT ROI EFFICIENCY Online Video: 4% OOH: 3% Radio: 3% Print: 18% TV: 71% Bubble size represents % of total profit Total profit = all return (short + long-term) generated over 3 years BREAK EVEN Online Display: 1% 0% 10% 20% 30% 40% 50% 60% 70% Ebiquity ROI campaign database (Feb 14-May 17) & Gain Theory. Campaign obs: 1,954 % OF BUDGET

18 Proportion of advertising-generated profit by medium - FMCG 2.00 TV: 87% Bubble size represents % of total profit TOTAL PROFIT ROI EFFICIENCY Online Video: 3% Print: 3% OOH: 7% Total profit = all return (short + long-term) generated over 3 years BREAK EVEN % 10% 20% 30% 40% 50% 60% 70% 80% 90% Ebiquity ROI campaign database (Feb 14-May 17). FMCG campaign obs: 606 % OF BUDGET

19 Proportion of advertising-generated profit by medium - FS TOTAL PROFIT ROI EFFICIENCY Radio: 4% Display: 1% Online Video: 3% OOH: 3% Print: 18% TV: 71% Bubble size represents % of total profit Total profit = all return (short + long-term) generated over 3 years BREAK EVEN % 10% 20% 30% 40% 50% 60% 70% Ebiquity ROI campaign database (Feb 14-May 17). Financial services campaign obs: 371 % OF BUDGET

20 Proportion of advertising-generated profit by medium - Retail TV: 71% Bubble size represents % of total profit TOTAL PROFIT ROI EFFICIENCY Online Video: 5% Radio: 4% OOH: 2% Display: 1% Print: 16% Total profit = all return (short + long-term) generated over 3 years BREAK EVEN % 10% 20% 30% 40% 50% 60% 70% Ebiquity ROI campaign database (Feb 14-May 17). Retail campaign obs: 625 % OF BUDGET

21 % of campaigns delivering positive payback across the short and long term CATEGORY ALL TV RADIO PRINT OUT OF HOME ONLINE DISPLAY ONLINE VIDEO NUMBER OF CAMPAIGNS FMCG 52% 67% 35% 16% 40% 5% 57% 606 FINANCIAL SERVICES 79% 92% 77% 78% 71% 40% 73% 371 RETAIL 82% 96% 86% 87% 76% 54% 68% 625 ALL 72% 86% 75% 78% 48% 40% 67% 1,954 Ebiquity ROI campaign database (Feb 14-May 17) & Gain Theory. Campaign obs: 1,954

22 Including the long-term effect reveals the true impact of advertising SHORT TERM ONLY INCLUDING LONGER TERM NET PROFIT (PER YEAR S SPEND) MILLIONS FMCG FS RETAIL FMCG FS RETAIL ASSUME AVERAGE ANNUAL SPENDS FMCG ( 3.1m), Financial Services ( 4.8m), RETAIL ( 6.5m) MILLIONS Ebiquity ROI campaign database (Feb 14-May 17) & Gain Theory. Campaign obs: 1,602

23 There is a strong case for increased TV investment across key sectors CURRENT SHORT-TERM ONLY SHORT & LONG C. 75% C. 85% C. 95% C. 54% C. 65% C. 75% C. 55% C. 50% C. 65% Ebiquity ROI campaign database (Feb 14-May 17) & Gain Theory. Campaign obs: 1,602

24 Key findings TOTAL AD-GENERATED PROFIT (WITHIN 3 YEARS) SHORT-TERM AD-GENERATED PROFIT (WITHIN 3 6 MONTHS) % OF BUDGET % OF PROFIT AVERAGE PROFIT ROI PROFIT LIKELIHOOD % OF PROFIT AVERAGE PROFIT ROI PROFIT LIKELIHOOD NUMBER OF CAMPAIGNS TV 54% 71% % 62% % 1,280 PRINT 23% 18% % 22% % 980 OUT OF HOME 8% 3% % 3% % 580 ONINE VIDEO 6% 4% % 5% % 158 RADIO 5% 3% % 5% % 540 ONLINE DISPLAY 4% 1% % 2% % 330 ALL MEDIA 100% 100% % 100% % 1,954 Source: Profit Ability Report