CROSS MEDIA OPTIMIZATION RESEARCH:
ACHIEVE BETTER RESULTS WITH THE SAME AMOUNT OD MONEY - ALLOCATE BUDGETARY PROPORTIONS WITIHIN MEDIA MIX
One of the largest and revolutionary media mix market research CrossMedia Optimization Research (XMOS) confirmed a long known but never before outspoken and evidenced fact: to improve your media mix results you have to invest more in internet advertising.
The objective of the CrossMedia research is to help marketers and their agencies answer the eternal question: “What is the optimal media mix in terms of frequency, reach and budget allocation for a campaign to achieve its marketing goals?
Key findings of the research are: for maximum return of investment in advertising, companies should increase investments into internet advertising from the current 1-3 percent of advertising budget to 10-15; internet is the most effective supplement to traditional media advertising; the use of traditional media and internet together brings synergy, because the effect of joint activity is bigger then sum of single parts.
The research was done by MSN and awarded research expert Rex Briggs of Marketing Evolution company, in cooperation with Dynamic Logic company, the Advertising Research Foundation (ARF) and the Interactive Advertising Bureau (IAB). With the use of a distinguished and precise research methodology, which was nominated for the best international research by ESOMAR (European Society for Opinion and Marketing Research), the goal of the research was to determine the way to improve efficiency of integrative marketing campaigns that combine internet and traditional media (press, TV and or radio). With simultaneous measuring of traditional media and internet in many advertising campaigns, optimum media mix and the position of each medium in it were determined and set.
XMOS enables a valuable insight into the integrated marketing campaigns and gives answers to questions such as:
XMOS RESEARCH WAS DONE IN THREE PARTS
First part
The first part of research that ended in 2001 included Unilever's Dove Nutrium soap. The advertising campaign included television, print, and interactive advertising. The objective of the campaign was to increase key brand parameters: awareness (spontaneous brand recall and recall with help), brand image (soap containing vitamin E, two soaps in one, it nourishes your skin, it is for people just like you, it keeps your skin healthy), and purchase intent. At the same time they wanted to determine the optimal allocation of budgetary proportions within media mix.
The final results of the study’s first advertising campaign were unquestionable: internet advertising was of significant contribution to the response of target audience to brand. The campaign that used print, television and internet ads increased brand awareness for 3 percent. The brand image increased for 13 percent during the campaign. The purchase intent as the most important parameter increased for 3 percent as well.
The most important finding is that a different allocation of budgetary proportions in media mix using the same amount of money led to better results. For Dove that would result in: by increasing the internet reach to 60 percent the brand parameters would increase for 5 percent. By increasing frequency from 1.7 to 3.1 the brand parameters would increase for 3 percent. The combination of both, the reach and frequency, would result in an 8 percent increase. So they reccommended this brand to increase the share of the internet budget from 2 to 15 percent.
Second part
The second part of the research included a survey and media mix optimization of three brands: Colgate Total toothpaste, McDonalds’ new sandwich and Kleenex tissues.
The objective of the campaign for Colgate Total was to increase purchase intent of occasional users and non-users of the toothpaste. The biggest share of budget was for television advertising, the internet got 7% of the budget. Final results showed that TV advertising reached 75 percent of target audience, the rest of 25 percent were totally missed. At the same time 15 percent of those reached through television were not exposed to ads enough (frequency was to low). The result was the media mix optimization, which led to the following conclusions: 1. Print and internet advertising supplement TV's reach and coverage, but with the fact that internet is much more effective and is lower in cost at reaching target audience. Also internet is very efficient and successful at generating purchase intent within the target group (Colgate would have 23 percent more cost to encourage consumer purchase using TV advertising only and even 84 percent more when using print.) 2. Internet advertising is more effective at achieving key brand parameters and it reaches more than half of those consumers that are not exposed enough to TV ads. By allocating seven percent of the budget to internet (plus advertising in other media), purchase intent increased to nine percent in comparison to advertising in traditional media. By increasing internet allocation from seven to eleven percent (that is the optimum level for this brand), purchase intent would increase for twenty percent and the brand image would increase for 34 percent in comparison to only using TV and print advertising.
The objective of McDonalds’ campaign was to increase product awareness (new sandwich). In the campaign internet had only 1% of budget. But the research revealed that by increasing budgetary proportion for internet from one to 13 % product awareness would boost for 5% ,which is 3% more in comparison to the same budgetary funds for TV ads. This would result in six million more consumers becoming aware of the product. And another interesting revelation of this research: with the use of internet ads consumers can be addressed emotionally, too.
The objective of the third campaign – for Kleenex tissues was to build awareness for Kleenex Soft Pack, improve brand parameters and gain more customers to use tissues. The research revealed that internet is a central medium that is able to efficiently reach segments of those consumers that television ads cannot cover (around 40% of all target consumers). Television and print can reach approximately the same number of target consumers and both produce similar results regarding brand parameters. But internet is more cost-effective and is therefore more efficient at supplementing TV advertising. But the best results would be achieved by supplementing TV advertising with both, internet and print. Final finding of the research is that increasing internet allocation using the same budget, results in increasing the return of investment (ROI). After the research it was suggested to Kleenex to increase budgetary proportions for internet from one to 10 percent.
Third part
The third part of the research done last year also included the following large companies: Ford with its new car F-150 pickup truck, Coca-Cola with the new drink Light Lemon, GlaxoSmithKline with Sensodyne toothpaste, Philips with a personal care product, Universal Studios with the new E.T. movie, the Extra-Terrestrial on DVD, VeriSign and others.
After research results those companies were also recommended to allocate budgetary funds in media mix: more funds (10-15%) should go for internet for optimization of marketing campaign results. The synergy was revealed also in these cases: optimal results are reached by simultaneously using traditional media and internet.
Why does an increased investment into internet advertising improve results at using a static budget in media mix?
1. COVERING: internet covers those consumers that would not see TV ads or would not be exposed to them enough;
2. EFFICIENCY: internet advertising brings benefits in improving brand parameters;
3. VALUE: internet advertising is in general more cost-efficient at achieving final goals regarding brand parameters
4. SYNERGY: the use of traditional media and internet together brings synergy results which are bigger then the sum of single parts.
According to the XMOS research, the recommended optimal budget allocation in media mix for the majority of products with low consumers’ involvement is:
|
|
TV |
|
Web |
|
Colgate |
75% |
14% |
11% |
|
Kleenex |
70% |
20% |
10% |
|
Dove |
72% |
13% |
15% |
|
|
TV |
Radio |
Web |
|
McDonalds |
71% |
16% |
13% |
It is evident that optimal results are achieved when internet advertising has 10-15% of budget in the marketing mix. The percentage can vary for products regarding different marketing goals, different budgets available, different target consumers’ characteristics and other factors.
The research also indicated that internet budget in media mix is increased when advertising products with higher involvement of consumers (technology, automotive …).
The key finding: the majority of marketers invest too little in internet advertising. By not investing enough in internet advertising, they are not saving; they are only accepting a media mix that is not an optimal one.