In the  2010s there may be no better mantra for the marketing function than the old adage “work smarter, not harder”.  Faced with stagnant (or declining!) budgets and staff levels, it is no longer practical to use brute force ad spending to drive marketing returns.  Instead marketers are seeking ways to apply new technology to existing data so as to squeeze out every drop of value.  Towards this end, we are providing all TouchPoint Plus copytest users free consulting with the newly patented Outlook® Media Planning and Forecasting tool.   Below are three examples of how this is being used to help television advertisers immediately ramp up returns with no additional outlay of time or money.

Customized ad refreshment schedules.  It is now well established that the selling power of an ad diminishes as media is placed behind it.  To avoid wasting too much spend behind worn out ads, rules-of-thumb have been created (e.g. not airing an ad for over 1200 GRPs).  Such broad rules are ‘generally right, but specifically wrong’ in that they neglect the fact that each ad wears out at a different absolute rate depending on its strength.  The Outlook application uses this knowledge to algorithmically find the optimal allocation across available ads, sometimes yielding millions in additional sales.

Mix of different length ads.  Facing pressure to reduce paid media while expanding effective reach, many advertisers are rediscovering the cost effectiveness of shorter length ads.   At 60% to 70% of the media cost of their 30-second counterpart, 15-second ads are particularly attractive for stretching a media budget.  But since shorter length ads generally underperform their longer counterparts there is a risk that overuse will actually suppress returns not expand them.  Generalizations fail to address the problem as they don’t take into account the size of the campaign, the number of ads available, or brand specific effectiveness ratios.  A module within the Outlook application simplifies this decision and, even at the very early planning stage, provides a specific recommendation taking all these variables into account.  As an example, this below scenario finds that a 45%/55% 15 vs. 30-second GRP mix is optimal (this equates to an approximate $3.5 Million / $6.5 Million split for this brand’s planned $10 Million campaign).

Dynamically adjusted media budget.  One of the biggest ROI squelchers is not being able to take full advantage of ‘home run’ creative when it is found.  Without quantification of potential sales impact, management is likely to be risk adverse and not approve reallocation of resources from other marketing activities to advertising.  By projecting likely sales returns, the Outlook forecasting capability translates advertising plans into the language of business.  The end result is greater confidence by management that the switching of resources within marketing, or even boosts to the overall marketing budget, are warranted.   A classic published example of this comes from StarKist Tuna in a Pouch:

The Precision of the model makes it useful in planning the optimal number of executions for a given media plan, planning the optimal allocation of media among advertisements, and determining when commercials have worn out and should be refreshed.  In our case, the model revealed not that out ad had worn out, but that it had a significant amount of selling power left.  In fact, the planning software projected that our “Fisherman’s Wharf” execution still retained over 80 percent of its selling power!  We took this recommendation to management, and they approved a few more million dollars for our TV media budget.  The ad went back on air in January.  Tuna in a Pouch share gain for the following quarter was 1.3 points, a bit higher than the Outlook estimate of 1.0 points for the expected advertising contribution.¹

The end result for StarKist was a 368% return on their investment.  This was versus a 76% return without the increase in spend and an expected break-even had the traditional approach been done.

The above highlights just three of the many ways that Outlook planner can help boost marketing returns.  But hopefully they illustrate that the technology exists to help meet today’s ‘less must be more’ reality.

¹A true return on investment… Developing and managing advertising for StarKist Tuna in a Pouch, Barry Shepard.  Quirk’s March 2003.  Bold emphasis added.

Lake Success, NY, April 24, 2014 – MSW●ARS Research, has been awarded U.S. Patent, #8,676,638 for the system and method underlying the innovative Outlook® Media Planner.

The Outlook Media Planner is an app that enables marketers to run multiple “what-if” scenarios to determine the likely impact their advertising will have on sales and market share.  The Outlook Media Planner can be used as an upstream tool, while advertising is in development, or as a downstream tool, after ads have been produced and are ready for airing.  Marketers can use these “what if” scenarios to optimize total media weight as well as the distribution of weight among all the ads in a plan.

How does it work?

The Outlook Media Planner applies proven algorithms to key marketing variables in the context of media costs and the brand’s current market position.  It incorporates the newest learnings on advertising strength, effective media weight, wearout, continuity and competitive environment to estimate an advertising plan’s likely quarterly impact on the bottom line.  The application is modularized to answer a variety of common marketing questions such as:

What if my budget gets cut; can I still make my numbers?

• What amount of media spend is necessary to meet my business objectives?
• How many ad executions will I need?
• When will my ads need to be refreshed with new ones?
• What will the sales impact be this quarter?
• What’s the optimal allocation of GRPs between my 30 and 15-second television ads?

Frank Findley, Vice President Research & Development at MSW●ARS and co-inventor added “Up till now marketers were forced to use blunt rules of thumb for ad planning and forecasting.  The data was available for a more rigorous approach but the complexity made it difficult and time consuming to do.  The Outlook Media Planner automates the process making it fast and convenient.”

About MSW●ARS Research, Inc.

MSW●ARS offers a product suite that evaluates, quantifies and optimizes the impact of advertising messages and campaigns comprised of any combination of touch points, including television, print, radio, outdoor and digital.  MSW●ARS helps marketers build brands by providing world class research solutions in the following areas: brand strategy, all stages of creative development from early concept to fully finished ads, campaign evaluation across all marketing and media channels, advertising and brand equity tracking, media planning and strategy, return-on-investment and forecasting.  The company provides solutions and consulting to marketers across traditional and digital marketing including: media mix optimization, media budget allocation, media and message connection, channel selection, digital media and emerging platforms.

MSW●ARS techniques are the world’s most widely documented and independently validated predictive measures of the effectiveness of advertising creative and have been equated with higher sales and market share through third-party validation.

MSW●ARS has a roster of marquee clients representing virtually every product category, including: Consumer Packaged Goods, Retail, Financial Services, Telecommunications, Technology, Automotive, and Pharmaceutical industries.

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Not since the advent of the television ad in 1941 has the potential for new ad formats been so great.  The emergence of digital platforms is enabling marketers to experiment with a number of new ad formats, each of which could revolutionize marketing as we know it.  Throughout 2014 we will be highlighting the most effective of the techniques being broadly adopted.

Part III: Tailored Digital Ads

In 2004 subscribers of reason magazine received a potential shock.  The front cover of their June issue included a satellite photo of their neighborhood with their own house graphically circled!  Nick Gillespie, then Editor in Chief, “used the stunt to illustrate the cover article about the power and importance of databases”¹.  Specifically, the article highlighted the emerging dynamic tension between consumers’ desires for privacy and those for a more convenient and relevant product experience.

Fast forward a decade and we see this same tension playing out within digital advertising.  In today’s world ad content can be personalized on-the-fly based on a variety of information associated with the viewer.  A geo tailored ad for a business can include a map showing the nearest location or a phone number for making an appointment.  A clothing store ad can change the gender of the model and the style of clothing based on gender and age.   Within e-commerce platforms, ad content may be tailored based on previous purchases.  And, perhaps most impressively, “socially” tailored ads can highlight brands liked or used by friends and family based on social media information.

The upside for consumers is that the more granular the information available to marketers the more pertinent and useful the ads will be for them.  The downside for consumers is the perceived lack of control of how information about them is being used.  An example of this later experience is LinkedIn’s experiments with its “social ads”.  In this ad format users are alerted to relationships between the advertised brand and people in their LinkedIn network.  Such ads improve relevance by leveraging commonality of need and personal trust.  In some of the original test versions names and photographs of the networked individuals were included.  Based on concerns from some of its members, LinkedIn revised this format to lesson the level of detail and also provide its members an easier opt out method.

Experiences like this beg the question, how do consumers look at the use of such information for advertising?  Given the explosive growth of consumers sharing information with social media and e-commerce platforms there is definitely a willingness to exchange some control of private information for a more valuable experience.  In response to client requests research was conducted in 2010 among 1380 census representative consumers.  The goal of this heretofor unpublished research was to understand their comfort levels² with using this type of information for various marketing purposes.

One general finding was that approximately two-thirds of consumers were at least somewhat comfortable with their personal information being used to provide more relevant ads.  The results were similar whether the ads were for television content or more traditional online display (69% and 67% respectively).  And while this supermajority demonstrated that greater relevance was valued, comfort didn’t reach the same level of other marketing uses which provided financial benefits (e.g. saving money) or greater convenience (e.g. better search results and product recommendations).  Also, a review of open-ended responses suggested that the tailored ads may also suffer from a lack of confidence that they will provide more relevance.  In the words of one respondent, “profiling does not always yield results consistent with a particular person”.  This highlights that care should be taken in choosing the content of tailored ads for instances where they are directed outside of the intended profile.

Comfort with personal information being used to…

Another finding was that comfort levels varied greatly by age group thereby showing a potential difference in the relative valuation of personal information.  As an example, looking at the results for online ads, there is a striking range in comfort from 76% among the youngest group to only 61% among the oldest.  A best practice based on this insight is to reserve more “forcefully” tailored ad content for campaigns targeted to younger audiences.

Comfort with personal information being used to…

As the technology to tailor ads continues to evolve, advertisers and their partners will continue to wrestle with finding the right balance between relevance and privacy.  In cases where there is potential for controversy, communication research such as copytesting may very much be warranted before campaign implementation.

¹Putting 40,000 Readers, One by One, on a Cover; David Carr, The New York Times April 5, 2004

²Closed ended-question wording: Businesses sometimes use personal information to customize offers or show more relevant advertising.  This can include data such as geographic location, age, gender, number of children, and approximate household income.  Please indicate your degree of comfort with information like this being used for each of the following marketing purpose