At this Insights Studio, authors from three different continents showcase their recently published work—including the JAR Best Paper 2022 on how advertising expenditures drive consumers’ perceptions of ad and brand quality. Also featured are studies on deepfakes and AI reshaping the advertising industry, the success of using product endorsers who are actors known for roles portraying despicable characters, and KPI patterns of social media influencers across several platforms. Talking points in the concluding Q&A span the future of AI in advertising and influencer marketing, machine-driven decisions for choosing endorsers, and factors (product- and economic-related) affecting consumer perceptions of quality in TV ads and engagement in user-generated content.
TVision’s co-Founder & CEO Yan Lui gave a presentation about a linear regression study the company sponsored with Upwave to understand the relationship between attention and brand lift outcomes. They conducted the study from Q4 2019 – Q1 2022. One hundred large-scale analyses were performed across 43 different brands. Each was a high frequency campaign. TVIsion has camera-based computer devices in 5,000 homes (roughly 14,000 people) so they can track their TV and CTV viewing.
At our February Young Pros event, Meghan McGuirk, VP Group Director, Investments at Havas Media, Cristina Schlobohm, Director of Communications Strategy at Havas Media, and Kara Donahue, Account Executive at Roku, walked attendees through the media buying and selling process. They explained the five main media planning milestones: briefing, defining a strategy, tactical work, activating a campaign and reporting after it’s complete. Each speaker elaborated by using real life examples and showed the perspective and impact that all teams involved in the process have—both on the client or vendor side.
This research replicates a 2021 study by Nicole Hartnett and colleagues who had analyzed what happens to sales when brands stop advertising for a year or longer. The difference in this new work is not only its focus on the impact of going dark on market share, but its use of much more extensive data, with farther-reaching conclusions and future research recommendations. It adds robustness to the prior evidence that when brands stop advertising, declines become more common and more significant, on average, as time increases.
Brian Wieser’s keynote address covered four trends that are affecting the media and advertising industries: industry consolidation, the rise of ad-free TV, the emergence of new e-commerce marketers and procurement. After his presentation, Scott McDonald probed him further about his observations about the state of the media and advertising marketplace in 2023. His key points on these four trends and highlights of Brian’s conversation with Scott appear below.
Audrey Steele (FOX) introduced this presentation by highlighting the objectivity of the years-long study focused on the relative value of different platforms and impression quality, with the brands involved amassing close to $3 trillion in sales. While many in the industry are focusing on maximum reach, this study looked at sales as the most important measure of impressions, quality and value between media platforms.
Brittany Slattery (OpenAP), who opened this discussion, explained that the new JIC was created by national programmers and media agencies for three main purposes: (1) To bring buyers and sellers to the table with equal voices; (2) To create baseline requirements for cross-platform measurement solutions and (3) To create a harmonized census-level streaming service data set across all of the programmers in the JIC. Fox, NBCU, Paramount and Warner Brothers Discovery are all JIC members, as are Dentsu, Group M, IPG Mediabrands, OMG and Publicis. The members hope to foster competition among multiple ad video measurement currencies. After her introduction, Danielle DeLauro (VAB) moderated a discussion with the representatives of three networks and Group M.
This multi-year project’s objective is to understand how brands reacted to the events of 2020 and what the long-term implications were. In that fateful year, brands encountered a pandemic-driven recession, lockdown and periods of social unrest, along with the impact of economic stimulus, leading to the current state of inflation. Questions this study looks to address include, what happens to a brand’s market share if it goes “dark.” Was this different than previous recessions? How long was recovery? Did small brands take advantage of inexpensive media and if so, how did this affect their market share? Findings from the initial year are now available.
Nicole Hartnett, Ph.D – Senior Marketing Scientist, Ehrenberg-Bass Institute
This research replicates a 2021 study by Nicole Hartnett and colleagues who had analyzed what happens to sales when brands stop advertising for a year or longer. The difference in this new work is not only its focus on the impact of going dark on market share, but its use of much more extensive data, with farther-reaching conclusions and future research recommendations. It adds robustness to the prior evidence that when brands stop advertising, declines become more common and more significant, on average, as time increases.
Whereas the 2021 study’s data were for a single product category — alcoholic beverages in Australia (bulk keg sales to bars and pubs and units sold by specialty alcohol retailers) — the 2023 data span 22 consumer goods categories and 365 brands sold widely in supermarkets in the U.S. Both studies look at brand size and prior trajectory conditions but the 2023 research adds whether the relationship between market share change and advertising cessation holds across product categories. Ultimately practitioners can use this work as a baseline to determine the possible effects of stopping advertising when advertising cuts are required, and as input into business cases to keep their ad budgets.
Key Takeaways
Market share, of brands that stopped advertising for at least one year, declined on average at a steady rate year over year.
Losses were quantified as declining by 10 percent after one year, 20 percent after two years and 28 percent after three years relative to the last advertised year, on average.
Brand size and market share trajectory before stopping advertising affect the rate of market share decline. Brands already in decline, and smaller brands suffered greater loss of market share.
This research adds to the evidence that advertising continuity over the long-term benefits brand performance.
Lloyd Darbonne – Senior Director Research, Insights, & Strategy, FOX Corp.
Bill Harvey – Executive Chairman, Bill Harvey Consulting, Inc.
Audrey Steele – EVP Sales Research & Strategy, FOX Corp.
Audrey Steele (FOX) introduced this presentation by highlighting the objectivity of the years-long study focused on the relative value of different platforms and impression quality, with the brands involved amassing close to $3 trillion in sales. While many in the industry are focusing on maximum reach, this study looked at sales as the most important measure of impressions, quality and value between media platforms.
Bill Harvey (BHC) detailed the study’s methodology of implementing a standard multiple regression analysis with ROI optimization using SMI’s real ad spend numbers and Circana’s and S&P Global’s sales spend across the top ten brands in each of QSR, CPG and Auto verticals over nine years of data.
Lloyd Darbonne (FOX) covered how the thousands of iterations of their ROI optimizer selected the media mix that predicted the highest share for each company studied. Concentrating on entertainment (inclusive of TV sports & news, TV cable entertainment, TV Big 4 entertainment and premium digital video TV), the optimizer then measured the optimal allocation for maximum ROI in each vertical. Results across verticals documented higher ROIs with significant reallocations and rebalancing of ad spends in TV and premium contexts.
Key Takeaways
Brands that increased their spend in non-premium digital lost sales and market share, much of it due to misallocation of advertising spend. There are opportunities for 20-40% ROI increases by reallocating non-premium digital dollars to TV.
TV has 2.6x the sales effect of non-premium digital. There is a 14.6% incremental sales lift added by advertising, on top of the baseline 85% sales without advertising. TV generated 69% of the added 14% across the combined three verticals, with non-premium digital at 27%. In all three verticals studied, broadcast entertainment still has a good amount of headroom—increasing share of ad spend will increase sales effects.
Buyer focus on CPM and rush to oversaturated lower-priced media and non-premium digital inventory has served to suppress the sales effects of overall campaigns.
Focusing on ROAS instead of reach, and using standard multiple regression analysis gives advertisers an advantage over slower-moving competitors.
