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Online advertising vs brand building (Nielsen)
 

Online advertising vs brand building (Nielsen)

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1. Click-through rate is not the right metric to measure brand impact – virtually no relationship...

1. Click-through rate is not the right metric to measure brand impact – virtually no relationship
exists between clicks and brand metrics or offline sales.
2. There is emerging evidence that brand metrics in response to online campaigns are correlated
with offline sales impact.
3. Online ads can succeed in driving brand impact, though success is not guaranteed and
advertisers must embrace new online branding metrics to separate themselves from the
competition.

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    Online advertising vs brand building (Nielsen) Online advertising vs brand building (Nielsen) Document Transcript

    • Beyond Clicks and Impressions: Examining theRelationship Between Online Advertising andBrand Building Executive Summary Advertisers increasingly think of online as a place to build their brands, but need greater confidence that their online investments are helping them achieve their brand goals. This paper explores both the role of online ads in brand building, as well as the best metrics for measuring the success of Internet ads against marketers’ goals. Leveraging Nielsen’s advertising effectiveness solutions to examine this relationship, the following conclusions will be discussed in this paper: 1. Click-through rate is not the right metric to measure brand impact – virtually no relationship exists between clicks and brand metrics or offline sales. 2. There is emerging evidence that brand metrics in response to online campaigns are correlated with offline sales impact. 3. Online ads can succeed in driving brand impact, though success is not guaranteed and advertisers must embrace new online branding metrics to separate themselves from the competition.Advertisers are lives – they access online at work (nearly 27 hours per user per month), on mobile But what’s interesting is this growth is not only from e-commerce advertisers lookingincreasingly building (43 percent of US adults now own smart- to generate web traffic or drive sales. phones), and even concurrently with other The Cambridge Group report also showsbrands online media (20% of U.S. adults watch TV while that in 2011 54 percent of those surveyedThere’s an old adage that advertisers using either a PC or mobile device on a believe online ads are highly effective atfollow consumers’ eyeballs, and over daily basis, according to the Media Behav- “enhancing brand/product image,” com-the course of the last 10 years, there has ior Institute USA TouchPoints study.) pared to just 38 percent of respondents incertainly been a remarkable rise in the a 2008 version of the study. As consum- Additionally, more and more advertisingnumber of consumers online and the ers have integrated the Internet into their dollars are finding their way online. In theamount of time they’re spending there. lives, advertisers are increasingly inter- 2011 Advertising Outlook published by ested in ways to better reach consumers,Since 2003, the number of Americans The Cambridge Group (a Nielsen com- deliver messages, and build ongoingwith Internet access has grown 34 percent pany), a survey of over 300 advertising relationships through this medium. Infrom 186.7 million to 249.3 million, ac- decision-makers from a variety of indus- other words, these advertisers are lookingcording to Nielsen. This growth has not tries indicates that digital budgets have to truly build their brands online.come in a vacuum – online has increas- increased more than any other type ofingly become integrated into consumers’ media in 2011.
    • With more and more advertisers look- measure how well online campaignsing to include online brand building intheir media mix, they are looking for two perform against brand marketers’ goals. Standard Brandthings: confidence that their online in- Many brand marketers run online campaigns with the objective to drive Effect questions:vestments are helping them achieve theirbrand goals, and metrics that give them in-store rather than online conversions. • Ad Recall: “Do you recall seeingthe ability to demonstrate success across Nielsen is able to measure whether online an ad online for product X in thetheir campaigns. ad campaigns influence offline purchase last 7 days?” behavior through Nielsen Sales Effect, which connects online exposure to off- • Brand Awareness: “Have you line sales using the Nielsen Homescan heard of brand X?”Is CTR a good measure consumer purchase panel. • Message Association: “Which brand do you most associateof brand impact? It’s clear from those findings that online advertising can have a substantial impact with the message X?”Online’s early history as a direct-response on offline purchase behavior. However, • Purchase Consideration: “Willsales channel gave way to traditional as shown in Figure 1, CTR itself does not you purchase brand X in the nextmetrics such as click-through rates (CTR), predict changes in in-store sales due to month?”impressions and conversions, which the ad campaign. Picking the campaignse-commerce marketers used to develop with the best CTR would not deliver the • Brand Favorability: “What is strategies for optimizing online sales. best overall uplift in sales. Moreover, your opinion of brand X?”However, the broadening of advertisers’ evaluating a campaign solely on theobjectives to include brand building has number of clicks greatly underestimatesled to questions about whether these the number of potential consumersmetrics can be used to accurately influenced by the campaign. Figure 1: Correlation of Sales Lift and Click-Through Rate Sales Lift Click-Through Rate The random scatter of the points indicates a lack of relationship between sales lift and click-through rate. Source: Nielsen2 Copyright © 2011 The Nielsen Company.
    • Other brand campaigns are designed to noticeable ads increasing both the likeli- While based on a small number of cases,impart information upon consumers, hood of recall and the likelihood of a click. looking at campaigns measured by bothmake them more aware of a new product But there is no measure of branding – Nielsen Online Brand Effect and Nielsenor service, or change feelings or inten- whether the message resonated with con- Sales Effect, there was strong alignmenttions about a brand or product. Using the sumers or if it was successful in changing between increased purchase consider-Nielsen Online Brand Effect methodology, consumer awareness, opinions or intent ation following an online campaign and a(See Page 5) Nielsen examined how well – that has any relationship to CTR. boost in offline product sales. Campaignsexposure to online ad campaigns influ- in which consumers reported increasedences these brand objectives. purchase intent after viewing an ad also showed a boost in product sales. CasesInterestingly, research shows that click-through rate for a given ad campaign also But are brand metrics with flat purchase intent showed no significant change in sales.fails to predict the rate of success in ac- correlated with sales? Overall, it is clear that traditional directcomplishing these attitudinal objectives.(See Figure 2.) Digging further into Nielsen research, response metrics such as click-through there is evidence that attitudinal rate fail to indicate whether online cam-As expected, there is a small positive re- measures, such as Purchase Intent, paigns will impact consumer attitudes orlationship between consumers clicking on are important predictors of offline offline sales. As a result, advertisers needan ad and their ability to remember that sales and thus, are a powerful way for better brand metrics that can serve asad (Ad Recall). However, the connection advertisersto gauge the success of their an indication of the sales impact of theiris still weak and likely due to more brand campaigns online. online ads. Figure 2: Correlations with Click-Through Rate Ad Recall Delta Brand Awareness Delta Message Association Delta Purchase Consideration Delta Brand Favorability Delta -1.0 -0.5 0.0 0.5 1.0 No strong correlations emerge between CTR and any of the Brand Effect metrics. Source: Nielsen Copyright © 2011 The Nielsen Company. 3
    • How do online ads Despite some claims that “no one pays attention to online ads,” Nielsen research Nielsen research also shows that online ads often increase overall awareness forimpact consumer shows that the average increase between the advertised brand. This is an especially the control and exposed groups is highest important factor in driving new productattitudes? for Ad Recall, an indication that consum- success – clearly, consumers must becomeOne of the key questions weighing on ers do remember exposure to an online ad aware of a new product before they canadvertisers’ minds is, “Are my online brand campaign. It should come as no surprise buy it.ads working?” To answer this question, that the first step to influencing consum- The “lower funnel metrics” – Brand Favor-Nielsen analyzed results from over 500 ers through advertising is ensuring that ability and Purchase Intent —are far moreonline ad campaigns measured by Nielsen they notice and remember the ad itself. difficult to influence than Awareness,Online Brand Effect over the last year and The next question brand advertisers want Recall and Association, given that thesea half. to answer is whether online ad campaigns metrics require a change in consumerIn short, the answer is yes. Brand ads do can actually change the opinions and opinion or behavior.on average succeed in moving the needle intentions of consumers. Following Adfor most measured Brand Effect metrics, Recall, Message Association showed theas shown in Figure 3. next highest average change, indicating that online ads can also succeed in con- veying a brand’s intended message. Figure 3: Average Online Brand Effect Results 6% 4% 3% 1% -1% Brand Message Purchase Brand Ad Recall Awareness Association Consideration Favorability Well-executed online advertising can drive branding metrics. Source: Nielsen4
    • Varying results across More generally, stronger performing web ads drive noticeably greater posi- Using brand metrics tocampaigns tive impact on all five branding metrics separate from the pack compared to average or weak ads. JustWhile our analysis indicates mostly posi- as TV ads perform better based on the Just as TV ad effectiveness research hastive results across the different Brand Ef- quality of the creative and programming taught advertisers which levers to pullfect metrics on average, perhaps an even context, online ads are similarly impacted in optimizing their TV campaigns, overmore important conclusion is that there by factors such as creative, publisher time, online ad effectiveness research canis a lot of variance in the performance content and type of ad unit. In fact, online be similarly leveraged to help marketersof online ad campaigns we’ve measured, advertising potentially offers a greater understand those factors that drive theas shown in Figure 4. We find some range of possibilities than TV in terms of most successful web campaigns.campaigns are very successful across all format (display vs. video), dimension/size, Those who embrace these new metricsmetrics, some campaigns succeed only on or publisher. In many cases, understanding and collect trustworthy data on ef-certain dimensions, and others underper- online ad impact and what makes a strong fectiveness across media platforms willform across the board. vs. weak ad is even more complex than be substantially better positioned than understanding TV ad impact. others, and likely to separate themselves from the competition. Figure 4: Average Online Brand Effect Results 15% 10% 5% 0% -5% -10% Ad Recall Brand Awareness Message Association Purchase Consideration Brand Favorability Weak Ads Average Ads Strong Ads Average Nielsen Online Brand Effect results for strong, average, and weak performing ads. Results are calculated as the average percentage point difference between the exposed vs. control groups on each metric. Source: Nielsen Copyright © 2011 The Nielsen Company. All rights reserved. Nielsen and the Nielsen logo are trademarks or registered trademarks of CZT/ACN Trademarks, L.L.C. Other product and service names are trademarks or registered trademarks of their respective companies. 9/2011 . 5
    • Nielsen Online Brand Effect Methodology #$#$#$#$% #$ www www $ & #$# ! ( ) * +, !" TAG !" + -. % #0! 1 / 1 Ad campaign tagged 2 User exposed to ad running 3 Exposure infoNielsen encrypted by 4 Control and exposed groups anywhere online and passed through polled by Nielsen Facebook platform on Facebook Source: NielsenHow Nielsen Online Facebook’s large and highly engaged user base enables samples to be built About This White PaperBrand Effect Works rapidly, meaning shorter turnaround time The data and insights in this white paper are compiled from a range of Nielsen for results. Because polling occurs afterNielsen Online Brand Effect measures on- exposure and within the normal Facebook resources. For more information, line advertising effectiveness using simple, user experience, no interruptive pop-up or contact your Nielsen representative.strategic standardized poll questions that click-away surveys are required. Finally, are an integrated part of the Facebook reduced sample bias through shorter, stra- About Nielsenexperience. (Note: Nielsen reports data tegic polls, truer measurement of impact Nielsen Holdings N.V. (NYSE: NLSN) isonly in aggregate to clients and receives through 24-hour latency, and validated a global information and measurementno personally identifiable information demos of Facebook’s expansive user base company with leading market positionsfrom Facebook). ensure a more accurate read of online ad in marketing and consumer information,Brand Effect questions are asked both of effectiveness. television and other media measurement,a sample of respondents exposed to the online intelligence, mobile measurement, Studies are compared against a normativead being measured, as well as a control trade shows and related properties. Nielsen database to determine overallsample that is demographically matched Nielsen has a presence in approximately effectiveness and awareness results.to the exposed group but did not see the 100 countries, with headquarters in Newad. The difference in exposed vs. control York, USA and Diemen, the Netherlands.scores is reported for each measure. For more information, please visit www.nielsen.com.6 Copyright © 2011 The Nielsen Company.