Book: What Sticks Presentation

What If We Were Wrong? Insights from Research against US$1Billion in Advertising Spending Greg Stuart Former CEO, Interactive Advertising Bureau Co-author: What Sticks

Marketing’s Inconvenient Truth Insights from Research against US$1Billion in Advertising Spending Greg Stuart Former CEO, Interactive Advertising Bureau Co-author: What Sticks

If Advertising had a Slogan…

Ads Work Wonders

Half the Money is Wasted

Courtesy of Erwin Ephron

$1 Billion Ad Spending Researched 1.1 million consumers surveyed

What Do We Know?

Over US $112 Billion of U.S. Ad Spending is wasted (1)

What makes you think yours isn’t? (1) Of the $295 Billion in U.S. Advertising Spending

Are You Prepared if You Are Wrong?

So, What Else do We Know 36% 31% 83% Media Motivations Messaging

And, We Don’t Seem to Own Responsibility for a Burden of Proof

Donny Deutsch speaking to 500 Marketers…

“ We did a wonderful spot…on the Superbowl… for Mitsubishi Gallant...that stops at the end and [says] go to “seewhathappens.com.”

We got about 600,000 clicks.

Was that great or that not great?

We told the client it was great so it was great.”

[nervous laughter]

Deutsch is the 14 largest agency in the US

The Truth Is…Marketing is Hard

Suppose you have 5 options:

5 Brand Positionings

5 Customer Segmentations

5 Ad Creative Approaches

5 Magazine Schedules/Plans

5 Online Plans

3,125 combinations 10 to 10 th = 1 billion combinations

And Future Will Be More Confusing 50% of HH’s 30M-‘08 12% 130M 50M HH’s Radio TV Print Outdoor

So What is a Marketer to Do? One Solution for Making Sure Your Advertising Sticks!

The First Step - Admit There is a Problem

Real knowledge is to know the extent of one's ignorance.

Confucius

What Sticks’ Three Steps

Universal Agreement to Goals

Have a Back Up Plan (Plan B)

Know the Value of @ Dollar

Motivations

36% Missed it

Who’s Headquarters is This?

ING

Fresh Thinking

Today’s Ads for ING Simplifies a Complicated Financial World

We Know Online Moves Sales Control n= 468 Branded n=469 Coupon n= 465 Purchase Intent: The next time you buy dry gelatin mix that comes in a box, what is the probability that you will buy Jell-O gelatin mix ? (Top 2 box- 11 point Juster Scale) All significant values are at a 95% confidence level Online advertising increases purchase intent by 7 points Offline Offline + Online Purchase Intent Lift: + 7%

Jell-O Online Ad Examples

Make Sure Your Motivations Stick

Know why consumers buy your brand

Ensure it is a valuable customer segment

Wring all ambiguity from your definition of success

What if your Motivation isn’t right?

When would you know it?

Is there Universal Agreement?

Messaging

31% Missed it

How do Consumers See Your Ads?

How Bad is Online Creative?

For 5 recent studies, creative testing was done prior to the research launch:

Only 1 brand’s ads required no adjustment

2 brands found 1/2 the ads were not effective

Diluting the effectiveness of the campaign

2 brands discarded ALL ads & started all over

Both developed ads that scored much better

Who were the 5 Advertisers? P&G J&J Kraft Nestle Target

Nothing Else Matters if Creative is Wrong Source: IAB Cross Media Study B A

Creative Makes a BIG Difference Better creative can make the difference between success and absolute failure Ad A Source: IAB Cross Media Study

What Made the Difference? Persistent Branding! Source: IAB Cross Media Study B A

What Do You See?

Make Sure Your Messaging Sticks

Creative testing is cheap – Just do it!

Because not testing is REALLY expensive!

Split cell testing is best (experimental design)

What if you are Wrong? When would you know it?

By the way… 47% Missed either Motivations or Messaging

Media

83% Missed it

Media Timing Influences Success Average If Marketer had focused impressions on the 6 hours around lunch time, impact would have been significantly better Time of Day Lunch

Media Mix Influences Success TV Use Online Use Heavier Heavier Lighter Lighter Heavy Online Heavy TV Heavy TV Light Online Light TV Light Online Heavy Online Light TV 26% 38% 15% 21% Media Usage among 18-49 year old target 34.3 Million!

Too Much Media Influences Success Introducing New Menu Item: Grilled Chicken Flatbread Sandwich Ad Frequency (or Budget) % Aided Awareness 20% of Broadcast Budget Reinvested 13.6% in Online Point of Diminished Returns 5pt Gain! Cut 6.4% 10.0% 20.0% 30.0% 40.0% 50.0% 60.0% 0.0%

Making Your Media Stick

Media is an investment–what is your ROI?

Must know what is the value of a Dollar

Without knowing, you can’t Optimize

Average gain was 35%

The 4 th M

Maximiz ation!

Maximization is Applying Classic Innovation Theory To Marketing

70-20-10

70% of budget to what you know works

20% to innovating off of what you know works

10% to brand new ideas

“ Most Important Launch In History Of Ford” - Bill Ford F150 Truck is #1 selling vehicle in U.S.

The F-150 Online Ads

Trying Something Brand New: Home Page Takeover Ad Ran One Day on Each Portal - Roadblock Roadblock 43% One Day Reach

Cost Effectiveness of Each Medium Cost to Increase Purchase Consideration Interpretation: If it cost Roadblock $1 (indexed at 100) to increase purchase consideration, then it cost $1.35 for Online, $4.56 for magazine and $11.04 to TV to achieve the same increase. $1.35 $1.00 $4.56 $11.04 Sample Cost 100 Roadblock 456 Magazine 1104 TV 135 Online Relative Cost Index Brand Metric: Purchase Consideration (top 2 box)

The Value of Small Changes Ford Media Mix * Traditional Media * Approx. $200 Million Budget Result in another $750,000,000 in U.S. Truck sales Sold Another +$1,350,000,000 in U.S. Trucks (at retail vs Base Plan)

Peter Drucker says…