Book: What Sticks Presentation

Slide 1: What If We Were Wrong? Insights from Re se arch against US$1Billion in Adve rtising Spe nding Greg Stuart Former CEO, Interactive Advertising Bureau Co-author: What Sticks www.WhatSticks.NE

Slide 2: Marketing’s Inconvenient Truth Insights from Re se arch against US$1Billion in Adve rtising Spe nding Greg Stuart Former CEO, Interactive Advertising Bureau Co-author: What Sticks www.WhatSticks.NE

Slide 3: If Advertising had a Slogan… Ads Work Wonde rs Half the Money is Wasted Courtesy of Erwin Ephron 3 www.WhatSticks.NE

Slide 4: $1 Billion Ad Spending Researched 1.1 million consumers surveyed 4 www.WhatSticks.NE

Slide 5: 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 5 www.WhatSticks.NE

Slide 6: Are You Prepared if You Are Wrong? 6 www.WhatSticks.NE

Slide 7: So, What Else do We Know 36% 31% 83% Motivations Messaging Media 7 www.WhatSticks.NE

Slide 8: And, We Don’t Seem to Own Responsibility for a Burden of Proof Donny De utsch 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 8 www.WhatSticks.NE

Slide 9: The Truth Is…Marketing is Hard Suppose you have 5 options: 5 Brand Positionings 5Custome r Se gme ntations 5 Ad C ative Approache s re 5 Magazine Sche dule s/ Plans 5 Online Plans 3,125 combinations 10 to 10th = 1 billion combinations 9 www.WhatSticks.NE

Slide 10: 10 www.WhatSticks.NE

Slide 11: And Future Will Be More Confusing 50% of HH’s TV 30M-‘08 Radio Print 130M 50M HH’s Outdoor 12% 11 www.WhatSticks.NE

Slide 12: So What is a Marketer to Do? One Solution for Making Sure Your Adve rtising Sticks! www.WhatSticks.NE

Slide 13: The First Step - Admit There is a Problem Real knowledge is to know the extent of one's ignorance. Confucius 13 www.WhatSticks.NE

Slide 14: What Sticks’ Three Steps 1. Unive rsal Agreeme nt to Goals 2. Have a Back Up Plan (Plan B) 3. Know the Value of @ Dollar 14 www.WhatSticks.NE

Slide 15: Motivations 36% Missed it 15 www.WhatSticks.NE

Slide 16: Who’s Headquarters is This? 16 www.WhatSticks.NE

Slide 17: ING Fresh Thinking 17 www.WhatSticks.NE

Slide 18: Today’s Ads for ING Simplifies a Complicated Financial World 18 www.WhatSticks.NE

Slide 19: We Know Online Moves Sales Online advertising incre ase s purchase intent by 7 points Purchase Intent: The next time Purchase you buy dry gelatin mix that Intent Lift: +7% comes in a box, what is the probability that you will buy 77.4% Jell-O gelatin mix? 70.4% (Top 2 box- 11 point Juster Scale) Control n= 468 Branded n=469 Offline Offline + Coupon n= 465 Online All significant values are at a 95% confidence level 19 www.WhatSticks.NE

Slide 20: Jell-O Online Ad Examples 20 www.WhatSticks.NE

Slide 21: Make Sure Your Motivations Stick 1. Know why consume rs buy your brand 2. Ensure it is a valuable custome r segment 3. Wring all ambiguity from your de finition of succe ss What if your Motivation isn’t right? Whe n would you know it? Is the re Unive rsal Agre e me nt? 21 www.WhatSticks.NE

Slide 22: Me ssaging 31% Missed it 22 www.WhatSticks.NE

Slide 23: How do Consumers See Your Ads? 23 www.WhatSticks.NE

Slide 24: How Bad is Online Creative? For 5 re ce nt studie s, cre ative te sting was done prior to the re se arch launch: Only 1 brand’s ads re quire d no adjustme nt 2 brands found 1 / 2 the ads we re not effe ctive Diluting the effective ne ss of the campaign 2 brands discarde d AL ads & starte d all ove r L Both de ve lope d ads that score d much be tte r Who were the 5 Advertisers? P&G J&J Kraft Nestle Target 24 www.WhatSticks.NE

Slide 25: Nothing Else Matters if Creative is Wrong A B Source: IAB Cross Media Study 25 www.WhatSticks.NE

Slide 26: Creative Makes a BIG Difference Bette r cre ative can make the diffe rence be tween absolute succe ss and failure Ad A Ad A 20% , Purchase Intent Ad B, 2% 0% 5% 10% 15% 20% 25% Percent that Intend to Buy Colgate Source: IAB Cross Media Study 26 www.WhatSticks.NE

Slide 27: What Made the Difference? Persistent Branding! A B Source: IAB Cross Media Study 27 www.WhatSticks.NE

Slide 28: What Do You See? 28 www.WhatSticks.NE

Slide 29: Make Sure Your Messaging Sticks Creative te sting is che ap – Just do it! • Because not te sting is RE L e xpe nsive ! AL Y • Split ce ll te sting is be st (experime ntal de sign) What if you are Wrong? Whe n would you know it? By the way…47% Missed either Motivations or Messaging 29 www.WhatSticks.NE

Slide 30: Me dia 83% Missed it 30 www.WhatSticks.NE

Slide 31: Media Timing Influences Success 50% 45% Average 40% Lunch 35% 30% 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 Time of Day Top 2 If Marketer had focused impressions on the 6 hours around lunch time, impact would have been significantly better 31 www.WhatSticks.NE

Slide 32: Media Mix Influences Success Media Usage among 18-49 year old target Heavier Heavy Online Heavy Online 26% Online Use 38% Light TV Heavy TV 34.3 Million! TV Use Heavier Lighter Light TV Heavy TV 15% 21% Light Online Light Online Lighter 32 www.WhatSticks.NE

Slide 33: Too Much Media Influences Success Introducing Ne w Me nu Ite m : Grille d Chicke n Fla tbre a d S a ndwich Reinvested Cut 60.0% 13.6% 6.4% in Online 50.0% % Aided Awareness 5pt Gain! 40.0% 20% of Broadcast Budget 30.0% Ret nished Dimoint of 20.0% s urn i P 10.0% 0.0% Ad Frequency (or Budget) 33 www.WhatSticks.NE

Slide 34: 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 Ave rage gain was 3 5 % • 34 www.WhatSticks.NE

Slide 35: The 4th M Maximization! 35 www.WhatSticks.NE

Slide 36: Maximization is Applying Classic Innovation Theory To Marketing 7 0 % of budget to what you know works 70-20-10 2 0 % to innovating off of what you know works 1 0 % to brand ne w ide as 36 www.WhatSticks.NE

Slide 37: “Most Important Launch In History Of Ford” - Bill Ford F150 Truck is #1 selling vehicle in U.S. 37 www.WhatSticks.NE

Slide 38: The F-150 Online Ads 38 www.WhatSticks.NE

Slide 39: Trying Something Brand New: Home Page Takeover Ad Ran One Day on Each Portal - Roadblock Roadblock 39 www.WhatSticks.NE

Slide 40: Cost Effectiveness of Each Medium Cost to Increase Purchase Consideration Brand Me tric: Re lative Cost Sample Purchase Consideration Index Cost $11.0 (top 2 box) 4 TV 1104 Magazine 456 $4.56 Roadblock 100 $1.00 Online 135 $1.35 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. 40 www.WhatSticks.NE

Slide 41: The Value of Small Changes Ford Media Mix * 100% Result in another+ Sold Another $750,000,000 in in $1,350,000,000 80% Traditional Media U.S. U.S. Trucks Truck sales 60% (at retail vs Base Plan) 40% 20% 0% Base 2.5% 6% Plan Online Online * Approx. $200 Million Budget 41 www.WhatSticks.NE

Slide 42: Peter Drucker says… Today knowledge has power. It controls access to opportunity and advancement. Pe te r Drucke r (Fathe r of Mode rn Manage me nt) 42 www.WhatSticks.NE

Slide 43: Together, We Can Change Dilbert Accountability is not me asure me nt, Accountability is doing some thing about it 43 www.WhatSticks.NE

Slide 44: What If We Were Wrong? Right? . 36% 31% 83% Motivations Messaging Media www.WhatSticks.NE

Slide 45: Thank You Greg Stuart +1.631.7 0 2 .0 6 8 2 gre g@WhatSticks.NET www.WhatSticks.NE

Slide 46: 46 www.WhatSticks.NE