Week 4 - Media Focus and Effectiveness

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ONE STEP AHEAD

A P R I L 2 0 2 0C H E P R O X I M I T Y
M E D I A P R O D UC T F U N D A M E N T A L S

Media Product Fundamentals
Week 4 – Focus and Effectiveness.
Incremental channel effects
and prioritising needs over wants.
May - 2020

Where have we been so far?
We ran through the idea of media
being an integrated system.

Where have we been so far?
We ran through the idea of media being an integrated system.
We agreed that we shouldn’t run to solutions – we need to get
comfortable in the problem.
We outlined ways to investigate and break apart a problem.
We explained ways to use driver trees to quickly understand
the largest contributors to the problem, as well as potential
macro solutions.
We ran through the Needs/Pains/Gains framework to better
understand consumer/target motivations.
We looked at how we tier motivators in terms of attention,
in order to understand how we communicate these.
We then sorted media relevant to the consumer by its ability
to communicate these messages.

And this is before we’ve even
written a brief for media
partners, let alone sent it out.

8
Focus and effectiveness
Incremental channel effects and
prioritising needs over wants.
May 2019

I’d like to
acknowledge the
contribution of
Genevieve
Reynolds in
shaping this
thinking

And Nicholas Biggs and Renee
Hyde for basically organising
the entire thing – from material
to technology, invites etc.

Last week we spoke about a similar thing
but in a different context.
We spoke about things we NEEDED to
pay attention to, and things we LIKED
to pay attention to.
This context is more around determining
when choosing channels and activities,
what is a need and what is a nice to have.

Need to Have Nice to Have
Critical
Quantifiable
Non substitutable
Material
Non-essential
Substitutable
Difficult to quantify
Unknown impact

If you don’t
have it, you
cannot achieve
your objective
If you don’t have
it, you will
probably succeed
anyway.

Michael Jordan Luc Longley

We make need to have and nice to
have decisions every single day.
I know personally, nice to have
decisions are generally more fun
and interesting.

Need to have: Power, gas,
mortgage, health insurance, school
fees, medicine, petrol, rest
Nice to have: Fashion, sneakers,
chocolate, nice beer, after shave

You can make all the nice to
have investment decisions you
want when its your money.

When it’s someone else’s
money and they are using your
services to deliver the best
outcome, you need to focus
on the need to have’s.

A good test: “What would
happen if I didn’t do this?”

“What would happen if I
didn’t pay the mortgage?”
“What would happen if I didn’t
buy that Kitsune jumper?”
• Bank fees
• Fall behind on payments
• Potential default
• Credit rating issue
• Impact on family
• Significant risk
• Could lose home
• Wouldn’t enjoy buying
it and receiving it
• One less jumper
• Couldn’t wear it out*

“What would happen if I
didn’t pay the mortgage?”
“What would happen if I didn’t
buy that Kitsune jumper?”
• Bank fees
• Fall behind on payments
• Potential default
• Credit rating issue
• Impact on family
• Significant risk
• Could lose home
• Wouldn’t enjoy buying
it and receiving it
• One less jumper
• Couldn’t wear it out*
Need Nice

May be a bit
too restricting

Source: https://www.productplan.com/glossary/moscow-prioritization/
M
S
C
W
Must have: Non – negotiable product
needs that are mandatory for the team.
Should have: Important initiatives that
are not vital but add significant value.
Could have: Nice to have initiatives that
will have a small impact if left out.
Will not have: Initiatives that are not a
priority for this specific time frame.
MoSCoW Prioritisation

I came across MoSCoW in research for
the media book I am writing and have
chosen to use it for media decisioning.
MoSCoW comes from Agile, an area
I am not at all an expert or even a
laggard in.

Must have: No point in undertaking activity without it,
not legal without it, cannot deliver. Viable campaign
without it.
Should have: Important but not vital, may be
challenging to leave out but still viable with, may
require an alternative and/or workaround.
Could have: Wanted or desired but less important, less
impact if removed
Will not have: Immaterial, high confidence will not
impact positively on campaign.

Why all the focus on need/nice
to have and must/should/could?

In media we are faced daily
with hundreds if not thousands
of options.

Media companies
Media brands
Environments
and
programming
Time/day
Targeting
Data
Formats
Buying
mechanic
50+
1,000
30,000
24/7/365
1,000’s
10,000’s
120,000
CPM, CPC, CPA,
Fixed, Open, Private

We need some sort of
prioritization system to
sort through the
thousands of options

Creative
47%
Context 2%
Targeting 9%
Recency 5%
Reach
22%
Brand
15%
Source: : Nielsen Catalina 2018

In the context of media, you’re
generally focusing on specific
elements of the pie.

Reach is the most important as
it has the most flow on effect

Reach means reaching as many
buyers or prospective/eligible
buyers within your category
as possible.

1. Growth primarily comes from gaining new users
(penetration) rather than driving increased loyalty.
Most of a brand’s users will be light users.
2. Brands need to build physical availability (distribution)
and mental availability (saliency).
3. Even though brands differentiate themselves, in reality
consumers still react (and buy) within a repertoire (as
if there were no differences). Indeed, distinctivity is
more important than differentiation – as it helps drive
saliency.
4. Advertising works by refreshing (and occasionally
building) past memory structures.
How Brands Grow
Source: : Ehrenberg Bass

Reaching the maximum amount of
category buyers/category eligible
consumers means more relevant
people see our messages.

1+ reach is key
Evidence to date shows that advertising's
greatest sales effect occurs when an individual
moves from zero to one exposure (Sharp, 2009).
Subsequent close-by exposures can have a
positive effect, but the impact is much lower.
Figure 6 shows the typical advertising
response curve.
An effective multi-platform media mix needs to
reach more people without wasting advertising
dollars by hitting the same consumers multiple
times With the same stimuli within a short
window. The lower the overlap in audiences,
the greater the synergy.
Biggest
Change
Smaller
Change
Even
Smaller
Change
1 2 3+
Number of Exposures to Advertising
Source: Ehrenberg-Bass Institute, 2011
ResponsetoAdvertising

Creative
47%
Context 2%
Targeting 9%
Recency 5%
Reach
22%
Brand
15%
Category
buyer/category
eligible reach
contributes 36%
of the pie
Source: : Nielsen Catalina 2018

Creative and messaging is vitally
important – we know it contributes
up to 47% of effectiveness impacts.
However, in this context of media
we are focusing on medium and
effectively reaching people who
have the need and want to buy our
category at scale.

Hygiene Factors for
media consideration
Suitable context
Credible environment
Reasonable engagement

What is reasonable engagement?
Name Level
Unique
Audience (000)
Time Per Person
(hh:mm:ss)
Site 1 App(M) 9,231 14:29:53
Site 2 App(M) 8,913 09:06:06
Site 3 App(M) 6,600 05:40:44
Site 4 B 4,867 00:40:31
Site 5 App(M) 4,503 07:06:25
Site 6 B 2,272 00:03:16
Site 7 B 1,818 00:10:32
Site 8 B 950 00:22:48
Site 9 B 667 00:01:26
Site 10 B 530 00:03:28
Site 11 B 239 00:05:14
Site 12 B 191 00:01:39
Source: : Nielsen Answers 2020

Name Level
Unique Audience
(000)
Time Per Person
(hh:mm:ss)
Site 1 App(M) 9,231 14:29:53
Site 2 App(M) 8,913 09:06:06
Site 3 App(M) 6,600 05:40:44
Site 4 B 4,867 00:40:31
Site 5 App(M) 4,503 07:06:25
Site 6 B 2,272 00:03:16
Site 7 B 1,818 00:10:32
Site 8 B 950 00:22:48
Site 9 B 667 00:01:26
Site 10 B 530 00:03:28
Site 11 B 239 00:05:14
Site 12 B 191 00:01:39
Source: : Nielsen Answers 2020
What isn’t reasonable engagement?

But it’s nuanced and it’s
based on how much of this
eligible reach you can
utilize for your client.

Two key factors
1. Audience Scale
2. Ability to realise

What do I mean?
1. Audience Scale: The total amount
of the audience I want to reach that use
the channel or platform.
2. Ability to realise: The total amount
of that audience I can buy without it
becoming inefficient.

Media realisation matrix
0%
100%
Audiencescaleavailable
Available Audience realised 100%
High potential,
high realisation
Efficient use of
resource and audience
potential maximised
Low potential,
high realization
Low-Moderate use of
resource, audience
potential maximised
Low potential,
Low realisation
Inefficient use of
resource (money/time)
and maximum gain
immaterial
High potential,
Low realisation
Inefficient use of
and audience potential
underachieved

0%
100%
High potential,
high realisation
Efficient use of
potential maximised
Low potential,
high realization
Low-Moderate use of
resource, audience
potential maximised
Low potential,
Low realisation
Inefficient use of
and maximum gain
immaterial
High potential,
Low realisation
Inefficient use of
underachieved

0%
100%
High potential,
high realisation
Efficient use of
potential maximised
Low potential,
high realization
Low-Moderate use of
resource, audience
potential maximised
Low potential,
Low realisation
Inefficient use of
and maximum gain
immaterial
High potential,
Low realisation
Inefficient use of
underachieved
Zone of maximum gain
Zone of indulgence Zone of small gains
Zone of inefficiency

Let’s play out a scenario
Looking at 5 channels/platforms
$2m over 4 weeks
$300k into Channel 1
$1m into Channel 3

Media realisation matrix – Scenario 1
0%
100%
Ch. 1
Ch. 2
Ch. 3
Ch. 4
Ch. 5
High potential,
high realisation
Low potential,
high realisation
Low potential,
Low realisation
High potential,
Low realisation

On the surface
5 channels
Audience is 25-54 male skew, 100k HHI
Covering 4 different media types
Moderately sized media plan
Feels good – lots of providers, well known logos,
broad use of contemporary ways of buying

Scratch below the surface here …
$300k into Channel 1 – Ch.1 can reach 95% of our
TA, this investment level caps at 40%
$400k into Channel 2 – Ch. 2 reaches 25% of our
TA, maximises at 25%
$1m into Channel 3 – Ch. 3 can reach 85% of our
TA, we have maximized this at 60%
$150k into Channel 4 – Ch. 4 can reach 80% of our
TA but we’ve only chosen to activate against 10%
$150k into Channel 5 - Ch. 5 can reach 90% of our
TA but we’ve only chosen to activate against 5%

My view – never leave the
audience on the table.

40%
0%
100%
25%
60%
10%
5%
1 2 3 4 5
Scenario 1
15% budget
20% budget
50% budget
7.5% budget
7.5% budget

40%
0%
100%
25%
60%
10%
5%
1 2 3 4 5
Scenario 1 – missed opportunity
15% budget
20% budget
50% budget
7.5% budget
7.5% budget
10%
10% 10%
55%
70% 90%

40%
0%
100%
25%
60%
10%
5%
1 2 3 4 5
Scenario 1 – missed opportunity
15% budget
20% budget
50% budget
7.5% budget
7.5% budget
90%70%
55%
30% of budget is
not maximized

0%
100%
25%
1 2 3 4 5
Scenario 1 – optimised opportunity
95%
60%
30% budget
20% budget
50% budget
Remove 2 channels that
are inefficient
No audience loss, in fact
an audience gain
Maximum audience realised

Commonly held view: Using
multiple channels maximises
media return and efficiency

Ehrenberg Bass: Does each
medium help build cumulative
reach more effectively than
spending more in any of the
individual media?

40%
0%
100%
25%
60%
10%
5%
1 2 3 4 5
Scenario 1 – non optimised
15% budget
20% budget
50% budget
7.5% budget
7.5% budget

0%
100%
25%
1 2 3 4 5
95%
60%
30% budget
20% budget
50% budget
Scenario 1 – optimised opportunity
Remove 2 channels that
are inefficient
No audience loss, in fact
an audience gain
Maximum audience realised

Each channel has to have an
incremental contribution of
reach against the audience
you are seeking.
Don’t get caught up in doing
more for the sake of doing more.

Channel 1 – 90% of our TA use this, but it
becomes inefficient at 60%
Channel 2 – 15% of our TA uses this, and we
can access them all at an efficient position
Channel 3 – 95% of our TA use this, we can
access 75% before it becomes inefficient
Channel 4 – Ch. 4 can reach 35%, but only 30%
are realistically efficiently reached
Channel 5 - Ch. 5 can reach 10% of our TA, with
2/5 of them available to purchase realistically.
New car launch, target female 25-39 – some macro
media options based on data/insight/suitability

Media realisation matrix – new car scenario
0%
100%
Ch. 1
Ch. 2
Ch. 3
Ch. 4
Ch. 5
High potential,
high realisation
Low potential,
high realisation
Low potential,
Low realisation
High potential,
Low realisation

0%
100%
Ch. 1
Ch. 2
Ch. 3
High potential,
high realisation
Low potential,
high realisation
Low potential,
Low realisation
High potential,
Low realisation
Media realisation matrix – new car scenario

0%
100%
30%
1 2 3 4 5
New Car Scenario – optimised opportunity
– 4 weeks
75%
60%
$1,200,000
$700,000
$450,000
Channel 1 - $1.2m required per
month to generate 60% 1+
Channel 2 – 700k required per
month to generate 100% IS
Channel 3 - $450k per month
required to generate 75% 1+

0%
100%
30%
1 2 3 4 5
New Car Scenario– optimised opportunity – 4
weeks – incremental gains
75%
60%
$1,200,000
$700,000
$450,000
These 3 channels provide
95% of the eligible
audience – thus, any added
channels are unlikely to
bring any additional
audience benefit.

Why is this important?
The more you stack onto
a media plan the more
work you create, the
more chance for error,
and the lower the return
on resource becomes

Remember – the only guaranteed
outcome from using more channels
is the creation of more work.

Search
0%
100%
TV
OOH
Radio
Social
Search TV OOH Radio Social
• Broad channel selection
• Channel diversity
• Search – 50% of key terms not
visible
• TV – Audience at 1+ 35%
• OOH – Light, 3 cities
• Radio – Audience at 1+ 20%
• Social – 5% of addressable
audience reached
Issues
• Duplication of category
buyers/audience across channels
• Significant chunks of audience not
reached across all channels
• Incremental contribution of
channel additions not understood
• Token use of social and out of
home that misses majority of
category buyers
Product: Mid sized new automotive

Video
0%
100%
TV
Search
Video TV Search
• 3 channels used
• Foundation channel selected (video)
• Video audience reach exhausted at
80% with media efficiency and
efficacy maintained
• TV utilized to reach incremental
audience at efficient cost
• Search at level which captures
volume of demand in market
Benefits
• 90-100% of audience reached
• Clear ‘ringfencing of audience’
across channels
• Reduction in resource required to
manage partners, logistics, creative,
measurement
Product: New release theatrical

TV
0%
100%
Search
SearchTV
• 2 channels used
• Foundation channel selected (TV)
• TV reaches 85% of audience with
efficiency and frequency
• Format allows longer creative to be
rotated – demonstrates product
benefits
• Search used to capture intent signals
and convert awareness into action
• Search coverage is 100% of key
terms
Benefits
• Two channels to manage
• Focused deployment
• Resourcing requirement for media
logistics management more efficient
Product: Pensioners Insurance

To finish – effective share of voice

Source: : https://www.thedrum.com/opinion/2019/05/23/exclusive-look-binet-and-field-s-new-b2b-marketing-research
Budgeting for growth: The share of voice rule
12%
10%
8%
6%
4%
2%
0%
0% 2% 4% 6% 8% 10% 12%
Growth Proportional
to ESOV = SOV–SOM
Shareofvoice
Strong correlation
for B2BSOV > SOM:
Brands tend to grow
SOV < SOM :
Brands tend to shrink

How ESOV converts into growth
2.0
ESOVEfficiency
1.8
1.6
1.4
1.2
1.0
0.8
0.6
0.4
0.2
0.0
Retail FMCG Durables Financial
Services
Other
Services
B2C
Average
B2B
Source: IPA Databank, 1998-2018 cases
Average
+0.6% SOM
p.a. per
10% ESOV
B2B very
Similar
to B2C
1.8
1.5
0.6
0.30.2
Adjust budget
for category
& context
Sector

Adjust budget to fit pricing strategy
Low prices accelerate growth Up-weight SOV for
premium brands
1.0
0.8
0.7
0.6
0.5
0.4
0.3
0.2
0.2
0.1
0.0
Value/mid-market Premium/Super
Premium
Value Mid
Market
Premium Super
Premium
ESOVefficiency
AverageESOV
Source: IPA Databank, 1998-2016 for-profit cases
13.8%
10.4%
7.3%
6.1%
16%
14%
12%
10%
8%
6%
4%
2%
0%

In short: If your share of advertising
exposure within your category is
higher than your share of sales in that
category, your brand will grow. If it’s
the opposite, your brand will shrink.

What’s it all about?
Basically – if you are exposing yourself to more people, more
frequently than your share of market, you’re more likely to reach
more people either in-market or eligible and you can make your
product more meaningful in relation to competitors, and you can
generate higher salience and recall.

Kantar:
“It is not just weight of spend that matters, it is against what it is spent. It is
perfectly possible for a brand to spend more than its fair share and still not
grow because its offer is not meaningfully different from the competition, or
people perceive it to be too costly. Similarly, a disruptive brand may grow
faster than expected simply because the relevance of its offer is immediately
obvious when people come to buy the category. Finally, categories with low
proportions of switching will not see the same strength of relationship
between increase in market share and share of voice simply because share
change is slow.”
Source: http://www.millwardbrown.com/global-navigation/blogs/post/mb-
blog/2019/05/29/do-not-misinterpret-the-excess-share-of-voice-analysis

Where, how it is spent matters hugely. As well as …
1.Underlying business strategy – a disruptive strategy
ought to yield greater returns,
2.Nature of the brand positioning – a brand that is out
of sync with today’s culture will likely, underperform
3.Media channel selection – choices that create positive
synergies will overperform,
4.Activation at point of sale – failure to create instant
recognition will mean the brand underperforms.
Source: http://www.millwardbrown.com/global-navigation/blogs/post/mb-
blog/2019/05/29/do-not-misinterpret-the-excess-share-of-voice-analysis

ESOV also has to be viewed not in isolation
If ESOV correlates to market share gains – then ultimately
the investment can be turned into a yield calculation.
If 10% of SOV equals $3m in cost, and 0.6% of market
share gain = $10m in gross profit… then 3m in creates
$10m.
To be truly prudent, we could compare against RORC ratio
– R&D investment in Y1 compared with gross profit in Y2.
RORC has the same issue as it’s HOW the money is spent,
not that it is spent … that is the key.

ESOV is very hard to measure accurately in AU
1. Competitive tools are of limited accuracy for
broadcast channels.
2. Channels like OOH are hard to legitimately measure
in terms of true live exposure at a competitor level.
3. Digital SOV misses most platforms, search etc
4. ”Exposure” is subjective
So, more times than not ESOV becomes ESOS
(share of spend)

An example where ESOV is challenging to measure
1. You’re a non cola soft drink
2. You have 5% market share
3. Your category spends $30m PA
4. You decide to aggressively grow and substitute
SOV for SOS
5. You recommend spending $9m pa to have around
30% of share of spend to grow market share 1.8%
6. However, you’re only in 20% of the stores as your
competitor
7. Your main competitor has shelf space agreements
in place for prime position
8. Your main competitor has a series of aggressive
price promotions in high volume outlets

So with ESOV
Always use responsibly.

To summarise
• Be focused.
• Use MoSCoW
• “What would happen if I DIDN’T do this?”
• Reach matters.
• Don’t confuse category eligible with mass.
• Prioritise scale and the ability to utilize.
• More channels doesn’t necessarily mean better.
• Never leave audience on the table.
• Know when to fold them – think of the pareto principle
• ESOV – utility is all in the application
• The Chicago Bulls wouldn’t have won a championship
without Michael Jordan

Contact me anytime
ben.shepherd@cheproximity.com.au

Materials
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Webex recording will be available
to view via link
Dispatch 24-48 hours post session

See you next Wednesday
12:30pm AEST

Please join us next
Wednesday 20 May for
‘Briefing – the powerful multiplier’

Week 4 - Media Focus and Effectiveness

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