® ®
Transforming Advertising Response Into Growth
Measuring Print Advertising
Responsiveness via MMM
A Presentation to
ARF...
®
• Marketing mix models are typically driven by
weekly store or market level data
– This is how promotions are executed
–...
®
TREATMENT CONTROL
Heavily Exposed
100 GRPs
Lightly Exposed
50 GRPS
Need: sharper indication of how
advertising works
• W...
®
• As measurement progressed --
Nielsen SAMI UPC
Bi-months 4-weeks weekly
Regions MarketsStores
• And analytics progresse...
®
Greater financial returns from
advertising expenditures
• Media ROI, as estimated by marketing mix models, has
frequentl...
®
MMM - Example
6
Sales
Advertising
Perfect Match! – Will get all the credit for sales
®
MMM-Example
7
Sales
More likely – Major credit for sales
Advertising
®
MMM-Example
8
Sales
Current data – no/little credit for sales
Modeled data smooth the variability, thus
provide less to ...
®
Need: Audience data suitable for
MMM
• Audience-data suitability for marketing mix models also
varies noticeably:
– Tele...
®
10
Example - TV
• An example of the change in advertising’s
contribution with a change is audience
measurement
• Based o...
®
Markets vs. Working Exposure Groups:
Volume contribution by marketing factor
Standard MMM:
80%
7% 13%
BASE PRICE/PROMOTI...
®
Single Source
• Single-source data links exposures to purchases for the
same households
– Providing a sharp contrast bet...
®
Occurrence Data
• Measures of advertising have two components:
– Occurrences
– Audiences
• The precision of available oc...
®
14
General Enhancements – All Media
• Timely reporting
• Single source data
• Provide distinctions beyond geography and
...
®
15
Print Specific Enhancements
• Issue specific data – critical!
• Audience accumulation data – critical!
• Create treat...
®
Better advertising inputs could shift
marketing spending back towards advertising
Share of Marketing Expenditures
Advert...
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Measuring Print Advertising Responsiveness via MMM

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Presentation at the ARF Print Council

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Measuring Print Advertising Responsiveness via MMM

  1. 1. ® ® Transforming Advertising Response Into Growth Measuring Print Advertising Responsiveness via MMM A Presentation to ARF Print Council October 23, 2008 1
  2. 2. ® • Marketing mix models are typically driven by weekly store or market level data – This is how promotions are executed – Providing the sharpest possible contrast between promoted and un-promoted sales – Like a designed experiment -- Need: sharper indication of how advertising works TREATMENT CONTROL Promoted store weeks Un-promoted store weeks It’s black & white
  3. 3. ® TREATMENT CONTROL Heavily Exposed 100 GRPs Lightly Exposed 50 GRPS Need: sharper indication of how advertising works • Weekly market or store data does not provide much contrast for sales with and without advertising exposures – Every market includes individuals with a range of exposure levels – Most weeks include individuals with a range of exposure levels • Even during planned hiatuses due to make-goods and scheduling mishaps 7 6 5 4 3 2 1 It’s not black & white – but shades of gray Frequency
  4. 4. ® • As measurement progressed -- Nielsen SAMI UPC Bi-months 4-weeks weekly Regions MarketsStores • And analytics progressed -- Response Bump Promotion Marketing models analysis models mix models • Marketing budget allocations shifted -- Need: sharper indication of how advertising works Share of Marketing Expenditures Advertising Promotion Share of Marketing Expenditures Advertising Promotion
  5. 5. ® Greater financial returns from advertising expenditures • Media ROI, as estimated by marketing mix models, has frequently been reported to be small or negative • No wonder advertising’s share of marketing expenditures has fallen over the years 0 50 100 150 200 250 300 350 400 450 Brand Observations TVROIIndex TV Advertising ROI Index unprofitable profitable Source: Mike Duffy & Paul Beck, ACNielsen, “From Empirical Generalizations to Lessons Learned: Interpreting Market Response Evaluations Across Brands and Categories, MSI Metrics and Financial Performance Conference, 2006
  6. 6. ® MMM - Example 6 Sales Advertising Perfect Match! – Will get all the credit for sales
  7. 7. ® MMM-Example 7 Sales More likely – Major credit for sales Advertising
  8. 8. ® MMM-Example 8 Sales Current data – no/little credit for sales Modeled data smooth the variability, thus provide less to attribute to advertising Advertising
  9. 9. ® Need: Audience data suitable for MMM • Audience-data suitability for marketing mix models also varies noticeably: – Television has excellent weekly data, but weekly market level data is still estimated for all but the largest markets – Magazines are local-market challenged, issue specific challenged and weekly challenged • Although issue specific and weekly magazine measurement shows promise – modeling may undermine the value – Internet is local-market challenged – Radio, magazines, outdoor and newspapers are all weekly- data challenged and episode/issue specific challenged – And all media have issues with measures of ad exposure • Advantaging some media over others • Disadvantaging advertising in total, model accuracy and impartiality
  10. 10. ® 10 Example - TV • An example of the change in advertising’s contribution with a change is audience measurement • Based on Project Apollo data (full presentation given at ARF’s AM3) • Explored using a measure of exposure based on delivery • “working impressions” – impressions delivered to a HH within 28 days prior to a category purchase • Examined the sales contribution attributed to advertising
  11. 11. ® Markets vs. Working Exposure Groups: Volume contribution by marketing factor Standard MMM: 80% 7% 13% BASE PRICE/PROMOTION ADVERTISING Advertisings contribution almost doubles from 7% to 13% by changing the measure of advertising delivery!
  12. 12. ® Single Source • Single-source data links exposures to purchases for the same households – Providing a sharp contrast between exposed and unexposed purchases – Like a designed experiment -- Single source data offers the ability to build from the ground up – as opposed to starting with national data and spreading impressions arbitrarily across markets Will a sharper indication of how advertising works lead to a clearer view advertising’s contribution and redress the marketing allocation imbalance? TREATMENT CONTROL Exposed purchases Unexposed purchases
  13. 13. ® Occurrence Data • Measures of advertising have two components: – Occurrences – Audiences • The precision of available occurrence data varies markedly by medium – Advantaging some media over others – Disadvantaging model accuracy and impartiality • Print has fairly good occurrence data
  14. 14. ® 14 General Enhancements – All Media • Timely reporting • Single source data • Provide distinctions beyond geography and week • Better measures of advertising delivery • Data aggregated rather than spread • Faster data delivery • Better occurrence data
  15. 15. ® 15 Print Specific Enhancements • Issue specific data – critical! • Audience accumulation data – critical! • Create treatment vs. control • Regional editions • Checkerboard issues/regional editions • Less modeled data – variability is good! • Timely reporting • Electronic print measurement
  16. 16. ® Better advertising inputs could shift marketing spending back towards advertising Share of Marketing Expenditures Advertising Promotion Share of Marketing Expenditures Advertising Promotion Share of Marketing Expenditures Advertising Promotion Past Present Future Better print inputs could shift advertising dollars to print!

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