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Numbers every marketer should know

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from the article MOST MARKETING IS BAD BECAUSE IT IGNORES THE MOST BASIC DATA

Published in: Marketing

Numbers every marketer should know

  1. 1. NUMBERS EVERY MARKETER SHOULD KNOW TOM ROACH, MANAGING PARTNER, PERFORMANCE, BBH LONDON
  2. 2. ZERO to 1 The greatest number of consumers of any brand are very light buyers, and they contribute significantly to sales volume, so for most brands the biggest opportunity for growth comes from taking people from buying it zero times to buying it once in a typical purchase cycle. Source: Byron Sharp, ‘How Brands Grow’
  3. 3. 16% As little as 16% of all advertising is both remembered and correctly attributed, meaning that 84% of advertising spend could be wasted. In a study by the Ehrenberg-Bass Institute of a sample of 143 TV ads, avg. ad recall was found to be around 40%, and avg. branded recall was 40% of that. Source: Ehrenberg-Bass Institute study, quoted in Byron Sharp’s ‘How Brands Grow’.
  4. 4. 1message Source: Kantar Millward Brown If you want people to remember your key message, you’re best delivering 1 message not 2+. Analysis of the Link database shows that the more messages you try and communicate, the less likelihood there is of any single message being communicated.
  5. 5. 2x Emotional campaigns are almost 2x as likely to achieve top-box profit performance as rational campaigns, and over 2x as efficient at driving market share growth per 10 pts of excess SOV. Source: Binet & Field, The IPA 'The Long and the Short of It'
  6. 6. 4x Campaigns designed to drive fame are around 4x as efficient at driving market share growth per extra 10 pts of SOV according to an analysis of the IPA Databank. Source: Binet & Field, The IPA 'The Long and the Short of It'
  7. 7. 2nd Quality of creative execution is, after market and brand size, the 2nd most important driver of advertising profitability, on average multiplying profitability by a factor of 12 according to Data2Decisions. Source: Paul Dyson, Admap, Sept 2014, 'The Top 10 Drivers of Advertising Profitability'
  8. 8. 16x Highly creatively-awarded campaigns can achieve around 16 times the efficiency of non-awarded campaigns, meaning they drive market share growth 16 times more strongly per point of excess SOV, whilst less awarded campaigns achieved just under 10 times the efficiency of non-awarded campaigns. Source: Binet & Field, The IPA 'Selling Creativity Short'
  9. 9. 60/40 Brands should spend around 60% of their budget on brand-building activity and 40% on activation for maximum effectiveness. Too little brand activity and the brand equity needed to drive sales in future will not accumulate. Too little activation and the brand will not be exploiting the sales potential of brand equity as it accumulates. Source: Binet & Field, The IPA 'The Long and the Short of It'
  10. 10. 0.5% Excess share of voice (ESOV = SOV - SOM) is an important contributor to the level of growth. On average, a 10 point difference between SOV and SOM leads to 0.5% of extra market share growth. So a brand with a share of 20.5% with an ESOV of 10 points would grow to 21% market share over a year. Source: Nielsen 'Budgeting for the upturn: does share of voice matter?'
  11. 11. -15% On average, uplifts in consideration following a campaign decline at 15% a week, meaning the uplift will have decreased 50% in 5 weeks and will be back at pre-campaign levels in under 4 months. Source: Mediacom Business Science modelling, avg across every category
  12. 12. +1%pt On average a +1%pt movement in brand consideration will drive an uplift in total sales of 0.5-1.5%. Source: Thinkbox, Ebiquity, Gain Theory, 'Profit Ability: The business case for advertising'
  13. 13. £3.24 Source: Thinkbox, Ebiquity & Gain Theory: ‘Profit Ability: the Business Case for Advertising’ The average long-term profit ROI from £1 spent on advertising is £3.24. £1.51 is delivered in the short-term, with an average long-term multiplier of 2.1. TV has the highest short-term profit ROI of £1.73 on avg. and the highest long-term multiplier, 2.4.

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