Insight, Analytics and the New Marketing
TV still works
In my previous post I talked about how, contrary to popular belief maybe, people are watching more TV than ever and that they are engaging with TV advertising. In this post we will look at whether TV is still an effective medium.
There is an increasing amount of empirical evidence that suggests TV advertising is getting increasingly effective. Perhaps the most often quoted analysis is the one done by Les Binet and Peter Field in 2008. They mined the IPA databank which holds more than 1000 marketing effectiveness case studies from around the world gathered as part of the IPA Marketing Effectiveness Awards. They found that campaigns that used TV have been growing in effectiveness over the past 3 decades. The graph below shows the average % increase in market share growth for campaigns that include TV for the 1980’s, 1990’s and 2000’s.
In June 2009 Joel Rubinson of the ARF performed one of the most extensive reviews of quantitative evidence available in an attempt to validate the hypothesis that TV is losing its effectiveness. He combined 7 different databases of quantitative evidence of the impact of TV campaigns on sales. They included data from the IRI panel, econometric modeling companies like PM Group, Dratfield and Marketing Evolution and research data from Pointlogic and Milward Brown. This combined database contained more than 300 cases across 74 different product categories. Rubinson was not able to validate the hypothesis that TV is becoming less effective. On the contrary – 6 out of the 7 databases showed that TV advertising has become more effective over time. The Pointlogic data for example showed that among 25 different types of touchpoints measured in their survey between 2004 and 2007, TV moved up from 7th to 4th in terms of people impacted per $1,000 spent. In an interview with Brandweek Rubinson said that his study concluded that “units sold numbers increased as a result of increased TV impressions. [When you observe it] across 388 case histories, I think you’ve got to believe it.
These findings are also confirmed by marketing science company MMA. “We haven’t seen a significant trend in the erosion of effectiveness of TV,” said Douglas Brooks, senior VP of MMA in an interview with Advertising Age in Feb 2009. In fact, MMA, which reports to clients each year on its findings regarding aggregate TV effectiveness, has seen a slight uptick in effectiveness in recent years.
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