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Yes, Advertising Works.Now, What’s My ROAS Across Media Platforms?

Leslie Wood PhD - Nielsen Catalina Solutions

Britta Cleveland - Meredith Corporation

Dave Poltrack - CBS Corporation

Tony Marlow - Yahoo

Jim Spaeth PhD- Sequent Partners

Alice Sylvester - Sequent Partners

June 14, 2016

How does

the cost of the media

affect it?

Are there differences by

category?

Is this changing

over time?

How do the

media

platformscompare?

How do brand

characteristics

affect the return?

Does

creative

type vary

the results?

What Sales & Return

should I expect from

my Advertising?

Step 1: Assembled a group of experts:

Step 2: Dug into the data and looked at:

• Correlations,

• Graphs,

• Distributions

• Insights

Meet the Cross-Industry Project Team

Leslie Wood PhD, Chief Research officer,

Nielsen Catalina Solutions-

project lead

Jim Spaeth PhD, Partner, Sequent Partners

Alice Sylvester, Partner, Sequent Partners

Britta Cleveland, Senior Vice President, Research

Solutions, Meredith Corporation

Dave Poltrack, Chief Research Officer, CBS

Corporation and President of

CBS VISION, CBS

Tony Marlow, Head of Field Marketing,

Yahoo

3

• Nearly 1,400 studies with complete data

• 11 years of tracking, though not all media

tracked over all years

• Media: TV, Online Display & Video, Mobile,

Cross-Platform, Magazines

• 450 CPG brands in the U.S.

• All reported values with less than 10 studies

are removed and all values with between

10-20 studies are shown with faded color

Meet the Dataset

4

Meet the Media

Linear TV since 2009 – TV networks & cable networks

Magazines since 2012 – Major publishing companies, large

campaigns

Online Display since 2004/Video since 2008 – major publishers &

portals; typically premium inventory. Little to no programmatic.

Wide variety in size of campaigns and size of brands

Mobile since 2013 – In-App measurement

Cross Media since 2013 – Includes more than one media

5

Objectives

$

Determine the ROAS (Return on Ad Spend) figures for each media that reflect the actual differences in the media

Determine sales productivity metrics that remove media costs from the equation

What factorsdrive sales results?

Many of the drivers of

differences between media

are not being controlled for

Norms Across Media are Challenging:

Each media has a different mix of years, of brands, categories

and budgets

Recessionary

period

Changes in

media landscape

– no clear

categorization

$

$

Media costs and

Incremental Sales vary

by year, size of brand,

category & media

budget

7

How Do We Measure the

Incremental Sales

Attributed to Advertising?

8

NCS Connects the Media People Consumewith the Products they Buy

Exposure Data Nielsen Media &

Partner Data

Nielsen NPM

Mobile

80 MM HH

Radio

29K HH

Set Top Box Data

4.3 MM HH

Digital

100 MM HH

Client Proprietary

Print

50 MM HH

Buy DataCatalina Frequent

Shopper Card Data

90 MM HH

• Nielsen Homescan

All-Outlet Data

• Client Proprietary

Sales DataAnonymous

Single Source

Households

How we Measure the Sales Impact of Advertising

Measure & Interpret Sales

Impact by focusing on

purchasing patterns

Test Design and

Treatment Execution

Exposed & Unexposed HHs

matched on hundreds of

variables to isolate ad impact

UnexposedControl Households

+14%

ExposedTest Households

Exposed

(Test)

Unexposed

(Control)

Exposed households

isolated in database

10

The Result: Incremental Sales

Exposed and Unexposed Comparison Accounts for 52 Weeks Purchase History & Demographics

Campaign Start

Your Ad Drove

Incremental Sales

Unexposed

Household

Purchases

Exposed

Unexposed

Campaign End

11

Key Metrics:

An ROAS of $3.00 means

that for every $1.00 spent

on advertising, $3.00 is

driven in incremental sales.Incremental

Sales Lift

Campaign

Costs

Incremental

Sales Lift

Exposed

HH

Incremental

Sales Lift

Impressions (000)s

delivered

Incremental Sales

per Exposed or

“Reached” HH

Incremental Sales

per thousand

Impressions

ROAS$

These metrics

remove the

cost of the

media to

measure “sales

productivity”

12

ROAS:

All Studies – Across Media

Source: Nielsen Catalina Solutions, Multi-Media Sales Effect Studies from 2004 – Q4 2015. Copyright 2016 © Nielsen Catalina Solutions

$

$2.63 $2.55 $2.45

$1.53

$3.94

$2.62

$-

$0.50

$1.00

$1.50

$2.00

$2.50

$3.00

$3.50

$4.00

$4.50

Display Linear TV Mobile Digital Video Magazines Cross Media

ROAS

13

Incremental Sales per Reached HH:



$0.19

$0.33

$0.23 $0.23 $0.26 $0.25


Incremental $ per Reached HH

14

Incremental Sales per Impression (000):


$16.95

$20.56

$26.52 $23.48

$20.30

Display Linear TV Mobile Digital Video Cross Media

Incremental $ per Impression (000)

Note: Magazine Impressions not currently included in the database


15

Incremental Sales per Reached HH

Incremental Sales per thousand impressionsROAS$



Different Metrics Paint a Different Picture

Mobile

Linear TVMagazines

16

ROAS:

Category – All Studies

$3.71

$3.06$2.82 $2.78 $2.67 $2.60 $2.59

$-

$0.50

$1.00

$1.50

$2.00

$2.50

$3.00

$3.50

$4.00

Baby Pet Health & Beauty GeneralMerchandise

Food Beverage Over-the -Counter

ROAS

$


17

ROAS:

Category – Across Media$


$-

$0.50

$1.00

$1.50

$2.00

$2.50

$3.00

$3.50

$4.00

$4.50

$5.00


ROAS

Baby Pet Health & Beauty General Merchandise Food Beverage Over-the -Counter

18


Category – Across Media


$-

$0.05

$0.10

$0.15

$0.20

$0.25

$0.30

$0.35

$0.40

$0.45




19

Incremental Sales per Impression (000):

Category – Across Media


$-

$5.00

$10.00

$15.00

$20.00

$25.00

$30.00

$35.00

$40.00

$45.00





20

What we do know: Brand Characteristics Matter

Marquee BrandsBigger Brands, shorter

purchase cycle

Mid-sized

Brands

Infrequent UseSmaller brands, longer purchase cycles,

fixed level of purchasing across time

Average Penetration

(1 year)47% 15% 10%

Average Purchase

Cycle (days)69 71 96

Average Brand Share 31% 16% 11%

FROZEN

Cluster Analysis: clustered brands into groups based on their purchase cycle, dollars per week and penetration

21

Across Clusters: Very Different Average Performance

$3.63

$2.78

$2.18

$-

$0.50

$1.00

$1.50

$2.00

$2.50

$3.00

$3.50

$4.00

MarqueeBrands

MidsizeBrands

InfrequentUse

ROAS

$0.31

$0.22

$0.14

$-

$0.05

$0.10

$0.15

$0.20

$0.25

$0.30

$0.35

MarqueeBrands

MidsizeBrands

InfrequentUse



22

ROAS:

Clusters – Across Media$

Values with 10-20 studies



$3.70

$2.74 $2.95

$5.94

$2.70 $2.65 $2.57

$1.44

$3.82

$2.69

$1.96 $2.10 $1.75

$3.80


ROAS

Marquee Brands Midsize Brands Infrequent Use

23


Clusters – Across Media




$0.29

$0.73

$0.25

$0.53

$0.19

$0.30 $0.25 $0.23 $0.24 $0.26

$0.12

$0.33

$0.13

$0.24




24

Incremental $ per Impression (000):

Clusters – Across Media

$22.38

$25.36

$31.97

$18.17

$21.92

$28.13

$20.68 $20.68

$11.58 $13.14

$17.83








25

ROAS:

All Studies – Across Years

$3.05

$4.22

$2.23 $2.20

$4.20

$3.30

$5.28

$3.27

$2.31$2.80

$2.33

$-

$1.00

$2.00

$3.00

$4.00

$5.00

$6.00

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015

ROAS

$


26

Summary/Findings

• It was much harder than we thought to isolate the variables to create a pure “apples to apples” comparison between media

• For example, we could not control for creative – and we know from other studies that creative is a primary driver of all lift measures: ROI, ROAS and Incremental Sales

• While we need to use with caution, advertisers can compare their results to these norms

o By Media Platform, Category, Brand Cluster & other filters

• Brand Clusters are better indicators of incremental sales than category

27

Implications

• There is no “best” media – strategy & message drive the choice

• These are averages. Be accountable to sales: Know Your Numbers!

•Make sure that your creative is as strong as it can be, and is driving sales

• Leverage data and measurement to inform media decisions

28

$2.63 $2.55 $2.45

$1.53

$3.94

$2.62 $0.19

$0.33

$0.23 $0.23 $0.26 $0.25

$16.95

$20.56

$26.52

$23.48

$20.30

Incremental Sales per Reached HH

Incremental Sales per thousand impressions

ROAS

$


Summary: Three Key Metrics


Display Linear

TV

Mobile Digital

Video

Magazines Cross

Media

Display Linear

TV

Mobile Digital

Video

Magazines Cross

Media

Display Linear

TV

Mobile Digital

Video

Cross

Media

29

Appendix

How Does the Same Brand

Perform Across Media?

Brand A:Very Different Results for the Same Medium, Same Period of Time

0.00

0.20

0.40

0.60

0.80

1.00

1.20

1.40

ROAS

Brand A – Same Time PeriodThree Digital Portals - Nine Different Tactics

$


32

Brand B:Consistently High Results for Different Years and Different Media

0.00

0.50

1.00

1.50

2.00

2.50

3.00

3.50

4.00

ROAS

Brand B Different Media & Years


$

33

Media Type by Year NCS Began Measurement

2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015

Source: Nielsen Catalina Solutions, Multi-Media Norms & Benchmarks: 2004 -Q4 2015. Copyright 2016 © Nielsen Catalina Solutions

Online Display

Online Video

Cross Media

TV

Mobile

Magazines

Radio

34

$3.62$3.27 $3.18

$2.62 $2.51 $2.43 $2.35$2.06

$-

$0.50

$1.00

$1.50

$2.00

$2.50

$3.00

$3.50

$4.00

Reward/Sweepstakes *

Promotion/Coupon

Nutritional * Other Interactive Equity -Branding

Usage Recipe

ROAS

ROAS:

All Studies – Creative Type$



35

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