RoI for Digital Ads is Better Than TV, Reports Kellogg

08 September 2008

BOSTON, Massachusetts: The Kellogg Company's return on online investment in its Special K brand bettered that of TV, the cereal giant's cmo Mark Baynes told attendees at the annual Back to School Consumer Conference staged last week by beleaguered investment bank Lehman Brothers.

Comparing the results of ad campaigns over the past eighteen month, Baynes said: "It's still relatively early in our learning, but analysis of the Special K initiative … showed digital media exceeding that of broadcast RoI."

Kellogg, along with H J Heinz, was one of the first major food multinationals to up both adspend and product prices in response to the surge in global raw materials costs.

Its ad budget topped $1 billion (€700.6m; £565.4m) in 2007 and is set to exceed that sum in the current year. An additional $300 million is allocated to promotional spending.

According to Baynes, the Special K data is "obviously very encouraging," and will help "drive stronger adoption across the business".

As to the online medium in general: "For the right opportunity, the [online] space offers fresh ways to commercialize new and existing brands, target specific audiences on needs more cost effectively."

Meantime, UBS analyst David Palmer managed to exhume a gram of good news from the current economic morass, telling the conference that cereal consumption will grow during Q4 2008, accelerated by higher rates of unemployment.

Yup, you read that right. Accelerated by higher rates of unemployment.

More people will be eating breakfast at home because they don't have anywhere else to go, propounded Palmer.

"When you lose your job, it not only determines how you feel and how much money you have, it's also determines where you are," he said. "Where are you rushing to?"

Data sourced from; additional content by WARC staff