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Trad media is 'indispensable'

News, 10 February 2017
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NEW YORK: Advertising in traditional media, and specifically television, is far more effective than digital at driving consumer recall and purchase intent for mainstream FMCG brands, new research suggests.

Bain & Company undertook research for a major consumer goods company in a developed market, comparing four types of media – online banner ads, online video, TV and storefronts – and analyzing the cost for each additional 1% increase in reach and the rate at which viewers recalled the ads.

Writing in Forbes, Kenji Govaers (Bain partner, Tokyo), Matthew Meacham (Bain partner, London) and Guy Brusselmans (Bain partner, Copenhagen), reported that "For now, at least, traditional media is still an indispensable channel for many brands".

They found that the "recollected reach" – or the percentage of the total population reached who recalled a campaign – was lowest for digital media and peaked at around 30%. Television advertising, on the other hand, was recollected at rates of up to 60%.

"By repeating the same ad, a brand using traditional media gains incremental reach and increases its recallability among those already exposed to the ad," the authors said.

Moving on to purchase intent, they concluded that this increases with multiple exposures to different types of media,.

"Purchase intent reached 80% for those encountering an ad on many different media types, including digital and traditional," the authors stated.

But, they added, "the implications are different for different types of brands".

Thus, bigger brands with mass appeal and high awareness are likely to benefit from a "reach and repeat" strategy using traditional media, while smaller brands with mass appeal can start with cost-efficient digital media before adding traditional media as they gain scale.

Some brands have cut back on their TV spending in order to make more available for digital, but separate research argues that they are doing so without understanding the full effects.

Research by TiVo, presented as part of ARF Experiential Learning: Re!Think 2016, found that for every $1 saved in TV spend, the drop in sales return was $3.

The Bain authors further noted that their conclusions were subject to change, along with the media environment.

"Lower recallability in digital media may reflect the fact that the current format and content of online ads is not designed to be scalable," they said.

"However, if the online media develops new formats and content that can boost recallability and reachability, then digital media's appeal will grow."

Data sourced from Forbes; additional content by Warc staff

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