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TV drives short-term ROI

News, 29 November 2016

SYDNEY: FMCG brands generate a return of A$1.74 for every A$1 invested in television according to new study that finds no other media achieving a similarly positive short-term revenue ROI.

That was the case at any rate for the nine brands participating in the Payback Australia study, in which brands spending a combined total of A$200m – which included Unilever, Pfizer, Lindt, Kimberly-Clark, Goodman Fielder, Sanitarium and McCain – gave marketing analytics firm Ebiquity access to three years of raw sales and campaign data.

Print (A$0.79), video (A$0.72), radio (A$0.71), OOH (A$0.62) and online display (A$0.41) all came in below the breakeven point of a A$1 return, B&T reported.

Not only that, but the impact of television advertising lasted considerably longer than other media as well.

The study showed that TV retained around 65% of its impact from the previous week, between two and three times the levels of its rivals. OOH (28%) fared best of the rest on this metric, followed by video (23%), online display (22%), print (19%) and radio (17%).

"The fight for every additional percentage point in product sales is a tough one for advertisers in the FMCG category," said Richard Basil-Jones, chief executive of Ebiquity Australia & New Zealand.

"Based on extensive econometric modelling, advertising on TV compared to other media types, has proven to be the clear leader for return on investment for the very large and important FMCG category," he stated.

The head of IAB Australia took issue with that assessment, however, arguing that the study did "not provide particularly helpful data for marketers" since it did not take account of the media multiplier effect and was focused only on short-term ROI.

"It also totally fails to address the speed and inevitability of consumers' changing media consumption behaviour," Vijay Solanki told Ad News.

"Indeed with the high calibre of marketers in the market, it seems unlikely that they continue to reinvest in channels and strategies that do not work for them," he pointed out.

Data sourced from B&T, Ad News; additional content by Warc stuff