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There are all sorts of reasons why television advertising is so brilliant at creating success for brands and businesses both in the short-term and the long-term. Here are the top ten, plus supporting evidence and links.
- TV is the best profit generator
- TV has unbeatable scale and reach
- We’re watching more TV than ever before
- TV is the most talked about medium both on and offline
- All TV ads are response ads
- TV is the new point of sale medium
- TV is the dominant youth medium
- TV is THE emotional medium and emotional campaigns are more effective
- TV is the catalyst for other media
- TV builds brand fame
There are many ways advertising is judged; was it popular, did it win awards for creativity, are people talking about it or sharing it with friends? These are all valid, but nothing is as important as whether or not the advertising was effective in hard business terms. Did it actually work? If not, then it is hard to justify the investment. TV works better than any other form of advertising. It generates the highest absolute volumes of sales and profit whilst also delivering the best ROI. However, you need proper econometric analysis to unpick this.
Thinkbox is able to point to four major and impartial studies into the effectiveness of advertising to make this assertion with confidence.
- The PWC Payback Study 1 – the most extensive of its kind ever undertaken – over 10 years of data for over 700 brands in seven different market sectors to unlock the payback of TV expenditure
- TV delivered the highest sales return of any medium; £4.5m per £1m spent
- TV delivered value for longer. The first year’s TV investment was still delivering at 80% of the Year 1 level in Year 2, and even Years 3 and 4 were benefitting from TV investment in Year 1
- TV also demonstrated the highest correlation between brand value (based on WTP -willingness to pay) and investment using an innovative research technique to evaluate how consumers value brands
- With one exception, TV was the dominant medium used by the brand leaders in each sector and all of them were above-average TV investors compared to the average for their market. TV investment almost perfectly correlated with brand value, far more so than for any other marketing channel
- The PwC Payback Study 2 added more insight into what happens to people’s willingness to pay for brands in a downturn
- Brands have a 73% chance of losing brand value (WTP) within 12 months if they reduce their TV spend and a 67% chance of increasing brand value if they increase TV spend
- Those making heaviest ads cuts are losing most brand value – especially those cutting TV
- The damage from a year off TV can take five years to undo, says Data2Decisions
- TV advertising has a far stronger correlation (82%) with brand value than any other medium (the nearest is press with 47%) – and over double the correlation of the average for all other media
- Payback 3, http://www.thinkbox.tv/server/show/nav.1818 is an econometric analysis of 3,000 ad campaigns across nine advertising sectors between 2006 and 2011. It compares, on a like-for-like basis, the sales and profit impact during the last five years of five forms of advertising: TV, radio, press, online static display and outdoor. It shows that TV advertising created the most profit (an average return of £1.70 for every £1 invested) and that its return on investment (ROI) has increased by 22% in the last five years
- Ebiquity found that TV advertising is 2.5 times more effective at creating sales uplift per equivalent exposure than the next best performing medium
- The IPA Study – ‘Marketing in the Era of Accountability’ – 27 years of IPA Effectiveness Awards data
- Campaigns which used TV are on average 25% more effective than ones which did not
- Campaigns which used TV as the lead medium are more likely to generate large business effects
- TV creates emotion better than other media and was far more effective in driving the bottom line (sales, market share, profit and loyalty)
- Fame (which TV excels at) is at the heart of the most effective advertising
- Liking (which TV excels at) an ad is the best predictor of business success
- The study also showed that TV is getting more effective over time; it has increased its lead over all other media channels in each of the last three decades. In fact, the report concludes “don’t neglect TV. Far from being dead, TV advertising remains one of the most effective and efficient media. New technology and increased competition for viewers may actually be making TV more efficient, not less”
Further links: Effectiveness
Television has always had the capacity to reach a massive audience. Commercial TV now offers a plethora of channels and programmes and can reach over 70% of people in one day. It is TV’s ability to deliver these numbers and in a short space of time that is a key USP for the medium.
In addition ‘Event TV’ and programmes like Britain’s Got Talent and Champions League Football are bringing in even bigger audiences, particularly for hard-to-reach viewing groups (like young men aged 16-34), as well as making famous the advertisers associated with them.
This capacity, unique to TV, can also serve to make brands seem bigger than they really are, instilling a sense of authority and stature and re-enforcing that TV is the biggest game in town.
- You can reach 71% of people in a day on commercial TV, within a week you can reach 93% and within a month, 98% - no other medium can better (Source: BARB)
- Britain’s Got Talent peaked at 10.9m million people on Saturday, 28 April 2012
- The average viewer watched 47 TV ads a day
- The UK as a whole watched 2.7 TV billion ads a day
Linear TV viewing in the UK has been steadily breaking records in recent years until, in 2010, it broke through the 4 hours a day mark for the first time. This was an astonishing vote of popularity by the viewing public. We now spend more than a day a week (over 28 hours according to the Broadcasters’ Audience Research Board (BARB)) watching broadcast TV. And don’t forget that this doesn’t include all the TV BARB doesn’t yet measure, like out of home, online or mobile TV. This accounts for a minimum of at least an hour of extra viewing.
- In the UK we watched 28 hours, 14 minutes of linear TV a week in 2011
- The daily average was 4 hours 2 minutes each
- And commercial impacts increased by 2.6% yoy in 2011, having grown by 19.6% over the last five years to a new record high
- Touchpoints 4 (5,572 sample; media usage monitored in real time; all media exc outdoor) shows people spend far more time watching TV than with any other medium; (TV 49%, Radio 26%, Internet 21%, Newspapers 3% and Magazines 1%)
- Time spent with a medium is a poor way of assessing its effectiveness; most people would accept that a minute of TV advertising is more powerful than a minute of, say, radio. However, if we compare time spent with each medium against their shares of advertising revenues, TV is significantly undervalued
- The growth of commercial viewing has helped create a TV market where prices are at 1980s levels in real terms – spectacular value for advertisers
Further links: TV at a glance
TV is cultural glue. People love talking about TV, off- and online, almost as much as they love watching it. The advent of 2-screening has seen TV become even more magnetic. Many of us now share a virtual sofa with the world and having a second screen to hand enables us to give live, online reaction to TV via social media; uploading pastiches to YouTube, joining TV-related Facebook groups, and airing opinions on Twitter.
- 21% of people in the UK 2-screen every day (IPA Touchpoints 4) 27% have used social networks such as Facebook and Twitter while watching TV (IPA Touchpoints 4)
- One in five (19%) has shared TV content on a social network (Thinkbox Tellyporting, 2010)
- 9% have joined a TV-related Facebook group (Thinkbox Tellyporting, 2010)
- 40% of primetime tweets are about TV, says Twitter
We all know that TV makes people do things, from voting for our favourite reality contestant to ordering something online, and the advancement of technology has made it even easier to respond to television. Driving viewers to do something (increasingly online) is now a key objective for many advertisers.
Thinkbox commissioned MediaCom to examine this further and study the link between TV spots and web activity conducted within a 10 minute timeframe of the TV ad broadcast. What they found is that all TV ads will create an online response, even if response is not the primary objective, and because they can now be instantly searched for, shared, copied and appraised at the click of a mouse, this is adding a whole new dimension to response advertising.
- All TV activity will illicit an online response. For example, 94% had gone online as a result of seeing something on TV in the last year (Source: Online Journeys with The Best Organisation)
- 25% with internet access at home concurrently watch TV & browse the net every day (Source: IPA Touchpoints 4)
- Those who view concurrently spend around 31 minutes per day doing so (Source: IPA Touchpoints 4)
- As a result of seeing a TV ad, 57% agree they have conducted an online search, 36% agree they have visited a brand’s website to find out more, 28% have searched the net to find out where to buy the brand and 21% have purchased online - Source: TV+Online: better together (a joint study with the IAB commissioned from Q Research)
- TV ads trigger online activity. Approx 60% of all immediate response to TV ads is via an online route. This has increased from c15% 10 years ago - Source: The new rules of TV response (commissioned from MediaCom)
- Even pure brand ads with no call to action generate an immediate web response. - Source: The new rules of TV response (commissioned from MediaCom)
Thinkbox’s TV + Online study, with the IAB (TV & Online: Better together), demonstrated that, for the most digitally enabled people, TV is often concurrently consumed with the laptop open and online. People are increasingly ready and able to use it to find out more or communicate about the content they are watching on TV, both programming or advertising content. There are many examples of TV leading directly to online search, comparison and purchase and strong evidence that, without TV, online activity would be less effective. The journey from TV to purchase is now much shorter – even immediate – thanks to the internet.
- Amongst the TV + Online sample concurrent consumption of TV and online is fast becoming a regular event
- We saw in the study anecdotally how that can lead to people following up what they see on TV with immediate online action, via search, website visits, purchase. A brand can go from initial awareness to sale all within the same commercial break
- People who were registered on retail websites could immediately place items they had seen in a TV ad on their shopping list
- In total, 75% of the sample could recall acting on at least one TV commercial, compared to 52% who could recall acting on an online ad They are generally more positive about TV advertising across all its roles, but particularly at the start of the consumer journey
- Consequently, more of them say they have been persuaded to purchase online by a TV ad than by online advertising 52% of people claim to have shopped online while watching live TV (Thinkbox Tellyporting research, 2010)
TV is the dominant youth medium. It remains the medium younger people spend the most time with. Plus, young people also watch more additional TV online than most. Young people have always been lighter TV viewers…but they grow into adults and we should always be careful not to confuse life-stage behaviour with long-term trends.
- 15-24s spend 43% of their media day with linear TV (IPA Touchpoints 4, 2012)
- Young people watch a lot of TV, and it is increasing for 10-15s and 16-24s
- 10-15s’ viewing has grown 11% in the past 5 years; 16-24s’ has grown 10%.
- Young people particularly like commercial TV: it accounts for 72% of 16-34s’ viewing
- As a consequence of more viewing, younger people are watching more ads. 10-15s watch 7.7% more ads now than 5 years ago; 16-24s watch 22% more
- Within the 16-24s group, around 1.5m students living away from home are not counted by BARB during term-time – and they watch a lot of TV
In advertising, we have always known anecdotally that strong creativity means more success, but there was little proof of the link. We now have the beginnings of a databank of proof, not least a study called ‘The link between creativity & effectiveness’, by the IPA, in association with Thinkbox. This analysis, by the distinguished marketing consultant Peter Field, looked at 435 campaigns over a sixteen year period (1994-2010). It fused the Gunn Report database of creatively-awarded ad campaigns with the IPA Effectiveness Databank, home to ad campaigns which have proven their effectiveness, to examine any link between the two.
It is TV’s ability to create deep, long-held emotional brand associations that is one of its most unique benefits.
‘The link between creativity & effectiveness’ (2010), by the IPA in association with Thinkbox, found that:
- Creative campaigns are 12 times more efficient at delivering business success.
- The more creatively awarded a campaign, the more effective it becomes.
- Creatively awarded campaigns are much more likely to be ‘emotional’ than ‘rational’ (44% vs. 19%).
- Investing in creativity is a powerful way to achieve fame (i.e. buzz).
- Creatively awarded campaigns that invest strongly in Excess Share of Voice (ESOV) perform particularly well, suggesting that many creative campaigns could further improve ROMI by investing more in Share of Voice (SOV).
- Despite generally being disadvantaged by lower levels of ESOV, creatively awarded campaigns still generate more and greater business effects than non-awarded ones.
- With the same level of ESOV, creatively awarded campaigns would have driven twice as much market share growth as non-awarded ones.
- 35% of consumers ranked Gunn awarded campaigns as ‘highly liked’ versus just 20% for non-Gunn awarded campaigns.
- In ‘Marketing in the Era of Accountability’, the IPA proved that emotional ads were 94% more effective than rational or informative ads.
TV advertising doesn’t just work for what’s being advertised, it also creates a ‘halo effect’ across a brand’s portfolio. So, for instance, if a beauty brand advertises a shampoo product on TV, the campaign is likely to boost sales of its other products, such as body spray or moisturiser; if a bank advertises a mortgage product, its home insurance and current accounts will benefit. And TV also makes other elements of advertising campaigns work harder; it is other media’s steroid. These facets of TV are often missed and so are another cause of the misattribution of TV’s powerful effect. Luckily, econometric studies can unpick them…
- 38% of TV’s total sales effect is felt by products not directly advertised (Payback 3)
- TV’s effects are felt by all accompanying media, but are most starkly seen in combination with radio advertising, where radio’s effectiveness is increased by up to 100%, and with branded search, which a typical TV campaign increases by up to 35% (Payback 3)
- The Direct Marketing Association (DMA) found that when TV is added to other response-gathering media it improves their performance dramatically:
- Print response rises by 92%,
- Direct Mail by 96%
- Online responses increased by 164%.
Quite simply TV is the best medium for making and keeping brands famous. From Hovis to Yeo Valley to PG Tips, we recognise the truth of this intuitively, and nearly all of the most famous brands have famous TV campaigns.
Investing in creativity is a powerful way to achieve fame (i.e. buzz and talkability). Brands can buy awareness but not fame; and fame is proven to be at the heart of the most effective advertising
Furthermore and through the most thorough and impartial examination of the last 27 years and 880 Advertising Effectiveness Awards (the best of the best), the IPA has proved that no matter what size your budget, TV makes campaigns more effective and it also outperforms all other media channels.
- Campaigns which used TV were on average 25% more effective than ones which did not (source: ‘Marketing in the Era of Accountability’, IPA)
- Emotion and fame (at which TV excels) were the most effective creative strategies (source: ‘Marketing in the Era of Accountability’, IPA)
- The link between creativity and effectiveness research analysed the correlation between campaigns' performance across a wide range of the worlds' most respected creative awards determined by The Gunn Report, and their performance in hard business terms recorded in the IPA Effectiveness Awards Databank between 2000 and 2008. It reveals a direct correlation between strong advertising creativity and business success and that high levels of creativity make advertising campaigns at least 11 times more efficient
Discover the power of TV advertising
There has never been a better time to start adding the power of TV to your marketing, as scores of new-to-TV advertisers are finding out. This link will give you some guidance on how to get started and also who to get in touch with, both at Thinkbox and at the TV companies.
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Thinkbox and the Marketing Society have collaborated on this new handbook to explain why TV advertising can make a powerful difference to your business. It features key findings from the major recent studies of advertising effectiveness to create a compact guide on how advertising works and, in particular, TV’s place at the heart of the most successful campaigns. Here you will find concrete proof of how TV can work for you and how it pays back, whatever the time scale or budget. You can also download the handbook in handy PDF form, or navigate through to some nickable PowerPoint slides with notes that will help you make a watertight case for investment in TV. Find out more right here...
Our latest ad dramatises the powerful effect that TV can have. We thought you might like some "at a glance" examples of brands that have recently used TV and experienced business-transforming effects, against all sorts of objectives from launching or building a brand to increasing web-traffic, footfall and sales: we hope there is something here to inspire.