Marketing Effectiveness: Getting the right returns from brand investments
Results of a Nielsen study looking at marketing of products in Asia-Pacific, the Middle East and Africa concluded that not all paid media dollars expect a lift in consumer product revenue. Sometimes brands need to weight more promotional price discounting and Internet buzz into the mix.
For these products, mass media spending was 16% more than average and commanded an average of 31% higher share of category spending.
Nielsen noted: “Some above-the-line investments can actually hurt profitability and brand value.. Internet-based marketing and that which generates buzz among consumers can often be more valuable than traditional marketing models.”
Also, price discounting of products can help. It says some advertised brands get 32% more responsiveness — encouraging more buyers to buy. Plus, these brands get a third less resistance when prices are raised later.
Also, Nielsen says as digital media becomes prevalent, online “buzz” or advocacy becomes more important — it can be a good kick-start to sales performance.
This is not to say paid-media doesn’t do its job. Nielsen says brands that advertise see stronger loyalty in the form of more category spending, some 31% higher. In evaluating return on investment, advertisers need to understand the precise return for every dollar invested in marketing activities. The study found that Internet media generated a return of $1.29, almost twice that of TV.