There are massive opportunities for great return on investment out there, particularly in digital media, but people need to be smart with their tactics and choose the right media type. This is the view of Terry Murphy, media lead at Nielsen.
“The story is never going to change, we’re in an industry that has the same story every year, it just gets more and more difficult. And each year the knobs are tightened just a little bit and each year, we need to sharpen our skills just a little bit more,” she stresses.
Speaking at Nielsen’s recent Consumer 360 event, Murphy gave some insight into the modern day consumer. They are more on the go, demanding more convenience from brands, not just in their shopping choices, but spilling over too into entertainment and viewing choices.
“Not a new trend, but it’s about how we work with it, is that earned media is generating the most credibility and trust. But what’s changing in that is that it’s not just about our friends or confined to a circle of direct contacts. Now it’s broadening, with opinion social media groups becoming more relevant,” says Murphy.
“On the paid for media side, traditional media are still ahead of the game particularly emerging markets in Africa, including South Africa. Our trust indices across the traditional media are still far higher than the rest of the world, and this leads to brand legitimacy,” she adds.
Despite these trends, what actually matters is the actions stemming from them. Budgets have softened across the board, but in some categories there is still spend. Nielsen research shows that generally, “the top five brands in each category are driving the growth”.
Still opportunities out there
Murphy is adamant there are plenty of opportunities to deliver impressive ROI for clients. “The many case studies we look at in our analytics division show this. If we understand the timing, our tactics and where we’re investing,” she explains. “What carries the biggest weight is the choice of media channel and this comes under the most scrutiny.”
Digital has the potential to surpass other media types
A piece of Nielsen research that tracked the marketing campaigns of 17 big brands (mostly FMCG) for three years revealed surprising results in terms of average ROI per media type.
Digital ranked as the top average ROI generator across the different types. “With digital, which is very attractive, there are a massive range of ROI returns. There are hundreds of thousands of digital platform choices and executions… Digital costs less in terms of cost per thousand and has the ability to target well.”
But she cautions: “The metrics in digital are confusing. You have click throughs, viewability at several different thresholds, impressions and page views, whether it includes bots or human traffic. There’s an extensive set of metrics in the digital landscape and this makes it very difficult to understand the on-target percentages of the target market and real reach… The complexity of metrics has to be understood and I’m not sure that it always does us a favour.
“There is a lack of consolidation in the metrics in the media space, not just in South Africa but on global stages; the general opinion is that digital needs to start bringing their measurement metrics into something that is more comparable with all traditional media,” Murphy says. “It’s cool that it can do all that stuff, but it’s now commanding more percentages of adspend, and it needs to be as accountable as TV has been in the past.”
TV remains a reliable medium
The research highlighted that television remains a reliable medium for marketing investment, producing consistent returns.
“TV has a range of between R1 and R2 return on R1 expenditure. It is a really safe medium. But the reality is, with TV you have a finite number of options… They’ve got a very stable, suitable currency that’s been running for decades. Everyone knows what they’re buying and what that buying delivers for them. It works out generally to be a positive ROI,” says Murphy.
The appeal of sponsorships
Murphy also touched on the increasing demand for sponsorships, particularly those around sport.
“Sponsorship generates still one of the highest trust factors in the country, certainly in South Africa, Africa and emerging markets. And giving the opportunity for smaller and regional brands to put themselves on the map.
“It’s no longer about tickets and logos and buying brand exposure in the televised match. It’s a lot more complex. And brands want to a part of every aspect of the sponsorship… It used to be a prestige thing, but now brands actually want to know the sales uplift on the thing they’re sponsoring,” she explains.
No longer are big brands the best sports brands. There’s now a lower barrier to entry, and smaller or regional brands are stepping up to the plate.
Kelvin Watt, managing director for Africa and the Middle East for Nielsen Sport, explains how brands should be approaching sports sponsorship and busts the myth that this type of sponsorship is only for big brands:
Optimism in tough times
Murphy’s takeaway called for optimism in tough times. “Let’s not get depressed about our softening media budgets. The range of ROI is massive if you are using the right levers, understand those levers, use the right metrics and place them properly. Traditional media is still doing the trick, but what is missing is the accountability… Digital is not only playing in the young kid’s game, digital needs to be as accountable as TV needs to be as returns from digital can outstrip those from TV if done properly,” she concluded.
Michael Bratt is a multimedia journalist at Wag the Dog, publishers of The Media Online and The Media. Follow him on Twitter @MichaelBratt8
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