New Think TV research claims some digital channels lead to short term losses for FMCG brands

Think TV has revealed “world first” research it says proves TV delivers the best ROI for FMCG brands and that advertising on other platforms leads to a short-term loss.

kim-portrateThe research by Ebiquity, claims every $1 invested in TV advertising generates a return of $1.74.

Based on the findings the research claims that FMCG advertisers were actually losing money on some advertising platforms over the short-term. It said online video advertising only returned  72 cents for every dollar invested, online display ads returned 41 cents, print 79 cents, radio 71 cents and out-of-home 62 cents.

Looking at the investment made by major FMCG brands including  Unilever, Pfizer, Lindt, Kimberly-Clark, Goodman Fielder, Sanitarium and McCain, it found that in comparison, the short-term effects of advertising in areas such as digital video, print, radio, display and outdoor delivered a loss compared with TV.

thinktv-1Ebiquity Australia and New Zealand chief executive, Richard Basil-Jones, said that the research has been rigorous in its assessment of the impact of ad spending across multiple platforms.

“The fight for every additional percentage point in product sales is a tough one for advertisers in the FMCG category, this rigorous Australian Payback study has proven that when it comes to advertising, TV is the leader for ROI,” Basil-Jones said.

Think TV chief executive Kim Portrate said marketers were trying to drive growth in challenging conditions.

“One of the few levers to grow your business is media,” Portrate said.

“Advertisers in the consumer packaged goods industry – covering pharmacy, liquor and grocery – know the importance of retailer in-store promotions but they also know it comes at a cost and is short-term.”

Other platforms have been quick to respond to the Think TV claims, with Commercial Radio Australia saying independent research showed radio finished ahead of TV and online.

“A landmark study that was conducted independently by Colmar Brunton last year showed that expenditure on radio delivered the greatest return on investment at 17%, followed by online and then TV,” CRA CEO Joan Warner said.

“She said the study showed radio was the only media that “‘consistently increases ROI.

“Colmar Brunton’s research measured the actual sales data and volume of enquiries for 21 national brands, including 17 FMCG brands and four government and service providers,” she said.

“116 campaigns and their real results over a period of 18 months were analysed to determine the impact on ROI when advertising on different media channels (TV, radio and online). The study also sought to determine the effect on ROI when those channels were used together.”

Vijay Solanki said Le Roy's broad experience would bring trust to the role

IAB boss Vijay Solanki said advertisers would not invest in channels that were not offering tangible ROI

Vijay Solanki, CEO of the Interactive Advertising Bureau, said the claims ignored the media multiplier effect.

“There is no argument that TV is important but this report does not provide particularly helpful data for marketers as it ignores the media multiplier effect and it speaks only about short term ROI,” Solanki said.

“It also totally fails to address the speed and inevitability of consumers changing media consumption behaviour.

“Indeed with the high calibre of marketers in the market, it seems unlikely that they would continue to reinvest in channels and strategies that do not work for them. We’ll wait until the full report is made available before commenting in any further detail.”


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