TV is the most cost efficient media channel delivering nearly twice as much sales uplift per dollar spend as search and radio, and around five times the uplift of outdoor and online display advertising, an Ebiquity study has found.
The $1 million Payback Australia study, which was commissioned by ThinkTV, analysed the raw sales data of 21 advertises across FMCG, automotive e-commerce and finance with a collective spend of $500 million. It is the second iteration of the study, with the first wave looking exclusively at spend in automotive.
It found that TV produced the greatest returns in automotive, FMCG and finance, while radio and search came out trumps in e-commerce.
The study considered all of the factors that impacted upon sales, such as pricing, seasonal trends and economy before measuring the impact of media spend. It compared media effectiveness of TV, radio, search, cinema, social, print, online display and video and outdoor.
The FMCG component of the study looked at sales figures from Unilever, Pfizer, Kimberly-Clark, Lindt, Goodman Fielder, Sanitarium and McCain. It found that price promotions are the most important factor impacting sales.
TV was the only media channel that delivered any ROI, returning $1.74 for every dollar of media spend. This was followed by print (80 cents), radio (70c) and online video (70c).
In automotive, TV delivered a return of $8.90 for every dollar spent. This was easily the best return of any media across the sectors analysed. The next best return was from radio ($5), search ($3.20) and cinema ($3). This was the only category in which social media ($1.60) delivered a positive ROI, the study found.
In e-commerce, radio ($1.90) and search ($1.50) were the standout media although the investment in radio was relatively low, placing more weight behind the importance of search. Online display (70c) and TV (60c) followed.
For the finance category, TV was a standout with every dollar returning $5.30, followed by online video ($1.10), radio ($1) and outdoor (70c). The study found brands had over-invested in digital with 27% of media budgets only contributing to 6% of the revenue lift from all media.
Ebiquity Asia-Pacific managing director Richard Basil-Jones said measuring ROI is increasingly important for CMOs in an increasingly complex and fragmenting media and marketing landscape.
“The results of Payback Australia are designed to meet those needs,” Basil-Jones said. “ROI is a critical measure for advertisers and although it varies by sector, the order of efficiency by media channel is similar. On aggregate TV emerges as the clear winner across all of industry, which is a testament to its enduring power for brands.
“The e-commerce category showed the importance of search as a key driver of sales. This reflects the pure-play online nature of the businesses we measured. However, it is important to highlight the role that advertising plays in driving traffic to the search platform itself, as a major business you cannot live on search alone and TV is the most effective media to support search.”
ThinkTV chief executive Kim Portrate added: “These results provide empirical evidence that today’s TV is not only the most effective media - making advertisers more money than any other media overall - it is also the most efficient with the strongest retention rate of any media.”
The full findings of Payback Australia will be presented at a ReThink TV event in Sydney on Thursday.
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