millwardbrown_perspectives_2008-2009.pdf - perspectives...

This preview shows page 1 out of 221 pages.

Unformatted text preview: perspectives 2008-2009 F R O M T H E C E O Dear Friends of Millward Brown, Writing this letter every year provides me with the opportunity to reflect on the past 12 months and begin to think about the coming year. And what a year it has been! For marketers, even the more mature among us, we have not seen or experienced a year like it before (and likely aren’t eager to experience one again). But for all of the economic pain and business tumult, I see a bit of a silver lining in what we’ve been through. Challenging times have forced us to stretch our thinking, exercise our creativity, and reinvent like never before. Those marketers who have embraced the challenges will inevitably emerge from the economic downturn stronger, while those awaiting the return to “normalcy” may be in for a very long wait indeed! At Millward Brown, we’ve been thinking a lot about how to help you, our clients, do more with less. Whether that’s driving high impact advertising, looking at how your brands fare at the point of purchase, or helping you reallocate your media for greater returns, we’ve tried to focus relentlessly on marketing efficiency and effectiveness. You’ll see that reflected in this, our third volume of Perspectives. Our Points of View series provides our editorial take on some of the hottest marketing topics of the day, like mobile marketing, social media, and effective targeting. We’ve also responded to your continuing appetite for digital learning with a new series on digital marketing effectiveness from our team at Dynamic Logic. Knowledge Points are data-driven analyses that come from our vast storehouse of survey information. Finally, we’ve reprinted some of the published articles by Millward Brown authors that you might have missed. Though we don’t anticipate a complete end to the economic turmoil in the coming year, we’re still optimists. Together with you, we’ve learned a great deal in the past year and that knowledge will serve us all well for the future. We look forward to helping you navigate the “new normal” of the marketing world. If you have thoughts on how we can better serve you, please do contact me. With best regards, Eileen A. Campbell, CEO, Millward Brown [email protected] table of contents P O I N T S O F V I E W Marketing Effectiveness: Beyond the Short Term .....................................1. What’s in Store for Store Brands ..................5 Make Friends, Don’t Pitch Them ..................9 Getting Serious About 360 ........................... 13 Direct-to-Consumer Advertising Works .............................................. 17 Whose Brand is it Anyway? ........................... 21 Targeting Online Ads: Aim for the Bulls-eye or Focus on Hitting the Target? ...................................... 25 Rules of Engagement ..................................... .29 Culture Clash: Globalization Does Not Imply Homogenization ...........................33 Marketing During Recession: Planning on Recovery ...................................... 37 What’s Next for Mobile? ................................. 41 K N O W L E D G E P O I N T S What Are the Most Successful Routes for Advertising to Children?........... 46 How to Make the Best Use of Music in an Ad...................................................... 50 Targeting the Over-50s Market ................. 54 Using Consumer Sales Promotions to Benefit the Brand .............................................. 58 What Does Cinema Advertising Add to a Campaign? ......................................... 71 How Best to Market to Business Professionals? .................................. 74 What Role Does the Brand Have in Business-to-Business Markets? ............77 How to Change a Brand’s Name Successfully ............................................ 81 D I G I TA L I N S I G H T S Beyond the Click®: Less Intrusive and New Online Ad Formats Perceived Most Positively by Consumers .................... 85 Beyond the Click: First Look at Mobile Performance .........................................87 Beyond the Click: Research Trends Suggest Web Users Are Growing More Accepting of Over-Content Ads ................ 89 MarketNorms® — Enabling You to Determine the Most Cost-Effective Campaign Elements to Maximize Your Brand Impact. ............................................ 91 Live From the Web…Sampling Done Right ............................................................ 94 M A R K E T F O C U S Vietnam.................................................................... 98 Switzerland ..........................................................102 What Are the Pitfalls of Using Sexual Imagery in Advertising? .................................. 60 Chile ........................................................................ 106 Is There Value in Comparative Advertising? .......................................................... 64 Japan ........................................................................ 114 Using Web Sites as Part of the Marketing Mix .......................................................67 Honduras ................................................................110 Sweden ................................................................... 118 Singapore .............................................................. 122 Romania ................................................................ 126 Nigeria ....................................................................130 Kenya ...................................................................... 134 P U B L I S H E D A R T I C L E S Argentina – How Media Clutter Has Impacted Advertising Effectiveness.......... 139 Gabriela Cés and Julia González Treglia Customer Focus.................................................. 145 Ove Haxthausen Stuck in the Crisis – A JapaneseStyle Crisis in the Making?............................. 151 Antonio Imedio and Miguel Ángel Martín How Should Global Brands Communicate in Recessionary Times? ...................................... 155 Nigel Hollis Chinese Consumer Attitudes in the Downturn..................................................158 Peter Walshe Different Reactions to a Crisis......................162 Rafa Garrido Filling in the Mobile Measurement Gaps.......................................... 164 Jennifer Okula Reassuring Brands Online Ads Really Do Have an Impact on Consumers...................................................... 167 Christina Goodman Global Research Needs to Be Overlaid With Cultural Tastes.......................169 Nigel Hollis Firms That Build Brand Value Will Be Recession Survivors.......................... 175 Joanna Seddon Finding the Best Length for Online Video Needs Further Research............................................... 180 Christina Goodman Who Are Our Children, Really?...................182 Petra Pr ušová ° Maximising Media Synergy for Cost-Effective Brand Building......................185 Sue Elms and James Galpin 10 Ways to Ensure an Actionable Segmentation.............................. 192 Alison Gore, Amanda Herbert, and Cathy Swift Global Brands and Local Culture.............. 198 Nigel Hollis How Rich-Media Video Technology Boosts Branding Goals................................... 203 Leah Spalding, Sally Cole, and Amy Fayer Users’ Resistance to Intrusive Ads May Be Dwindling as They Surf More.................................................... 214 Christina Goodman A C K N O W L E D G M E N T S points of view iv Marketing Effectiveness: Beyond the Short Term While the results of marketing investments are most readily measured in the short term, marketing’s beneficial effects often extend well beyond the initial weeks or months following a particular campaign or activity. Therefore, marketers who have a clear idea of how their activities will work in both the short and the long term are able to balance their immediate and longterm objectives in their brand management decisions. M I L L W A R D J u n e B R O W N ’ S P O V 2 0 0 8 As I discussed in my previous POV, Marketing Effectiveness: It’s More Than Just ROI, there is more to marketing effectiveness than what can be readily expressed in terms of return on investment. There is also more to marketing effectiveness than what can be observed and measured in the short term. But while marketers recognize the value that can be realized over the long term, they are often uncertain as to how to achieve it. Compared to short-term outcomes, long-term effects are harder to plan for, in part because they are harder to define and measure precisely. The need to demonstrate marketing effectiveness in the short term is a given. While this need is felt most acutely by marketers at publicly owned companies that must report quarterly earnings, marketers at privately held companies are also subject to pressure for proof of return on investment. And it is not surprising that businesspeople look for a quick payback. Investments are made on a continuing basis, and in deciding how much to invest for the next period, it’s helpful to know how recent activities have performed. For example, did a recent campaign lift sales sufficiently to generate incremental profit over and beyond the cost of the campaign? Most marketers, however, also recognize that there is more to marketing than incremental short-term payback. They know that today’s marketing investments will yield something beyond today’s immediate response. They know that their brands’ current market positions have been built over years, perhaps even decades, and that in their brands’ performance today they are observing the legacy of previous marketing investments — for example, in today’s loyal buyers, who were once new customers. The Millward Brown Optimor BrandZ™ Top 100 Most Powerful Brands Ranking testifies to the value that is attributed to brands by the financial markets. Figure 1 shows the performance over time of the companies owning the brands in the BrandZ Top 100 versus the S&P 500. Figure 1 BRANDZ Portfolio Performance vs S&P 500 50% B RA N DZ Top 100 Portfolio S&P 500 40% 30% 20% +14.8% 10% +3.0% 0% Apr 06 Jun 06 Aug 06 Oct 06 Dec 06 Feb 07 Apr 07 Jun 07 Aug 07 -10% $1,000 invested = $1,148 | $1,030 Gordon Wyner Executive Vice President, North American Strategy [email protected] 1 Oct 07 Dec 07 Feb 08 Apr 08 One approach that decision makers can adopt to overcome these problems is to identify measurable proxies for some of the future effects of marketing and then track these proxies on an ongoing basis. This has proven especially useful for brand measurement. Decisions can be based on the movement observed in these surrogate variables. So, if marketers know that a long-term consequence of successful marketing is an increase in brand equity, what activities should they pursue today to maintain and increase their brands’ equity and leverage it in their business? How can marketers better make current investment decisions with an eye toward their implications beyond the short term? I suggest that they start by drawing on several core research approaches to build a base for effective brand management. Among the various ways of looking at the future benefits of marketing investments, two of the most useful frameworks are brand and customer value. Each is defined in terms of how assets that build future profit streams are created. Understanding Carry-Over Effects Long-term marketing effectiveness often begins with the notion of carry-over effects — the degree to which various activities not only generate sales in the short term but also continue to have effects in the long term. Many analytical techniques start with an extensive historical series of data (i.e., two to three years’ worth) in order to capture the long-term impact of various marketing events. Brand Assets In terms of brand assets, research conducted by Millward Brown across a wide range of product categories has identified a number of drivers of brand equity that contribute to future in-market sales performance. These drivers can be represented by the five levels of the BrandDynamics™ pyramid: Traditional historical analyses of longterm sales effects don’t reveal anything about brand equity building or customer retention. • This type of analysis can show the amounts and types of marketing expenditures (e.g., media weight and messages) and the types of scheduling (e.g., at key seasonal periods or in pulses) that have worked best over time at generating sales. This knowledge can be invaluable for strategic planning. But one limitation of traditional historical analyses of long-term sales effects is that the results are not always ready to apply in time for decision making. Sometimes investment decisions must be made without the luxury of time to observe the unfolding of long-term effects across multiple years of data. • • Presence (the extent of a brand’s presence in the market) Relevance (the extent to which an offering is relevant and appealing to consumers) Performance (fulfillment of basic functional promise) Advantage (perceived advantages over competitors) • Bonding (a brand’s ability to generate loyal customers) Another problem with this type of analysis is that it doesn’t capture the other important ways in which marketing works beyond producing immediate incremental effects. It doesn’t, for example, reveal anything about brand equity building or customer retention. The BrandDynamics pyramid describes brand health through the absolute size of each level, as well as the percent conversion from presence through bonding. Figure 2 shows how AdeS, a soy-based fruit drink in Mexico, increased its market share as these measures increased from 2005 to 2006. • These dimensions can be measured reliably in consumer surveys, reported at regular intervals, and used to guide future brand planning. By periodically updating the link between these metrics and actual financial performance, brand stewards can help sustain confidence that investments will eventually pay back in the creation of brand asset value. 2 Growth in Brand Health and Market Share — AdeS in Mexico 2005 Bonding 2006 7% Advantage 21% 12% 19% 27% Performance 22% 35% Relevance 27% 39% Presence 37% Share of Market 4.1 as restaurant chains, beverages, foods, or personal care, periodically reassess whether they are correctly positioning all the brands. Are they addressing their competitors in an optimal way? What about the open spaces in the market? Current brand metrics indicate what’s important and enable decision makers to anticipate the benefits of positioning changes. 42% McDonald’s has introduced several such changes over the last few years. In 2005, McDonald’s launched the “Balanced Active Lifestyle” framework, which offers diverse menu choices, support for community programs, and substantial nutritional information to address the needs and well-being of customers. The “Forever Young” redesign of restaurants that is presently underway is the chain’s first major infrastructure change in decades. 50% 5.3 Brand-Level Decisions to Enhance Future Value Armed with surrogate measures of brand health, brand managers can feel confident about making decisions to enhance the future value of their brands. Many of these decisions may seem risky because, in the short term, they will not produce tangible effects. Investments in improving the brand experience of customers often fall into this category. Consider the time it takes to make infrastructure changes, such as changing the physical environment at all restaurant locations in a chain. Yet each time one of these changes influences a single customer on a particular occasion, overall brand value increases, albeit in an imperceptible way. With repeated successes over time across the total customer base, noticeable shifts in the brand asset value will result. These kinds of strategic brand-level changes will take time to implement and generate financial impact. However, they can be monitored and evaluated in the present to see that they stay on track toward the intended goals. Marketers know that in their brands’ performance today they are observing the legacy of previous marketing investments. Customer Assets For example, Starbucks recently announced several steps being taken to improve the customer experience in its outlets. These changes include the elimination of some non-coffee product lines and investment in new coffee-making equipment that allows more visual contact between baristas and customers. If, as the company’s management believes, these changes lead to a better overall experience for each customer, the company’s financial performance should improve, along with the long-term health of the brand. For customer assets, some of the key metrics are the elements of the customer-lifetime-value equation, such as duration of customer life, number of products purchased, and usage frequency. When combined with acquisition and servicing costs and future revenue projections, the net present value of the customer can be estimated. For example, customer profitability in a retail bank can be derived by determining for each customer the amount of revenue generated (from checking, savings, and credit accounts), the associated costs from the acquisition channel (direct mail response, Internet, or branch), and the cost of ongoing servicing (teller visits, call-center inquiries, and online banking). Creating and modifying brand positioning is another type of long-term brand decision making. Managers who oversee large, complex brand portfolios, such Typically, the relevant long-term measures can be derived from this type of transaction data, along with some primary research data to estimate category behavior for 3 share of wallet calculations. Importantly, these measures can be used to look at individual customers or segments to tailor marketing treatments. For example, branch personnel can be armed with customer value metrics in real time during a visit, along with suggested “next logical product” offers that will fit the customer’s profile and create value for the bank. Another approach to creating customer value is to focus on servicing high-value customers with special offers and treatments. The implicit assumption (which can be verified separately) is that it is more efficient to invest in customer retention than in the acquisition of new customers. The effectiveness of this retention approach can’t be seen immediately, but changes in metrics like average duration of high-value customers can be monitored to detect trends and directional changes in value. A limitation of these measures is that they take a long time to observe. For this reason, we sometimes turn to proxy variables that can be measured in the present to estimate some aspects of long-term customer value. Such measures might include reported customer satisfaction, willingness to recommend the brand, and intention to continue as a customer. However, it must be noted that these measures, while useful, don’t provide information about the cost to acquire or service a customer. Thus they cannot serve as true proxies for customer profitability. Overall customer value for the company can also be increased by improving the selection of customers based on their expected value. Targeting can be based on actual behavioral data or proxies for potential value, such as survey measures of available share of wallet. This approach goes beyond the application of broad customer acquisition metrics (such as response to an offer) or retention metrics (such as self-reported satisfaction), which assume that any customer is worth attracting. By periodically updating the link between brand health metrics and actual financial performance, brand stewards can help sustain confidence that investments will eventually pay back in the creation of brand asset value. Conclusion In the frenzy to achieve immediate payback, marketing decision makers risk omitting the future effects o...
View Full Document

{[ snackBarMessage ]}

What students are saying

  • Left Quote Icon

    As a current student on this bumpy collegiate pathway, I stumbled upon Course Hero, where I can find study resources for nearly all my courses, get online help from tutors 24/7, and even share my old projects, papers, and lecture notes with other students.

    Student Picture

    Kiran Temple University Fox School of Business ‘17, Course Hero Intern

  • Left Quote Icon

    I cannot even describe how much Course Hero helped me this summer. It’s truly become something I can always rely on and help me. In the end, I was not only able to survive summer classes, but I was able to thrive thanks to Course Hero.

    Student Picture

    Dana University of Pennsylvania ‘17, Course Hero Intern

  • Left Quote Icon

    The ability to access any university’s resources through Course Hero proved invaluable in my case. I was behind on Tulane coursework and actually used UCLA’s materials to help me move forward and get everything together on time.

    Student Picture

    Jill Tulane University ‘16, Course Hero Intern