ooh roi & media mix optimization...2015 2016 2017 tv ooh (incl cinema) +35% radio magazine...

OOH ROI & Media Mix OptimizationSummary Report

2018

Contents

• Review of ROI Findings from Phase One Study

• Research Objectives – Building the Case for Increased OOH Investment

• Market Average

– Latest media mix trends

– Recommended Out of Home spend

– Reallocation

• Category Detail

– Reallocation Summary

– Brand Metrics Summary

• Summary and Conclusions

| 2

Review of ROI Findings from Phase One Study

| 3

OOH delivers the second best RROI of traditional media, after TV. OOH beats Display

| 4

OOH outperforms all traditional media, except TV, and beats digital display per ad dollar invested.

OOH – Effective with Strong ROI

6.73

5.85

4.01

5.11

10.24

0

2

4

6

8

10

12

14

16

TV OOH Radio Print Digital

Display

Digital

Search

| 5

Including OOH Increases Sales Revenue ROIs for Search +40% and Print +14%

Using OOH Not using OOH

Using OOH makes Search and Print work harder.

5.575.97

1.37

4.58

3.73

14.28

0

2

4

6

8

10

12

14

16

TV OOH Radio Print Digital

Display

Digital

Search

OOH Provides Linear Incremental Returns

• TV and radio are in high diminishing returns.

• If sales are the only objective, budget should be added to OOH and taken from radio first and TV next.

• If new budget dollars are available, it would best be allocated to OOH.

• If budgets are to be cut, OOH should be kept and money should be taken from radio, TV, newspaper, and display first.

| 6

The Business Case for Larger OOH Investment

What is the normal % of OOH of total media spend?Combining Kantar’s comprehensive overview of all US advertisers’ offline spending in each category, with SMI’s accurate insight into digital spending (incl. search) providing vital context for recommendations for changes

How does OOH work to drive brand measures?Based on the results of Brand MMM results and response curves for major categories, the OMG Brand Planning Tool reports the optimal media mix at typical campaigns to suggest the ideal distribution of OOH, providing forward looking advertisers with “Brand” measures as KPIs rather than just short term sales or response.

Where ought budget to increase OOH come from?Where the change in % media mix of each channel (e.g. OOH) is being reallocated to/from (e.g the loss of TV is being redistributed to OOH).

Objectives & key questions

| 7

1.

2.

3.

Latest media mix trends

| 8

Actual Spend 2013-2017 – All Media Channels

| 9

TVTV is the predominant media type across all categories.

OOHRetail – Grocery has the highest % OOH (AVG 11.9%), followed by Restaurants & Coffee Shops (AVG 8.3%)

DIGITALConsumer Electronics and Finance – Banking have thehighest share of digital

PRINTRetailers spend the highest share on print

4.1%

3.9%

4.3%

4.5%

4.8%

0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%

2013

2014

2015

2016

2017

TV OOH (incl Cinema) +35% Radio

Magazine Newspaper Digital Display

Digital Video Digital Search Total

Mixed Levels of Growth in OOH’s Share of Budget, Retail-Grocery with fastest growth rate, while retail-non-grocery and food & drink show slight growth

4.8%

14.7%

8.7%

3.1%

6.8%

3.7%

2.4%

4.8%

0% 20% 40% 60% 80% 100%

Retail - Non

Grocery

Retail -

Grocery

Restaurants

& Coffee…

Food & Drink

Finance -

Banking

Consumer

Electronics

Automotive

Average

TV OOH (incl Cinema) +35%Radio MagazineNewspaper Digital DisplayDigital Video Digital Search

2017 media mix OOH % over the last 5 years

2.4%

3.7%

6.8%

3.1%

8.7%

14.7%

4.8%

0%

2%

4%

6%

8%

10%

12%

14%

16%

2013 2014 2015 2016 2017

Average Automotive

Consumer Electronics Finance - Banking

Food & Drink Restaurants & Coffee Shops

Retail - Grocery Retail - Non Grocery

| 10

The Growing Body of Evidence on the Effectiveness of OOH

Key findings from the past two years

| 11

Over the last two years examined evidence from a range of categories including Automotive, Consumer Electronics, Retail - Non Grocery and Food & drink CPG focused on the Finance - Banking, Retail - Grocery and Restaurants and Coffee Shops to show:

• OOH is a significant media channel in the mix now significantly increasing in some categories

• Digital channels are decreasing in the same categories

• OOH has good ROI and improves campaign ROI

• OOH continues to drive brand perceptions

• More should be spent on these categories

Current Spend Summary by Category

2017 spend : 2.4%

AVG spend (2013-17): 2.0%

Key Insights:

Media spend is offline focus, TV dominate

Gradual increase in % OOH from 2014

2017 spend : 8.7%

AVG spend (2013-17): 8.3%

Key Insights:

TV dominant, minimal digital

Stable % OOH (from 2015)

AUTOMOTIVE

RESTAURANTS & COFFEE SHOPS

| 12

2017 spend : 3.7%

AVG spend (2013-17): 3.7%

Key Insights:

2nd largest digital spend, although TV dominant

Recent increase in % OOH

2017 spend : 14.7%

AVG spend (2013-17): 11.9%

Key Insights:

TV, Newspaper, Radio focus

Largest & fastest growth in % OOH,

CONSUMER ELECTRONICS

RETAIL - GROCERY

2017 spend : 6.8%

AVG spend (2013-17): 5.2%

Key Insights:

Largest digital spend

Increase of % OOH since 2014

2017 spend : 4.8%

AVG spend (2013-17): 4.5%

Key Insights:

Centred on TV & Print

Stable % OOH

FINANCE - BANKING

RETAIL – NON GROCERY

2017 spend : 3.1%

AVG spend (2013-17): 2.8%

Key Insights:

TV dominant, large focus on magazine, small digital share

Stable % OOH

2017 spend : 4.8%

AVG spend (2013-17): 4.3%

Key Insights:

Retail-Grocery highest % OOH

All categories TV dominant

FOOD & DRINK

AVERAGE CATEGORY

Recommended Out of Home Spend Benchmarks

| 13

Recommended Spend on OOH

12%

16%17% 17%

13%

10%

15%

13%

16%

10%9%

14%

10%

13%

9%

0%

2%

4%

6%

8%

10%

12%

14%

16%

18%

20%

Low

bu

dg

et

av

era

ge

($5-6

0m

)

Ad

Aw

are

ne

ss

Bra

nd

Aw

are

ne

ss

Co

nsi

de

ratio

n

Re

co

mm

en

da

tio

n

Pu

rch

ase

In

ten

t

Me

diu

m b

ud

ge

t a

ve

rag

e

($10

-110

m)

Ad

Aw

are

ne

ss

Bra

nd

Aw

are

ne

ss

Co

nsi

de

ratio

n

Re

co

mm

en

da

tio

n

Pu

rch

ase

In

ten

t

Hig

h b

ud

ge

t a

ve

rag

e

($20

-180

m)

Ad

Aw

are

ne

ss

Bra

nd

Aw

are

ne

ss

Co

nsi

de

ratio

n

Re

co

mm

en

da

tio

n

Pu

rch

ase

In

ten

t

Re

co

mm

en

de

d %

sp

en

d o

n O

OH

The market on average should be spending more on OOH at all budget levels

| 14Source: Brand Planning Tool Automotive, Consumer Electronics, Food & Drink, Finance – Banking, Restaurants & Coffee Shops, Retail – Grocery, Retail –Non Grocery

Current

spend

4.8%

0%

20%

40%

60%

80%

100%

10 20 30 40 50 60 70 80 90 100

% r

ec

om

me

nd

ed

sp

en

d

Total Annual Budget ($m)

TV

Radio

OOH (incl Cinema)

Print

Digital Display

Digital Video

Digital Search

Benchmark Average Optimal Mix

|

15

AD AWARENESS

Most brands ought to invest at least 12% in OOH

BRAND AWARENESS

16% 17% 16% 16% 16% 16% 16% 16% 16% 16%

0%

5%

10%

15%

20%

25%

10 20 30 40 50 60 70 80 90 100


Most brands should invest 12% into OOH

0%

20%

40%

60%

80%

100%

10 20 30 40 50 60 70 80 90 100


13% 12% 12% 12% 11% 11% 11% 11% 10% 10%

0%

5%

10%

15%

20%

25%

10 20 30 40 50 60 70 80 90 100


% r

ec

om

me

nd

ed

sp

en

d

de

dic

ate

d t

o O

OH

0%

20%

40%

60%

80%

100%

10 20 30 40 50 60 70 80 90 100

% r

ec

om

me

nd

ed

sp

en

d


TV Radio OOH (incl Cinema) Print Digital Display Digital Video Digital Search

16%14% 13% 13% 12% 12% 11% 11% 11% 11%

0%

5%

10%

15%

20%

25%

10 20 30 40 50 60 70 80 90 100


0%

20%

40%

60%

80%

100%

10 20 30 40 50 60 70 80 90 100


0%

20%

40%

60%

80%

100%

10 20 30 40 50 60 70 80 90 100


|

16

PURCHASE INTENTRECOMMENDATION

13% 13% 13% 12% 12% 11% 11% 11% 11% 11%

0%

5%

10%

15%

20%

25%

10 20 30 40 50 60 70 80 90 100


14% 14% 14% 14% 14% 14% 13% 13% 13% 13%

0%

5%

10%

15%

20%

25%

10 20 30 40 50 60 70 80 90 100


A typical brand ought to invest 12% of media on OOH. Smaller brands should slightly

increase their allocation to OOH

CONSIDERATION

Benchmark Average Optimal Mix

% r

ec

om

me

nd

ed

sp

en

d

de

dic

ate

d t

o O

OH

A typical brand ought to invest 11% of media on OOH. Smaller brands should slightly

increase their allocation to OOH

All brands should invest 13-14% of their media budget in OOH

Recommended Spend Benchmarks

Current OOH AVG in mix is 4.8%. Recommended range of AVG spend is 9-17%

| 17

AD Awareness

Spend much more

Put 12% into OOH

Put 10% into OOH

Put 9% into OOH

Brand Awareness

Spend much more

Put 16% into OOH

Put 15% into OOH

Put 14% into OOH

Consideration

Spend much more

Put 17% into OOH

Put 13% into OOH

Put 10% into OOH

Recommendation

Spend much more

Put 17% into OOH

Put 16% into OOH

Put 13% into OOH

Purchase Intent

Spend much more

Put 13% into OOH

Put 10% into OOH

Put 9% into OOH

LOW

MED

HIGH

Budget

Recommended Spend Summary by Category

2017 spend : 2.4%

AVG spend (2013-17): 2.0%

Key Insights: BA Focus

LOW – BA (14%)

MED – BA (10%)

HIGH - BA (9%)

2017 spend : 8.7%

AVG spend (2013-17): 8.3%

Key Insights: PI Focus

LOW – PI (19%)

MED – PI (19%)

HIGH – PI (18%)

AUTOMOTIVE


| 18Ad Awareness (AA), Brand Awareness (BA), Consideration (CON), Recommendation (REC), Purchase Intent (PI)

2017 spend : 3.7%

AVG spend (2013-17): 3.7%

Key Insights: REC Focus

LOW – REC (17%)

MED – REC (18%)

HIGH – REC (16%)

2017 spend : 14.7%

AVG spend (2013-17): 11.9%


LOW – BA (36%)

MED – BA (36%)

HIGH – BA (36%)


RETAIL - GROCERY

2017 spend : 6.8%

AVG spend (2013-17): 5.2%


LOW – CON & REC (42%)

MED – REC (41%)

HIGH – REC (22%)

2017 spend : 4.8%

AVG spend (2013-17): 4.5%


LOW – PI (26%)

MED – REC (17%)

HIGH – REC (16%)

FINANCE - BANKING


2017 spend : 3.1%

AVG spend (2013-17): 2.8%


LOW – PI (18%)

MED – BA (10%)

HIGH – BA (10%)

2017 spend : 4.8%

AVG spend (2013-17): 4.3%

Key Insights:

Brands tend to benefit from increasing their % OOH to improve Brand awareness, Recommendation, Purchase Intent

FOOD & DRINK

AVERAGE CATEGORY

Category ComparisonMedia Mix Reallocation

| 19

AUTOMOTIVECONSUMER

ELECTRONICS

FINANCE –BANKING

FOOD & DRINK

RESTAURANTS &

COFFEE SHOPSRETAIL –

GROCERYRETAIL – NON

GROCERY

Current OOH Spend 2.4% 3.7% 6.8% 3.1% 8.7% 14.7% 4.8%

AVG % OOH Spend (2013-17)

2.0% 3.7% 5.2% 2.8% 8.3% 11.9% 4.5%

AD Awareness

Brand Awareness

Consideration

Recommendation

Purchase Intent

Summary - Reallocation of OOH From Other Media Channels

| 20

TV Radio PrintDigital

Display

Digital

Video

Digital

Search

OOH increases

from the loss of

all media types

except Digital

Video

OOH

gains mostly

from TV,

print, digital

display

Lower funnel

increases from

the decrease

of all media

types except

display

OOH mostly

improves from

TV and Print

OOH mostly

gains from

other media

types mid

funnel

OOH gains

from all media

types at the

lower end of

funnel

OOH mostly

advances from

TV and Print

AV

ER

AG

E

4.8%

4.3%

3

4

4

5

4

Media Mix Reallocation Summary

2017 spend : 2.4%

AVG spend (2013-17): 2.0%

Key Insights: 4/6 media types

OOH gains from:

TV Print

Radio Digital Display

2017 spend : 8.7%

AVG spend (2013-17): 8.3%


TV Radio

Print Digital Display

Digital Video Digital Search

AUTOMOTIVE


| 21

2017 spend : 3.7%

AVG spend (2013-17): 3.7%


OOH gains from:

TV Print

Radio

Digital Display Digital Search

2017 spend : 14.7%

AVG spend (2013-17): 11.9%


TV Radio




RETAIL - GROCERY

2017 spend : 6.8%

AVG spend (2013-17): 5.2%


OOH gains from:

TV Radio

Print


2017 spend : 4.8%

AVG spend (2013-17): 4.5%


TV Radio


FINANCE - BANKING


2017 spend : 3.1%

AVG spend (2013-17): 2.8%


OOH gains from:

TV Print

Radio Digital Display

2017 spend : 4.8%

AVG spend (2013-17): 4.3%

Key Insights:

OOH gains from 4 media types

Most often from:

TV, Print, Digital Display, Radio

FOOD & DRINK

AVERAGE CATEGORY

Where OOH Works Hardest in the Brand Funnel

By category and size of budget

OOH works hardest at different ends of the brand funnel depending on the category:

• Goods: OOH recommended most for driving awareness at the upper end – particularly for smaller budgets, before TV and print are increased

• Services: use OOH the most to drive consideration, recommendation and intention at the lower funnel end – with the exception of Retail -Grocery

• CPG: the pattern differs by budget – smaller should use OOH to drive awareness. For medium and large budgets it will work equally hard at both the lower and upper ends of the brand funnel

| 22*Upper (AD & Brand Awareness) and Lower (Consideration, Recommendation, Purchase Intent)

Small budgets Medium budgets Larger budgets

2018 a

na

lysi

s

Upper funnel Lower funnel Upper funnel Lower funnel Upper funnel Lower funnel

Finance - Banking 7% now 18-26% 12-42% 11-21% 13-41% 6-13% 10-22%

Restaurants & Coffee Shops 9% 10-11% 9-19% 11% 8-19% 12% 9-18%

Retail - Grocery 15% now 19-36% 4-18% 18-36% 4-14% 19-36% 4-11%

2017 a

na

lysi

s

Automotive 2% now 11-14% 10% 6-10% 6-7% 6-9% 5-7%

Food & Drink 3% now 5-8% 9-18% 6-10% 7-9% 5-10% 7-8%

Consumer Electronics 4% now 5% 3-17% 4% 5-18% 4-5% 5-16%

Retail - Non Grocery 5% now 15% 18-26% 11-14% 12-17% 8-13% 11-16%

OOH works hardest

Automotive Summary

| 23

To optimize AD Awareness brands should up OOH to 6-11%

Brands should spend up to 9-14% on OOH to drive Brand Awareness

Advertisers should increase their spend 6-10% to boost Consideration

To optimise Recommendation brands increase OOH share to 7-10%

Brands should spend 5-10% on OOH to drive Purchase Intent

Key take out:

Current share of OOH is 2.4% (2017). Share of spend has slightly increased from 1.4% (2014) to 2.4% (2017)

Automotive brands are recommended to spend 6-14% to boost awareness and 5-10% for low end of the funnel (consideration, recommendation, purchase intent).

Consumer Electronics Summary

| 24

Consumer Electronics brands should increase their share to 4-5% to boost

Ad Awareness

Brands are advised to increase share of OOH to 4-5% to improve Brand

Awareness

Advertisers should increase their share of OOH spend to 8-12% to optimise

Consideration

To optimise Recommendation brands should spend 16-18% of their budget

on OOH

Consumer Electronics brands should have their share of OOH to 3-5% to

improve Purchase Intent

Key take out:

Spend has increased over the last year from 2.7% (2016) to 3.7% (2017)

Brands can optimise awareness by dedicating 4-5% of media share to OOH

Brands should spend 8-18% to optimise mid funnel (Consideration, Recommendation)

Food & Drink Consumer Packaged Goods Summary

| 25

Brands should invest 5-8% of their budget to optimize AD Awareness

Advertisers should increase their share of budget to 5-10% to maximise Brand

Awareness

Food & Drink brands should invest 8-14% of their budget on OOH to

optimise Consideration

Brands should increase their share of budget for OOH to 7-9% to enhance

Recommendation

Advertisers should up their budget for OOH to 8-18% to boost Purchase

Intent

Key take out:

Food & Drink brands currently spend 3.1% of budget on OOH. Spend has been stable 2.5% in 2014 to 3.1% (2015, 2017)

Brands should spend 5-10% of their budget on OOH to optimise awareness.

Medium to high budgets should spend 7-9% of their budget on OOH, with low budgets advised to spend 9-18%

Retail Grocery Summary

| 26

To optimise AD Awareness, brands should up OOH spend to 18-19%

Grocery retailers should increase OOH spend up to 36% to boost Brand

Awareness

To optimise Consideration, medium to large budgets should maintain current levels of spend of (11-14%) while small

budgets should up this to 18%

Supermarkets only need to spend 4-9% on OOH to optimise

Recommendation

Supermarkets should to spend at least 14% on OOH to optimise Sales

Key take out:

Although spend in this category has increased markedly from less than 10% to almost 15% over the last five years –there is still scope increase this to optimise upper parts of the brand funnel. In particular brands can spend up to 36% to boost consideration.

While less spend is recommended to effect the lower part of the brand funnels we do know that OOH drives sales in this category

Retail – Non Grocery Summary

| 27

To optimise AD Awareness, large budgets should at least up OOH share

to 8%, and small budgets to 15%

Retailers should increase OOH spend up to 15% to boost Brand Awareness

To optimise Consideration, medium to large budgets should maintain current levels of spend of (11-12%) while small

budgets should up this to 19%

Retailers should spend 16-18% on OOH to optimise Recommendation

Brands should spend at least 13% to optimise Purchase Intent with smaller

budgets allocating 26%

Key take out:

OOH’s share retail’s media budgets has gently increased over the past few years but ought to be increased further to be fully optimal – particularly when driving consideration, recommendation and purchase intent where strong use of OOH is recommended

Finance – Banking Summary

| 28

To optimise AD Awareness brands should up OOH spend to 6-18%

Banks should spend up to 13-26% on OOH to drive Brand Awareness

To boost Consideration, financial advertisers should increase spend to at least 11% on OOH. Small budgets

should up this to 42%

To optimise Recommendationlarge budgets ought to increase OOH

share to 22% and small-medium budgets up to 42%

Advertisers should spend 10-13% on OOH to drive Purchase Intent

Key take out:

Current share of OOH has increased from 4.5% in 2013 to 6.8% in 2018 but there is scope to increase this much further still, especially when optimising lower brand metrics – small and medium budgets should spend up to 42% to boost Consideration and Recommendation

Restaurants, QSR & Coffee Shops Summary

| 29


Brands should spend up to 11-12% on OOH to drive Brand Awareness

To drive Consideration, Restaurants & Coffee Shops should maintain

spending 8-9% on OOH

Brands of all sizes should up their OOH spend to 16-17% to boost

Recommendation

Brands should spend 18-19% on OOH to optimise Purchase Intent

Key take out:

Current share of OOH has been quite stable over the last five years at 9%. This is close to the optimal level for boosting the upper end of the brand funnel.

However, increasing this investment up to 19% of all size budgets will optimise the lower ends of the brand funnel and drive Purchase Intent

Average Category Summary

| 30


Average brands should increase OOH spend up to 14-16% to boost Brand

Awareness

To optimise Consideration, low should spend 17% and high 10%

Average brand should invest 13-17% on OOH to optimise Recommendation

Need to spend 9-13% on OOH to optimise Purchase Intent

Key take out:

Increase from current spend of 4.8% to 9-17% to boost all brand metrics

The average brand should focus on boosting Brand awareness, Recommendation, Purchase Intent.

OOH most often gains from 4 channels (TV, Print, Digital Display, Radio)

Summary and Conclusions

Summary - Market Overview

Current and recommended OOH allocations for the average category

Source: 2017 Kantar Offline + Digital Display + SMI Video & Search, Automotive, Consumer Electronics, Food & Drink, Finance – Banking, Restaurants & Coffee Shops, Retail – Grocery, Retail – Non Grocery

| 32

Current Spend

Average category spends 4.8% of their budget on OOH

All categories are TV dominant

Retail-Grocery has highest OOH

allocation % OOH

Recommended SpendBrands tend to benefit from

increasing their OOH % to

improve:

• Brand awareness

• Consideration• Recommendation• Purchase Intent

Reallocation recommendationsIncreased OOH spend should

come most often from

reductions in 4 media types:

• TV

• Print

• Digital Display

• Radio

Conclusions

OOH is an increasingly significant media channel in the mix

Six of the seven categories analyzedhave increased or been stable over the last five years, with Retail Grocery recently reaching 14.8%.

Consumer Electronics had shown some decline but recently shifted upward and is now at 3.7%. At the same time, digital channels have been receding across most categories

OOH drives brand perceptions

For Goods, OOH works hardest mostly at the upper end of the funnel – e.g. Autos should increase their small spend of 2% up to 14% to drive Ad and Brand Awareness.

In Services, OOH mostly works at the lower end of the funnel – e.g. small-medium finance brands can spend up to 42% here.

OOH can affect CPG at all points in the brand funnel – e.g. Food & Drink should increase spend from just 3% to at least 5% to optimize all metrics.

There is a case for all categories to increase their investment in OOH

Close attention needs to be paid to the size of budget and the metric being moved to ascertain the ideal level of OOH investment.

All categories can benefit at some point of the brand funnel from increasing their OOH - especially for the important CONSIDERATION metric where the average brand regardless of budget should be spending at least 10% in OOH.

Proof for larger OOH investment

| 33

ooh roi & media mix optimization...2015 2016 2017 tv ooh (incl cinema) +35% radio magazine...

Documents