worldwide partners presentation 5 09
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This was a presentation made to the group of international advertising agencies meeting in Edinburgh Scotland in May 2009.TRANSCRIPT
www.gregstuart.com
What’s Next for Agencies?
Greg StuartGreg Stuart
Co-author: Co-author: What SticksWhat Sticks
www.gregstuart.com
Legacy of The Stuart’s
in Scotland`
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Stuart’s Had a Good Run Here...
King/Queen’s Name From UntilRobert II of Scotland February 1371 April 1390Robert III of Scotland April 1390 April 1406James I of Scotland April 1406 February 1437James II of Scotland February 1437 August 1460James III of Scotland August 1460 June 1488James IV of Scotland June 1488 September 1513 James V of Scotland September 1513 December 1542 Mary I (Queen of Scots)December 1542 July 1567
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…Until Mary, Queen of Scots
Married first husband, King of France - 1558He died in less than a year
Married her first cousin, Lord Darnly - 1565He died in an explosion
Then married Earl of Bothwell - 1567Believed to be Darnly’s murderer
Upraising – Mary is Imprisoned - 1567Abdicates throne to 1 year old son
Flees to England w/ support of Queen Elizabeth I (1st Cousin) - 1568
Attempts to inherit throneTrial for attempts (3 times) to assassinate Elizabeth - 1587
Beheaded Greg Stuart moves to New York City to enter Advertising - 1983
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What If We What If We Were Were
Wrong?Wrong?Worldwide Partners, Inc. Summit
Edinburgh, Scotland May 2009
Greg StuartGreg Stuart
Co-author: Co-author: What SticksWhat Sticks
www.gregstuart.com
Advertising’s
Inconvenient Truth
Greg StuartGreg Stuart
Co-author: Co-author: What SticksWhat Sticks
Insights from Research against US$1Billion in Insights from Research against US$1Billion in Advertising SpendingAdvertising Spending
What If We What If We Were Were
Wrong?Wrong?
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What Did We Find?
Over 37% of Ad Spending is Wasted
(1) What makes you think yours isn’t?
(1) Equal to $112 Billion of the $295 Billion in U.S. Advertising Spending
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If Advertising had a Slogan…
Ads Work Wonders Half the Money is Wasted
Courtesy of Erwin Ephron
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$1US Billion Ad Spending Researched
1.1 million consumers surveyed
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And, We Don’t Seem to Own Responsibility for a Burden
of ProofDonny Deutsch speaking to 500 Marketers…
“We did a wonderful spot…on the Superbowl… for Mitsubishi Gallant...that stops at the end and
[says] go to “seewhathappens.com.” We got about 600,000 clicks.
Was that great or that not great? We told the client it was great so it was great.”
[nervous laughter] Deutsch is the 14 largest agency in the US
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Media
So, What Else do We Know
Motivations Messaging
36%36% 31%31% 83%83%
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The Truth Is…Marketing is Hard
Suppose you have 5 options: 5 Brand Positionings 5 Customer Segmentations 5 Ad Creative Approaches 5 Magazine Schedules/Plans 5 Online Plans
3,125 combinations
10 to 10th = 1 billionbillion combinations combinations
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So What is a So What is a Marketer to Marketer to
Do?Do?One Solution for Making Sure One Solution for Making Sure
Your Advertising Your Advertising Sticks!Sticks!
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The First Step - Admit There is a Problem
Real knowledge is to know the extent of one's ignorance.
Confucius
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What Sticks’ Three Steps
1.Universal Agreement to Goals
2.Have a Back Up Plan (Plan B)
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Are You Prepared if You Are Wrong?
Used with permission Cartoonbank.com
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What Sticks’ Three Steps
1.Universal Agreement to Goals
2.Have a Back Up Plan (Plan B)
3.Know the Value of each Dollar
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Motivations
36%Missed it
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Who’s Headquarters is This?
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ING
Fresh Thinking
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Today’s Ads for ING
Simplifies a Complicated Financial World
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Messaging
31%Missed it
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Creative Matters
BB
AA
Source: IAB Cross Media Study
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Creative Makes a BIG Difference
Ad B, 2%
Ad A, 20%
0% 5% 10% 15% 20% 25%
PurchaseIntent
Percent that Intend to Buy Colgate
Better creative can make the difference
between success and absolute failure
Ad AAd A
Source: IAB Cross Media Study
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What Made the Difference?
Persistent Branding!
BB
AA
Source: IAB Cross Media Study
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How Poor are We at Online Creative?
For five studies, creative testing was done prior to the research launch:Only 1 brand’s ads required no
adjustment2 brands found 1/2 the ads were not
effective Diluting the effectiveness of the campaign
2 brands discarded ALL ads & started all overBoth developed ads that scored much better
Who were the 5 Advertisers?
P&G J&J Kraft Nestle TargetWho were the 5 Advertisers?
P&G J&J Kraft Nestle Target
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What Do You See?
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Media
83%Missed it
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Media Timing Influences Success
30%
35%
40%
45%
50%
3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23
Top 2
LunchLunch
Average
If Marketer had focused impressions on the 6 hours around lunch time, impact would have been significantly better
Time of Day
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10.0%10.0%
20.0%20.0%
30.0%30.0%
40.0%40.0%
50.0%50.0%
60.0%60.0%
0.0%0.0%
Sometimes Spending Less is MoreIntroducing New Menu Item:
Grilled Chicken Flatbread Sandwich
Ad Frequency
(or Budget)
% A
ided
Aw
aren
ess
20% of Broadcast Budget
Reinvested 13.6%
in Online
Po
int
of
Dim
inis
hed
Ret
urn
s
5pt Gain!
Cut6.4%
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Beware of the Diminishing Returns
% o
f Bra
nd Im
pact
Aw
aren
ess,
Imag
e or
Pur
chas
e In
tent
0
10
20
30
40
50
60
70
80
90
100
0 1 2 3 4 5 6 7 8 9 10
Frequency
Diminishing returns
1
2
34 5
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Media Mix Influences Success
TV Use
On
line
Use
Heavier
Heavier
Lighter
Lighter
Heavy OnlineHeavy TV
Heavy OnlineHeavy TV
Heavy TVLight Online
Heavy TVLight Online
Light TVLight Online
Light TVLight Online
Heavy Online Light TV
Heavy Online Light TV26%26% 38%38%
15%15% 21%21%
Med
ia U
sage
am
ong
18-4
9 ye
ar o
ld ta
rget
34.3 Million!
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Media Optimizations Matters for Retail Too
$31.04
$7.36$2.67
0
5
10
15
20
25
30
35
40
Online Magazine TV +Newspaper
Media
Payback
100
1165
422
0
100
200
300
400
500
600
700
800
900
1,000
1,100
1,200
Online Magazine TV +Newspaper
Media
ROI: Profit Payback Per Dollar Spent on
Advertising
Cost to Generate an Equivalent Sale
(indexed)
Overall, Online was the most cost effective & efficient in driving sales
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The Impact on Sales
Online advertising accounted for 2% of the advertising budget and yielded 9% of in store
salesBudget Allocation Vs. Sales Impact by Media
All Other Media 98%
Online 2%
80%
85%
90%
95%
100%
Ad Spend Sales Impact
Sales Caused by
Online 9%
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The 4th M
Maximization!
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Maximization is Applying Classic Innovation Theory To
Marketing
70-20-10
70% of budget to what you know works
20% to innovating off of what you know works
10% to brand new ideas
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“Most Important Launch In History Of Ford”
- Bill Ford
F150 Truck is #1 selling vehicle in U.S.
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The F-150 Online Ads
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Roadblock
Trying Something Brand New:Home Page Takeover Ad
Ran One Day on Each Portal - Roadblock
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Cost Effectiveness of Each Medium
Cost to Increase Purchase Consideration
Brand Metric:Purchase Consideration (top 2 box)
Relative
Cost Index
Sample Cost
TV 1104$11.0
4
Magazine 456 $4.56
Roadblock 100 $1.00
Online 135 $1.35Interpretation: If it cost Roadblock $1 (indexed at 100) to increase purchase consideration, then it cost $1.35 for Online, $4.56 for magazine and $11.04 to TV to achieve the same increase.
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The Value of Small Changes
0%
20%
40%
60%
80%
100%
BasePlan
2.5%Online
6%Online
Result was another
$750,000,000 in U.S. Truck sales
Total of +$1,350,000,000
in U.S. Truck Sales
(at retail vs. Base Plan)
Ford Media Mix *Tra
dit
ion
al M
ed
ia P
lan
* Approx. $200 Million Budget
Online Online
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Ford Possibly Put It Best
It isn't the incompetent who destroy an organization.
It is those who have achieved something and want to rest upon their achievements who are
forever clogging things up.
Charles SorensonFord Motor Car
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Together, We Can Change Dilbert
Accountability is not measurement, Accountability is doing something about it
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What If We What If We Were Were
..
Wrong?Wrong?Right?Right?
MediaMotivations Messaging
36%36% 31%31% 83%83%
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Increasing Online Increasing Online Advertising Impact Advertising Impact
+1,000% +1,000% by End of Todayby End of Today
Bonus
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Stop Buying International Impressions for Domestic
CampaignsIf, International
users comprise about 15% to 30% of a site’s audience
Removing International increases effectiveness by 18% to 43%
0%
20%
40%
60%
80%
100%
KC ING McDonald's Verisgn
US Non-US
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Respect Diminishing Returns
It’s a Law of Physics in Media
% o
f Bra
nd Im
pact
Aw
aren
ess,
Imag
e or
Pur
chas
e In
tent
0
10
20
30
40
50
60
70
80
90
100
0 1 2 3 4 5 6 7 8 9 10
Frequency
Diminishing returns
1
2
34 5
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Heaviest Online Quintile Captures Half the Ad
Impressions
5% 6%11%
19%
58%
0%
10%
20%
30%
40%
50%
60%
70%
Per
cent
of
Tot
al I
mpr
essi
ons
Light Users All other quintiles Heavy Users
Avg Freq: 1.0 2.1 3.2 5.5 25.0
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One Solution: Website Frequency Caps Can Really
Help
10%12%
21%
29% 29%
0%
5%
10%
15%
20%
25%
30%
35%
Frequency of 3 Per Week per Site Dramatically Increases Reach & Thus Performance
Light Users All other quintiles Heavy Users
Increased Increased reach by reach by
72%72%
Increased Increased reach by reach by
72%72%
+50% to 70% +50% to 70% in Adin Ad
EffectivenessEffectiveness
+50% to 70% +50% to 70% in Adin Ad
EffectivenessEffectiveness
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Many Things can Affect Effectiveness (e.g., Time of
Day)
30%
35%
40%
45%
50%
3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23
Top 2
LunchLunch
+10% to 15% +10% to 15% in Ad in Ad
Effective-Effective-nessness
+10% to 15% +10% to 15% in Ad in Ad
Effective-Effective-nessness
Average
If Marketer had focused impressions on the 6hours around lunch time, impact would have been significantly better
% P
urc
hase
In
ten
t
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Impact of Ad Size 1
56%40%
64%
86%
0%
20%
40%
60%
80%
100%
468x60 120x240 120x600 336x280
Percent Change in Brand Index
banner small rectangle small skyscraper larger rectangle
Results: Size Matters
1 Aggregated results for three brands tested2 The average of four brand measures tested
The 336x280 resulted in an average +54%
increase in brand impact vs. 468 x 60
2
+20% to +20% to 54% in Ad54% in AdEffective-Effective-
nessness
+20% to +20% to 54% in Ad54% in AdEffective-Effective-
nessness
IAB, DoubleClick Ad Effectiveness Research 2001
Banner Small Rectangle Small Skyscraper Large Rectangle
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Make Sure EVERYTHING Works!
Same Media Budget Same Media Budget 310% Increase 310% IncreaseSource: InsightExpress
Imps (M)Brand
PerformanceContri-bution
Creative 1 10.0 -15.9% (1.59) Creative 2 10.0 13.8% 1.38 Creative 3 10.0 11.3% 1.13
Total 30.0 0.92
Imps (M)Brand
PerformanceContri-bution
Creative 1 -- -- --Creative 2 15.0 13.8% 2.07 Creative 3 15.0 11.3% 1.70
Total 30.0 3.77
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Creative Possibilities
Priceless!
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Improving Ad EffectivenessInsights from the What Sticks Research
LowHigh1. Cut out International impressions18% to
43%
2. Manage Frequency 50% to 70%
3. Capitalize on Time of Day/DoW10% to 15%
4. Ad Size matters 20% to 54%
5. Get rid of ads that don’t work 5% to 300%
6. Page Placement really matters 6% to 350%
7. Creative is “mission critical” 0% to 400%
Total Gain Possible: 0%3210%
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Making Your Media Stick
Media is an investment–what is your ROI?
Must know what is the value of a Dollar• Without knowing, you can’t
Optimize• Average gain was 35%
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Make Sure Your Motivations Stick
1. Know why consumers buy your brand2. Ensure it is a valuable customer
segment3. Wring all ambiguity from your
definition of success
What if your Motivation isn’t right?When would you know it?
Is there Universal Agreement?
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Make Sure Your Messaging Sticks
Creative testing is cheap – Just do it!• Because not testing is REALLY
expensive!• Split cell testing is best (experimental
design)
What if you are Wrong? When would you know it?By the way…47%
Missed either Motivations or Messaging
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Mary I (popularly known in the English-speaking world as Mary, Queen of Scots and, in France, as Marie Stuart) (8 December 1542 – 8 February 1587) was Queen of Scots from 14 December 1542 to 24 July 1567.She was the only surviving legitimate child of King James V. She was six days old when her father died and made her Queen of Scots. Her mother, Mary of Guise, assumed regency and her daughter was crowned nine months later.In 1558, she married Francis, Dauphin of France, who ascended the French throne as Francis II in 1559. However, Mary was not Queen of France for long; she was widowed on 5 December 1560.After her husband's death, Mary returned to Scotland, arriving in Leith on 19 August 1561. Four years later, Mary remarried, choosing her first cousin, Henry Stuart, Lord Darnley, as her second husband. Their union turned unhappy and in February 1567, Darnley was found dead in the garden at Kirk o'Field, after a huge explosion had taken place in the house.She soon married James Hepburn, 4th Earl of Bothwell, who was generally believed to be Darnley's murderer. Following an uprising against the couple, Mary was imprisoned in Loch Leven Castle on 15 June and forced to abdicate the throne in favour of her one-year-old son, James VI. After an unsuccessful attempt to regain the throne, Mary fled to England seeking protection from her father's first cousin, Queen Elizabeth I, whose kingdom she hoped to inherit. Elizabeth, however, ordered her arrest, because of the threat presented by Mary, who was considered the rightful ruler of England by many English Catholics.After a long period of custody in England, she was tried and executed for treason following her alleged involvement in three plots to assassinate Elizabeth and place herself on the English throne.
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"Remember Gentlemen the Theatre of history is wider than the Realm of England."
she replied that she forgave them, for "you are about to end my troubles!"
Be happy while you're living, for you're a long time dead.Scottish Proverb Confessed faults are half mended.Scottish Proverb Fools look to tomorrow. Wise men use tonight.Scottish Proverb Luck never gives; it only lends.Scottish Proverb
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“The difficulty of literature is not to write, but to write what you mean” Robert Louis Stevenson quotes
“The hardest thing in life is to know which bridge to cross and which to burn” David Russell quotes
“Oh what a tangled web we weave, When first we practice to deceive” Sir Walter Scott
“To be kind to all, to like many and love a few, to be needed and wanted by those we love, is certainly the nearest we can come to happiness.” Mary Stuart
“People who are unable to motivate themselves must be content with mediocrity, no matter how impressive their other talents.” Andrew Carnegie
“Tell a man he is brave, and you help him to become so” Thomas Carlyle
“Go as far as you can see; when you get there you'll be able to see farther” Thomas Carlyle
If the Scotch knew enough to go in when it rained, they would never get any outdoor exercise.- Simeon Ford
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[9:09:25 AM] Greg Stuart: Here's another one on the nextTo marry is to halve your rights and double your duties.Scottish Proverb[9:09:56 AM] David Weseley: hah![9:10:56 AM] David Weseley: beggars cannae be choosers[9:11:30 AM] David Weseley: i am looking for ones apropos to you[9:11:44 AM] David Weseley: Better keep the devil at the door than have to turn him out of the house[9:12:03 AM] David Weseley: this one is great: Enough is as good as a feast[9:13:13 AM] David Weseley: Mair by guid luck than guid guidance[9:13:49 AM] Greg Stuart: I don't get the last one[9:14:03 AM] David Weseley: More by good luck than by guidance, or planning[9:14:08 AM] David Weseley: Our business in this world is not to succeed, but to continue to fail in good spirits[9:14:20 AM] David Weseley: Penny wise and pound foolish[9:14:29 AM] David Weseley: The cure may be worse than the disease[9:14:31 AM] Greg Stuart: Who did the our business one?[9:14:33 AM] Greg Stuart: Loave that[9:15:00 AM] David Weseley: and perfect for your book: When one door sticks, another one opens[9:15:11 AM] David Weseley: I don't know, now I am reading a list on the net[9:15:18 AM] David Weseley: http://www.rampantscotland.com/features/scottish_proverbs.htm[9:15:19 AM] Greg Stuart: send me the link[9:15:54 AM] David Weseley: this is another classic:[9:15:56 AM] David Weseley: Ye canna make a silk purse of a sow's lug (a pig's ear).[9:16:30 AM] Greg Stuart: Love that one too