09 DEC 2019
6 MIN READ
Commissioned by Thinkbox and in collaboration with WPP companies Gain Theory and Wavemaker, MediaCom recently revealed a major new econometric fuelled study, Demand Generation.
“Demand Generation provides the industry with the broadest view of media performance to date. It goes under the bonnet of what factors drive the optimal media plan for a brand, with The Demand Generator helping advertisers to tailor the result specifically for their brand.” Jane Christian, Managing Partner, Head of Business Science, MediaCom
Analysing £1.4 billion of media spend from fifty UK brands across 14 categories, the market leading research not only revealed the optimal media mix for companies, but also developed a tool, The Demand Generator, for advertisers who may not have access to their own econometric analysis. The tool gives businesses the opportunity to identify their optimal media mix depending on their category, budget, brand size, appeal (e.g. mass market or niche), % of sales that take place online and the desire to minimise risk.
Creating the most up to date research with a breadth of data built on previous research, advertisers are able to use the research as the perfect formula to be able to utilise their spend that equalise both substantial short-term sales as well as sustaining base sales growth. Pooling together our largest databank of client data to date, the collaboration proved the wealth of expertise across the businesses, ultimately revealing a fool-proof process in which advertisers can utilise for success.
The research determined that for spend to be optimally allocated across channels, there are 6 key considerations to consider.
- What is the context of my brand?
Four contexts have the most significant impact on optimal channel choice
i. The sector
ii. % of sales online
iii. Business size
iv. Niche vs. Mass
- What is the outcome I’m trying to achieve with marketing?
Prioritise Growth – Identify inefficient spend to reduce and reinvest into headroom elsewhere in the plan to maximise volume.
Prioritise Efficiency – Identify inefficient spend to reduce and remove to improve return per pound spent even if it limits overall volume.
- How much of my budget do I need to set aside for fulfillment media?
Differing fulfillment costs are not a new concept and for online purchases there is a second layer to consider – Fulfilment Media, such as Brand PPC and Affiliates. These channels have a role to play in the purchase journey, however they are not demand generating channels, so their budget should be accounted for separately.
- How do I avoid diminishing returns?
We all know that with every pound we invest, we receive different returns. The right overall media investment means understanding the answer to an ever changing questions, ‘Where and when should I spend the next pound of media spend to maximise my return?’
- When do I need the payback?
It’s not just digital channels that generate a strong short term return, many offline channels do too, but offline channels tend to need more pre-planning. This is where regular forecasting will help you anticipate where you’ll need a boost to make sure that your plan can drive maximum short term return.
- How much risk am I prepared to take to achieve my outcome?
Risk differs by channel and our research finds that a higher risk plan focuses more on digital channels, but has the potential to generate a higher ROI.
For more information on this work or to view the deck, and the work Business Science do and how you can work with us, please contact [email protected]