Thinkbox (marketing body for commercial TV in the UK) and Ebiquity (independent marketing performance specialists) have teamed up to commission Payback4: Pathways to Profit, a new econometric effectiveness study of advertising. On May 15th 2014 they conducted a study of over 4,500 advertising campaigns across 10 advertising sectors from the last seven years. It compared, on a like-for-like basis, the sales and profit impact of five forms of advertising: TV (linear spot and sponsorship), radio, press, online display (excluding VoD) and outdoor.
The study showed TV advertising still remains the most effective form of advertising and creates the most profit for businesses pound for pound. TV has consistently demonstrated the highest ROI of any form of advertising between 2008 and 2014, especially during a period of exceptional economic and technological upheaval and change. If anything, TV has become more effective within the last three years, the study found TV gave an average return of £1.79 for every £1 invested during 2011-14. The nearest to this is radio with £1.52, followed by press with £1.48. When it comes to online display and outdoor advertising the gap between these and TV is vast in terms of profit delivery with an ROI of only £0.91 and £0.37 respectively.
We believe multi-screening has played a big part in TV’s increased effectiveness, with viewers now able to act instantly on what they see. Because of this advertisers have had to gain a better understanding of how to employ multiple TV ad opportunities whilst integrating them with other media. Nearly half of all UK adults fall into a group known by Thinkbox as Media Stackers (these are people who use the second screen to communicate unrelated to the TV programmes). One way we have found to target these media stackers is to add a call to action onto the ad, for example, a voucher code specific to the TV ad that can be used for discounts on a site. The proportion of brands featuring specific online calls to action in their TV ads has increased from two per cent in 2005 to 16 per cent in 2013.
TV advertising consistently makes other elements of campaigns work harder. Ebiquity found that, even without a call to action, consumers are still engaging with the brand through search. TV’s effects are felt by all accompanying media, but one of the most significant effects is on branded search. The study found the amount of branded online searches created by TV advertising on search engines had increased by 33 per cent per rating point during 2011-14 compared with 2008-11.
Total TV advertising revenue increased by 3.5 per cent in 2013, the fourth consecutive year that TV ad revenue has grown in the UK. Group M predict that 2014 will continue this trend and TV will still be an effective investment for advertisers ROI