If your advertising agency identified a simple way to increase your company’s sales by 4% without spending an extra dollar, would you follow their advice? Even if that advice was to shift more of your media budget over to TV advertising?
It’s a simple fix, but because you are a Canadian company, chances are you will not do it. Canada is a Top 10 Market globally when it comes to internet and mobile ad spend - #9 and #5 respectively - but we plummet to #17 when it comes to TV advertising. Mark Ritson, marketing guru and outspoken industry expert, recently said that he had never seen a market so prejudiced against TV. What gives?
It’s difficult to know why advertisers choose to underinvest in TV in Canada when research around the world has long pointed to TV’s effectiveness and strong ROI. It could be that too many marketers make media decisions based on their own habits or worse, the anecdotes of cool industry types. Or it could be that marketers needed credible, Canada-specific data to back up TV’s claims.
$1.4B in lost revenue
A new study from Accenture, The Moneyball Moment for Marketing in Canada, analyzed $3 billion in Canadian media spend across 105 brands in four different industries and discovered that the companies they studied missed out on $1.4 billion in sales revenue in 2018 alone.
Why? They overinvested in digital and underinvested in TV.
These companies correctly understood that using multiple touchpoints equates to more a powerful campaign, but they got the balance wrong. They likely underestimated the value of TV advertising because they didn’t account for its Halo Effect, the significant impact that TV advertising has on the performance of other media channels. After Accenture calculated the Halo Effect, television’s ROI jumped an incredible 23% to $14.34 to deliver the highest sales ROI of any media channel, while the sales ROI of digital media dropped by double digits.
At thinktv, we often say that the answer is in the “and”, not the “or”. We know that media works best when it works together. This study outlines the importance of getting the balance right. Check out the detailed research results here.
What’s next? Examine how you allocate your company’s ad dollars and leverage comprehensive attribution analytics to ensure the optimal media mix. See you on TV.
By: Catherine MacLeod, President & CEO, thinktv.