|
Robert
L. Tomei
SVP, Chief Marketing Officer
VNU Marketing Information Group
Consumer packaged goods marketers have been slow to incorporate
the Internet into their marketing and media plans. Some of
the questions marketers are asking themselves are:
- How can I find and target consumers on the Internet?
- Can online media drive offline sales of consumer packaged
goods?
- If online media can drive offline sales, how can I measure
the return on this media investment?
The following article addresses how online marketing can play
a key role in your media mix strategy.
Traditional Media and the Internet
Traditional media, such as print and TV advertising, has eluded
the scrutiny placed on trade and consumer promotions. Even
with the extensive fragmentation that has taken place, many
media planners are still using age and gender demographics
to determine media placements and spending levels. For anyone
who has been in the business for a while, “Women Age
22–49 with 2+ Children” should sound familiar.
These demographics are certainly valuable, but for many marketing
efforts, other consumer identification methods can also be
utilized efficiently and effectively.
There are a number of critical media issues that marketers
are grappling with. Consumers have many product choices, media
channels and shopping channels. Too much media is wasted.
Marketers want to target consumers more efficiently through
accountable, relevant measurement of campaigns. Marketers
are also looking to find their most valuable customers, both
offline and online.
The Internet has had a huge impact on consumer behavior. The
Internet provides consumers with a completely new way of accessing
information and shopping. Today, consumers are online more
than ever before, and the penetration rates will continue
to grow [See chart 1].
The Internet now represents 11% of media consumption, a significant
measure compared to newspapers (5%) and magazines (3%). Even
when compared to television (50%) and radio (31%), the Internet
should be considered a major force. And Internet media consumption
is expected to increase +30.2% by 2005, while TV and radio
expect single-digit increases, and newspapers and consumer
magazines are forecast to decrease in consumption.
Targeting Consumers
Ideally, marketers would like to deliver their message to
just those consumers who are identified as “high potential.”
The Internet provides the opportunity to deliver these “direct-to-consumer”
marketing programs and establish an ongoing dialogue with
key consumer groups to reinforce brand and/or store loyalty.
Combined with offline diagnostic tools such as consumer panel
data and other databases like frequent shopper data, the Internet
can be used to identify consumers, communicate to them and
evaluate marketing programs, whether they are executed online,
offline or in-store.
The first step is to establish a goal for the campaign—increased
sales, increased loyalty, etc. The framework for direct-to-consumer
marketing is to first identify key consumer groups by creating
a profile of the consumer from the integration of online and
offline purchase data captured by longitudinal consumer panel
data and then score that consumer profile against larger databases
such as a large Internet portal like Yahoo!. The second step
is to run a specific online campaign aimed at the target audience.
The third is to evaluate the campaign by analyzing the purchase
behavior of the profile group that was exposed to the campaign
versus the group that was not exposed—a true ROI measurement.
The graph below shows the spectrum of targeting that is available
to marketers today, starting with untargeted “mass reach”
programs and extending to statistical applications that will
enable more efficient/effective direct-to-consumer marketing
[See chart 2].
The traditional methods of targeting include demographic and
geographic models that deliver consumer profiles based on
age, gender and DMA. These provide information on ZIP code,
income and the number of children in the household.
The combination of actual purchase behavior via a consumer
panel and an Internet portal like Yahoo! provides marketers
the ability to establish a complete view of key consumer groups,
including the integration of offline and online activity.
It allows the marketer to define the consumer behavioral profile
from the consumer panel data and then identify which search
words and pages within Yahoo! these consumers are visiting.
A Case Study
ACNielsen, in conjunction with Yahoo!, has begun implementing
a program to evaluate the effectiveness of online promotional
campaigns by analyzing the impact of this online activity
on actual offline sales among key consumer segments. The service,
called Consumer Direct, allows marketers to identify, communicate
and evaluate campaigns of this nature.
The goal of Consumer
Direct is to partner with marketers to help plan and personalize
online campaigns. With the ACNielsen Homescan consumer panel,
marketers can understand offline purchase data, brand loyalty
measures, category usage information, and promotional sensitivity
data. Yahoo! has over 100 million users, which provides online
behavioral information (both declared and observed from search,
content and ad activity), online transaction data, user demographics
(age, gender, geography) and scalable platforms, including
ads, promotions and surveys.
With a recent Consumer Direct program for a major packaged
goods manufacturer, using a permission-based subset of the
Homescan consumer panel and creating a “link”
between these panelists and Yahoo! visitors, we were able
to identify-communicate-evaluate the effectiveness of an online
campaign on offline purchase behavior [See chart 3].
The “linked” panel allows the segmentation of
consumers who currently purchase a category or brand to their
online activity (i.e., sites visited). These segments were
then evaluated based on the client’s marketing goals
and objectives. The client worked with ACNielsen to define
high potential consumers—in this case, Heavy Category
Users.
Next, ACNielsen used Yahoo! information to determine the online
profile that best distinguished those in this “desired”
consumer segment versus those who were not part of this group.
The distinguishing characteristics of these Heavy Category
Users translate into a set of rules that statisticians call
a “scoring algorithm.” The scoring algorithm was
then applied to the entire Yahoo! visitor file, and the result
was a ranked list of all Yahoo! visitors, from those who behaved
most similarly to these Heavy Category Users.
This ranking allowed for the capability to communicate with
this select group of Yahoo! visitors at the top of the list,
to receive a specific online promotional message through Yahoo!
(a random group was held out as a control group and did not
see any of the client’s branded media on Yahoo!). The
usual online metrics (clicks, page views, promotional site
interaction, etc.) were also tracked [See chart 4].
In this case study campaign, a special promotional web site
was developed by the client to provide information to category
users. The objective of the campaign was to drive the Heavy
Category Users to this special promotional site and increase
brand purchases. Target consumers received 90 million impressions
and 13 million unique visitors visited the site.
The Results
Actual offline purchase data was then analyzed to determine
the effect the campaign exposure had on actual sales, by comparing
those consumers “exposed” to the program versus
those that were “not exposed.” In this case, the
Exposed group had a sales lift of 1.28 while the Non-Exposed
group had a sales lift of 1.16, a statistically significant
difference of 9.6%.
In this case study, the Yahoo!-delivered campaign had a positive,
statistically significant impact on offline purchases. Dollar
purchasing increased 76% and penetration increased three times
among the Exposed group. Consumer Direct increased targeting
efficiency by 73%. Yahoo! online targeting resulted in category
reach of 24%, while the Consumer Direct targeting resulted
in category reach of 41%. Dollar sales attributed to the campaign
were $1.8 million, and the contribution of $620,000 resulted
in a return on investment of 40%. And finally, 100,000 new
brand buyers were added to the franchise.
The Internet is now a medium that packaged goods marketers
must incorporate into their total marketing mix. Although
there has been much criticism of web site development costs
and online media spending, if a creative and analytical approach
is taken and there is an integration of online campaigns with
other offline media/promotional programs, significant sales
and brand development successes can be delivered through direct-to-consumer
marketing programs on the Internet. Most importantly, return-on-investment
measures of media spending can now for the first time be measured
for these online campaigns.
|
