1. XMOS Research Review The New Marketing Mix
Rex Briggs, Marketing Evolution

2. We are a people of tradition, but the past no longer serves us
We are a people of tradition, but the past no longer serves us. Learn from the present and focus on the future.

3. Have you re-evaluated your marketing mix?
The Media Landscape Has Changed
Have you re-evaluated your marketing mix?

4. Our conceptual models of media and advertising are outdated
The Past is Outdated
Our conceptual models of media and advertising are outdated
Media and advertising in context
XMOS learning
Closing thoughts

5. Our conceptual models of media and advertising are outdated
Old Way
Media Magnetism
Active Attention
Learning Theory
New Way
Advertising Wallpaper
Passive Attention
Absorption Theory Brand salience & enhancement

6. The Past is Outdated In the Beginning, Media Mesmerized Us

7. There was a time when radio could hold attention

8. Television then…
TV Now…

9. Television then…
TV Now…

10. Advertising Wallpaper

11. We have learned more in the past 10 years about how the brain works than we learned in the previous 100 years Learning theory is rarely applicable in today’s media environment Advertising’s effect is more subtle, and impossible for consumers to accurately gauge on their own

12. Our conceptual models of media and advertising are outdated
Old Way
Media Magnetism
Active Attention
Learning Theory
New Way
Advertising Wallpaper
Passive Attention
Absorption Theory Brand salience & enhancement

13. Orange Juice Case Example
Control group:
Branded OJ Taste Test
Exposed group:
Ad exposure, then
Branded OJ Taste Test
5.1
Overall taste rating:
7.6
Overall taste rating:
Illustrative data, see JAR 2004 for case example

14. But there is no real security in what is no longer meaningful.
It takes a lot of courage to release the familiar and seemingly secure, to embrace the new Alan Cohen
But there is no real security in what is no longer meaningful.

15. The Key To Understanding The New Landscape:
Implication to marketers:
Set aside your assumptions and see what works.
Implication to research:
Measure the effect through observation
- Don’t guess at it.
- Don’t ask consumers to guess at an ads influence!
The situation is like a beam-balance in which each brand weighs the same. With one brand one each side, the scale is balanced. However, it takes only a feather added to one side of the balance to tip it in favor of the brand on that side. The brands consumers have to choose from are often very similar. Which way will the buying balance tip? When we look for advertising effect we are looking for feathers rather than heavy weights. David Ogilvy, 1963, Confessions of An Advertising Man

16. Measuring Advertising
Never ask respondents if they took a certain action because of advertising
Instead, observe the effect
Advertising is a low involvement communication and is not generally perceived as a cause for action (even when it is)

17. Measuring Advertising Effect
Brand Image: Considering everything you have seen or heard about the All New 2004 Ford F-150 and your own personal opinions, please indicate the degree to which you Agree or Disagree with the following statements.
(Top-Two box- 5 Point Scale)
“Good looking”
+22%
Before Campaign
After Campaign
*significant value are at a 95% confidence level

18. 15 Public Studies to Date XMOS 1.0 Unilever’s Dove
XMOS Branding - 1st wave
McDonald’s
Colgate Total
Kimberly Clark Kleenex
AstraZeneca Nexium
XMOS Branding - 2nd wave
Universal Pictures Home Video
ING
VeriSign
Sensodyne (UK)
Carlsberg (Denmark)
Charlie’s Angels (Denmark)
XMO$ Sales & Branding
12. Ford F-150
13. P&G’s Olay
14. Kraft’s Jell-O
15. Nestlé's Coffee-mate

19. XMOS Learning
Headline finding
In-depth learning

20. Online Advertising Impact
Online achieves direct response
Online builds awareness
Online communicates brand image
Online builds preference
Online sells products offline

21. The Headline Conclusion
Same Budget
Better Results

22. Same Budget, Better Results
Optimizing Online
Results in a 14% increase in purchase intent
Same Budget, Better Results
To make these changes – increasing online’s reach and average frequency, it would mean significantly increasing online’s share of the total advertising budget. From a meager 2%, it’s recommended that online command 15% of the dollars. But the rewards are many:
Reallocation in this fashion would produce an 8% increase in overall branding metrics and a 14% increase in purchase intent – a variable that marketers hold in very high esteem.
Spending not a penny more – simply by reallocating a small portion of its offline budget online – Unilever has improved its overall impact dramatically.
Reallocation in favor of online would indeed improve efficiency by 8% in combined branding metrics and 14% in purchase intent.
Specifically, the advertising should use the additional online dollars to increase average frequency and increase the reach of the online campaign.
The Dove Nutrium Study did indeed break new ground, both in terms of its approach to studying cross-media effectiveness and also in the results and insight that it yielded. And it became the foundation for an entire series of equally impressive studies that would follow.

23. Good ads are incredibly important
And…
Good ads are incredibly important
Take the time to test creative

24. In Depth Learning From CROSS MEDIA RESEARCH

25. Summary Of XMOS Results
Brands
Dove
Chicken
Flatbread
Total
Kleenex
Nexium
ET Home Video
ING
Verisign
Jell-O
Coffee-mate
Olay
F150
Reco’d % Online
15%
13%
11%
10%
10-15%
19% 4% 5%
TBD
****
6%*
Brand Awareness --
+8% **
***
Brand Image
+34%
+7%
+10-20%
Purchase Intent
+14%
+20%
+1-5%
+1491%
Sales
+4%
In Field
+5%
* Not the optimized level, but considered an interim step
** Brand ran Optimal level so there was no gain from more online spending
*** Because of differing objectives, cross media comparison was inconclusive
**** Results based on three months of analysis, full analysis is six months, and is still in progress

26. Why does increasing Online produce better results within the same budget?
Coverage
Effectiveness
Value
Online advertising is typically more cost efficient at producing branding gains
Online advertising affects branding metrics
Online reaches those who would otherwise not get the advertising message

27. Lighter TV users are Heavier Online Users
COVERAGE

28. Why does increasing Online produce better results within the same budget?
Coverage
Effectiveness
Value
Online advertising is typically more cost efficient at producing branding gains
Online advertising affects branding metrics

29. Marketing Objectives
Build awareness, reinforce key image attributes and boost purchase intent
Generate sales
Brand differentiation and sales
Generate purchase intention and sales

30. Universal Home Video – E.T. DVD Release
Launch Goals:
Communicate the release of E.T. DVD
Position brand as one of the most beloved movies of all time, with new footage & enhanced visual effect, a must buy DVD
Primary Objective: Generate purchase interest

31. The Power of Good Creative

32. The Power of Good Creative

33. Summary of branding gains
Based upon what you have seen or heard, how much would you say each statement describes the movie E.T. The Extraterrestrial on DVD and video…(Describes completely/Describes somewhat)
An unforgettable masterpiece for the whole family
Stat sig.
TV + Rich Media Overlay
TV + Online
TV Only
Pre-Campaign

34. However, TV & Online do Drive Purchase Intent
Thinking about E.T. The Extraterrestrial, how likely are you to buy the DVD or Video
Definitely will/Probably will buy (net)
Findings: TV alone does not affect purchase intent
However, the combination of Online advertising and TV does produce a statistically significant impact
Moreover, TV and the overlay Online execution makes an even bigger impact
TV + Rich Media Overlay
Stat sig.
Stat sig.
TV + Online
TV Only
Pre-Campaign

35. TV Built Awareness but Not Purchase Intent
Brand Awareness
TV Campaign %
Pre-TV
Post TV Campaign
Purchase Intent

36. Rich Media 6½x More Cost Effective TV Based on Relative Cost Index against Effectiveness
Rich Media Overlay
Online Banners TV
DVD Release Awareness
100
1079
192
Brand Image Avg (top box)
339
648
Purchase Intent (def/probably)
315
No lift N.A.
Summary
However, the CPM was only 2X Online 100
TV 169
Rich Media Overlay 299

37. Universal: Major Gains with Online
Absolute gains (bar chart) and % lift TV
Online
Rich Media
+31%
+1491%
+107%

38. Offline Sales Results XMOS: Other sales studies Ford AstraZeneca
Procter & Gamble Olay
Kraft Jell-O
Nestle Coffee-mate
Other sales studies
A dozen CPG/FMCG studies by IRI
Ten CPG/FMCG studies by AC Nielsen
Pharma marketing mix by DoubleClick

39. Jell-O Ad Examples

40. The Addition of Online Builds Brand
Online advertising increases purchase intent by 7 points
Purchase Intent Lift: +7%
Purchase Intent: The next time you buy dry gelatin mix that comes in a box, what is the probability that you will buy Jell-O gelatin mix?
(Top 2 box- 11 point Juster Scale)
Offline
Offline + Online
Control n= 468; Branded n=469; Coupon n= 465
All significant values are at a 95% confidence level

41. Online Sells Product Offline
Average Weekly Volume per 100 Households Measured in Ounces
Incremental Volume +.1 oz
Sales Lift: +7.5%
Online advertising resulted in a 7.5% sales volume lift
Control*
Exposed to Online Ad
*All volume numbers above are weekly volume per 100 Households

42. Jell-O Sales ROI Online
ROI: Payback of Each Media Vehicle per Dollar Spent
Above average ROI
Radio
Trade
FSI
Direct TV
Direct Print
Online
Below average ROI
Online frequency=9.8
Online frequency=7.0
Calculated National Theoretical Recommended frequency level

43. The Coffee-Mate Online Campaign

44. The Addition of Online Builds Brand
Online advertising increases five out of eight key metrics
Brand Image: Considering everything you have seen or heard about Coffee-mate Non-Dairy Liquid Creamer and your own personal opinions, please indicate the degree to which you Agree or Disagree with the following statements: (Top-Two box- 5 Point Scale)
Average increase +7%
Control n= 468; Branded n=469; Coupon n= 465
Results shown are for branded campaign using an average of all attributes
Offline
Offline + Online
*All significant values are at a 95% confidence level

45. And Again, Online Builds Sales
Average Weekly Volume per 100 Households Measured in Ounces
Incremental Volume +1.3oz
Sales Lift: +10%
Online advertising resulted in a 10% sales volume lift
*Control Panel=606 Exposed Panel=1,127. All volume numbers above are weekly volume per 100 Households
**Statistically Significant at the 95% confidence level
Control*
Exposed to Online Ad

46. Coffee-mate Sales ROI
ROI: Payback of Each Media Vehicle per Dollar Spent
Above average ROI
Consumer Promotions
Trade TV
Online
Below average ROI
Online Recommended Level

47. The All New Ford F-150

48. “The Most Important Launch In the History Of Ford” - Bill Ford

49. One Day Reach = 40%!!!
Roadblock

50. Campaign Launched With Digital Road Block

51. TV and Online Roadblocks (Purchase Intention)
Both are effective
But the roadblock
is more cost efficient

52. Individual Media Effects Led by Online Branding Metrics SummaryTV
Maga-zines
Road-block
Online
Ad Recall
+3pts
+13pts
+6pts
+15pts
Familiarity
Not Sig
+11pts
+10pts
Avg Brand Image Attributes
+8pts
+9pts
Purchase Consideration
+5pts
+4pts
Shopping
Purchase Intention (unaided)
+2pts
+12pts

53. Online is a MAJOR contributor to success
Internet Reach
55% or
2.2 Million Consumers interested in buying F-150 because of Online ads
Online’s Impact =
Purchase Intention
+6.8%
Strategically, what was the best option for McDonald’s? The answer was to extend the REACH of the Internet message. Optimally, the online portion of the campaign should reach a total of 60% of the total target audience. This increase would drive overall awareness up 8.3%. In terms of total impact, this means that McDonald’s would generate awareness among 6 million more customers, without spending one additional dime of marketing money!
Weighted average of Roadblock and Online
(impact of roadblock x reach of roadblock + impact of online in-market + reach of in-market) / sum of reach = weighted impact

54. Purchase Consideration Impact Efficiency Relative Cost Index (ROMO)
Brand Metric: Purchase Consideration (top 2)
Relative Cost Index
Sample Cost TV
2153
$21.53
Magazine
354
$3.54
Roadblock
196
$1.96
Online
100
$1.00
Interpretation: If it cost Online $1 (indexed of 100) to increase purchase consideration, then it cost $1.96 for the roadblock, $3.54 for magazine and $21.54 to TV to achieve the same increase.

55. Online’s contribution to sales
Roadblock
Online’s contribution to sales
21% sales lift over control group**
That’s 6% of total sales caused by Online advertising
In-market ads
** 28% actual lift, 21% represents a more conservative figure to account for heavier media delivery. 21% lift accounts for 6% of total all new F-150 trucks during measurement period.

56. Ford Sales Analysis 500,000 F-150’s sold annually
Online was 6% of sales, or 30,000 trucks
Results in $750,000,000 annual F-150 sales
Tracked Buying of Control & Exposed Group
@ $25,000 per Truck

57. What if Ford Ran Increased Online?
Online included Roadblocks & In-Market
Plan would then sell +5%, or 25,000 trucks
Results in additional $625,000,000 annual sales
Optimization and Judgment suggested +6% increase in Online
@ $25,000 per Truck

58. Brand Tracking And ROI Modeling
Sales lift:
Nexium 6.0%
Jell-O 7.5%
Coffee-mate 10.0%
Olay 12.5%*
Ford F %**
Sales
Low Hi
Branding Hi
Low
Olay
Are these findings a surprise?
Branding and Sales increases are not new news
Consistent with branding studies and two dozen sales studies
Coffee- mate
Jell-O
*Mid-point data only. Campaign is still in field, Reported % increase in household buy-rate. Actual volume increase were higher.
** 28% actual lift, 21% represents a more conservative figure to account for heavier media delivery

59. The Power of Good Creative

60. Room for improvement
Of the last 5 XMOS program, creative testing was done prior to the study launch
2 brands found 1/2 the ads were not effective
Diluting the effectiveness of the campaign
2 brands discarded ALL ads, starting all over
Both developed better ads that scored much better
Only 1 brand’s ads required no adjustment

61. Case in Point: Olay

62. Online Ads
AD4
AD5

63. Measuring Effectiveness: Creative Testing
Point difference over control
Branding Metrics #4
Awareness- Unaided
not sig
Awareness- Aided
+3%
Purchase Probability (top 2 box)*
Average Branding Attributes
Message Association (love the skin your in)
+4%
* Ad 5 show directionally positive increases in purchase probability

64. Revised Ads Produced Better Results
Try the “Glance test”

65. Online Ads

66. Individual Media Effects
Branding Metrics
Point difference over control
Online (revised)
Awareness- Unaided
+11%
Awareness- Aided
not sig
Average Branding Attributes
+9%
Purchase Probability (top 2 box)
+12%
Offline n =573
Offline +Online n =547

67. The Power of Good Creative

68. Why does increasing Online produce better results within the same budget?
Coverage
Effectiveness
Value
Online advertising is typically more cost efficient at producing branding gains
Online advertising affects branding metrics
Online reaches those who would otherwise not get the advertising message

69. The Old Marketing Mix Is NO LONGER OPTIMAL
Billions are lost due to sub-optimal marketing mix

70. The Key To Improving Marketing ROI
Set aside old, outdated assumptions and measure what produces the best ROI
If you hope to make advertising more profitable, you had better measure what’s working, and what’s not

71. Applying the New Learning:

72. Beware of Media Planning Inertia

73. Updating last years mix
with minor tweaks is NOT
a solution
Instead, use zero based media planning

74. Applying the New Learning:
What is the quality of your ads?
Do you run a live pre-test to optimize them?
BEWARE of norms (make sure the comparisons are meaningful)
The financial value of strong creative can’t overstated

75. Have An Online Spend Growth Plan

76. The Art and Science of Developing a Strategy is SIMPLE
Strategic
Insights,
Measurement,
Planned
Learning by
Experimentation

77. SIMPLE - Explained Strategic Insights Measurement
Research provided knowledge about the consumer’s motivations
Research provided insight about competitive positioning
Defining and segmenting your audience based on motivations and reachability through media
Understanding and developing the soul of your brand
Measurement
Advertising delivery and effectiveness measurement
Strategic (XMOS) versus tactical measurement (GRPs)
Planned Learning by Experimentation
Planned learning is different from ad hoc research.
It begins by pin-pointing knowledge gaps, prioritizing learning and taking a longer-view of addressing these issues

78. Research Roadmap for Integrating Online Media
4 stage approach to using research to understand the impact and value of Online in your media mix.
Phase 1: Online campaign branding effectiveness
Phase 2: XMOS Branding or Online Sales impact Phase 3: XMOS: Online in Marketing Mix Models
Phase 4: XMOS: Ongoing Marketing Mix and Brand Tracking Measurement
$1,000k
$500k
$100k
Phase 4
Phase 3
Phase 1
Phase 2
Brand’s Total
Online Spend
Time

79. Accountability is not measurement…
It is doing something about the measurement.

80. What can you do? Recommendations Form a working group
Include key brand, agency and measurement team members
Examine your key target audience share of time with each media
Make measuring relative effectiveness a priority
Ensure that online is properly quantified -- Old RDD tracking studies fail at measuring online
Review and update marketing mix annually

81. Applying the New Learning:
Identify Leaders and Curmudgeons
Engage them both
Example: Marketing Evolution’s Scenario planning
Consider re-vamping the entire marketing metrics and decision process
Do you measure the right things?
Is everyone trained on marketing measurement?
Is there a process for changing based on research learning?

82. Closing Thoughts

83. Jump. It is not as wide as you think.’
A bit of advice given to a young Native American at the time of his initiation: ‘As you go the way of life, you will see a great chasm Joseph Campbell
Jump. It is not as wide as you think.’

84. Test, Learn, Evolve
Rex Briggs