Marketers in the United States are underspending by about 16 percent, or $31 billion annually, according to a study released by the Advertising Research Foundation. The study, called “How Advertising Works Today,” also raises issue with marketers not spreading their budgets widely enough across media. Described by ARF CEO Gayle Fuguitt as the most extensive industry study in more than a quarter century, it covers 5,000 campaigns for 1,000 brands (which include Pfizer, Kellogg Co. and Sun Products) in 41 countries to make up $375 billion in global ad spending.
The ARF study found that on average, brands see a 19 percent return on investment increase by using two media platforms instead of one. Increasing that number to five platforms improved ROI by 35 percent. However, 29 percent of campaigns surveyed relied one only one platform, with 60 percent using two or fewer. By that measure, ARF says that the estimated $196 billion U.S. marketers will spend this year should really be closer to $227 billion.
While there’s a big payoff to adding more platforms, the same does not apply digital display ads. The study showed sales actually began to decline after a user served with an ad is hit with a digital banner impression 40 times or more a month, and any positive impacts go away long before that.
Radically different creative across different media also has a negative impact. Varied creative strategies may cancel each other out and become less memorable. The best way to go is with a unified cross-media campaign, which were on average 57 percent more effective.
That’s not to say an entire campaign has to have the same message or look. An image of an athlete holding a Gatorade bottle in a Facebook ad will make the TV ad featuring the same athlete more memorable, according to Pranav Yadav, CEO of Neuro-Insight, which tracks the brain’s electrical activity to see how people respond to ads.
“When similar aspects are taken from one platform to another, it increases memorability on the second platform,” said Yadav, in describing a process called “priming.” TV and print have a particularly strong cross-priming effect because they both are generally viewed in a relaxed setting. Similarly, mobile and digital outdoor ads go well together because both are viewed “on the go.”
TV and print have a strong cross-priming effect, he said, because they both tend to be viewed in a relaxed setting. Likewise mobile and digital outdoor ads often work together because both are viewed “on the go.”
Traditional media still has a major impact among millennials. To reach an audience in the 18-34 age range, the ARF recommends allocating 71 percent on traditional and 29 percent on digital. A budget with 78 percent spending on traditional media and 22 percent on digital worked best for audiences across age groups.