Five effectiveness lessons to wow your clients

Five effectiveness lessons to wow your clients
Matthew Philip, Strategy & Effectiveness Director at Manning Gottlieb OMD, discusses how can you get a grip on effectiveness, create real value for clients and win at the biggest awards in the business.

1)     Long-term effects can outshine the short-term ones

It’s tempting to focus on those shiny, short-term effects of advertising – CPC, CTR, likes – but it’s often the long-term financial payback that will really amaze your clients.

For evidence, look no further than Les Binet and Peter Field’s ground-breaking ‘The Long and the Short of it’ study analysing IPA Effectiveness Award entrants who showed that the full financial benefits from advertising takes time.

That’s because the long-term effects of advertising – such as price inelasticity – are often the biggest profit drivers for businesses.

In fact, they found that the optimum ratio for investment is around 60% on long-term brand building and 40% on short-term demand driving.

It won’t come as a surprise, then, that the Grand Prix winners at the IPA Effectiveness Award overwhelmingly tend to tell the story of long-term campaigns.

So have a close look at your client’s performance and results over a much longer period of time as it may help you unearth some real nuggets of insight into how advertising drives their business success. Take our 2014 Gold-winning IPA Effectiveness Award for Specsavers which showed the transformative power of advertising to build a business over almost 30 years!

 

2)     Fame beats persuasion almost every time

Jeremy Bullmore famously tells the story of Victoria Beckham who stated that she wanted to be “more famous than Persil Automatic”. And she was right – aiming for fame is the best strategy for pop stars and brands alike.

In ‘Marketing in the Era of Accountability’ Binet and Field found that fame strategies on average were up to three times more likely to have a large effect on profit growth than persuasion campaigns. Research companies like BrainJuicer have also shown that ads which build brand fame consistently create more profit that other types and the proof really is in the pudding: they rated Guinness’s ‘Made of More’ campaign as a 5-star ad and it duly took home a Gold at the 2016 IPA Effectiveness Awards.

Bringing this thinking into your planning can create real value for clients – for Specsavers we identified the power of ‘Should’ve Gone to Specsavers’ at driving brand fame at reorganised their entire communications approach around it. In this case, we discovered that focusing your efforts on fame doubled return on investment.

 

3)     Effectiveness and efficiency are different things

Effectiveness is defined simply as whether you achieved your goals. Efficiency is a ratio of what you created per unit of investment. Each is important, but a focus on one at the expense of the other might actually create less value for your client.

If the right goals are set, effectiveness should be the holy grail. As we’re generally dealing with profit-oriented companies* this is best shown by the scale of the business effect created – or total payback. It’s a simple sum: profitable sales coming from your activity minus total cost of activity. If the end result is positive, then that’s cash on the bottom line and a happy client!

Efficiency is an important tool for increasing effectiveness, but can be misleading used in isolation. Ratios such as ROMI (return on marketing investment) tell you about the efficiency, but not necessarily the total scale of the effect. Calculated correctly, you simply divide the payback by the cost of the campaign and express it as a percentage.

It should be used on its own with caution; in practice, payback is maximised at higher levels of spend than ROMI, so optimising to efficiency may mean spending less and missing out on the real power of advertising! But because it’s a ratio it’s great for comparing options for spend, or demonstrating how one approach might be better than another.

 

4)     Creativity can be a game-changer

Paul Dyson at Data2Decisions found that of all the ways to increase campaign effectiveness, creativity stood head and shoulders above everything else within our control. 10 years later, he found its importance had grown.

Peter Field confirmed this finding in ‘The Link between Creativity and Effectiveness’, noting that creatively awarded campaigns delivered consistently greater business effects than ones that weren’t.

Specsavers benefitted from this creativity dividend. We were able to compare different creative ‘periods’ with roughly parable communications investments to show that their highly-creative ‘Should’ve…’ brand idea delivered three times more revenue per pound spent than other ideas.

 

5)     Advertising can help brands succeed in uncertain times

During turbulent times it can be tempting to cut easy expenses, and advertising’s often one of the first to go.

But arming yourself with effectiveness thinking can give your brand an advantage in a downturn. Evidence from the PIMS database and countless others suggest that businesses that maintain or increase advertising spend during recessions recover much quicker and come out with greater market share.

Our 2014 IPA Effectiveness paper for Specsavers shows just that. As the downturn hit in 2007, competitors slashed their ad budgets. Specsavers increased theirs and came out on top.

So how can you get a grip on these effectiveness stories, create real value for clients and win at the biggest awards in the business? Immerse yourself in effectiveness thinking with the IPA’s Eff Test and 36 years of Effectiveness Award papers – fame and fortune awaits.

*Of course, plenty of advertising activity is aimed at social goals – many of the great IPA Effectiveness winners have tackled those with amazing success.

Matthew is a Strategy & Effectiveness Director at Manning Gottlieb OMD, the most awarded media agency in the history of the IPA Effectiveness Awards. Over the past ten years he’s helped clients such as Specsavers, John Lewis, and Age UK tackle business problems and grow communications effectiveness, and is a contributing author to “What is a 21st Century Brand”.

The IPA has teamed up with the Internet Advertising Bureau (IAB) to revamp the Eff Test in order to produce new industry training that will help clients and agencies to evaluate the effectiveness of their digital activity. Find out more about the new module here. You can also visit our Effectiveness hub to view case studies, reports and video swith cutting edge thought leadership of the world's most successful campaigns and brands.

Last updated 16/05/2017

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