IPA: ‘TV more effective than DM’

A new report by the IPA rubbishes the notion that the key to building successful brands is to create loyal customer relationships – instead claiming TV ads create the most business effects and are crucial to long-term profit.
The study, which is likely to raise more than a few eyebrows in marketing departments up and down the country, examines 1,000 ad campaigns from over 30 years of the IPA Effectiveness Awards.
However, critics will no doubt point out that most of these are dominated by TV advertising, not direct marketing or online campaigns.
Sponsored by Thinkbox, the commercial TV marketing body, it claims to provide evidence-based recommendations for businesses on how best to approach investment in advertising.
The report said that advertisers need to ensure their campaigns strike the right balance between long-term investment in brand-building using mass media, and short-term, direct methods that stimulate sales. Campaigns that use both in harmony are more effective, more efficient and more profitable.
It maintains that long-term (3+ years) investment in advertising delivers double the profit of a short-term approach (less than 1 year), but investing in both delivers even higher returns.
It added: “The largest part of an ad budget should be invested in media with a mass reach and long-term effects, such as TV. At least 60% should be invested in these brand-building media with the remainder spent on shorter-term activation channels to provide a response mechanism to capitalise on the effects of the brand-building activity.”
Les Binet and Peter Field, co-authors of “Advertising effectiveness: the long and short of it”, said: “These findings contradict some fashionable thinking in modern advertising, where increasing emphasis is placed on nurturing a one-to-one connection with customers.
“The truth is that the vast majority of people have better things to do with their lives than to form deep and meaningful relationships with brands. Advertisers should not chase loyalty from customers but should speak to as broad an audience as possible and do so over the long term. Obsessing solely about short-term sales is self-defeating; brands must be in it for the long term as that is where the greater success lies. TV is particularly effective for long-term success.”
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