Bigger Budgets Equal Better Branding Metrics

by Oct 21, 2002, 12:00 AM

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The findings from the IAB's Cross Media Optimization Study released this morning at the organization’s annual meeting in New York, indicate the potential for an increase in branding metrics when online advertising's share of the overall campaign budget is increased via reallocation of dollars.

IAB President & CEO, Greg Stuart said that this study “absolutely shows that the online medium's percentage of marketing budgets must be increased in order to maximize results for marketers."

The researcher examined a campaign for McDonald's Grilled Chicken Flatbread Sandwich, which was targeted at U.S. adults 18 to 49, with the goals of increasing awareness as to the product's attributes and to drive purchase intent. The XMOS research of Internet users measured the impact of the campaign quantifying the effect of online advertising relative to offline, analyzed the efficiencies to determine if online could improve the brand metrics and if it could do so more efficiently, and thereby recommend a more efficient media mix.

Neil Perry, Senior Director, Internet Marketing, McDonald's Corporation. "The media environment is increasingly fragmented. This study has confirmed for us that the Internet can provide us with an excellent way of reaching out to important customer segments, particularly the 18 - 24 year-old demo."

In determining the product image for McDonald's Grilled Chicken Flatbread Sandwich in four attributes, New, Exciting, Different and Combination of great flavors, in all four cases responses for "describes completely" and "describes somewhat", online advertising in combination with offline significantly increased the product image over offline only. These four attributes were most greatly impacted by online advertising among the key youth segment (15 -24), and when combined with TV and Radio advertising, boosts the positive perception by an impressive 9 points.

"In this study for McDonald's Grilled Chicken Flatbread Sandwich, online advertising very clearly improves the branding metrics. What we have found is that McDonald's TV and Radio advertising works well; the branding lift over pre-campaign levels is 187%. But if online plays are larger role in the mix, and the percentage of online advertising is increased to 13% of the same budget, the projected lift would be 232%. That's a big contribution from online advertising," said marketing measurement expert Rex Briggs of Marketing Evolution, who conducted the study along with Dynamic Logic and Forrester Research.

"The results are better when online plays a larger role in the mix because offline media reaches a point of diminishing returns,” Briggs said. “Buying more TV and more Radio ceases to add as much value as adding in Online so that consumers see the McDonald's brand in a new environment that reinforces the core advertising message. Additionally, offline media misses or under-delivers to a segment of consumers who are more prone to be reached online. Television doesn't reach or only lightly covers 27% of the 18 - 49 target market with online access. Seventy-six percent of these consumers used the Internet one or more hours yesterday, so using the Internet to reach these somewhat elusive consumers provides better coverage of the overall target audience," he added.

"The recommendation coming out of this study is that for new products from McDonald's or products targeted at the youth segment, increasing online's share of the budget achieves better overall results," Briggs concluded.

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