Shifting Promo Dollars To Media Produces Higher ROI

Media company Turner Broadcasting commissioned a study showing that shifting as little as 10% of promotional dollars to media advertising can result in big return on media investment results for marketers.

The study -- conducted with IRI, the consumer products/healthcare marketing analytics company -- noted that consumer product marketers can spend as much as 66% of marketing dollars on promotion. Shifting 10% of that money can return in return on investment (ROI) gains of 10% to 25%.

Turner/IRI research looked at three years of data, across 62 brands representing $20 billion in sales and $3 billion in marketing spend across food, beverage, health care, beauty and home-care marketers.

The research indicates that the results are more dramatic when separating short-term and long-term ROI versus overall promo spending. Short-term ROI of media “is comparable to standalone promotional efforts.” But long-term ROI media spend can be two to three times that of promotion. Beverages, food and healthcare in particular can  see major results.

For example, every dollar spent on short-term media advertising for a beverage marketer produced an ROI of $1.21 -- comparable to promotion spending, which yielded $0.96. But this amount rose substantially when looking at long-term media spending, where for every dollar spent, it produced $2.54 in ROI.

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1 comment about "Shifting Promo Dollars To Media Produces Higher ROI".
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  1. britta cleveland from meredith, December 15, 2016 at 1:22 p.m.

    The Turner/IRI research is another strong argument that marketers can achieve the greatest ROI when they focus on cross platform media. For more than 10 years, Nielsen Catalina Solutions has measured the effectiveness of media in driving sales as part of marketing plans.


     


    Their research has revealed that when combined, the ROI value for marketers in driving sales and performance is extremely high. As noted by a recent Nielsen report NCS CPG Benchmarks examining 1,400 case studies -- the ROI across media, led by magazines, was as high as $3.94. Similarly, other NCS research revealed that when you remove these components from your marketing plan, you not only lose your ROI, you lose market share to your competitors. Given this compelling data, the real question is why would any marketer in 2017 sacrifice proven ROI and market share for short term promotion?

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