• by David Kaplan , April 22, 2005

Contrary to popular belief - and ad agency caviling - marketers, when it comes to return on investment for television advertising, say that they are most concerned with getting their message to the target and achieving sales goals, according to a survey by The ROI Council.

The study, "Understanding Return on Investment in TV Advertising: Advertiser and Agency Perspectives," was prepared by The ROI Council and presented at a luncheon before media buyers and planners in New York City on Thursday. The ROI Council is the brainchild of Court TV under the direction of Reichig, the cable network's senior vice president for sales strategy.

The survey of 156 media buyers, 168 media planners, 48 advertisers, and 19 account executives also found that a lower CPM is not a top-ranked goal for 2005. Planners, not surprisingly, especially value building brand image before lowering the CPM.

And despite promises of huge dividends from product placement/integration, the practice was low on the totem pole in terms of ROI, largely because it's considered even more difficult to tease out data from product placement than television commercials as a whole.

"Still, given that product placement commands $3.5 billion in spending, it's surprising that more respondents rated traditional TV advertising - cable and network - as delivering higher ROI than other media - including product placements and TV sponsorships," said a co-author of the study, Debbie Reichig, Court TV's senior vice president for sales strategy.

TV is still considered the most effective ad medium when it comes to ROI. In fact, the respondents said that the ROI value of online ads is close to TV, while print lags far behind, though buyers and planners do differ in some of these areas.

"And only a little more than half said that they use TV for the CPMs - about 80 percent pointed to the ability to target through TV that accounts for its appeal," Reichig said.

In terms of ROI leading the charge on garnering sales, media buyers and planners were close together, as 74 percent of buyers and 71 percent of planners said that was the chief reason for understanding ROI. The two sides were in similar accord on issues such as media plan versus media delivery (65 percent of buyers, 64 of planners), awareness of campaign (64 percent of buyers, 65 percent of planners), and change in market share (62 percent, 61 percent respectively).

Buyer and planners were more divided when it came to citing ROI's importance related to changing brand awareness (50 percent vs. 59 percent), cost per lead/sale (48 percent vs. 40 percent), and change in intent to purchase (37 percent vs. 45 percent).

And though the search for ROI measurements has been compared to the search for the "Holy Grail," the respondents largely said that finding comprehensive, insightful measurements is a wholly realistic goal. Nevertheless, there is a great deal of uncertainty regarding how far the industry has to go in achieving it.

"There's a sizable number of media professionals who say they don't know where the industry is at, but that's probably based on the different roles and interpretations of media buyers, planners, and advertisers," noted Kim Garcia, senior director, sales research for CourtTV.

One media planner in attendance noted that the industry is awaiting larger penetration of DVRs, which has data that contains what people are watching. "That data looks at households, so if someone is watching the Cartoon Network in the daytime to a significant extent, that tells you a lot and can contribute to a better understanding of ROI," the planner said.

However, a media buyer said that the information gleaned from DVRs or similar devices won't be enough. "DVRs will only tell you so much," the buyer said. "It won't tell whether, most of the time, the person was engaged or not. And that is essential to having a true fix on ROI."

Either way, Reichig was happy to hear the feedback and is sure that as time and technology goes by, different concerns will present themselves.

"Advertisers are driving this and, judging from the responses, it seems that the agencies are just a quick step behind them in recognizing the importance of solid ROI data," Reichig said. "And that's a very good sign for the industry."

The ROI Council is comprised of the following agencies: Carat USA, Initiative Media, MPG, Lowe Worldwide, Magna Global, Media Edge, MediaCom, MindShare, OMD, Optimedia, PHD. USA, RPA, Starcom Worldwide, Universal McCann, Zenith.

MediaPost also participated in supplying its database to the council for the purposes of this study.