Sunday, December 3, 2023

Every #1 spent display ads drives #1.94 in Earnings

A year-long research project involving Unilever, Nestle and the Internet Advertising Bureau (IAB) has put a number on the impact that online display advertisements can have on the earnings of popular household brands.

The project tracked the performance of advertisements for nine brands – Nescafé, Häagen Dazs, Persil, PG Tips, Magnum, Surf, Maille, Tropicana and Aquafresh – over a Selection of popular desktop and mobile sites such as The Guardian, Yahoo!, eBay, Gumtree, AutoTrader and Mail Online.

The researchers were able to track those that didn’t, as well as the decisions of those that obtained the ads. This was done using a combination of Nectar loyalty card information (which provides transaction information on 12 million Sainsbury’s clients) and Nielsen Homescan data on shopping behaviour at UK supermarkets.

The information suggests that online advertisements have a pronounced impact on consumer behavior. Every #1 spent on display advertisements delivered an average of1.94 in sales across markets. 1 brand found a return of #3.38.

Halo impact

“The ‘Holy Grail’ question we get from entrepreneurs is what effect does an online advertisement have on offline sales, and the answer is a really major one as the great majority of the earnings attributable to the online ad happened in-store,” said the IAB’s chief digital officer Tim Elkington.

“The calibre and range of the brands involved in the job gives marketers a reassuring guide concerning what their investment in electronic will pay back.”

1 aspect of the findings relates to the ‘halo effect’, or the effect that store-branded advertisements can have on sales. Each one of the ads served to consumers as part of this analysis carried a Sainsbury’s logo, and the IAB quotes since they are at Sainsbury’s, that these advertisements are effective at driving additional sales in other niches.

55% of shoppers think an ad carrying the logo of the Sainsbury indicates that the item could be available in shops. 38% said that the logo would make no difference to where they would seem to buy the item.