A problem with ad awareness norms to assess advertising quality

It is now common for market research agencies to promise their clients norms against which they can compare their advertising campaign.  For example, they might report…

“The new campaign for Fabulo achieved 37% ad awareness, this compares well to the average of 31% for new campaigns after 3 weeks”.

This sounds like good practice, but the norm is meaningless.

Better yet the research agency might compare against campaigns in a particular product category, or adjust for a particular GRP/TARP weight.  But this still isn’t good enough, GRPs (Gross Rating Points) tell us nothing about the reach and frequency of the campaign.

Worse still the metric confounds both media strategy effects and advertisement quality effects.  What is really needed is measurement immediately after the ad goes into the market, just of those consumers who had a potential exposure (OTS).  This can measure the ability of the advertisement to cut through and impact on memory structures, i.e. assess the quality of the advertisement live in-market.  Only then, when you know if the ad itself is working well or not, can you later use ad awareness metrics to evaluate the media strategy.

Media buyers fail to deliver reach

It’s a provocative title, but it could have been worse – “media buyers don’t understand media” is almost as apt. The reality of modern media buying is that media agencies are essentially buyers of media, not planners. They have been pushed into this situation by uneducated advertisers who find it hard to know what is good media strategy from bad, but do appreciate costs. So media agencies have squeezed out costs, and by and large this has meant that their investment in media knowledge has shrunk to almost nil.

It’s a sad situation for advertisers, but of their own making, though Universities also share much of the blame for sending graduate marketers out into the world with almost no training in media.

Yesterday I came across an example of the distorted crazy market for media. According to Regional Television Marketing figures, 36% of Australia’s population lives in regional areas, but just 17% of the marketing dollars spent by national advertisers appear on our television screens. This is in spite of these regional areas featuring some large cities, and a population with higher than average spending power.

Why do big brands ignore regional TV ? They distribute their brands into regional Australia, but they don’t advertise them there. The reason is that regional TV is more difficult to buy, i.e. more costly for media agencies, it can’t be bought from a “single desk”. Also media agencies, under pressure to demonstrate their “buying power”, bulk buy metro TV space in advance. They seldom do this for regional TV. So they have a huge incentive to shift the space they have, if they don’t sell this their profits take a serious blow.

So it’s common practice to recommend metro TV and ignore regional TV. This can be subtle, just part of the company culture where all the attention goes to metro TV, or overt where regional TV is actively discouraged – this is unethical behaviour, but it happens.

So, for an Australian advertiser, the most simple cost effective way of gaining some pure reach is to split out some of the metro TV budget and allocate it to regional TV. It’s an astonishingly easy way to enhance the sales effectiveness of the ad spend.

I’m sure there are hundreds of similar examples, around the world, of silliness in the media buying industry.

Should cheap low quality ads be charged more for their TV air time ?

Now that the US has finally got ratings for the commercial breaks (via minute by minute recording) the TV networks are all interested in maximising their ratings during the break (ie not losing too many viewers while the ads are on). Which is all good news for advertisers.

One of the things that affects viewing of the ad breaks is the quality of the ads. Low quality ads turn viewers away, and ruin things for all the other advertisers. Put around the other way, poor quality ads enjoy a bit of a ‘free ride’ on the audiences retained by the good quality ads. So should networks give discounts for higher quality, more entertaining advertisements ? And charge more for annoying and boring advertisements ?

Advertising agencies should encourage it, as it would be a further incentive for marketers to commission bigger budget advertisements. In fact it is potentially a win-win situation for everyone. Consumers get ads they actually want to watch. Advertisers get a financial incentive to produce these ads. And networks that feature higher quality ads should enjoy better ratings.

I’m hopeful that innovative networks will begin offering pricing along these lines and/or agencies or clients will start negotiating deals along these lines.

Is recognition a better advertising metric ?

Robert Heath makes a sound case that advertising campaign recall is not the perfect measure of advertising effectiveness. This is not controversial, indeed it would be hard to find anyone who would argue against this position. It’s one thing to recall that a brand has been advertising, another to recall a particular ad, and yet another for the ad to build/refresh brand memories.

More interestingly Heath makes an argument for the use of visually prompted recognition to evaluate advertising performance, especially for affective (non persuasive) ads. Then he presents empirical evidence that shows that non-brand users who recognised the ad felt better about the brand. Whereas the (few) who recalled the advertising did not feel any better about the brand than those who did not recall the campaign.

Very interesting. Except that his sample size is 2, i.e. two (non persuasive, affective) ads.

Both these articles cover the same arguments and same 2 ad tests:

1) Heath, Robert and Agnes Nairn (2005), “Measuring affective advertising: implications of low attention processing on recall,” Journal of Advertising Research, 45

(2), 269-81.2) Heath, Robert and Pam Hyder (2005), “Measuring the hidden power of emotive advertising,” International Journal of Market Research, 47 (5), 467-86.

Memory is complex, so is communication. Different metrics give different insight into how the communication is affecting memory. The problem with using visually prompted ad recognition as test of memory is that people have fantastic ability to recognise images. So it functions more as a test of exposure, than of memory - which makes it a useful measure but in different ways, i.e. not as a direct measure of advertising effect.

Verbally prompted recognition (i.e. verbally describing the ad) is possibly a better way of assessing whether it was seen and processed a little, and helps diagnose if the problem is that the communication doesn’t get noticed or if the branding is off. It essentially gives a lot of cues but is less complete than visually prompted ad recognition.

Both my and Heath’s hypotheses need more testing.

Do TV ads reach DVR owners ? What marketers really need to know.

Commercial market research company Millward Brown have announced results of a (single) study of TV ad awareness showing no difference between DVR owners and non-owners.

There are several good reasons to believe that the potential impact of the DVR/PVR/Tivo has been overstated.
Does this study add supporting evidence ? Unfortunately no, not really.

The survey, done with ABC, CBS, FOX and NBC, purports to show that owning a DVR does not reduce the effect of prime time TV advertising (on ad recall). But this is not a longitudinal study, its quasi-experimental design appears to have simply compared current DVR owners with non-owners - when we know these are two very different groups of people. DVR ownership in the US is rare (about 7%), and current DVR owners are not typical TV viewers (before or after they get their DVR). I expect they watch more TV, and more intently, even with ad fast-forwarding they are probably more knowledgeable about ads.

Just as importantly we can’t generalise these results to all DVRs. In the US currently most of the DVRs only allow fast forwarding of ads, and as Nigel Hollis rightly points out this may actually result in more intense processing of the ads by viewers. But other DVRs allow for 30 second jumps at the click of a button - a few clicks and the viewer misses most ads in the break entirely. This is a different ball game, but how much it affects ad effectiveness remains yet unknown.

In order to understand the DVR effect we need a realistic picture of how much avoidance occurs already in a non-DVR environment. It could very well be that DVR facilitated ad skipping merely replaces other forms of passive and active ad avoidance - in which case DVR impact will be negligible.

We’d also like to know how much ad skipping will occur amongst ‘normal’ TV viewers once they have a DVR. And we need to know how much effect an ad can have even if it isn’t viewed entirely, and how this differs for different types of ads.

The Ehrenberg-Bass Institute’s media research group has recently conducted a large scale field experiment examining passive (ie not switching channels or leaving the room) ad avoidance. More than 400 people were observed watching TV in their own homes. Full results will be released to corporate members shortly, but meanwhile I’ll mention that we were pleasantly surprised by the amount of impact that good quality ads had amongst viewers who were avoiding the ad break (muting the sound, reading, talking etc.).

More evidence that viewers don’t have to be actively engaged with the ad for it to have an effect. Which is a good thing because viewers are rarely actively engaged with ads.

- Dr Byron Sharp
http://www.MarketingScience.info

Are pay TV channels like specialist magazines ?

Last year B&T magazine (20/9/04) asked if Australian pay TV channels are like specialist magazines.

And the representatives of these channels replied YES. This is not surprising because they typically pitch pay TV to Australian advertisers as delivering both targeted and highly involved audiences. The argument being that specialist channels attract specialist audiences. And because viewers have chosen to pay for the channel, so the argument goes, they must be interested in the content and they must therefore ‘watch more intently/closely’.

While this sounds plausible, it’s actually a load of nonsense. Australian pay TV doesn’t deliver different nor more involved TV audiences, it simply delivers smaller TV audiences.

The analogy with specialist magazines is inappropriate because TV channels are typically sold in bundles of very many different channels. So most subscribers of a particular pay channel are not people who deliberately selected to buy this particular channel - it just happened to come with their bundle. Whereas, in the case of specialist magazines, a person who buys, say, Decanter magazine undoubtedly has a serious interest in fine wine, so this magazine does deliver its advertisers a targeted (but also very small) audience. In contrast, viewers of Foxtel’s FashionTV are not fashion enthusiasts (a few are, but most aren’t). They are normal people with pretty much a normal interest in fashion and a tendency to occasionally watch FashionTV a bit.

Accidental viewing represents a huge part of the audience for all small TV channels, including genre specific pay channels. In Australia the reach of a typical pay channel halves when you count those people who watch for at least 10 minutes rather than for 1 minute. Or, put another way, in any given week more than half of a PayTV’s audience watched for less than 10 minutes - not a lot of involvement there!

As Erwin Ephron in New York pointed out to me, because the average US household can receive close to 100 channels “accidental” viewing tends to dominate the viewer composition (and audience value) of smaller cable channels (Food, House and Garden TV, Fashion, MSNBC Business, Lifetime for women, etc.). Considering that their average rating is typically 0.2 and the average amount of people-switching at any time is closer to a 5.0, this is effectively a tsunami 25 times as large constantly washing over the channels. The result is that even narrow-casting channels tend to collect undifferentiated (ie normal people) audiences.

Regardless of what PayTV operators say in marketing trade publications, they do know that their small specialist channels do not deliver targeted audiences. Indeed they have testified before US congress that they can not sell unbundled channels because they would then deliver audiences so small that no advertiser would ever be interested in buying space on them. They know they need channel surfing to deliver much of their ratings and, indeed, survive.

It is a common misconception that a genre specific channel must skew to a targeted audience. But in actual fact, the skew is far less than is anticipated. For example, in the UK the pay channel “Men and Motors” runs with the tag line “fast cars and women” - unashamedly targeting men. And yet, 30% of its viewers are women. But more importantly (and this point is frequently overlooked, or omitted from the sales pitch) is that hardly any men at all actually watch it. Only about 5% of male viewers who actually subscribe to the channel watch it at all in a week, and of those who do watch, they devote less than one hour to it (out of their 30 hours of weekly TV viewing). These same men in these pay TV households spend many more hours (18 !) each week watching the big Free-To-Air channels.

The story is the same throughout the world. But is particularly true here in Australia because as yet we have no high rating pay TV channels. Unfortunately many marketers make decisions based on industry mythology & sales patter rather than fact. They need to get (start seeking) the facts.

Byron Sharp

Dr Byron Sharp is Professor of Marketing Science at the University of South Australia where he directs the Ehrenberg-Bass Institute. The Institute’s research is financially supported by major advertisers as well as both FTA & pay TV networks such CBS, ABC, CNN, ESPN, Network Ten, and TVNZ.