TV Advertising Leads To Higher Sales And Better Brands
TV advertising produces both an immediate increase on sales and long term brand recognition, according to the new findings from tvSpan. This contrasts sharply with one of the most favoured marketing methods – price promotion – which has been found to produce only a short term sales effect and to lead to a reduction in brand loyalty.
The findings are part of ongoing research into the effectiveness of TV advertising as part of a £5m joint venture between ITV and market research company Taylor Nelson Sofres (see ITV To Spend £5m On Research Into The Effects Of Ads) and show that television advertising generates 12% of annual product sales over the course of a year. For every £1 spent on television advertising, £2.33 is made in sales over the year.
This is good news for advertisers of fmcg goods who are under increasing pressure from retailers to deliver lower prices and constantly need to weigh up the benefits of short term sales gained by big price cuts compared to the benefits of brand-building.
Sue Moseley, strategic planning director of TSMS, said: “The tvSpan findings are clear cut – price promotions such as ‘buy one – get one free’ will sell product but do nothing to build brand loyalty. If price cuts are funded at the expense of television advertising, there will be little left to differentiate branded products from private labels.”
The results also showed: TV advertising influences purchasing decisions for a longer period than the ad run; concentrated exposure immediately prior to purchase has greater effect and ITV peaktime is more effective airtime generally.
TvSpan is the only single-source research in the UK which links product purchasing with TV viewing and exposure to advertising. The current report is based on 3 years of data, 10 large grocery categories and 113 advertised brands from the Meridian research panel.
The next stage of its research will look at the programme environment surrounding the commercial breaks and will plan an “optimum” scheduling guide for advertisers and agencies to create maximum sales effectiveness.
ITV: 020 7843 8000 Taylor Nelson Sofres: 020 8967 4404