Brands could increase ROI by taking a different approach to campaign flight schedules, according to new research by Entropy.

Brands we’ve been speaking to over the past few months seem to fall into two categories with regard to COVID-19.

While there are, of course, exceptions, they seem either to be performing very well (for example those with a strong e-commerce proposition) or very badly (such as those in travel and hospitality). There doesn’t seem to be much middle ground.

So with pressure on budgets tighter than ever, and many brands now in their planning rounds for 2021, we feel it is timely to share some findings from tests we’ve run with two brands, Danone and Vimto, in order to make media budgets work harder.

Challenging planning conventions

This also feels like a good time to be challenging industry planning conventions if there is evidence to support doing so.

We were interested in building on the foundations of the Radiocentre, Ebiquity, and Thinkbox studies demonstrating the general ROI impact of radio to challenge some long held planning conventions and explore how adjusting laydown could improve effectiveness.

Traditionally, FMCGs have flighted linear radio as a medium secondary to TV, with one continuous burst (as opposed to week on / week off) often at c.4-5 OTH per week. However, using IRI’s response curves we are challenging this convention with two other scenarios that simulated significantly higher ROI.

Working independently with IRI, Entropy has been managing regional tests and Marketing Mix Modelling (aka econometrics) studies with the two brands. These ran on Capital and Heart and were commissioned by Global in order to help FMCG brands understand how to maximise the ROI of their radio media spend. They were across two geographic regions in order to make the tests cost-efficient and to provide regional variation for modelling purposes.

Despite the fact that the findings are from FMCGs it is worth saying that we don’t see any reason why the same hypotheses couldn’t be extrapolated to other sectors (with the exception of highly seasonal products or new launches / campaigns).

Significant potential increase in ROI

So what did we find?

For Danone and Vimto, we were able to simulate a significant potential increase in ROI using:

  1. An optimised laydown of week on / week off (as usually recommended for TV within FMCG) 
  2. Lower weekly GRP levels (allowing for more weeks)

For Danone and Vimto this resulted in a significant improvement in the ROI from radio. For example, high level results from Danone were:

  • Pulsing week on / week off increases radio by 38%
  • Pulsing week on / week off and reducing weekly GRPs increases radio ROI by 71%.

As a former FMCG marketer myself, I can reflect that in some organisations TV – due to its higher spend level – obviously gets a lot of focus. There might also be a digital lead in the room in a response, but sometimes other “secondary media” used to build incremental reach may not have the same level of rigour in planning or measurement applied. When you think about it, it seems logical that these principles may apply similarly on radio.

Another factor, often undiscussed, that can impact channel ROI is how MMM data is collected and processed in the models. For example, from our experience often data is provided at a national rather than regional level which will limit the variability in the data. Also due to a combination of factors, usually including resources dedicated to assisting with the data provision, inadequate data is provided. For example, by only providing spend data for some channels. 

To state the obvious as many businesses contemplate budget cuts and shifts in consumer behaviour, brands should be searching to increase effectiveness as much as they can. We’d be interested in hearing of any tests that brands run to further evidence these hypotheses.

Download the full report and results for both Vimto and Danone for free. We’d also be happy to discuss the findings with you.