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Allocating Media Resources in a Push and Pull Marketplace

Allocating Media Resources in a Push and Pull Marketplace. Don E. Schultz and Martin P. Block Northwestern University DMEF Direct/Interactive Marketing Research Summit San Diego 18 October, 2009. Customer/ Prospect. Marketer. Media Allocation Used to be Easy.

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Allocating Media Resources in a Push and Pull Marketplace

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  1. Allocating Media Resources in a Push and Pull Marketplace Don E. Schultz and Martin P. Block Northwestern University DMEF Direct/Interactive Marketing Research Summit San Diego 18 October, 2009

  2. Customer/ Prospect Marketer Media Allocation Used to be Easy Agency → Media → Retailers Unique Products/Offers Messages and Incentives Efficient Delivery Was Always the Answer

  3. Today’s “Push” and “Pull” Communication System Web Search Competitors Competitors Agency→Media →Retailers Commoditized Products/Services Customer/ Prospects Employees/Recommenders/Friends /Influencers Marketer Competitors Messages and Incentives Competitors Word-of-Mouth New Forms of Media

  4. Allocation Based on Message Distribution Doesn’t Work

  5. Media Consumption Measures Are Needed Schultz and Pilotta, ESOMAR, 2004

  6. Questions Media Consumption Raises • How Do Online and Offline Intersect and Combine at the Customer Level? • What media forms do customers use in combination? • What media forms do customers use simultaneously? • Is there synergy among and between online and offline? • If so, how can we measure the combinations? • Who does the planning and allocation in a push and pull marketplace?

  7. Simultaneous Media Studies (SIMM) – BIGresearch • A method of understanding how consumers use and consume media today and the impact it has on them • Methodology • Conducted twice per year in the USA since 2002. China since 2006 • 14 separate waves (15th in analysis now) • 200,000+ individual responses (17,000 more in Wave 15) • Drawn from on-line interactive base of 60 million individuals • Double opt-in methodology • Captures media usage, retailer preference, influence of media, past and future purchases, etc. • Includes 31 media forms – online and offline • Accuracy of .01 level • Benchmarked to non-online studies • Weighting/balancing of 14 US Census 2000 age-sex cells • Testing in Mexico and other countries

  8. Four Critical Measures in Media Consumption What media form is accessed Amount of time spent with each media form Media combinations – what media used together and simultaneously Which media form has the greatest influence on product purchase

  9. How Much Time Consumers Spend With Each Media Form Measures #1 and 2 First Quarter, 2008, BIGresearch Avg Minutes per Day Email 131.3 TV 129.6 Internet 127.5 Radio 93.5 Direct 56.3 Magazines 49.1 Newspaper 44.8 IM 40.8 Games 36.6 Satellite 22.0 Web Radio 14.4 Blog 11.7

  10. More Important: the Media Forms People Use Together…Their Media Combinations

  11. US Media Combinations Measure #3 Primary Medium (When …,do you simultaneously ….) (Regularly only) 1st Quarter, 2008 – BIGresearch

  12. Media Combinations Are What Create Media Synergy…The Biggest Challenge in Media Planning Today!

  13. Influence Media Form Has on Consumer Purchase Decisions % Influence Word-of-Mouth 36.2 Coupons 28.4 Inserts 21.5 TV 20.8 Newspapers 20.0 Read Article 19.8 In-Store 19.6 Direct 19.1 Magazines 17.0 Cable 13.6 % Influence Radio 13.1 Internet 12.3 Email 11.7 Outdoor 7.2 Yellow Pages 7.0 Blog 3.1 Satellite 3.1 IM 2.9 Web Radio 2.7 Picture Phone 2.2 Measure #4 *Across 8 product categories, Apparel/Clothing, Automobile, Eating Out, Electronics, Grocery, Home Improvement, Medicines, and Telecom/Wireless 1st Quarter, 2008 – BIGresearch, Inc.

  14. Using Those Four Measures, We’ve Developed Predictive Media Models…

  15. An Example, In the Computer Category, What Media Forms Do Consumers Prefer? Do you plan to make any of the following major purchases within the next 6 months? Example: Computer No 84.81% Yes 15.19% Total 100.00% First Quarter, 2008 – BIGresearch

  16. What Would Be the Best Media Combination to Reach These Intended Computer Purchasers?

  17. Purchase Intent and Media Influence Do you plan to make a computer purchase within the next 6 months by Media Influence No Yes Total Coupons 26.8 31.0 27.4 Inserts 20.6 25.0 21.3 Newspapers 19.8 24.7 20.5 TV 19.2 26.8 20.3 In-Store 18.3 23.3 19.1 Direct 18.2 23.1 18.9 Magazines 15.6 22.7 16.7 Cable 12.3 19.3 13.3 Radio 11.7 18.5 12.7 Internet 10.6 19.3 11.9 Email 10.4 16.8 11.4 Yellow Pages 6.5 10.5 7.1 Outdoor 6.3 11.0 7.0 First Quarter, 2008, BIGresearch

  18. Pruned CHAID TreePlan to Buy a Computer by Categories of Media Influence Total Plan to Buy Computer No Internet Low Internet High Internet Some Radio Some Email Low Magazine High Magazine No Cable Some Cable Low Email High Email Some Email

  19. In the Increasingly Complex Push and Pull Media Marketplace, Media Consumption Is the Key Element

  20. We’re Working on Media Synergy • Media Synergy Comes of Age – Part 1 Journal of Direct, Data and Digital Marketing Practice Don E. Schultz, Martin Block, and Kalyan Raman Volume 11, Number 1, July – September 2009 • Media Synergy… Revisited… and now, Relevant - Part 2 Journal of Direct, Data and Digital Marketing Practice Don E. Schultz, Martin Block, and Kalyan Raman Forthcoming

  21. Questions or Comments?

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