The Medill IMC Spiegel Research Center at Northwestern University in partnership with Publicis Media conducted a study on the influence of Paid vs. Owned media on sales. The study looked at media and earnings data for 800 brands across 50 categories. This was a presentation given at the Advertising Research Foundation’s 2017 conference.
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The Impact of Owned vs. Paid media April 2017
1. Digital owned media effects and its synergy
with paid media on brand sales
Rob Jayson
Global lead, Apps development
Publicis Media
www.linkedin.com/in/robdjayson
#ARFannual17
Martin Paul Block
Professor, Integrated Marketing
Communications
NorthWestern University
mp-block@northwestern.edu
2. John Philip Jones linked share of market to
share of paid media spend in 1990
Source: John Philip Jones HBR 1990
3. OUR QUESTION:
Have digital owned platforms impacted this?
• Does owned media traffic volume to brand websites and/or
branded social brand sites have a different relationship to
share of sales?
• And does that share impact the share of paid media?
4. OUR FINDINGS:
Yes, Prof. Jones. It does
• Changing the effects of paid media
• Impacting categories differently.
5. Methodology
• The study observed the relationship between paid and owned media and
sales across 802 brands in the US market
• 56 categories (i.e., Credit Cards) within 15 industries (i.e., Financial
Services) from 2010 to 2015.
• Brand sales data are from Bloomberg, Euromonitor, 10k and 10Q annual
reports.
• Brands’ online and offline media spending is the metric of paid media
input and is collected from Kantar and Pathmatics.
• Owned media input metrics are the unique visitors (UV) to brands’
desktop and mobile sites from comScore.
• The other owned media input metrics are fans’ acquisition and
interactions on their social media sites (Facebook, Twitter, YouTube and
Instagram) and are collected from Publicis Media’s SocialTools.
6. Share of paid media (SOV) declines relative to
growth in share of market
0
0.1
0.2
0.3
0.4
0.5
0.6
0.7
0 0.1 0.2 0.3 0.4 0.5 0.6 0.7 0.8 0.9
SOV
SOM
All Brands All Categories
All Brands SOV Poly. (All Brands SOV)
As expected the paid
media results we found
echoed JPJ original
findings
Source: NWU/PM study; comScore; PM Social Tools
7. But share of owned media customer traffic continues
to grow as market share grows
0
0.1
0.2
0.3
0.4
0.5
0.6
0.7
0
0.1
0.2
0.3
0.4
0.5
0.6
0.7
0 0.1 0.2 0.3 0.4 0.5 0.6 0.7 0.8 0.9
SOO
SOV
SOM
All Brands All Categories
All Brands SOV All Brands SOO Poly. (All Brands SOV) Poly. (All Brands SOO)
Share of customer traffic
to owned brand sites is a
much more linear growth
to market share growth
Source: NWU/PM study; comScore; PM Social Tools
8. Does this pattern hold for rising and falling share of
market brands?
• Sub-divided brands by their 5 year compound sales growth rate
• Rising brands – 5 year CAGR grew by > +3%
• Static brands – less than 3% variance in CAGR
• Declining brands – CAGR fell by < -3%
• Key metrics
• PAID MEDIA: Share of voice within the brands category
• OWNED MEDIA: Share of traffic to brands web, mobile &
social sites within the brands category
9. Rising brands grow share of paid media and owned
traffic as category market share rises
0
0.1
0.2
0.3
0.4
0.5
0.6
0.7
0
0.1
0.2
0.3
0.4
0.5
0.6
0.7
0 0.1 0.2 0.3 0.4 0.5 0.6 0.7 0.8 0.9
SOO
SOV
SOM
Rising Brands
> 3% CAGR last 5 years
Rising Brands SOV Rising Brands SOO Poly. (Rising Brands SOV) Poly. (Rising Brands SOO)
Rising brands include all categories – CPG,
Retail, Luxury, Auto, Entertainment, etc
Brands with increasing
share of market have
invested equally in their
paid media share of voice
AND their owned media
share of customer traffic
Source: NWU/PM study; comScore; PM Social Tools
10. But declining brands lower their share of owned traffic
faster than paid media share
0
0.1
0.2
0.3
0.4
0.5
0.6
0.7
0
0.1
0.2
0.3
0.4
0.5
0.6
0.7
0 0.05 0.1 0.15 0.2 0.25 0.3 0.35 0.4 0.45
SOO
SOV
SOM
Declining Brands
< -3% CAGR last 5 years
Declining Brands SOV Declining Brands SOO Poly. (Declining Brands SOV) Poly. (Declining Brands SOO)
Declining brands include all categories – CPG,
Retail, Luxury, Auto, Entertainment, etc
Brands with declining
share of market have lost
their their owned media
share of customer traffic
faster than their paid
media share of voice
Source: NWU/PM study; comScore; PM Social Tools
11. -0.3
-0.2
-0.1
0
0.1
0.2
0.3
0.4
0 0.05 0.1 0.15 0.2 0.25 0.3 0.35 0.4 0.45
SOO-SOM
Share Owned over Share of Ad Spend
Declining Brands
> -3% CAGR last 5 years
Rising Brands SOO-SOV Linear (Rising Brands SOO-SOV)
Rising brands increase their share of paid and owned at
the SAME rate. Declining brands favor share of paid
over their share of owned
-0.5
-0.4
-0.3
-0.2
-0.1
0
0.1
0.2
0.3
0.4
0.5
0 0.1 0.2 0.3 0.4 0.5 0.6 0.7 0.8 0.9
SOOoverSOV
Share Owned over Share of Ad Spend
Rising Brands
> 3% CAGR last 5 years
Rising Brands SOO-SOV Linear (Rising Brands SOO-SOV)
HIGHER
SHARE
OF
OWNED
HIGHER
SHARE
OF PAID
Source: NWU/PM study; comScore; PM Social Tools
Rising brands Falling brands
12. Snapple
Pom Wonderful
Naked Juice
Ocean Spray
Simply Orange Juice
Floridas Natural
Motts
Sunsweet
-0.2
-0.15
-0.1
-0.05
0
0.05
0.1
0.15
0.2
0 0.01 0.02 0.03 0.04 0.05 0.06 0.07 0.08 0.09 0.1
SOOoverSOV
Share Owned over Share of Ad Spend
Juice - Rising/Static Brands
Juice Rising Brands SOO-SOV Linear (Juice Rising Brands SOO-SOV)
Tropicana
Capri Sun
Minute Maid
Welchs
V8D
o…
Sunny D
Juicy Juice
-0.2
-0.15
-0.1
-0.05
0
0.05
0.1
0.15
0.2
0 0.02 0.04 0.06 0.08 0.1 0.12 0.14 0.16
SOO-SOM
Share Owned over Share of Ad Spend
Juice - Declining Brands
Juice Declining Brands SOO-SOV Linear (Juice Declining Brands SOO-SOV)
This trend of declining brands favoring paid over owned
holds true for CPG categories (Juice)
Source: NWU/PM study; comScore; PM Social Tools
HIGHER
SHARE
OF
OWNED
HIGHER
SHARE
OF PAID
Rising brands Falling brands
13. Bank Of America
JPMorgan Chase
Wells Fargo
Capital One
Ally Bank Charles Schwab
PNCTD
US Bank
BMO Harris Bank
-0.2
-0.15
-0.1
-0.05
0
0.05
0.1
0.15
0.2
0 0.02 0.04 0.06 0.08 0.1 0.12 0.14 0.16 0.18 0.2
SOOoverSOV
Share Owned over Share of Ad Spend
RetailBanks - Rising Brands
Bank Rising Brands SOO-SOV Linear (Bank Rising Brands SOO-SOV)
Citi
Fifth Third Regions
Santander
Citizens Suntrust
HSBC Bank USA
BBVA Compass Bank
-0.2
-0.15
-0.1
-0.05
0
0.05
0.1
0.15
0.2
0 0.01 0.02 0.03 0.04 0.05 0.06 0.07 0.08
SOO-SOM
Share Owned over Share of Ad Spend
RetailBanks - Static/Declining Brands
Bank S&D Brands SOO-SOV Linear (Bank S&D Brands SOO-SOV)
And retail categories with e-commerce (Retail Banks)
Source: NWU/PM study; comScore; PM Social Tools
HIGHER
SHARE
OF
OWNED
HIGHER
SHARE
OF PAID
Rising brands Falling brands
14. Chick-Fil-A Restaurant
Dairy Queen Restaurant
Hardees Restaurant
In-N-Out Burger
Restaurant
Panda Express
Restaurant
Popeyes Fried Chicken
Restaurant
Sonic Restaurant
Taco Bell Restaurant
-0.2
-0.15
-0.1
-0.05
0
0.05
0.1
0.15
0.2
0 0.01 0.02 0.03 0.04 0.05 0.06 0.07 0.08
SOOoverSOV
Share Owned over Share of Ad Spend
QSR - Rising Brands
QSR Rising Brands SOO-SOV Linear (QSR Rising Brands SOO-SOV)
Arbys Restaurant
Burger King Restaurant
KFC Restaurant
McDonalds Restaurant
Pizza Hut Restaurant
Subway Restaurant
Wendys Restaurant
-0.2
-0.15
-0.1
-0.05
0
0.05
0.1
0.15
0.2
0 0.05 0.1 0.15 0.2 0.25 0.3 0.35
SOO-SOM
Share Owned over Share of Ad Spend
QSR - Static/Declining Brands
QSR S&D Brands SOO-SOV Linear (QSR S&D Brands SOO-SOV)
And with mixed categories (QSR)
Source: NWU/PM study; comScore; PM Social Tools
HIGHER
SHARE
OF
OWNED
HIGHER
SHARE
OF PAID
Rising brands Falling brands
15. The media and subsequent engagement
demands refined metrics
Traffic Sub
metric
Traffic platform
metrics
Owned Traffic
metric
Owned Traffic
Brand Websites
Desktop site
traffic
Mobile site traffic
Brand Social
Pages
Total Fans
Total Interactions
(likes, shares,
retweets)
16. Under performing brands consistently under delivered
on two metrics
1. Lower % of total web site traffic achieved via mobile
2. Higher ratio of total total fans per interaction on social
Tier % 2015 total web
traffic via mobile
2015 Total social
fans per
interaction
Tier 1 & 2 (> -3% CAGR) 58% 2,800
Tier 3 (< - 3% CAGR) 49% 3,677
Source: NWU/PM study; comScore; PM Social Tools
Despite significant variations by category and platform we have found this
consistent pattern to be suggestive of an important consideration for brands
17. When looked at by category the under delivering brands fall
short in owned in different ways – Retail Banks
Source: NWU/PM study; comScore; PM Social Tools
Retail Banking Category % 2015 total web traffic
via mobile
2015 Total social fans
per interaction
Tier 1 & 2 (> -3% CAGR) 47% 511
Tier 3 (< - 3% CAGR) 38% 435
18. QSR Category % 2015 total web
traffic via mobile
2015 Total social fans
per interaction
Tier 1 & 2 (> -3% CAGR) 67% 432
Tier 3 (< - 3% CAGR) 69% 887
When looked at by category the under delivering
brands fall short in owned in different ways – QSR
19. Maintaining share of owned at the same rate as
share of paid is a trait of growth brands
• Brands that have lost share over the last 5 years have delivered
a higher share of paid media spending than owned media traffic
• As well as total owned share we created two sub-metrics in
owned
• % of website traffic that was mobile
• Number of total fans acquired per content interaction on
social
• Declining brands overall underperformed on both sub-metrics
• How they underperformed depended on the category
20. We like this start and there’s work to be done
• Which owned media delivers best?
• In combination with paid?
• Which owned media engagement delivers best?
• What drivers explain category differences best?
• And more. . . .
Across 2015 and 2016 Publicis Media and the Spiegel research center at NorthWestern have been jointly developing a very interesting piece of research that we believe reveals some fascinating insights into the way that brands have deployed owned brand platforms – that is brand websites both on desktop and mobile and brand social sites across FB, Twitter, YouTube and Instagram.
We wanted to examine how John Philip Jones’ famous work showing how brands with larger shares of market consistently reduced their share of paid media adspend below their share of market. Conversely smaller brands raised their share of adspend above their share of voice.
How, we wanted to discover, did share of market correspond to share of owned media traffic? Did the same rules apply, as they did for paid media adspend?
After extensive research, looking at over 800 brands across a five year period using proprietary data sources and lot of hard work from students, it turns out that the same rules do not apply.
We found that as brands grow their market share they grow their share of owned media traffic at the same rate, not at a decreasing rate.
But things got really interesting when we segmented the brands by their sales growth success across the 5 year study period
Brands that had shown high positive sales growth of the 5 year period had grown their share of owned media traffic significantly more than their share of paid media adspend
Whereas brands that had shown no growth or negative growth in sales over the period had grown their share of adspend more than their share of owned traffic
Whats more we found this pattern consistently across all categories, whether ecommerce categories or not.
Our presentation at the ARF will go into detail on this research, examine the finding and the implications and next steps of what we have found.