Uncovering the secrets of media allocation

Posted by Rich Cherecwich on November 4th, 2010 at 8:41 pm

Media planning and buying has not evolved to keep up with consumer behavior. That should come as no surprise to online marketing pros who have been clamoring to get more money from traditional media for years.

“Time spent with media is flat to down, but time spent on the internet is up,” said Radha Subramanyam, the VP and head of corporate and media research at Yahoo, speaking at ad:tech New York on Tuesday. “When you look at where people are spending time and where the money is going, there is something quite disconcerting about that.”

But what’s the best way to extend reach, increase frequency, and gross rating points (GRPs) without diminishing returns? It’s not the simple traditional to digital shift you’re thinking of, according to new research from Yahoo and Nielsen.

The two companies looked at how advertisers across four different categories divided their media spend across TV, print, and the internet. In nearly every category (automotive, credit cards, retail, and CPG) had available reach, but marketers were missing it by overspending on TV.

“TV spend is way beyond the point of diminishing returns,” said Howard Shimmell, SVP of media product leadership for The Nielsen Company. “You can take money out without losing lots of reach. More spend online is able to generate more incremental reach.”

But the solution to increased reach was to invest more online and off – in print.

The retailer that participated in the study took 20 percent of it’s TV spend and reinvested it in magazines and online. The result was 7 percentage points more reach in print, and 21 points more online.

The perfect blend obviously varies for each brand, but the question is, will you mix up your marketing allocation?

One Response to “Uncovering the secrets of media allocation”

  1. Telmar says:

    This post serves to highlight the importance of effective media buying software that can help markerters determine which media outlets offer the highest ROI. Without quality data and analytics, media buyers are left helpless when determining the most effect route through which to plan a campaing.