Digital brands grow in different ways to those suggested by established marketing theory: it’s time to review the current model and recognise these new driving factors, says creative network R/GA’s global chief strategy officer Tom Morton in a WARC Exclusive.
Even as Super Bowl ad prices escalate, the investment can be worth it
Event tie-insCreativity & effectivenessYouTube
Super Bowl ad prices rise every year, but as one of the last mass-market TV events, the investment may be worth it, especially for commercials that go viral and can therefore reach double or triple the Super Bowl audience.
Why it matters
Even for brands that can afford it – this year’s Super Bowl cost $7 million for 30 seconds – investing in The Big Game requires consideration and planning to get the most out of the investment.
Urban Outfitters, the retail holding company, has seen a “bifurcation” in consumer habits due to inflation, with younger shoppers at its namesake chain reacting differently to older, more affluent shoppers at its other banners.
Why it matters
Inflation does not impact everybody in the same way: more youthful cohorts, for instance, may not have the same levels of earnings and financial security as older customer segments. As such, brands need to understand the particular needs of these distinct groups.
Younger consumers feel the pinch
“We do believe that there is a sort of bifurcation that has happened as a result of the inflation,” Richard Hayne, Urban Outfitters’ CEO, said on an earnings call with investors.
Its eponymous brand is frequented by younger people who are often “on their first job, or maybe a second job, and they're making a little bit less money,” he added.
The income boost provided by stimulus payments from the US government last year has not been replicated, he noted, hurting the disposable income of these shoppers.
“This customer is the most sensitive to inflation … Inflation is really hitting them much harder” than the core audience for its higher-end Anthropologie and Free People retail stores, said Hayne.
Events drive spending for higher-income shoppers
Among the “higher-income bracket [customers] of those two brands, we don't see any signs right now of inflation impacting their buying decisions,” he continued.
More specifically, these shoppers want to be “out and about”, and are attending weddings and other events. “She's going to spend her money to prepare for those events, so she looks good during the events. That's what's driving her,” Hayne said.
“These customers are excited for a return to normal. They’re shopping in stores again and are out and about with family and friends, traveling, dining-out, and going to many, many events,” he added.
How M&M’s built on its association with screen time
Confectionery brand M&M’s has long been a popular snack for cinema-goers, but with the rise in OTT viewing it also aims to be the “streaming snack of choice”; a tie up with Amazon Prime Video led to a “positive sales uplift”.
Why it matters
Amazon is uniquely placed to help brands to achieve quality mass reach through its Prime Video platform, and then capitalise on this upper-funnel activity with performance advertising at the point of e-commerce purchase.
Marketing campaigns that include email are more effective than the average campaign, generating 2.8 effects per campaign overall (2.7 effects without), according to a new report* from the DMA (Data and Marketing Association).
Why it matters
Email campaigns are above average performers in generating response and business effects, but below average at generating brand-building effects, giving a useful indication of where the channel’s strengths lie.
The average campaign including email generates 2.0 response effects and 0.5 business effects.
Email marketing underperforms for generating brand effects, but still accumulated 0.3 brand effects per campaign on average.
Growth in customer retention activity worked well in 2020, but by 2021 it was clear that there was only so much incremental demand that can be stimulated from existing customers.
Email generates the largest number of effects (3.1 effects per campaign) when used to target new customer acquisitions – compared with 2.6 effects in retention campaigns.
A 29% uplift in the total number of effects is recorded for multi-channel vs solus email campaigns. Double the number of brand effects are also recorded – an important consideration for a channel that generally under-performs in this space.
A combination of email and ad mail is most effective at generating a response. Email and offline (TV, radio, out-of-home and print) is the best combination for shifting the dial on brand metrics.
“Although primarily used as a direct response platform, email can also have a significant brand impact for organisations – shifting the dial on the attitudinal metrics that are so important in stimulating future demand” – Tim Bond, director of insight at the DMA.
*The Meaningful Marketing Measurement: Email Focus report draws on data from over 300 email campaigns, and beyond that over 1,000 cross-channel campaigns overall, while the DMA’s Intelligent Marketing Databank provides insight into the effectiveness of the email channel, as well as how marketers are measuring email effectiveness.