Blog Jori van de Spijker – Practice Lead Brand & Comms
These last couple of years we have seen many advertisers switch to an always-on strategy. Bursting seems to be a thing from the past. After all, academic studies have shown us that an always-on strategy is more effective. However, we seem to forget the fact that not everybody has the luxury of the budget brands like Coca Cola and Heineken have. And even these brands need to spread their media budget across sub-brands and products. This is where the conflict arises: ‘Do I really need to spread out the limited media budget I have available, throughout the whole year?’
Just one contact
In our Brand Growth interviews, we have asked many marketeers what they mean with always-on. We learned that there really was no widely agreed definition for it. For some, the bar is as low as just one exposure to the brand every week. However, is that really enough? The big question in budget allocation is at which point are you overspending and at which point are you spreading the budget so thin that it lacks the impact to break through the advertising clutter.
The precise bandwidth
To help advertisers with this challenge, DVJ Insights developed the Reality Performance Score. It’s a unique method that can predict the precise bandwidth brands need to be in when it comes to their media spending. It tells you at which point your brand spends too much, and when you are not spending enough – to realise the wanted impact. We have been doing this for years, and as a research agency we like to learn from the work we have done. So, our in-house experts collected all the data from clients for which we continuously measure the RPS. Looking at an impressive meta-analysis across 20 brands in 10 categories, what do we find? How often are advertisers spending too much, and how often are they spending too little?
The results were staggering. We found in only 40% of the weeks where the advertiser was active, the media budget was within the ideal bandwidth. In 20% of the cases too much was spent, resulting in waste. But interestingly, underspending is an even bigger issue: in 40% of the weeks RPS was below the minimum threshold, meaning there was not enough media pressure to be able to break through the clutter and thus no chance to realise an effect.
When brands don’t have the luxury to be within their ideal bandwidth throughout the whole year, it’s better to spend the money more wisely. Plan your media in such a way that you are within the optimal bandwidth for the maximum number of weeks, even if that means not being active every single week. Because always being below the minimum bar for impact would truly be a waste of the already limited budget available.
Re-thinking your strategy
In our ambition to prevent overspending, advertisers have gone too far. To the point where underspending is now a bigger problem. Always-on should never be a goal in itself. When always-on leads to being always-off, it is time to re-think your strategy.