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A Case Study – How to Know Which Competitors’ Customers Your Ad is Going to Steal

August 22nd, 2018 Comments off

Across categories, companies/brands will oftentimes create an advertising initiative that is meant to target a certain competitor, or groups of competitors.  In doing so, they likely employ a communication strategy that they believe will target those consumers currently purchasing products/services from said competitors.  The problem is: How do they actually know if their communication strategy is going to source from the desired competitors – and at optimal levels?

Luckily, we at MSW-ARS have the perfect solution that quantifies this, and it utilizes our validated CCPersuasion® metric that has been proven to predict Marketing Mix Modeling (MMM) results.

Our TouchPointTM Plus solution uses consumer respondent behavior to determine, among other things:

  1. Is the ad driving sourcing appropriately from the overall competition?
  2. Are the targeted competitors driving this result?

We want to use this blog entry to show you how we are able to do this while utilizing background information on our collection method as well as a real example of this data.

First, let’s give some background on gauging overall sourcing.  How do we compute the overall result?

Our CCPersuasion metric utilizes a competitive category set of brands/companies, which enables us to assess which respondents have a predisposition to favoring each competitor.  We are then able to see what happens to these groups of consumers once they are exposed to the test brand’s advertising.  The net shift toward the test brand is called CCPersuasion, or CCP for short.  The CCP level is evaluated against our Fair Share® Benchmark, which incorporates category dynamics like brand and category loyalty, level of competition, brand sizes, and country-specific biases.

 

By comparing to Fair Share, we are then able to determine if the CCP level (thus overall net sourcing to the test brand) is above, below, or at the average.

Next, we can examine how each competitor is affected by the test brand’s advertisement, contributing to the overall CCP score.

 

In this graphic (above), from a blinded study, we can see that Brand E is losing the most to the test brand while Brand A is losing the least.  However, what is not clear is what we should be expecting from each competitor.

Therefore, we must incorporate our Fair Share benchmark and compute what we expect to source from each brand…

 

 

This graphic (above) incorporates the expectations based on our Fair Share benchmark, which reveal some learnings we did not see in the previous graphic regarding each of the competitive brands:

  • Brand A: We initially saw sourcing from this brand was the lowest, but this data shows that perhaps that should NOT have been the case. Even though it lost less to the test brand, Brand A is actually much larger than Brand B – and should have lost more than it did.

 

  • Brand B: The -2.0 loss for Brand B did not seem impressive in the initial graphic, though it turns out Brand B is actually the smallest competitive brand in this set – thus their loss to the test brand is actually greater than expectations.

 

  • Brands C & D: Both of these brands are contributing to the test brand’s CCP result, but we now know with this graphic that they are actually the two largest brands in the set – thus their losses to the test brand actually should have been even greater.

 

  • Brand E: We knew from the initial graphic that Brand E was a stronger driver of CCP results, but what we did not realize until now is that they are actually losing a disproportionately high amount of their consumers to the test brand.

 

Now, let’s take a look at a real case study.  This is an example for a recently aired DirecTV NOW commercial that was tested by MSW-ARS.  This ad ran heavily during the Spring 2018 months.  If you watched a lot of March Madness coverage, then you may very well remember seeing this ad.  It is the same study we used in the Scene-To-Scene blog from last month in case you’re interested.

Here is a storyboard which summarizes what the DirecTV Now ad communicates:

 

And here are DirecTV Now’s sourcing results by company from the test:

 

As well as by groups/types of competitive television offerings:

Far and away the top driver of trial to DirecTV Now in this test is cannibalization from traditional dish-oriented DirecTV – which is sourced far beyond their expectation.  This DirecTV Now spot includes strong branding cues for DirecTV, and includes messaging around “No annual contract” – which we saw work well in the data explored in the previous Scene-To-Scene blog – and are likely driving this result (traditional dish-oriented DirecTV typically requires a contract).  Dish Network also loses to DirecTV Now at a slightly higher than expected level, supporting this notion.

Fellow over-the-top media services, PlayStation Vue, Sling, and YouTube TV, also contribute to DirecTV Now’s gains – though slightly lower than expectations.  This is likely due to the focus of the spot being more on the “out with the old, in with the new” thought – and these companies are already in the “new” – thus not necessarily targeted by this argument.

Traditional cable companies and internet service bundles, as a whole, do not contribute to DirecTV Now’s gains as much as one may expect given their market share – they fall well below expectations.  Arguably, the main knock on these companies in this spot is around “no bulky hardware” and “get the live TV you love” – both of which are not powerful in driving the spot.

The under-sourcing from traditional cable companies and internet service bundles is even more apparent when you remove AT&T from that group as they are actually bucking the trend and losing to DirecTV Now beyond expectations.  As you may know, AT&T is the parent company of DirecTV (and DirecTV Now), and the AT&T logo is embedded within the DirecTV Now logo.  This appears to be garnering the attention of current AT&T internet service bundle subscribers. One of the most powerful scenes is the “Try DirecTV Now for $10 a month for 3 months” scene, which is featured amidst AT&T branding cues.

In conclusion:

  • We expect this spot to do more to drive dish-users to DirecTV Now than other OTT media service and non-AT&T traditional cable users. 
  • DirecTV dish-users and AT&T internet service bundle subscribers are expected to drive their respective sub-categories in switching to DirecTV Now after seeing this spot – likely in part driven by their familiarity with the companies, and the messaging speaking more to them. 
  • This degree of cannibalization is probably not ideal for DirecTV and AT&T.  However, given the changing landscape of this category, which includes consumers moving more to streaming options, it may be wise to point out that at least DirecTV/AT&T are driving consumers to their streaming option with this spot rather than losing them outright to a competitor.

 

Thank you for reading.  We hope you enjoyed this blog entry – and please look out for more in the future.

For more information on how our communications research tools can help improve your advertising’s effectiveness, please contact us at aklein@msw-ars.com.

Categories: Ad Pre-Testing Tags:

Dissecting Ad Effectiveness Using Our Scene-To-Scene Exercise

July 24th, 2018 Comments off

Have you ever struggled to understand why your ad is performing the way it is? Or better yet, which part of the ad is driving its result – and how you can duplicate (or avoid) it in future development efforts? If so, then we have the perfect solution, and it utilizes our validated CCPersuasion metric that has been proven to predict in-market Marketing Mix Modeling results.

Our solution is an exercise we call Scene-To-Scene, which is available in our Touchpoint Plus methodology.  It involves splitting the ad into its constituent “scenes” and then gauging positive and negative interest for each of them.  By taking this data and crossing it with our CCPersuasion exercise, we are then able to establish which parts of the ad are actually having the most impact on the ad’s effectiveness – both positive and negative.

To show this firsthand, we have included an example for a recently aired DirecTV NOW commercial that ran heavily during the Spring 2018 months. If you watched a lot of March Madness coverage, then you may very well remember seeing this ad. Here is a snapshot along with the ten “scenes” we established for it:

 

The first four scenes feature the opening drama, which parallels with the idea of switching from more traditional cable to DirecTV NOW – it includes an actress portraying a girlfriend who is throwing her soon-to-be ex-boyfriend’s belongings (including his traditional cable box) onto the front sidewalk.  Each “scene” includes a line from the ad so we are able to assess them individually – as well as collectively – if desired.

Beginning with scene 5, the next handful of scenes each talk one specific benefit of DirecTV NOW, which we are also able to assess individually using the Scene-To-Scene approach:

  • Scene 5: Live TV
  • Scene 6: No hardware
  • Scene 7: No satellite
  • Scene 8: No contract
  • Scene 9: $10/month for 3 months

Scene 10 is an ending tag with the call-to-action to the website.  While we do not necessarily expect the tag to generate a ton of interest, this allows us to check and make sure that is the case.

How did it turn out? See for yourself here:

 

As we expected, the opening drama in the first half of the spot received very polarizing responses – with a couple scenes actually receiving more negative interest (red) than positive interest (green) agreement, such as scenes 1 and 3. Others are netting more total attention, but still with substantial negative reactions, such as scenes 2 and 4.

 

The second half of the spot – well, that’s a different story:

 

Scenes 8 and 9, which talk “no annual contract” and “$10 a month for 3 months,” respectively, receive by far the most favorable responses of any individual scene in this ad.

However, while this is an obvious qualitative win for those two scenes, which are heavy on the product messaging and not so much on the creative drama, it does not necessarily prove that these scenes themselves are great at driving the ad’s CCPersuasion level…

 

Therefore, we can cross these responses with CCPersuasion responses and approximate just how impactful these scenes are – as well as all the others. See this in the graphic below, which includes a % below each scene indicating its share of impact on the CCPersuasion result:

 

As we likely expected, this verifies scenes 8 and 9 are powerful in driving the persuasive power of this spot – combining for half of the result and being far and away the most impactful scenes.

However, this also shows data we may not have expected with the opening drama. Scenes 1, 2, and 4 – which all involve the girlfriend actively “throwing out the old” – all return around 10% of this ad’s persuasion power apiece – meaning that even though they were not necessarily receiving significantly higher positive responses than negative responses, they are still valuable to the spot – especially setting up interest in the product benefits.

Scene 3, which appeared to be similar to Scene 1 on the qualitative scale, is actually not nearly as powerful in driving viewers to DirecTV NOW. This scene is different in that it is a break from the action and the “sorry, not sorry” line is also a break from the definitive change message of the other opening scenes.

Scene 5, which talks “live TV,” does not appear to be very powerful either qualitatively or in driving CCPersuasion, but perhaps is a necessary set-up line to explain what DirecTV Now is, as opposed to on-demand streaming services such as Netflix.

And while the “no bulky hardware” and “no satellite” scenes achieved fairly decent qualitative feedback, we can see that they really do not compare to the two scenes that come directly afterward (8 and 9) in terms of driving CCPersuasion.

 

Last, but not least: we are also able to provide qualitative feedback to add perspective into what exactly is driving each of these scenes. Every study that includes Scene-To-Scene will also include a file that shows what exactly respondents are saying drove (and didn’t drive) their interest. Here are some examples for one of the most popular scenes in this spot (scene 8 – “no satellite”):

  • “I have satellite now, and would like to try something different.”
  • “It would be nice to not need a satellite”
  • “I like that you don’t need a satellite.”
  • “I like the idea of no satellite which often goes out due to weather conditions”
  • “This means that there is no need to drill or screw or ask landlords/HOA permission to subscribe to a satellite dish.”
  • “Because when I think DirecTV in general I think of Satellite and this doesn’t need one”
  • “Because DirecTV has been a satellite focused company in the past”
  • “You do not have to have an unsightly piece of hardware attached to your roof”

 

Thank you for reading.  We hope you enjoyed this blog entry – and please look out for more in the future.

 

For more information on how our communications research tools can help improve your advertising’s effectiveness, please contact us at aklein@msw-ars.com.

Categories: Ad Pre-Testing, Emotion, Qualitative Tags:

Millennials and Private Label – a Blossoming Problem for National Brands?

January 12th, 2018 Comments off

It has been well reported and documented that private label brands are surging in the US. Whether it is due to their optimal mix of great value and experience or other reasons, they have forced name brands to re-think strategies. It is also well-known that Millennials are contributing to this trend as they are prioritizing experience over attainment.

In this short blog entry, we aim to show just how important this generational dynamic is to the future of private label brand purchasing. In addition, we will also highlight solutions MSW-ARS has for helping name brands both measure and address concerns in this area.

First, it is important to note just how much of a generational difference there is with regard to purchasing name brands “wanted most” in the table below comprised of thousands of responses across 60+ categories. The difference between Millennials and Baby Boomers is far greater than any other standard demographic. This suggests that age is one of, if not the most important socioeconomic indicator in determining one’s propensity to buying brands they most desire. It is not that Millennials do not desire name brands, they are just choosing not to purchase them at the same rate as previous generations.

 

Not surprisingly given “wanted most” trends, Millennials are also the most likely to purchase cheaper/generic brands. In the table below, Millennials are well over twice as likely to buy generics/less expensive brands versus Baby Boomers.

 

What does this mean for some of the individual categories we track? Here are a couple of tables showing the differences between Millennial and Baby Boomer purchasing in 2017.

First, those purchasing the brand they wanted most:

 

In addition, here is a table showing those purchasing a less expensive/generic brand:

 

The previous data can lead to many different hypotheses, including the following:

  • Is this just a life stage phenomenon?  Will Millennials’ purchase patterns more resemble Gen X and eventually Baby Boomers once they become older?
    • While it is possible Millennials will more resemble previous generations as they age, we are not confident that they will. When compared to previous generations, Millennials have lower income, which in turn would suggest why they are turning more toward generics/lower priced brands as opposed to brands they truly want. However, in the tables above, the three income tiers do not differ much with “most want” and “less expensive/generic” purchasing, especially when compared to the generational tiers. So, unless another Millennial age-dependent characteristic is currently driving their added tendency toward purchasing generics/less expensive brands, and will eventually go away (perhaps something like high student loan debt, which was not tracked), then we believe the generational data is more of a change in attitudes toward generics/name brands than any special constraint unique to any younger generation.
    • In addition, the previous tables show very different trends in purchasing behavior simply based on different categories. Millennials have similar buying trends to Baby Boomers with categories such as Athletic Shoes, Energy Drinks, and some Electronics, while they are MUCH more likely not to buy what they most want when purchasing a Sedan, Analgesics, or Bathroom Tissue. To us, this further suggests Millennials are not just defaulting to generics/less expensive brands everywhere, they are simply realigning what is worth paying more for.
  • If current trends hold, then what does this mean for the generations after Millennials once they become a large portion of the consumer base? Those born in the year 2000 and later are entering the market for many different goods and services now that they are turning 18 and becoming adults.
    • To answer this, certain assumptions have to be made in order to make any type of prediction. These three scenarios immediately come to mind:
      • Scenario 1 – Continuing Trend: If current trends hold, then we could very reasonably expect the next generation after Millennials (Generation Z) to be even more likely to purchase generics/less expensive brands and less likely to purchase the brands they truly want.
      • Scenario 2 – Millennials Become Like Gen X: If Millennials actually do go on to more resemble earlier generations as they age, then we can reasonably see a situation where the generations simply “replace” one another. Generation Z would have purchasing behavior close to that of today’s Millennials, while Millennials become more like today’s Gen X, and Gen X becomes more like today’s Baby Boomers.
      • Scenario 3 – Current Trends Are Just The Tip Of The Iceberg: A lot of trends begin with younger people, then eventually spread to the older population (see social media). If this happens with generic/less expensive brand purchasing, then it’s possible that ALL of the current generations could eventually see an increase – even Baby Boomers. This would likely be one of the worst developments for name brands that may be at a price premium.

We also should not fail to mention another scenario, which is…no one really knows as of right now. Unlike the previous three scenarios, this is the only one we can currently believe with high confidence. That may sound discomforting, but there are action steps you can take in order to be fully prepared for what comes next on this front as well as future decisions for your brand.

We at MSW-ARS offer custom, cost-efficient solutions to both diagnose and address potential brand and category decisions that may arise via the rise of generics/less expensive brands or others elsewhere.

To diagnose category and brand opportunities, we offer custom tracking that can be as streamlined or in-depth as you prefer. In fact, the data used in this blog post is from our syndicated Brand Strength Monitor platform (TBSM), which includes our choice metric that is the ONLY validated measure of brand value – and at a low cost. For example, with that particular data, you will be able to diagnose where your category stands in this generational battle, and be able to see the impact for your specific brand relative to other brands (not shown in this blog, but is very easy to do).

To help address these opportunities, we offer our strongly validated copy testing products that can help determine which route is the best for your brand to take in order to make the best decision for overcoming the rise of generics/less expensive brands, as well as others. With the rise in popularity of generics/less expensive brands, we have made improvements to our copy testing methodology to help directly address this area.  Our approach aims to identify the consumer journey, and how brands can make themselves relevant to consumers’ growing desire for experience.

Please do not hesitate to reach out if you would like additional information regarding this blog post or what our custom products can do for you.

Thank you for reading!