What Drives Advertising Effectiveness? It’s Not What Most Marketers Think
Of the five key factors driving advertising effectiveness – creative, brand, targeting, reach, and recency – which one drives the largest percent of incremental sales? The answer may surprise you.
According to a recent study by Nielsen and outcomes-based marketing firm NCSolutions, the factor that generates the most sales is creative, accounting for nearly half (49%) of the sales effect. This is a significant difference from what most marketers believe, as the Advertiser Perceptions’ annual survey shows that marketers estimate creative’s share to be between 19% and 21%.
On The Other Hand
On the other hand, marketers tend to overestimate the importance of targeting, with their share estimates ranging from 23% to 27% over the past five years, compared to the actual 11% contribution to sales effect.
“The sales contribution perception of targeting is twice the reality,” says Pierre Bouvard, Chief Insights Officer at Cumulus Media/Westwood One Audio Active Group. He also notes that marketers’ belief in targeting’s effect on sales has dropped from 27% in January 2020 to 24% in 2024, perhaps due to the looming cookie depreciation.
The study also found that brand accounts for 21% of the sales effect, reach for 14%, and recency for 5%. Interestingly, marketers’ estimates for these factors are also higher than the reality.
The Importance Of Advertising Effectiveness
Advertising effectiveness is a crucial aspect of marketing, as it determines the impact of your advertising efforts on your business. Understanding the key drivers of advertising effectiveness can help you allocate your resources more effectively and maximize the return on your investment.
Prioritizing Creative Quality
The findings of this study suggest that marketers should prioritize the quality of their creative content over other factors, such as targeting and reach. “Creative quality should be the top priority,” says Bouvard. “Don’t overstate the value of targeting – it is a small lever.”
By focusing on creating high-quality, engaging content that resonates with your target audience, you can significantly increase the effectiveness of your advertising campaigns and drive more sales.
Overall, the study by Nielsen and NCSolutions has revealed some surprising insights about the drivers of advertising effectiveness. While marketers tend to overestimate the importance of targeting and underestimate the impact of creative, the data shows that creative quality is the most significant factor in driving sales. By prioritizing creative content and adjusting their perceptions of the other factors, marketers can optimize their advertising strategies and achieve better results.
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