Web, TV Advertising Even in Growing CPG Retail Sales

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Web, TV Advertising Even in Growing CPG Retail Sales

Early results of studies conducted by comScore, Inc., in partnership with Cincinnati-based dunnhumbyUSA, on the effectiveness of online advertising in building retail sales of consumer packaged goods brands show that the Internet can be as effective an advertising medium as TV advertising. Over the course of 12 weeks, online ad campaigns with an average reach of 40 percent of their target segment successfully grew retail sales of the advertised brands by an average of 9 percent, vs. an average lift of 8 percent for TV advertising as gauged by Chicago-based Information Resources, Inc. (IRI) and published in its research paper “How Advertising Works.”

The comScore/dunnhumbyUSA research focused on the 200,000 comScore and dunnhumbyUSA panelists who were members of supermarket loyalty programs and whose retail buying behavior was measured via point-of-sale UPC scanners when the panelists presented their membership cards at the checkouts of participating supermarkets. By comparing the retail buying practices of comScore panelists exposed to online advertising campaigns for a variety of CPG brands with the purchase behavior of “control” panelists who were not exposed to such campaigns, comScore was able to isolate the effect of the ad campaigns in boosting retail sales of the advertised brands.

The studies looked at ad campaigns for brands in a broad range of CPG product categories, among them cereal, cookie mixes, pizza, juice drinks, snack bars, pasta, tea, deodorants and toothpaste. The campaigns featured display ads, including both static banner ads and rich media. Over a three-month period, comScore noteed that these types of ad campaigns were able to grow sales of the advertised brands in retail supermarkets by an average of 9 percent. About 80 percent of the online ad campaigns analyzed led to statistically significant sales increases for the advertised brands.

Results were compared to studies of the effectiveness of TV advertising conducted by IRI using its patented BehaviorScan system, which can vary the television advertising seen by IRI panelists who have agreed to show identification cards at the checkouts of participating supermarkets. By eliminating TV advertising among one group of panelists and enabling it to flow through to others, IRI can isolate and measure the effectiveness of TV advertising in increasing retail sales. IRI published the results of 73 such studies in “How Advertising Works,” which found that 36 percent of the studies resulted in a statistically significant sales increase at retail. Across all tests conducted, the average sales lift attributable to the impact of TV advertising was about 8 percent over a one-year period.

“These early results confirm the ability of online advertising to successfully build retail sales of CPG brands on par with the impact of television advertising,” noted Gian Fulgoni, executive chairman of Reston, Va.-based comScore. “It is likely that the more precise targeting ability of the Internet - especially in terms of accurately reaching the desired demographic segment -- is a key reason for its effectiveness. That is meaningful in and of itself, but when you take into account the fact that online advertising is generally less costly than television, these results take on even greater significance.”