According to the press release, the aim of the study was to empirically measure and prove the sales effects and efficiency (ROI) of online advertising in terms of transparent market intelligence. To this end, the OVK, in cooperation with the market research institute Nielsen, examined the topic from two perspectives: Customer-specific modeling results using the example of the two product brands Steinofen and Piccolinis of the Wagner umbrella brand (Nestlé) on the one hand and a database analysis of 69 marketing mix modeling projects/campaigns on the other. The results for Wagner show that the additional turnover generated by online campaigns, including umbrella brand effects, is almost three times higher in relation to gross advertising expenditure. Here, display advertising has the relatively highest return on investment (ROI) of all online advertising forms used.
Measurable umbrella brand effects through online advertising
Based on three years of data, the study uses the example of the Wagner brands Steinofen and Piccolins to show that online advertising transports umbrella brand effects - investments in other Wagner brands have had an overall positive impact on ROI. In principle, the additional revenue generated by online advertising, including the umbrella brand effect, is disproportionately high in relation to gross advertising expenditure: while online accounted for only 9.6% of gross advertising expenditure, more than a quarter (25.9%) of additional media revenue is attributable to this online share. Even without the umbrella brand effect, online's share of additional media sales (25.9%) is higher than its share of gross advertising expenditure (23.3%). Overall, the online ROI without umbrella brand effects is almost half as high (44%) as the total media ROI. In a comparison of all forms of online advertising, display pays off the most and achieves a 79% higher ROI than the average. Conclusion: From an efficiency point of view, online advertising measures should be prioritized in the media mix.
Offline sales effects through online advertising
Based on the analysis of the specific examples of stone ovens and Piccolinis from the Wagner umbrella brand, the second part of the study, the database analysis, also focused exclusively on fast-moving consumer goods (FMCG). The analysis of 69 campaigns with a total of several million consumer purchase contacts in Germany shows that online achieves significant offline sales effects - and does so efficiently: while online advertising achieves an average gross ROI of 0.72 euros per euro invested, the best third of the projects and campaigns examined benefit from an ROI of 1.86 euros per euro invested. The invested online budget achieves its optimum effect with flight lengths of around ten weeks. Adjusted for brand size, it can be seen that online advertising also generates good ROIs for smaller brands.
Markus Frank (Microsoft Advertising), Deputy Chairman of the OVK: "The results illustrate the extremely positive sales effects and associated good ROI of online advertising and that offline sales can only be successful if online is integrated into the media mix. From an efficiency point of view, online advertising must even be prioritized. This study creates a clear increase in transparency with regard to the actual impact of online advertising and makes a significant contribution to clarifying the market in terms of the performance of online display advertising."
Antje Witgen (Nestlé Wagner): "The study confirms the importance of digital media for efficient brand building. Nestlé Wagner is driving forward the use of appropriate online forms of advertising; the detailed results of the OVK are therefore a further criterion for optimizing our overall and online media mix."
About the methodology of the online sales study
Methodologically, the study consists of two parts. The first part comprises the results of individual modeling. For this purpose, the sales performance is analyzed by taking into account and calculating the relevant performance values (additional sales, ROI). Independent variables are also included in the model: Media, retail promotion (price promotions, flyers/daily newspaper ads, display), distribution, range width, normal price changes, promotional prices and other factors (seasonality, temperature, holidays). The data for the second part of the study comes from a database analysis of over 69 Nielsen modeling projects to determine sales performance. The focus here is on working out the performance of online advertising in relation to online ROI. The database contains the results of marketing mix projects that Nielsen has carried out on behalf of clients in Germany since 2002. Data from three years was taken into account for each project.