Achieving ROI On Your Ad Spend In The New Normal

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A recession doesn’t necessarily mean a lower ROI.

And when it comes to advertising spend, there is ample opportunity to generate a return in the current climate, according to Analytic Partners MD Paul Sinkinson.

“The reality for many Australian and New Zealand businesses is that you should cut the budget,” he said.

“But there’s a long way between cutting budgets and getting to zero. So recessions don’t have to mean lower ROIs.”

Data shows 54 per cent of brands saw an increase in ROI during previous recessions.

On the contrary, brands that reduced their media investment during past recessions suffered an 18 per cent loss in sales.

“Simply put, advertising drives sales. If don’t do that advertising you don’t get those sales,” Sinkinson said.

He also warned against going “dark” during this time, revealing it takes twice as long to recover in terms of brand association.

“It’s not as simple as just turning the tap back on to be able to get that opportunity back,” Sinkinson explained. “Somebody else could have taken it.”

But the solution is not to simply advertise as normal.

COVID-19 has drastically changed media patterns and consumption habits, meaning advertisers must rethink their approach.

For example, data shows brand advertising outperforms product and promotional campaigns 80 per cent of the time.

“The reason for that is largely its ability to drive the entire portfolio, rather than just one product line. It can Halo across the business,” he said.

what are they watching?

With Neilsen having recently suggested being homebound could lead to an almost 60 per cent increase in the amount of video consumed, advertisers must quickly identify where these eyeballs are going.

During a briefing session last week, YouTube APAC head of culture & trends Ashley Chang revealed how COVID-19 has changed audience behaviours.

Late-night TV presenters have taken to doing monologues from their bedrooms, while nine of the top 10 largest music live streams of all time have occurred since March 15.

However, the most drastic shift has been viewers turning to YouTube to learn.

“There is a frankly insane amount of utility that YouTube is providing to people right now and has been for the last couple of months,” Chang said.

“We’ve seen spikes in content related to how to make masks, how to grow your own veggies and obviously everyone’s new stress-relieving activity baking bread.

“Considering the current economic climate as well, it’s no surprise that content related to financial literacy and digital upskilling has increased as well.”

#WithMe content – whether that be a cooking video or exercise routine – has surged in popularity in recent months.

“What we’re seeing is a type of interaction that’s more rooted in the lived experience of the audience – it’s content that is designed to more than just entertain,” Chang said.

It’s not just what Australians are watching on YouTube that is changing, it’s also how they watch it.

Around 7 million people are watching YouTube videos on their TV screens, said Chang, with average watch time on TV growing 65 per cent YoY in Australia in March of this year.


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