Editor’s note: Harold Spielman is CEO of MSW Group, the holding company for Great Neck, N.Y.-based McCollum Spielman Worldwide and its subsidiaries and services.

Advertising management has the major task of protecting a company’s brands, increasing profitable sales, and maximizing the efficiency of the media budget. Certainly, a complex task made even more challenging by the fact that producing effective TV advertising is quite difficult. In the short span of 30 or 15 seconds, the producing agency must:

  • attract attention and hold the viewer;

  • establish the brand name;

  • communicate pertinent information and/or create a mood or feeling;

  • bring about a change in state of mind or attitude;

  • persuade to behave in a prescribed way (e.g., buy the brand).

The difficulty of this task is clearly seen in a very large study that the MSW Group did a few years ago for the Association of National Advertisers (ANA). We reviewed the results of 4,600 commercials that had been taken off-air and tested through our firm’s AD*VANTAGE/ACT system. (See sidebar for description of AD*VANTAGE/ACT.) Each commercial was measured on two key criteria. One was awareness, or the ability of the commercial to break out of the cluttered environment of today’s TV. Second was persuasion, or the ability to bring about some positive changes in purchase behavior or brand/product attitudes. We compared each individual commercial with the norms within its specific product field. As you can see in Fig. 1, the bulk of the advertising was average, which was not very surprising. On the other hand, only 16 percent performed significantly above the norm in their respective product field. Mediocrity is, in fact, the norm. But perhaps the most disturbing figure was that 34 percent of the commercials that were on-air failed to meet basic competitive goals. Essentially, this represented millions of dollars of media time that were wasted.

Clearly, anything that can be done to reduce the number of ineffective commercials that are put on the air and increase the number of effective ones will vastly improve the efficiency of the ad budget - no matter what size it is.

Figure 1

Figure 2

But this creative problem can be overcome, as seen in the second part of this study. The distribution on the bottom of Fig. 2 is the percentages of commercials our clients put on-air after they have gone through a pre-test program. The differences are not only statistically significant, they are mind-boggling when translated into the efficiency improvement in the use of your media dollars. Interestingly, about one third of the commercials that come into our shop are simply not going to make it. Again, that’s indicative of the great difficulty that exists in producing effective advertising. However, our concern is selecting the ones that are worth producing for upwards of $600,000 and airing as part of a multi-million dollar media expenditure.

Encourages creativity

From time to time, we hear that pre-testing inhibits creativity. Our view is quite the opposite. It encourages creativity. Why? Because we have never seen creative people who lack ideas. The management problem is to sort those out. Pre-testing allows the client to encourage experimentation and then use the pre-test research to sort out the strong and the weak. Following is a dollar comparative of pre- and post-testing derived from the success/failure rate. From the ANA study, we know that on average one in three commercials will very likely fail. Consequently, to get two successful commercials on-air, you should be producing three and expect to discard one. If you produce the three commercials as “finished” executions at a very conservative average cost of $600,000 per “finished” commercial, plus the research cost (three commercials tested at $17,000 each = $51,000) that would sort out the relative effectiveness of those three, you would have an expenditure of $1,851,000.

However, if you produce the same three in one of the pre-test forms at $25,000 per commercial, plus the same cost of research, your total expenditure is $126,000. Now, having selected the two that are most effective from the pre-test research results, you produce only the two strongest in “finished” form, adopting appropriate corrections learned from the pre-testing phase.

You now have the total expenditure of $1,326,000 and you have pocketed a savings of $525,000. Most important, you know that your advertising dollars will be applied to your strongest messages. This little exercise deals with just one brand. For companies marketing multiple brands, the savings would be appreciable.

While producing TV advertising is close to an art form, copy research can make a real contribution to the creative development process by bringing the consumer into the process. But does this effort reflect itself in marketplace performance? The MSW Group and its clients have, over the years, done substantial work in investigating the predictive relationship of pre-test advertising research measures to in-market performance. Fig. 3 lists a variety of these studies.

Figure 3

Figure 4

One of the most useful and compelling studies was published in the Journal of Advertising Research by Klein & Tainter. Based on MSW AD*VANTAGE/ACT studies of over 1,100 commercials, a guide to in-market performance was developed. Essentially, as shown in Fig. 4, we found that those campaigns with commercials in quadrant I (high clutter/awareness breakout and high persuasion, upper right corner) met or exceeded the advertisers’ sales goals in 91 percent of the cases. Those that fell in quadrant IV (low clutter/awareness breakout and low persuasion, lower left) only met the goals in 30 percent of the cases. As to the relative influence of clutter/awareness and persuasion, it was clear that for established products, persuasion was the more important factor.

The above study is one of a large number of validation studies carried out based on MSW Group’s data. (Details on these studies are available upon request.)

Working with our clients, we have developed a multi-step process we call The CONTINUUM for the development of effective advertising. There are appropriate tools we can bring to bear at each stage in the process; the learning from each stage flows to the next. It is a circle with a feedback system.

Reduce the failure rate

Today we have in hand highly accurate tools for predicting the consumer’s response to advertising. A systematic approach to pre-testing will sharply reduce the one-in-three failure rate that we’ve seen in past studies. Most importantly, pre-testing gives the ad agency the opportunity to experiment and try out the unusual and offbeat, with little risk to the advertiser’s brand or budget. In the process, great-looking and sales-effective advertising can come on-air and meld the imaginative needs of the agency and the sales demands of the advertiser.

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