DCM Research
Any questions please contact:
Sarah Dack, Head of Research – Ext. 6230
Alex Wright, Research Manager – Ext. 6231
Lucy Shaw, Research & Insight Exec – Ext. 6229
BrandScience Presentation / General Econometrics - Questions & Answers
What is the difference between ROI and RROI?
ROI = Return on Investment (Profit)
 Measures the incremental profit generated by a €1 investment in advertising
 €1 ROI = Breakeven after cost of media is subtracted
 Higher than €1 ROI means immediate payback of media spend + additional profit for each €1 invested
(e.g. €1.18 ROI = €0.18 profit per €1.00 invested in advertising)
RROI = Revenue Return on Investment (Revenue sales)
 Sometimes difficult to get profit information from clients due to their sensitive nature so lots of
econometric models work on revenue return on investment (All cases in the BrandScience Results Vault
work on this basis)
 €2.00 RROI = €1 invested in advertising has driven sales revenue €2.00
How are case studies in the BrandScience model selected?
 The BrandScience Results Vault contains RROI findings for hundreds of products across multiple clients
going back to 2001. It contains over 1,000 cases in Europe but not all of these contain cinema or are
measurable via econometrics.
 This piece focuses on the 111 cases within the results vault which do contain cinema as part of the
media mix, and within this, 56 cases which are measurable by econometrics.
Greenbook(K:)/Sales Presentations/Econometrics/ROI Presentations/Question & Answer sheet/BrandScience Q&A sheets
How do econometric agencies filter out individual media effects?
 Each econometrics model contains 156 weekly datapoints (i.e. 3 years’ worth of data) per brand.
 Datapoints include pricing, distribution, weather, competitor activity, all types of advertising, PR,
packaging changes etc. All of which vary over time. If they don’t vary it is hard for the econometrics
agency to evaluate exactly how that element of the activity has impacted on sales.
 Specific campaign involves:
-
6-10 weeks of data analysis for each advertising burst (campaign impact / impact of outside factors
on campaign performance)
-
Analysis of 6-26 weeks of sales data to see how advertising has paid back / over what period it
continues to drive sales (carryover rate)
A client has said their campaign did not show an ROI for cinema. Does this mean it didn’t work?
 In this instance the econometrics agency may say that cinema ‘was not able to be measured’. Not
measured does not equal no sales, although it’s often interpreted that way. It just means the
econometrics agency can’t filter out the impact of cinema verses other activity happening at the same
time. There are many reasons for this – e.g. Spend was too low, cinema started/ended at the same time
as other media so the agency couldn’t filter out its specific effect.
How can we help cinema get picked up by econometrics model?
 Get involvement from DCM research / the brands econometrics team as early as possible in the planning
process. They can work together to give you vital insight as to what weights, timings and regions will
work best to drive return on investment for the client.
 Don’t plan cinema at exactly the same time and weights as TV. Introduce it 1-2 weeks earlier/later;
alternatively introduce a burst (week-on, week-off) strategy if TV is constant.
 Consider up-weights or down-weights in regions – ideally between 25-40% in at least two TV regions
 Make sure it has its chance to shine. If the client is planning a massive heavy weight TV campaign, for
example, cinema will need to be planned at a high enough level to allow it to cut through. Using it at
low levels may mean that it struggles to be heard above all the other ‘noise’.
 Ensure the right data goes into the model – The better quality of data going in, the better quality of the
result coming out.
What if a client’s econometrics model shows a negative result for cinema?
 If other media such as TV, Press, Outdoor etc. have also been used as part of a brands campaign find out
how they’ve performed. How does cinema compare?
Greenbook(K:)/Sales Presentations/Econometrics/ROI Presentations/Question & Answer sheet/BrandScience Q&A sheets
 If the others have performed well but cinema has not involve the DCM Research Team. We can speak to
our counterpart at the econometrics agency to try and find out what the underlying issues are and if
they can be solved.
 However, if all media has not performed well it’s probably due to creative or other factors outside of our
control.
How many case studies do you need in order for the findings to be considered robust?
 Due to the fact that each case study contains 156 weekly datapoints, BrandScience, consider four cases
per media sector to be robust.
What does ‘Carryover rate’ or ‘Ad stock’ mean?
 Advertising carryover rate = Impact that advertising has over time on sales or awareness. The higher the
carryover rate the longer the media / sales effect will be.
 An average cinema carryover rate of 72%, for example, means that sales will decrease on average by
72% each week after launch. So if cinema drove 100 sales in its first week, it would drive 72% in its
second, 52 in its third, 37 in its fourth, 27 in its fifth etc.
Greenbook(K:)/Sales Presentations/Econometrics/ROI Presentations/Question & Answer sheet/BrandScience Q&A sheets
Cinema and TV both show high carryover rates vs. other media why is this?
 An easy way to think of carryover rates is how memorable a creative is…
 Long term branding campaigns such as John Lewis ‘Gifts you can’t wait to give’ or Sainsbury’s ‘Live well
for longer’ = high memorability / High carryover rate. These tend to be used in TV and Cinema.

Promotional campaigns such as ‘10% of car insurance this month’. Are designed to drive sales on a short
term basis. You’ll remember them for a little while but in the medium or long term. These are generally
used in Print or Radio and have shorter carryover rates of around 30%.
How big a part does creative play in delivering strong RROI?
 There are seven drivers of sales - Product, price, place, promotion, communication, competition and
context. However, it’s pricing, product and place (i.e. distribution) that contribute the lions share.
 The services category (which includes Finance, Retail, Travel, Hotels chains etc.) has very little
distribution effect as their sites tend to be fixed. In these categories advertising and promotion play a
much larger part in driving sales (around 24%). However, for FMCG where distribution plays a much
larger part, advertising has a much smaller overall effect on sales (around 4%).
 In both cases, however, for advertising to work well creative plays a very big part. Good creative that
connects with its audience will drive sales (and one that doesn’t will not!).
What is the optimal copy length for cinema? Do I need a ‘show stopping’ 90 second creative like John
Lewis to get a good Return on Investment?
 BrandScience have not drilled down into optimal copy length as part of this piece. However, the vast
majority of advertising which is shown on cinema is exactly the same copy length as TV, with around 8590% of it being 30 second creative. This piece of research encompasses all 56 case studies in the
BrandScience Result Vault who have used cinema (and econometrics have been measured) so it is fair
to assume it is also the case here.
 Cinema is great showcasing amazing long length copy like the John Lewis Christmas 2011 campaign. It
emotionally connects with the audience, and its impact is proven by strong retail sales.
 Equally though, as you can see from the BrandScience deck, it also performs exceptionally well for
FMCG products which tend to use a shorter length creative and vary in tone.
What sectors are included in each category?
 FMCG (Fast Moving Consumer Goods): Confectionary, Food & Drink, Household Grocery (laundry
detergent, cleaning products etc.), Newspapers & Magazines, Health & Beauty
 Impulse: Unplanned purchases such as sweets, chocolate bars, ice creams, soft drinks etc. that you can
always buy more of from corner shops, kiosks and grocery stores.
 Food & drink – Grocery
 Health & Beauty – Cosmetics, Toiletries, OTC (Over the counter) medicines etc.
 Services: Retail, Finance, Telco, Travel, Leisure & Entertainment, Government, Charity
 Leisure & Entertainment: Resorts, Hotels, Theme Parks, Lotteries, TV stations (does not include film)
Greenbook(K:)/Sales Presentations/Econometrics/ROI Presentations/Question & Answer sheet/BrandScience Q&A sheets
Greenbook(K:)/Sales Presentations/Econometrics/ROI Presentations/Question & Answer sheet/BrandScience Q&A sheets
Explanation of Decomps slide – Only shown in appendix of full DCM deck
What does ‘base’ mean?
 Base sales are what the brand would have achieved if all factors had remained static (i.e. there was not
ATL, BTL activity, no changes in distribution etc.)
What is included in the ‘other’ section?
 FMCG – Primarily driven by price, promotions and distribution.
 Services – Driven by Promotions, brand measures, competitors activity etc.
What is included in the ‘media’ section?
 All above the line (ATL) media including: TV, Print, Outdoor, Radio, Online, Cinema. It does not include
Direct Marketing.
Why does media only account for a small amount of sales for FMCG vs. Services?
 There are seven drivers of sales - Product, price, place, promotion, communication, competition and
context. However, it’s pricing, product and place (i.e. distribution) that contribute the lions share.
 The services category (which includes Finance, Retail, Travel, Hotels chains etc.) has very little
distribution effect as their sites are fixed so communication and promotion account a larger part of the
pie. For FMCG, however, distribution plays a much larger part (new product listings etc.) so comms by
comparison has a much smaller effect.
Greenbook(K:)/Sales Presentations/Econometrics/ROI Presentations/Question & Answer sheet/BrandScience Q&A sheets