Reach vs. Frequency...and a Threshold for "Measurable" Reach

A friend recently sent me a link to Erwin Ephron's 1995 Journal of Advertising article "The Shelf Space Model of Advertising" which explains why TV is the biggest of the big dogs: it has better reach.

The article is a must-read for both TV and online planners. While it is grounded in TV research, the conclusions likely extend to all media. The key nuggets:

1. There is 60% more impact on purchase from reach (1st impression to a new user) versus frequency (the 2nd or following impressions).
2. There is a "threshold" of measureable effectiveness in reach: "The caveat is we need to [...maintain...] a weekly reach of 35% to 40%, a monthly reach of 65% to 70% and a quarterly reach of 80% to 85%, so we talk to enough people to have a measurable effect on brand sales."

We have seen very similar analysis to point number 1 in online. Frequency studies differ in what is optimal frequency, but all the ones I've seen agree with the TV research in that they conclude that the first impression to a new user (reach!) is the most valuable.

But the second point is the truly stunning insight for online: the biggest media buys on the web very rarely -- if ever -- achieve 35-40% weekly reach. This isn't because the Web doesn't enable reach at that level (it does!)...it's because online publishers don't generally optimize reach (and online advertisers generally let them get away with it).

Amazingly, too, a typical 40% reach (to say W18-49) online schedule could probably be had for 1/5 to 1/10 the cost of that same schedule in TV. This is not (by the way) to say that anyone should stop buying TV and move it all to online...but perhaps paring back the excess frequency in a TV schedule and spending it on online reach could deliver the same impact to marketers that Ephron suggests recency planning would deliver for TV advertisers -- double-digit sales increases for no incremental spend.

Comments

[pk]

Great post.

Three comments/questions

1. Has anyone done any similar research regarding cross-media reach?

Intuition says that the first impression/reach in *any* media - television, online, or whatever - is the most important.

That is, if you've already hit someone once via television, it's probably better to hit someone else with an online ad to maximize 'cross-media reach.'

Of course, it's difficult to track cross-media reach/frequency. Still it's helpful to understand, or at least think about, what the ideal case would be.

If the elusive "ideal" marketing plan were to be found, would the best (current) use of online be to hit as many people as possible that you *couldn't* hit with television? Or will the relatively inexpensive nature of online ads combined with its massive reach eventually knock tv from the pole position, despite acknowledged format/impact limitations of online as compared to a 15 or 30 second tv spot...? Is a banner ad sufficient to present the timely 'reminder' that Ephron wishes to achieve?

2. Does any of this change with competition? If two competing brands (very similar in all respects) each adopt a reach maximization strategy and execute it with equal facility - who wins? According to Ephron, it's the brand who happened to advertise immediately before the purchase - that is, the brand with best recency. In this case, does frequency play a more important role by increasing the likelihood of 'getting the last laugh'?

3. The Ephron article highlights timing, and admits that maximizing reach is still somewhat wasteful, because who you really want to hit is the person that is just about to buy again. ("In the week before purchase, the first impression does most of the work.") Give database matching technologies and detailed purchase histories from, say, leading retailers - it's not a stretch to believe that they could know, to a reasonable certainty, when it was time to advertise. For example, purchase history indicates that consumer X purchases toothpaste once every 3 weeks, etc. That means we should hit them....NOW! Very big brother, but food for thought nonetheless.

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