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Allocating Spending On Digital-Video Advertising

A Longitudinal Analysis Across Digital and Television

Nazrul I. Shaikh, Mahima Hada, Niva Shrestha
DOI: 10.2501/JAR-2018-038 Published 1 March 2019
Nazrul I. Shaikh
Market Fusion Analytics,
  • Find this author on Google Scholar
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  • For correspondence: nazrul@gmail.com
Mahima Hada
City University of New York,
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  • For correspondence: Mahima.Hada@baruch.cuny.edu
Niva Shrestha
Nielsen, Inc.,
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  • For correspondence: nivashres01@gmail.com
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Article Figures & Data

Figures

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  • Figure 1
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    Figure 1

    Effectiveness of Television and Digital Media

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    Figure 2

    Efficiency of Television and Digital Media

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    Figure 3

    Maximum Potential and Saturation Patterns Of Television and Digital Videos

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    Figure 4

    Change in Effectiveness and Return on Investment (ROI) with Increase in Investment for Digital Videos

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    Figure 5

    Effectiveness of Television and Digital Media for the Food and Beverage Brand Across Campaign Themes

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    Figure 6

    Efficiency of Television and Digital Media for National Food and Beverage Company Across Campaign Types

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    Figure 7

    Maximum Potential (Percentage of Total Volume) and Saturation Patterns of Television and Digital Videos for a Standard Campaign

Tables

  • Figures
  • TABLE 1

    Scaled Marketing Investments by CeCareus in Year 1 and Year 2

    Marketing MediumYear 1Year 2% Change Year 2 vs. Year 1Aggregation
    Television0.780.79  +0.49%National
    Digital display0.100.12+16.7%National
    Digital search0.01National
    Coupons0.060.06  +0.05%Store
    Print0.000.00−33.3%Regional
    Radio0.020.01−60.4%Regional
    Rest0.030.01−58.4%Regional
    Total1.001.00−1.20%Regional
  • TABLE 2

    Scaled Investments by CeCareus on Digital Display in Year 1 and Year 2

    Digital DisplayYear 1Year 2% Change Year 2 vs. Year 1
    Flash0.640.53  −0.40%
    Rich media0.130.19+66.3%
    Custom0.110.09  −2.10%
    Videos0.120.19+93.3%
    Total1.001.00+16.7%
  • TABLE 3

    Model Outputs: Coefficients of the Marketing Variables, Retention Rates and Weibull Scale Parameters

    Marketing Mediaβ (t)RetentionScale
    Television0.0279 (5.34)0.502.8
    Digital videos0.0062 (4.22)0.601.2
    Flash0.0021 (2.89)0.201.3
    Rich media0.0016 (2.09)0.301.3
    Custom0.0003 (3.12)0.251.5
    Search0.0011 (4.76)0.401.9
    Print0.0001 (1.03)0.201.0
    Radio0.0000 (0.98)0.201.0
    Coupons0.0047 (3.82)0.102.3
  • TABLE 4

    Results: Optimization of the Marketing Mix

    Marketing InstrumentYear 2Proposed% Change Year 2 vs. Year 1
    Television0.790.74    −6.33%
    Digital videos0.030.06+100.00%
    Flash0.060.04  −33.33%
    Rich media0.030.03    −5.52%
    Custom0.010.02+112.5%
    CeCareus digital search0.010.02+100.00%
    CeCareus coupons0.060.08  +33.33%
    CeCareus print0.000.00  +00.00%
    CeCareus radio0.010.00−100.00%
    Rest0.010.01
    Total1.001.00
    Net impact on ROI ($)0.891.02
    • Note: ROI = return on investment.

  • TABLE 5

    Scaled Investments by Beverage on Television and Digital Display in Years 1 and 2

    Campaign/Creative ThemeMediumYear 1Year 2% Change Yr 2 vs. Yr 1
    StandardTelevision0.210.23    9.52%
    Digital videos0.020.05150.00%
    Digital display0.020.01−50.00%
    Search0.010.01    0.00%
    Social media0.120.01    0.00%
    Coupons0.020.03  50.00%
    NewsTelevision0.160.19  50.00%
    Digital videos0.050.06  18.75%
    Digital display0.020.03  20.00%
    Search0.020.02  50.00%
    Social media0.020.02    0.00%
    Coupons0.030.04  33.33%
    ReminderTV0.290.19−34.48%
    Digital videos0.040.05  25.00%
    Digital display0.030.02−33.33%
    Search0.010.01    0.00%
    Social media0.030.02−33.33%
    Coupons0.010.01    0.00%
  • TABLE 6

    Results: Model Coefficients for Food and Beverages Brand

    Campaign/Creative ThemeMarketing Mediumβ (t)RetentionScale
    StandardTelevision0.0386 (2.82)0.802.8
    Digital videos0.0065 (2.31)0.501.1
    Digital display0.0024 (1.99)0.301.4
    Search0.0017 (2.72)0.601.5
    Social media0.0015 (2.71)0.401.7
    Coupons0.0011 (0.98)0.201.1
    NewsTelevision0.0329 (4.01)0.602.5
    Digital videos0.0049 (1.97)0.401.8
    Digital display0.0008 (1.01)0.301.2
    Search0.0015 (3.47)0.501.5
    Social media0.0010 (2.21)0.201.3
    Coupons0.0027 (1.98)0.101.1
    ReminderTelevision0.0354 (3.78)0.702.3
    Digital videos0.0041 (2.19)0.501.6
    Digital display0.0014 (2.07)0.401.5
    Search0.0012 (3.12)0.501.5
    Social media0.0001 (1.12)0.201.3
    Coupons0.0011 (0.98)0.301.1
  • VariableCoefficientO
    Constant−0.0078−5.44
    Media investments (transformed)
    Television  0.02795.34
    Email  0.00004.00
    Digital video  0.00626.93
    Flash  0.00212.89
    Custom  0.00323.12
    Rich media  0.00162.09
    Paid search  0.00024.76
    Print  0.10661.03
    Organic search  8.18362.27
    Restaurant factors
    Operating hours  0.4554126.38
    CeCareus sales-per-footfall index−0.5419−42.68
    Price discount  0.045541.88
    Depth of discount  0.01179.89
    Weekly metric: store cleanliness  0.010312.89
    Weekly metric: employee training−0.0008−11.96
    Weekly metric: team helpfulness  0.012817.63
    CeCareus_coupon_T1 transformed  0.003111.20
    CeCareus_coupon_T2 transformed  0.00097.18
    CeCareus_coupon_T3 transformed  0.001211.10
    CeCareus_Coupon_T4 transformed−0.0001−1.07
    Holiday dummies (representative sample)
    Holiday dummy Labor Day−0.0317−14.84
    Holiday dummy Columbus Day  0.022410.26
    Holiday dummy Veterans Day  0.00301.49
    Holiday dummy Thanksgiving  0.060824.46
    Holiday dummy Christmas−0.0455−19.67
    Holiday dummy Christmas (lag)  0.00210.89
    Holiday dummy Martin Luther King Jr. Day−0.0542−25.50
    Holiday dummy Super Bowl−0.0562−26.97
    Holiday dummy Super Bowl (lag)−0.0284−13.46
    Holiday dummy Valentine's Day  0.046822.92
    Holiday dummy Easter−0.0060−2.38
    Holiday dummy Memorial Day  0.01706.56
    Holiday dummy Memorial Day (lag)−0.0182−9.23
    Holiday dummy July 4th  0.086740.61
    Holiday dummy July 4th (lag)−0.0401−17.70
    Seasonal factors
    Seasonality index  0.7640111.41
    Average temperature  0.042925.44
    Macroeconomic factors
    Unemployment rate−0.0439−12.58
    Consumer price index−0.2221−5.27  
    Competitor factors
    Competitors' location and restaurant size index−0.0001−1.89  
    Competitor 1 marketing investments  0.0000−4.71  
    Competitor 2 marketing investments−0.0001−12.91
    Pseudo R2  0.89
    Observations  81,224
    Log likelihood−9,459
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Allocating Spending On Digital-Video Advertising
Nazrul I. Shaikh, Mahima Hada, Niva Shrestha
Journal of Advertising Research Mar 2019, 59 (1) 14-26; DOI: 10.2501/JAR-2018-038

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Allocating Spending On Digital-Video Advertising
Nazrul I. Shaikh, Mahima Hada, Niva Shrestha
Journal of Advertising Research Mar 2019, 59 (1) 14-26; DOI: 10.2501/JAR-2018-038
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