Typically, CPG video marketing focuses on branding objectives as opposed to delivering sales outcomes.
However, as marketers are held more accountable for their spending, click-through and completion rates are less valuable and ROAS is increasingly becoming table stakes. New research from Sequent Partners, Digital Video at the Inflection Point, which includes feedback from brands like Kellogg’s, P&G and Conagra, supports this concept, showing that 65 percent of marketers say digital video is growing in importance to drive offline sales for their brand.
How does this shift from CPG video engagement to sales affect marketers and their campaigns? Here are five takeaways from Sequent’s research that apply to shopper marketing.
1. REPURPOSING: JUST BECAUSE YOU CAN DOESN’T MEAN YOU SHOULD
As one CPG marketer said in the study, “We use long form, short form, GIF, still action, content marketing advertorial evolved from branded advertising—mini how-to videos, advertorial types of messages, content marketing, not branded messages.”
With the rapid growth of video, CPG marketers are moving quickly to repurpose their video assets in order to get in front of the right people at the right time. However, in an effort to be everywhere and repurpose everything, it’s important for marketers to not stretch their content too thin across a laundry list of deliverables.
Remember, just because it’s possible to repurpose a TV commercial doesn’t mean it’s the smartest approach. Instead of just recycling old assets, use them as a starting point, but making them more targeted and personalized, delivering relevancy and driving action.
2. CLASSIFY VIDEO BASED ON WHAT IT ACHIEVES, NOT WHAT THE INVENTORY COSTS
The marketers in Sequent’s survey tend to put video in the same bucket as other, extremely inexpensive digital media, such as display and search, where ROAS is primarily driven by the low cost of inventory. As one CPG marketer said, “If the message is easy to tell in a banner, that’s a cheaper route.”
When compared to display and search, CPG video doesn’t initially seem anywhere near as effective from an ROAS standpoint because the campaign is much more expensive to build and run. However, this perception fails to account for the additional—and critical—impact that sight, sound and motion delivers over standard, static display ads.
Digital video is far more effective in promoting brand recall than display banners, which consumers usually ignore due to banner blindness. Therefore, the two can’t be lumped in the same bucket—and they definitely shouldn’t be part of the same line item on a CPG marketer’s media plan.
3. CREATIVE IS IMPORTANT, BUT SO IS TARGETING AND PERSONALIZATION
Creative is coming back to the forefront for brand marketers—and with good reason. At ANA’s recent Masters of Marketing conference, Mark Pritchard, chief brand officer at P&G, said the industry is stuck in a “content crap trap,” constantly churning out new content to engage consumers and not focusing enough on the creative execution.
Brand marketers need to emphasize creative throughout the process. “Creative is 75 percent of effectiveness,” says Jim A Kiszka, the associate director of experience planning at Kellogg’s. “We can find a good CPM and a channel to reach them, but if the creative isn’t relevant or eye-catching, we’re dead in the water.”
The concept that digital video is effective due to creative is important, but that doesn’t account for the impact that targeting and personalization brings to the ad. The Sequent study shows that the benchmark for digital video ROAS is well below the outcomes seen in case studies for digital video campaigns that use targeting and personalization to enhance the creative.
4. CREATIVE VERSIONING IS ESSENTIAL FOR CPG VIDEO AND DOESN’T BREAK THE BANK
Sequent Partners’ research showed that targeting and personalization with digital video have a huge impact—averaging $2.39 more ROAS than typical digital video benchmarks. But that versioning can be pretty expensive; as one CPG marketer said in the study, “We would need to swap flavors and products, but our budgets don’t allow us to do that at scale due to CPM issues. We want to get the right product and right message to the right target at the right time, but agencies will charge for this versioning.”
On a conceptual level, 1-to-1 personalization seems cost-prohibitive for CPG marketers with multiple brands, products and versions of products. But that inclination isn’t actually the reality if you find the right partner.
Controlling versioning costs is feasible with a partner who can access the data and technology to automate the creation of one-to-one video. The technology exists to take a more general, national commercial and add personalized features like products and messaging that will resonate most with each specific viewer. This creates hundreds of thousands of ad versions on the fly—and totally within budget.
5. TRACKING CONVERSIONS IS BECOMING EASIER
Because retailers sell the products, not the manufacturers, CPG marketers have issues with actually tracking sales from their marketing efforts. The only real way to measure CPG sales is to use third-party verification. As one CPG marketer said in the study, “A retailer can tell you the ROI because they have access to purchase data. The manufacturer only has click through, length of view. We only know if they purchase if we go to a database like NCS.”
Although it is an extra step, it’s crucial for marketers to demand their marketing partners incorporate third-party validation into their CPG video campaigns to understand the true impact of their efforts.
Digital video is changing. There are a number of new options that, until a few years ago, weren’t even an option for CPG marketers. It’s time to get up to speed on what is possible with digital video, so your brand can start executing more effective, outcome-based campaigns.