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Buyer Insights: Ad Agencies & AdvertisersA study of their buying habits, preferences & level of satisfaction with promotional products
Prepared by
April 2014
Methodology
Data Collection� 15-minute online survey
Sample� 400 respondents including 178 Agencies and 222 Advertisers� Sample source: Third-party online panel Research Now and Redbook database
Page 2
� Sample source: Third-party online panel Research Now and Redbook database� Sample Screening Criteria
– Decision maker or influencer in the purchase of promotional products– Advertisers: Revenues of $10 million or more
Field Date� March 5 – 28, 2014
Key Findings
Buying Process
� 8 in 10 Agencies and Advertisers buy promotional products from promotional consultants, which are considered part of the team by 41% across both groups
� Agencies are more likely to consider their promotional products provider as part of their team (61%), suggesting that promotional products consultants would benefit from
Page 3
team (61%), suggesting that promotional products consultants would benefit from approaching agencies to establish partnerships
� Price, design/function and preferences were the top drivers in the use of promotional products for Agencies and Advertisers
� Apparel was the category of promotional products most often purchased in the last 12 months by both Agencies and Advertisers
Key Findings
Promotional Products Effectiveness
� Promotional products are often integrated into the advertisers budget (52%) and the campaign budgets agencies manage for their clients (54%)
� However, Advertisers (41%) are more likely than Agencies (28%) to buy promotional products as needed, without having a designated budget for it
Page 4
� About 1 in 4 Agencies recommend promotional products to be included in the media buy for their clients’ advertising and marketing campaigns
� Agencies are also more likely to actually include promotional products in the media buy they do for clients (19%) and invest in this advertising medium (17%) than Advertisers (9%, respectively)
� In the past 12 months, 9 in 10 Agencies and Advertisers have purchased promotional products at least once, with 4 in 10 spending $25,000 or more in this medium
Key Findings
Investment in Promotional Products
� Across Agencies and Advertisers, 7 in 10 consider promotional products effective or highly effective
� Promotional products are often used to promote brand recognition (62%), brand and product awareness (58%), and to support corporate identity (52%)
Page 5
� The use of promotional products have often resulted in increased goodwill (56%) and brand recall (44%), but less so in on customer acquisition (31%), increased market share (22%) and overall ROI (16%)
� Apparel is considered one of the most effective promotional products categories by both Agencies and Advertisers
� The majority of Agencies and Advertisers would recommend using promotional products (88%) and many believe they have contributed to the campaigns’ success (73%)
� However, only a third have measured the response to the campaigns or included some form of tracking mechanism
Key Findings
Promotional Products & Media
� Overall, 7 in 10 have used promotional products in stand alone campaigns, and 6 in 10 have used them in conjunction with other media
� Promotional products were often used in exhibits/trade shows (33%), followed by print (22%) and social media (22%)
Page 6
� They are less often used in combination with mass media such as Radio (6%), Outdoor (5%) and TV (4%)
� Most Agencies (91%) and Advertisers (96%) customized or imprinted the products included in campaigns using promotional products in their last campaign
� Half of promotional products were mailed to specific vertical markets in their last campaign
How Promotional Products Are Purchased
� About 8 in 10 Agencies and Advertisers purchase promotional products from a promotional products consultant
Total(n=267)
Agency(n=110)
Advertiser(n=157)
80%Promotional Consultant 79% 80%
Page 8
A4/B3. How does your company purchase promotional products [on behalf of your clients]?
10%
7%
3%
Consultant
Online
Retail or catalog
Third party
10%
7%
4%
10%
8%
2%
Promotional Products Consultant Considered Part of the Team
� Agencies are more likely to include promotional products consultants as part of the team
Page 9
A4a/B3a. Do you consider the promotional products consultant a member [of the team working on behalf of your client/of your marketing team]?
Total(n=212)
Agency(n=86)
Advertiser(n=126)
80% 75%
Importance in Decision to UsePromotional Products (Top 2 Box)
Total(n=241)
Agency(n=95)
Advertiser(n=146)
77%Price
� Price, design/function and preferences are the top drivers in the use of promotional products for Agencies and Advertisers
Page 10
80%
72%
71%
67%
65%
60%
61%
53%
34%
45%
75%
81%
82%
67%
66%
64%
60%
67%
33%
22%
A15/B14. Thinking of the last time in the past 12 months [a client’s campaign/when your company purchased] promotional products, how important were each of the following factors in the decision to use promotional products?
77%
77%
77%
67%
66%
62%
61%
61%
33%
31%
Price
Design/function
Proven favorite of recipients
New idea
"Gift" perception of items used
Info about message longevity retention
Logistics
Uniquely positioned as ad medium not considered a nuisance
Recommendation from another person
Suggestion from vendor
Promotional Products Purchased in Past 12 Months
� Apparel was the category of promotional products most often purchased in the last 12 months by both Agencies and
Agency
Page 11
Agencies and Advertisers
A9/B9. List three promotional products purchased in the last 12 months [on behalf of your clients/at your company]?
Advertiser
Promotional Products Budget
� Promotional products are often part of the advertisers budget, which is also reflected in the campaign budgets agencies manage for their clients
� However, Advertisers are more likely than Agencies to buy promotional products as needed, without having a specified budget for promotional products
Agency(n=126)
Advertiser(n=160)
52%Usually a formal
part of the 54%Formal part of
Mktg or PR
Page 13A3/B2. Which of the following best describes how the budget for promotional products is [integrated in your clients’ advertising and marketing campaigns/set up at your company]?
52%
28%
18%
part of the campaigns
No budget, buy as needed
Clients handle it most of the time
54%
41%
3%
Mktg or PR budget
No budget, buy as needed
Part of the ad agency budget
Promotional Products Inclusion inMedia Buy/Advertising Investment
� Agencies are more likely to include promotional products in the media buy they do for clients and invest in this advertising medium
� About 1 in 4 Agencies recommend promotional products to be included in the media buy for their clients’ advertising and marketing campaigns
Total(n=255)
Agency(n=113)
Advertiser(n=142)
Page 14
A3a. On average, what percent of the time are promotional products featured in your agency’s recommendations for your clients’ advertising and marketing campaigns?A3b/B2a. On average, what percent of the time are promotional products included in [the media buy for your clients’ advertising and marketing campaigns/your company’s media buy]?A3c/B2b. On average, what percent of the investment in [your clients’ advertising and marketing campaigns/advertising] do promotional products represent?
26% Recommend promo products to clients
Promotional Products Purchase Frequency:Past 12 Months
� 96% have purchased promotional products in the past 12 months� 75% have done so 3 or more times during the same period
Total(n=263)
Agency(n=107)
Advertiser(n=156)
Page 15
A7/B7. How often has your company purchased promotional products, giveaways or incentives [on behalf of your clients] in the past 12 months?
4%4% 5%5% 3%3%5%5% 3%3% 6%6%
16%16% 17%17% 15%15%
22%22% 19%19% 24%24%
15%15%14%14%
17%17%
38%38% 42%42%35%35% 5+ times
4 times
3 times
2 times
1 time
None
Promotional Products Spending:Past 12 Months
Total(n=253)
Agency(n=102)
Advertiser(n=151)
� 4 in 10 spent $25,000 or more on promotional products in the last 12 months
Page 16
A8/B8. On average, how much did [you/your company] spend on promotional products [on behalf of your clients/for internal use at your company or department or for an external marketing/advertising campaign] in the last 12 months?
14%14% 11%11% 17%17%
23%23%21%21%
26%26%
22%22%24%24%
21%21%
13%13% 14%14%13%13%
28%28% 30%30%23%23%
$50K or more
$25K < $50K
$10K < $25K
$5K < $10K
Under $5K
Promotional Products Effectiveness
� 7 in 10 consider promotional products effective or highly effective
Total(n=264)
Agency(n=108)
Advertiser(n=156)
11%11% 10%10% 12%12%
Page 18
A6/B6. Overall, how effective do you find the use of promotional products?
1%1% 1%1% 2%2%1%1% 1%1%
24%24% 23%23% 24%24%
63%63% 66%66% 61%61%
11%11% 10%10% 12%12%
Extremely effective
Effective
Somewhat ineffective
Extremely ineffective
Don't know
Promotional Products Purpose
� Promotional products are often used to promote brand awareness and support corporate identity
Total(n=265)
Agency(n=109)
Advertiser(n=156)
62%Brand recognition
Brand/product
62% 62%
Page 19
A5/B4. Which of the following best describes how promotional products have been used [in your clients’ campaigns/at your company]?
58%
55%
51%
42%
41%
40%
38%
33%
29%
25%
16%
Brand/product awareness
Corporate identity
Public relations and goodwill
Customer retention & appreciation
Generate sales & referrals
Employee communications & recognition
New product introduction
Motivate behaviors & incentive programs
New customer acquisition
Drive traffic
Call to action
54%
48%
45%
38%
39%
30%
39%
31%
31%
28%
22%
60%
60%
56%
46%
43%
46%
38%
35%
28%
24%
12%
56%Increased goodwill 59%
Total(n=251)
Agency(n=95)
Results of Promotional Products Usage
� The use of promotional products have often resulted in increased goodwill and brand recall� However, a direct impact on customer acquisition, market share and overall ROI in less
frequent
54%
Advertiser(n=156)
Page 20
44%
31%
23%
22%
22%
16%
4%
Increased brand recall
Customer acquisition
Increased response rate
Increased website traffic/conversions
Increased market share
Increased overall ROI
Increased fundraising
43%
35%
23%
30%
25%
23%
4%
A12. Thinking of the last time in the past 12 months a client’s campaign included promotional products, did the use of promotional products result in any of the following?B5. Has the use of promotional products at your company resulted in any of the following?
44%
28%
22%
18%
19%
12%
5%
Promotional Products Campaign Usage Diagnostics
� The majority of Agencies and Advertisers would recommend using promotional products and many believe they contributed to the campaigns’ success
� However, only a third measured the response to the campaigns or included some form of tracking mechanism
Total(n=242)
Agency(n=95)
Advertiser(n=147)
Page 21
87%
78%
37%
38%
A11/B11. Thinking of the last time in the past 12 months [a client’s campaign/your company did a marketing/advertising campaign that] included promotional products, please answer the following questions.
88%
73%
35%
33%
Would recommend as part of future campaigns
Contributed to success of advertising/branding
campaign
Products included tracking mechanism,
website, phone number or QR code
Response was measured
89%
70%
34%
31%
Most Effective Promotional Products Used in Past 12 Months
� Apparel is considered one of the most effective promotional products categories
Agency
Page 22
A10/B10. List the top three most effective promotional products used in the last 12 months [on behalf of your clients/at your company]?
� Writing instruments are also considered very effective by Advertisers
Advertiser
Campaign vs. Stand Alone Usage
� Combining the use of both types of campaigns, about 7 in 10 have used promotional products in stand alone campaigns, and 6 in 10 have included them as part of advertising campaigns
Total(n=242)
Agency(n=95)
Advertiser(n=147)
Page 24
A13/B12. Thinking of the last time in the past 12 months [a client’s campaign included/when your company purchased] promotional products, were the promotional products used as part of an advertising or marketing campaign or a standalone campaign?
(n=242) (n=95) (n=147)
37%37%
25%25%
35%35%
3%3%
36%36%
29%29%
34%34%
1%1%
Stand alone Campaign Both Other
37%37%
22%22%
37%37%
4%4%
32%
25%
22%
22%
33%
22%
22%
21%
Exhibits/trade shows
Social media
34%
19%
21%
20%
Media Used in Conjunction With
� Promotional products were often used in exhibits/trade shows, followed by print and social media
� They are less often used in combination with mass media such as Radio, Outdoor and TV
Total(n=241)
Agency(n=95)
Advertiser(n=146)
Page 25
22%
21%
15%
19%
13%
13%
13%
13%
7%
7%
7%
4%
3%
1%
20%
19%
19%
15%
15%
14%
11%
11%
10%
6%
5%
4%
4%
1%
Experiential/special events …
Internet advertising
Promotions
Direct mail
Product samples
Contests/sweepstakes
Gifts with purchase
Point of purchase
Product placement/sponsorship
Radio
Outdoor
TV
Mobile advertising
Other
19%
17%
21%
12%
16%
14%
10%
10%
12%
6%
3%
3%
4%
1%A14/B13. What media were promotional products used in conjunction with?
Promotional Products Campaign Setup
� Most Agencies and Advertisers customized or imprinted the products included in campaigns using promotional products
� Half of promotional products were mailed to specific vertical markets
Page 26
91%
59%
Total(n=242)
Agency(n=95)
Advertiser(n=147)
94%
55%
Products were customized or
imprinted
Were mailed to specific vertical
market
96%
52%
A11/B11. Thinking of the last time in the past 12 months [a client’s campaign/your company did a marketing/advertising campaign that] included promotional products, please answer the following questions.
Who We Talked To
Total Agency Advertiser(n=400) (n=222) (n=178)
% % %
Page 28
% % %
Gender
Male 53 46 62
Female 47 54 38
Age
Under 35 14 9 17
35-44 14 16 13
45-54 27 29 26
55-64 33 34 31
65+ 12 12 13
Agency56%
Advertiser44%
S1. Are you…?S2. What is your age group?S4. How would you describe your company?
Where They Work
Most Agency AdvertiserClients Are…
(n=222)Sector
(n=178)% %
Business Sector/ IndustryHealthcare 28 7Manufacturing or construction 19 25Financial services 18 6Automotive & transportation 17 4Retail 15 3Technology 15 7Food & beverage 14 4Industrial 14 5Government 12 0
Page 29
S3. In what business sector/industry is your organization?A1. In what business sector/industry are most of your clients?
Government 12 0Consumer products 11 5Education 11 3Travel & hospitality 10 2Pharmaceutical & healthcare 9 2Telecommunications 9 1Restaurants 8 1Associations, institutions, unions, non-profit, etc. 7 1Consumer electronics 7 1Food processing & agriculture 7 1Groceries & food retailers 7 0Recreation 7 0Apparel wear & shoes 6 1Hardware & construction 6 2Real estate 6 0Consulting 4 2Tobacco products & supplies 2 0Housewares & appliances 0 1Marketing & advertising 0 2Media 0 1Pharmaceutical 0 3Other 19 12
What They Do
Total Agency Advertiser(n=400) (n=222) (n=178)
% % %Job FunctionSales manager/director 32 23 43Account/client services manager/director 5 8 2Account supervisor/manager/director/executive 5 8 2Marketing manager/director/VP 5 3 7Media director 4 7 0Media planner 4 6 1Sales promotion manager/director 4 3 4
Page 30
S5. What is your job function?
Sales promotion manager/director 4 3 4Marketing communications manager 4 2 6Event planning manager/director 3 2 3Brand/product manager/director 3 1 6Chief creative officer/creative director 2 4 0Communications/corp. communications manager/director/officer 2 3 1Production manager 1 1 2Art director 1 1 1Chief marketing officer 1 1 1Direct marketing/direct response manager/director 1 1 1Planner 1 1 1Social media/digital/ interactive marketing manager/director 1 1 1Account planner/senior account planner/planning director 1 1 0Media buyer 1 1 0Print production manager/director 1 1 0Public relations manager/director 1 1 0Media account director 0 1 0Account executive public relations 0 0 1Other 20 20 20
Their Company Financials
Agency Advertiser(n=222) (n=178)
Page 31
S6. What is your company revenue?S7. What are your agency billings?
(n=222) (n=178)% %
Agency Billings Company RevenueUnder $250K 6 $10M < $20M 20$250K < $500K 3 $20M < $50M 26$500K < $1M 3 $50M or more 54$1M < $5M 15$5M < $10M 12$10M < $20M 15$20M < $50M 17$50M or more 29