Every Advertising Dollar is Now Under Scrutiny
Marketers’ demand for greater advertising efficiency is akin to a driver’s need for improved fuel economy or MPG (Miles Per Gallon), where sales play the role of miles driven and advertising dollars are gallons of gas. Achieving this SPA (Sales Per Ad$) or advertising accountability in the face of consumer apathy, ever-increasing audience fragmentation and a reluctance to spend is no small task. Advertising agencies, media outlets and other communication vendors are under increasing pressure to show that their “vehicles” can produce these improved numbers. Failure to do so can lead to faster extinction than SUVs on a new car lot.
According to the FromTopDown study, enhancing traditional print and direct mail advertising with product samples that consumers can see and smell and touch actually generates incremental sales compared to advertising alone. While sampling is not a new idea, documentation that sensory-rich, experiential messaging campaigns can have a positive ROI is causing marketers to revisit what has been an undervalued element in their marketing arsenals. Results of FromTopDown’s research demonstrate that, when executed properly, such experiential campaigns can make a lasting emotional connection and spur sales generating a SPA rating better than that of advertising alone.
Cosmetic Industry Could Benefit the Most
This recommendation comes not a minute too soon for the prestige fragrance, beauty and cosmetics market. Beauty product marketers have relied heavily on in-store demonstrations done by their representatives at department store counters. As department store traffic has declined dramatically over the past decade, so have beauty product sales through this important sales channel. According to Cosmetic News Weekly, sales of premium cosmetics in the U.S. fell 3% in 2008 after weak sales growth of just 2% in 2007. Even when premium cosmetic products are available through other store and online outlets, the buying environment falls short of that offered by department store counters where products are demonstrated and consumers get a first hand opportunity to experience the sensory benefits of the product. If consumers are not coming to their counters to try their products, prestige fragrance and cosmetics marketers must now find ways to bring the makeup experience to the customer. The decline of this key sales channel has spurred a renewed interest in experiential advertising, i.e. ads that provide an actual sample of fragrance, skin care or other product attributes. Cosmetics marketers have known for decades that these ads provide a medium to bring the cosmetic experience directly to their most important target demographic. The unanswered question has been whether such ads can cost effectively “move the needle” on brand perception, sales and profitability.
