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National Television Exposure Still Vital to New-Product Introductions

Apr 26, 2004  •  Post A Comment

An account executive I once worked with had a sign on his wall: “Momentum unassisted is a gradual stop.” For packaged goods marketers, this means there must be a constant flow of new products that will keep the loyalty of existing customers, expand the brand franchise and fight off competition.
But once a product comes out of the laboratory, advertising is expected to create awareness and support distribution. Media play a critical role in the process, and in view of the advertiser’s heavy financial and psychological investment, the Year 1 plan is likely to receive closer scrutiny than the typical sustaining effort.
To give planners a feel for the average introductory plan, we used Nielsen’s Monitor-Plus service to identify 36 brands that began national advertising in 2002-03. Year 1 was counted as 52 weeks from the first week of substantial national television weight. Product categories included foods, over-the-counter pharmaceuticals, household products, cosmetics, personal-hygiene products and vitamins and supplements. We wanted to know how much the average brand spent in total and by medium, how it spread the dollars across the year, the gross ratings points levels, daypart selection and commercial length. Weight was expressed in terms of household GRPs as a common base across multiple target audiences.
The 36 brands studied spent a total of $470 million in Year 1, ranging from $4 million to $37 million, with the median brand spending $10 million. Forty-five percent of this was spent in the first three months, 75 percent in the first half-year and only 10 percent in the last quarter. This reflects the need to get new products off to a strong start with both consumers and the trade, though most of the brands we studied were line extensions that did not need to create core awareness from scratch.
Spending was heavily concentrated in television-74 percent in national TV (43 percent network, 21 percent cable and 10 percent syndication). Seven percent of the dollars were in spot. Magazines were the second-most-used medium, with 15 percent of spending. We found 21 of the 36 brands used a free-standing insert coupon to support the national introduction. Only three brands used the Internet.
Not So Heavy Weights
Planners tend to think “heavy up for a product introduction,” but in fact the weight levels were quite modest. In the first month they ranged from a low of 28 to a high of 880 household points. The average brand ran only 374 GRPs, or less than 100 points a week.
Total weight in the first 13 weeks averaged 932 points (minimum: 126; maximum: 2,088). Forty-four percent of national TV points were on cable, 40 percent broadcast network, 10 percent syndication and 6 percent Hispanic network TV (general-market GRPs). Half of the brands studied used more than 22 cable networks. Cable’s leading share of weight, compared with its smaller share of spending, is a reflection of the medium’s well-documented efficiency.
National television weight was concentrated in prime time and daytime, reflecting the predominately female packaged goods target audience. 43 percent of the weight on broadcast networks was in prime time and 33 percent was in daytime. Because of the many run-of-schedule buys, cable points were more evenly distributed: 18 percent of the weight was in prime time, 24 percent in daytime and the remainder was scattered across other dayparts.
We found no pattern in the use of 15- or 30-second units. Seven of the 36 brands we studied introduced with all :15s. Twelve brands used only :30s and the rest used some mixture of the two. Brands that were introduced with only :15s ignored the conventional wisdom that new products need a long creative message to properly communicate the brand’s features. However, since most of the products were line extensions of familiar brands and the communication objective was relatively simple, planners may have reasoned the extra frequency afforded by half-price :15s was more important than commercial length.
We recognize this broad overview does not account for the many creative touches that planners add to introductory plans. And there were even substantial differences in the way they used national television as the core medium. But we found enough consistency to feel confident that there are general practices planners should be aware of.
Roger Baron is senior VP and media research director for Foote, Cone & Belding.