Study: Online + Offline Media Delivers Better ROI than Either Alone
March 13, 2019 | Contributed by: Greg Sterling
For brands, retailers and small businesses that fulfill offline or through stores, traditional media is often more trusted but digital marketing offers more precision and “accountability.” However, there’s also fraud and waste in digital.
A new “ROI Genome” report from Analytic Partners discusses, among other findings, the relative ROI of online and offline advertising. The study is “based on the work Analytic Partners has provided our clients . . . [for] some of the biggest companies from around the globe.” The analysis was based on more than $400 billion in marketing spending over a period of years.
The report doesn’t carefully define “offline” advertising and focuses mostly on traditional, linear TV. However, there are passing references to print, radio and OOH in the report.
Analytic Partners says that lower costs and better targeting were the source of greater efficiencies for digital compared with “offline.” However, most traditional media (linear TV in particular) have not been easily measured until very recently, using mobile-location data.
In terms of relative performance of online channels, the report says the ladder of efficiency goes like this:
- Paid search
- Paid social
- Digital display
- Traditional TV
The report also says that there has been a marked decline in digital ad efficiencies over the past several years — here’s where things like fraud and viewability come into play — while traditional media ROI have remained stable. Accordingly there’s an ROI convergence going on.
Given this, the study argues that a mix of traditional and digital media are optimal and that a hybrid channel strategy combining both produces a better outcome for brands. Online and offline media buys together create 45% greater efficiency than either category alone.
There are immediate questions about advertiser budgets and how that impacts this analysis. While there’s probably little disputing the big findings of the report, there’s a more nuanced analysis for someone to do about which combinations of digital and traditional media deliver the most ROI at different ad budget levels.