Digital tipping points should not tip non-digital off the media plan

If the past 12 months have felt like living through several years at once, that may be because for some industries it has been.

In June, Johnny Hornby, founder of The&Partnership, told the FT that: “In the last three months we have seen three years’ worth of digital acceleration take place.”  

The Economist estimated in December that e-commerce’s share of total US retail sales grew as much in eight weeks as in the preceding five years.  And consumers in Italy took a “10-year evolutionary leap” towards digital usage in the pandemic, according to Netcomm, an Italian retail consultancy.

At the time of writing, it is hard to find persuasive observers who argue that behaviour in areas such as retail, business travel and office working will fully swing back to pre-pandemic patterns after the disruptions of COVID-19.

Tipping points affect bottom lines

It is more common to read of industries at tipping points where increasing use of digital by consumers alters the fundamental economics of businesses, requiring them to adopt digital-first or digital-only models as a matter of urgency.

The survival of Topshop as a web-only brand run by e-tailer ASOS after the failure of the brand’s previous owner, Arcadia, and store closures by John Lewis suggests that long-term change is well underway in parts of the retail sector.

If the future remains highly unpredictable, the past is not unreadable. It is worth at least reviewing previous evidence in the IPA Effectiveness Databank to ask what being a digital-first business means for media planning and advertising strategy. Should digital-first businesses, for instance, only use digital media to reach audiences?

What follows needs the caveat that it will be the 2022 IPA Effectiveness Awards before we have the first case studies of effective advertising during the pandemic. 

However, if insights from brands primarily bought or researched online before the pandemic are any guide, they suggest that digital-first brands will still need brand-building advertising on non-digital media to continue growing their customer bases.

Avoid the Online Fallacy

This view, that even digitally-led brands need the growth in awareness, consideration and other brand measures that non-digital media exposure can provide, is confirmed by IPA Effectiveness Awards case studies from Cotswold Co, Purplebricks, and 32Red.

How Cotswold Co. moved beyond optimisation

By combining rigorous Pay Per Click search marketing with attractive and competitively priced products, the Cotswold Co. furniture retailer had doubled in size annually for 16 years. By 2019, its category was firmly digital-first, with the majority of consumers both browsing and buying online. So why change its focus on optimizing its search strategy?

The short answer was to keep growing.  To achieve ambitious new targets, it needed to increase penetration and change brand perceptions among non-users at a time when PPC costs were rising and returns from search marketing falling. Ironically, rivals with better brand awareness could use cheaper branded search terms and organic search to attract customers.

Working with the agency Creature, Cotswold Co. developed a brand-building campaign to grow awareness and challenge perceptions of the brand as old-fashioned via TV ads, supported by print inserts, direct mail, digital, and social.

Following the campaign, the brand reported improved brand perceptions among audiences exposed to its TV ads, increased penetration and a record 8% revenue increase. Brand building also made the retailer’s search marketing more effective.

Making Purplebricks famously different

By 2016, UK online estate agents had traded for a decade but failed to disrupt the mainstream property market. Purplebricks was the best known web-based agent, but to meet its growth ambitions it needed to lift consideration and increase instructions to sell homes.

It invested in funny TV, led advertising, developed with Snap LDN, to to make famous the idea of ‘commisery’ – the despondency you feel if you thought you had needlessly paid out thousands in commission – and underline that Purplebricks did not charge sellers commissions. As its Effectiveness Award case study argues, “Only TV could deliver what we now needed to do: dramatise the emotional benefit of our core difference.”

Following the campaign, consideration rose from 23% to 38%. Market share almost doubled and revenue grew by 218% in 2016-17.

32Red

In 2014, online gambling business, 32Red, was aiming to double UK revenues to £100m in four years. To hit this goal, it would need to add more new customers in three years than in the previous 12, and grow revenue per player.

What is interesting about the 32Red case study, principally authored by M.i. Media, is that it combined data-led approaches to increasing the efficiency of both search marketing and TV advertising (a medium already heavily used by online casinos), with a move into selected sponsorship and branded content opportunities to introduce the brand to new customers in relevant contexts.

Following this multi-year strategy, the £100m target was reached one year early. 32Red was eventually sold for £176m, four times its valuation at the start of the growth plan.

The full case studies and Effectiveness in Context (which is free in digital format to IPA members) should be read by anyone working on brands transitioning towards digital-first amid the uncertainty of how markets will stabilise once we have moved into a sustainable post-COVID economic recovery.

They suggest that digital tipping points in customer behaviour should not be prompts to tip non-digital channels off media plans for the post-COVID future.