‘Big Media’ Can Help Advertisers Build Long-Term Demand.

A new book and study from marketing-effectiveness experts are challenging the advertising industry’s emphasis on highly targeted campaigns, arguing that broad reach through traditional media can play a critical role in driving long-term sales and profit growth.

The findings are highlighted in a new Westwood One analysis by Pierre Bouvard, the company’s Chief Insights Officer. Bouvard cites James Hurman’s new book, “Future Demand: How Marketing to Tomorrow’s Customers Will Break Your Brand Out of the Performance Trap,” along with a study by Les Binet and Will Davis titled “Go Big or Go Home: How Small Thinking is Killing Advertising and What to Do About It.”

The central argument is based on the so-called 95/5 rule. At any given time, about 5% of consumers are actively in the market for a particular product or service, while the other 95% are not. Advertisers therefore have two jobs: convert existing demand among consumers who are ready to buy and create future demand among those who are not.

Westwood One says the first task can involve targeted promotions and sales events, while the second requires brand-building efforts aimed at a much broader audience. The analysis cites research from the Ehrenberg Bass Institute recommending that marketers devote roughly 40% of their budgets to consumers currently in market and 60% to creating future demand.

“Big media ads” — including AM/FM radio, television and outdoor advertising — are presented as particularly effective tools for the latter objective because of their reach and ability to build brand perceptions.

The analysis argues that advertisers can eventually reach a sales plateau when too much spending is directed toward digital direct response and other efforts focused narrowly on consumers already in the market. Expanding investment into broad-reach media can help generate additional sales growth by reaching prospective customers before they have an immediate need.

Research cited by Bouvard also suggests marketers overestimate the sales impact of targeting. Advertiser Perceptions found that marketers and agencies estimated targeting accounted for 22% of sales effects, while Circana’s consumer-purchase research put the figure at 11%.

Broad-reach campaigns also appear to produce stronger business results over time. Research by Binet and Peter Field found campaigns targeting new buyers or the entire market were two to three times as effective as campaigns focused only on existing customers. Over a one-to-two-year period, companies pursuing broad reach were nearly four times as likely to report very large profit growth.

The analysis also points to differences in advertising memorability. James Hurman reports that people pay more attention to advertising in radio, television and outdoor media, while research from Amplified Intelligence indicates that more than 85% of online ads fail to reach the 2.5-second attention-memory threshold.

“People pay more attention to ads in (radio, TV and outdoor) and we’re better at remembering things that we’ve paid attention to,” Bouvard says.

Bouvard’s analysis concludes that advertisers should not automatically view audiences outside their immediate target as waste. Instead, reaching those consumers can help establish familiarity and positive associations with a brand before they enter the market.