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Unilever and Nestlé prove display ads work: £1 spent gets £1.94 return

Unilever and Nestlé prove display ads work: £1 spent gets £1.94 return
Wednesday December 13 2017

A year-long research project involving Unilever, Nestlé, i2c, Nielsen, Nectar and the IAB UK has revealed the degree to which online display ads drive sales of popular household brands both in-store and online.

Ads for nine brands – Nescafé, Häagen Dazs, Persil, PG Tips, Magnum, Surf, Maille, Tropicana and Aquafresh – were tested across mainstream desktop and mobile sites including The Guardian, Yahoo!, eBay, Gumtree, AutoTrader and Mail Online. The purchasing behaviour of those who received the ads was compared to those who didn’t using a combination of Nectar loyalty card data – providing transaction data for over 12 million Sainsbury’s customers – and Nielsen Homescan data, which measured shopping behaviour at other UK supermarkets.

The results showed that every £1 spent on online display ads delivered an average of £1.94 in sales across all supermarkets, with one brand seeing a £3.38 return.

“The ‘Holy Grail’ question we get from marketers is what impact does an online ad have on offline sales, and the answer is a very big one as the vast majority of the sales attributable to the online ad happened in-store,” said the IAB’s chief digital officer Tim Elkington. “The calibre and range of the brands involved in the project gives marketers a reassuring guide as to what their investment in digital will pay back.”

Interestingly, all the ads carried a Sainsbury’s logo which Elkington says illustrates the “halo effect” that store-branded advertising can have on sales in other supermarkets. The IAB conservatively estimate that these co-branded ads are 21% as effective at driving additional sales at a different supermarket as they are at Sainsbury’s.

This is based on the fact that 55% of shoppers believe that an ad carrying the Sainsbury’s logo means the product would be available in other supermarkets¹, while 38% said the Sainsbury’s logo would make no difference to which supermarket they purchased it from² (i.e. 55% x 38% = 21%).

The study, which was delivered by i2c – a joint venture between Sainsbury’s and Aimia (owner of the Nectar programme) – revealed that online ads also had a positive effect on people’s awareness of and favourability towards the brand, most notably that people who saw the ads were 12% more likely to consider the brand to be “premium.”