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Making the case for experiential marketing

21st Apr 2008
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Marketing budgets can be tricky things to negotiate at the best of times, but when you’re pitching an experiential campaign to a sceptical executive team, what do you say? Matt Henkes goes through the pitch with marketers who have negotiated this path.

By Matt Henkes, staff writer

Marketers have long been aware that a carefully crafted brand experience can do wonders for a company name. But in this crazy world where building a giant roller-disco on a flat-bed lorry and driving it around various rock festivals and shopping centres costs more than a simple press campaign, how do you convince the man with the cash that experiential is a worthwhile expenditure?

On the plus side, changes to the media landscape are encouraging businesses to broaden their horizons. Channel fragmentation over the last few years has severely impacted commercial TV channels such as ITV, which are posting the worst ever results year-on-year. The immense reach of mass marketing channels is also rapidly diminishing.

Joss Davidge has spent a number of years working as a marketing director at big name brands such as Unilever, Kraft Foods and Ginsters. He now works for BEcause Experiential on the agency side of the industry but has witnessed this shift for himself. “People now consume media in a way which is absolutely salient to their particular world,” he says. “And it’s personalised to them.”

"The whole argument about the power of experiential marketing to generate amplification and advocacy is its real strength."

Joss Davidge

But on the downside for experiential marketing, the activity has a reputation for suffering from a lack of measurability. Understandably, as experiential marketing is a maturing discipline with murky ROI, companies can be nervous to splash out on such campaigns. To further complicate matters, experiential campaigns can be expensive.

Tango’s senior brand manager, Sally Symes, is no stranger to staging experiential campaigns. She warns that significant investment is needed. “There is probably a minimum spend that you need to commit to otherwise you can get a compromised delivery,” she says.

Exactly what that figure is will vary dramatically depending on a range of factors including target audience, current brand awareness and the nature of the experience you’re trying to portray. “If you do have a small budget then you need to be extremely targeted,” she adds.

However, Davidge disagrees that experiential suffers from measurement challenges. “People who say it isn’t have no understanding of what is measurable and achievable,” he says. In fact, he argues, one of experiential’s strengths is producing more precise audience figures, something the company number crunchers will be eager to know.

A lot of the old models for mass media advertising still talk in statistical figures of cost per contact – the reach you can achieve and the number of opportunities for your ad to be seen. This can tell you how many people might have seen your poster on an average day but what it will struggle to tell you is how many people who saw that ad took the message on board and changed their perception behaviour as a result.

The power of experiential

With an experiential campaign, Davidge says, you can work in absolutes. You know exactly how many people you’ve spoken to and because you’re targeting specific consumers, you know they’re all in your target market. You know that each of these people will have tried the product and can get instant feedback. With data capture through vouchers or competitions, you can even monitor consumer behaviour after the event, including amplification and consumer advocacy.

Davidge argues that all of these points should feature in an experiential business case. “The whole argument about the power of experiential marketing to generate amplification and advocacy is its real strength,” he says.

"There is probably a minimum spend that you need to commit to otherwise you can get a compromised delivery."

Sally Symes, senior brand manager, Tango

This is also borne out in research figures, which show whereas only 17% of consumers can recall the brands they've seen in TV ads, 60% of people who take part in experiential marketing exercises have that brand recall.

When manufacturers of Croft Sherry, Gonzalez Byass (GB), decided it wanted to invest in brand experience, it worked with celebrity gardener David Domoney to create ‘The Croft Spot’, a garden at the Hampton Court Palace flower show, where consumers could sample the drink. Around 28,000 visitors experienced the garden and tasted the product.

But how does Jeremy Rockett, currently UK marketing manager at GB, know it had any effect? “It’s difficult,” he admits, “but what we did get was around 3.5 percent redemption of the vouchers we gave out at the event, which is pretty high.” Over the total campaign, repeat purchases increased significantly, he adds. Critically, Rockett believes the experiential events were “integral” to the wider campaign. “It’s difficult to single it out because the experiential was integral to the rest of the campaign,” he adds.

The problem with most mass marketing campaigns - with the exception of some with particular viral marketing value (the Cadbury's gorilla or the Budweiser frogs, for instance) - is they don’t motivate consumers to talk about them.

Experience is the key driver of advocacy. People who hear about a brand or see it in a two dimensional format are unlikely to tell their friends and family about it, whereas statistics show that someone who has taken part in a well executed experiential event will talk to up to four people.

Happy talk

One of the masters of experiential marketing is the telecommunications giant O2, providing VIP facilities for its customers at sponsored music and sports events. “We want to give our customers a unique experience that they would not be able to have anywhere else,” says Nicci Buck, O2 events manager. “Experiential allows us to get much closer to the customer, enabling us to build emotional loyalty.”

She says O2 will only do something if it adds value in some way. Over time, she says the loyalty that builds up through these experiences turns people “from customers into fans”. O2 exploits its high profile sponsorship assets to provide that extra experience for its customers.

"Experiential allows us to get much closer to the customer, enabling us to build emotional loyalty."

Nicci Buck, O2 events manager

For example, by sending a text message, customers could gain entry to the ‘Blue Room’ at the O2 Wireless music festival this summer, where they were able to relax, away from the mud, in a private branded bar with comfy chairs, reiki healing and a foot massage service.

Running a hefty experiential campaign for Ginsters as part of a wider integrated campaign, Davidge managed to double the value of the brand in the five years he was there. The campaign built up a big association with Cornwall and extreme sports. It travelled around beach events with a specially commissioned VW camper van, targeting a young audience with a ‘cool’ delivery, but also providing product samples and talking about the ‘coolness of Cornishness’.

The prime measurements were the number of consumer contacts and the amount of PR and press coverage generated. ROI was difficult to demonstrate directly because the company wasn’t looking to measure specific sales. However, it was possible to attribute ROI to the wider marketing campaign. “That’s true in a lot of instances because experiential is often part of an integrated campaign,” Davidge points out.

With the brand now worth in excess of £120m, he says it’s easy to see how the company made its money back.

The bottom line is that convincing a sceptical executive of the value of experiential as part of a wider campaign requires careful emphasis of the key points. Using the numerous measurements available, the finance team should be able to calculate cost per conversion and some form of ROI. They should be particularly impressed that the measurements deal in absolute figures rather than estimated statistics, but where it is less cut and dry, such as in the Ginsters campaign, focus again on the favourable comparisons with traditional marketing.

“The last point would be one of engagement,” advises Davidge. “Compare a statistical chance of a poster impression or the chance of someone seeing a 30 second TV advert to the opportunity to spend up to 15 minutes having a direct conversation with your target consumers.”

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