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Insight
30 . 05 . 18

Get the facts: planning for profit

Words by: Print Power
Recent research by Newsworks and Benchmarketing shows that increasing print newsbrands’ share of media spend could more than double the current campaign profit return on investment – and unlock an additional £3 billion in profits.
Planning for Profit- Get the Facts.jpg

In their words:

“It is a truth universally acknowledged that a brand investing money in advertising must be in want of a return (with apologies to Jane Austen!). No advertiser spends just for the sake of it, they do so to deliver business results…”

Our latest study… focuses on the total campaign profit delivered by investing in newsbrands. Importantly it quantifies the effectiveness of both print and digital newsbrands for the very first time.”

Key findings:

Profit return on investment (PROI) is the revenue generated by advertising campaigns divided by the profit margin for each client over the short- to medium-term.

Motors

- 2017 media spend: £977 million.
- On average, 4 percent of media spend is invested in print newsbrands, eliciting a campaign profit of £39 million.
- To maximise PROI, it is recommended that a minimum of 7 percent of the total media budget is allocated to print newspapers and 2.6 percent to digital newsbrands.
- Clients are losing out on £56.2 million potential profit through underinvesting in newsbrands, particularly print.

Finance

- 2017 media spend: £1.5 billion.
- On average, 2 percent of media spend is invested in print newsbrands, eliciting a campaign profit of £56 million.
- To maximise PROI, it is recommended that a minimum of 9 percent of the total media budget is allocated to print newspapers and 5.6 percent to digital newsbrands.
- Clients are losing out on £264 million potential profit through underinvesting in print and digital newsbrands.

Supermarkets

- 2017 media spend: £579 million.
- On average, 6 percent of media spend is invested in print newsbrands, eliciting a campaign profit of £204 million.
- To maximise PROI, it is recommended that a minimum of 19 percent of the total media budget is allocated to print newspapers and 1 percent to digital newsbrands.
- Clients are losing out on £246 million potential profit through underinvesting in newsbrands, particularly print.

Retail

- 2017 media spend: £1.66 billion.
- On average, 4 percent of media spend is invested in print newsbrands, eliciting a campaign profit of £132 million.
- To maximise PROI, it is recommended that a minimum of 5 percent of the total media budget is allocated to print newsbrands and 3.7 percent to digital newsbrands.
- Clients are losing out on £1.34 billion potential profit through underinvesting in newsbrands, particularly print.

Sam Tomlinson, partner & leader - Marketing & Media Insight Team, PwC UK:

“In a similar vein, the recent Radiocentre report ‘Re-evaluating Media’ highlights the gap between perceived and actual effectiveness of media, reminding the marketing world of the enduring value of proven media such as television, radio and print.

“And indeed, the PwC and Newsworks study ‘The Battle for attention’, back in 2016, highlighted the link between consumer trust in proven media and in its advertising, which was contrasted with the relative lack of trust in social media and pre-figured the current high-profile challenges now faced by the social media giants.”

“In this context, it’s really heartening to read this important new study by Newsworks and Benchmarketing. Their key thesis – that marketers should pay close attention to brand-building and profits when assessing the ROI of marketing spend – could not be more apposite in today’s world.”