Optimal Frequency Revisited

For decades all the evidence pointed to reach rather than frequency as the thing to focus on. Colin McDonald’s landmark study inventing singlesource and coining its name showed that one or at most two exposures were enough frequency to drive purchase change. Today’s work by Mike von Gonten and David Hoo shows reach killing frequency as a penetration driver.

Mike Naples and Herb Krugman are the people best remembered for their work in determining ideal frequency levels, and both came up with the magic number of three exposures.

Erwin Ephron and John Philip Jones popularized the notion of Recency, the idea that people should be reached often enough such that whenever they go to the store they have seen your ad most recently. What most people don’t realize is that this reflects frequency. Recency is the back door through which frequency comes back into media consciousness.

Some media folks err by analyzing reach over long periods of time relative to the velocity of the purchase cycle for fast moving goods. If people are buying yogurt weekly to any extent then it is important to look at one week reach/frequency and meaningless to look at four week. Frequency should always be looked at through the lens of Recency. A study of Arbitron Scanamerica data years ago by Leslie Wood showed big increases in sales for brands whose ads hit the person within 24-48 hours before the shopping trip, especially with frequency of two in that window.

Todd Dickson, the Chief Revenue Officer of Empire Today, a nine-figure per annum TV advertiser in the U.S. selling floorings, shared some interesting results with me recently. Using customer records and media data he was able to determine his optimal frequency level, which was much higher than the Naples/Krugman estimate. He was disturbed by the distribution of frequency in the campaign he had been running because so many impressions were delivered way below or way above the optimal frequency level.

He decided to try a media optimizer as a way of shaping a TV schedule to bunch frequency around the optimal level and suck it away from the extremes. We all know how difficult it is to change the tendency for 40% of the heaviest viewers to get virtually 80% of the impressions. And yet Todd was able to change ET’s second quarter 2013 schedule to maintain reach against his purchaser target, improve the frequency distribution, and save ~10% of dollars all at the same time. I was surprised for example when he showed me the frequency distribution results of six large markets, and how he reduced the number of viewers who saw an ad at “way below” optimal frequency levels. Ultimately, I concluded that Todd was able to take a large subset of viewers and increase the number of exposures from less than desired to closer to the optimal frequency range.

Over the past five years I’ve been amused and bemused on a number of occasions on which I was told by a senior media person at a large advertiser that “ROI is not why we use TV, we have direct mail for that.” Such folks think of TV for awareness and do not realize that the only reason they want awareness is to lead to ROI. Like the many media buyers who don’t realize they use a sex/age group because of its overlap with a purchaser target. After a while we humans forget the reason we do things, and doing them by rote becomes the apparent end in itself.

It’s a good thing that we have people like Todd Dickson to wake us up every now and then. Retailers and direct marketers have always been known for their tough-mindedness and for keeping their eyes on the ball of ROI. In Empire Today, however, we see not only the retail genes but also an emphasis on excellence and optimization. This is a great combination to produce stockholder value.

Bill Harvey is a well-known media researcher and inventor who co-founded TRA, Inc. and is its Strategic Advisor. Bill can be contacted at bill@billharveyconsulting.com

Read all Bill’s MediaBizBloggers commentaries at In Terms of ROI.

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