Snapchat has published a new research report that uses marketing mix modeling to provide more perspective on how Snap ads contribute to Consumer Packaged Goods (CPG) sales. The report also touches on Snapchat’s effectiveness as a channel for CPG brands.
One major challenge in CPG marketing is that as CPG items are purchased either online or in-store, that makes direct digital campaign attribution slightly more complicated. ‘Marketing Mix Modelling’, which makes use of point-of-sale information, along with internal and online data points, provides a more accurate view of overall ad impact, which is always the clearest from just online data.
CPG-Good?
Snap commissioned Nielsen to conduct a series of studies to gauge its platform’s effectiveness for CPG brands, as well as to provide a broader view of how Snap ads helped drive results for advertisers in the beauty and CPG categories within the US.
Snap explains:
“First, we analyzed return on investment (ROI) benchmarks using Nielsen Compass’s MMM Normative Benchmarking database for rolling 104-week benchmarks in Q4 2020 as well as the previous two quarters of back data. Then, we selected a representative set of five US advertisers within the Personal Care and Beauty vertical, and Nielsen constructed an aggregated dataset of each advertiser’s sales, Snapchat ad spend, ad spend on television, and spend on other digital channels using their Ad Intel dataset, pricing information, and other variables.”
The data set isn’t particularly large, seeing as how results have narrowed it down to only 5 advertisers. However, these results do indicate the effectiveness of Snap ads for BPG brands in terms of maximizing reach and product adoption.
First, based on Nielsen’s benchmarking database, results show that Snap ads generated around two times the ROI compared to overall media, social, and digital benchmarks. On that note, Snap ads have been found to also provide better ROI than social, online, video, and TV advertising.
“Snapchat showed 1.7x the return on ad sales compared to television advertising and is 2.7x more effective at delivering sales for advertisers.”
The analysis also looked at AR campaigns and at how Snap’s Lens tools potentially enhance CPG marketing results by allowing people interact and engage with product promotions, when compared to static campaigns
The Wrap
There are a few additional qualifiers that make it here, including audiences that you’re trying to teach, and the products themselves being marketed. Aiming to connect with older consumers voids all these, as they would most likely don’t even know what Snapchat is. However, should your target be within the platform’s intended age bracket, then the data here points out to Snap being a rather powerful tool in augmenting CPG campaigns.
A lot really boils down to creative, which not all brands are able to produce or at least maximize on. AR campaigns and promotions have proven to be more beneficial, given that one is capacitated enough to use them. The data here suggests that these elements could be well worth the extra investment. Either way, AR is evolving and stands to lead entire industries in the near future.
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