Study: Event Marketing Drives Purchases
By Tom Ryan
A new survey by the Advertising Research Foundation shows in-person events can boost purchase intent as high as 52 percent.
The study found that “purchase intent” – a customer’s stated interest in buying a product – rose from 11 percent to 52 percent among consumers who attended brand-sponsored events, including sports championships, walkathons and theme parks. Such purchase intent translated directly to sales about 50 percent of the time, the report states.
ARF studied 12 companies including Coca-Cola, Frito-Lay and State Farm that ran such events. Harris Interactive polled about 5,000 consumers online after the events’ conclusion.
“We used two research firms and three different analyses and it all ended up at the same place: experiential marketing works,” William Cook, ARF’s senior vice president of research and standards, told Brandweek.
Success results included companies like State Farm that have no product to give away at such events. “It’s an added opportunity to create awareness about your brand in relevant situations,” said Mark Gibson, assistant vice president of advertising at State Farm.
On the B2B side, similar results were found. According to a survey of 2,000 attendees of trade shows in the spring or summer, 20 percent said they would have bought the brands that were exhibiting regardless of their attendance at the show. However, purchase intent rose to 54 percent when customers interacted with the 14 different brands studied. Cisco, Dell and Microsoft were among the brands measured across four different trade shows. Nearly half (46 percent) of attendees felt they had an “emotional connection” with the brand after interacting with it at a trade show. Only 15 percent said they would have made that claim regardless.
“The special value of events, sponsorships and trade shows has to be considered,” Raymond Pettit, co-author and svp at MarketShare, told Brandweek. “There are many connection points you can build at an event whether it is emotional, aspirational or awareness building – it goes beyond just counting audience attendance.”
Drew Livingston, owner of TrashTalkFCM, a non-traditional agency that also participated in the study, believes more research still needs to be done to understand the value of event marketing. “The goal is to level the playing field with traditional media.”
Discussion Question: Do you think event marketing should become a bigger portion
of consumer brand and retailer marketing efforts? What do you see as the keys
to maximizing event marketing effectiveness?
Like anything else, event marketing done well is an excellent opportunity to connect with consumers in a relevant and resonant manner. Done poorly, the old booth and banner syndrome, will do little to have a lasting impact on consumer loyalty.
The theater and entertainment value of event marketing allows for an interactive connection. This should be kept in mind when activating such an event. It needs to be highly interactive, not passive and it should support the overall brand strategy.
It all depends on what you’re selling. Event marketing is great for trial and if a single purchase takes a customer out of the buying cycle for a long time, i.e., a computer, a television, a car, etc. it’s well worth it. Not sure how it impacts CPG purchases long term, though.
Event marketing is one tool available to a marketer. It needs to be considered in the context of an overall marketing plan. Events marketing can become quite costly, while reaching a small fraction of the overall target audience population. At the same time, they do provide a hands on experience for consumers, which can help form the emotional bond cited in the research.
Event marketing enhances multiple sensory engagement, which connects to consumer/shopper emotions and drives relevancy, short term and long term. That is not to say, however, that marketers can count on one experience to drive long term brand loyalty, given the rapidity with which the consumer relevancy filter is changing.
But in a well layered/integrated marketing plan, especially one that is focused on driving purchase, event marketing expands the touchpoints and emotional connections, helping to drive results by creating memorable and meaningful connections to brands. When done in retail settings, the correlation to purchase behavior can be staggering, and the longer lasting impressions can have a lingering positive impact for both brand and retailer.
Event marketing is an area of traditional marketing (I say traditional because even though it’s not mainstream, it still has been around a lot longer than newer channels like blog, social and viral marketing) that probably has been measured the least. So it is great to get some benchmarks.
That said, increasing spending on any element of marketing should not be driven solely on their impact on purchase intent. Purchase intent doesn’t have a 1 to 1 relationship with sales.
It is also important to measure the impact of all tactics on actual sales using quantitative techniques like marketing-mix models and optimization to simulate the sales impact of modifying spend in different marketing channels and identify the weighting that has the greater impact on sales. How much should be spent in one channel is a combined function of sales per dollar driven by that tactic and the diminishing returns rate for that channel.
In the fashion industry, event marketing can be a fabulous way to present your product and services to the customers. Going as far back as simple old fashion shows to today’s more upscale events including demonstrations, parties, and charity tie-ins, this has become a very profitable, usually affordable and effective way to get the message out.
With everybody in the world marking down merchandise and trying to have price wars, this is one place that price means nothing. Customers are drawn to the excitement of “Event” and the party atmosphere of companionship and socializing. They are willing to pay more for the experience, and small stores and individually owned retailers are reaping the rewards.
Familiarity breeds consent. Events can help make a product or service more familiar to a portion of the target audience. But purchase intent is a notoriously slippery metric and the emotional ties the researchers call “affect” are only a precursor to potential action, not a guarantee it will happen.
As an element of the message “fog” that marketers try to surround us with, event marketing surely has an honored place. For some prospects, an event experience may serve as the “tipping point” that pushes awareness over to advocacy or advocacy to action. For others, it may be the first moment of awareness along the long road to the first moment of truth.
Also worth considering as we seek understanding of these results: Event participants are by nature a self-selected sample. Despite all these caveats, I should say that I am a proponent of event marketing as a welcome flavor note in the marketing stew. Events and sponsorships bring brands to the people and make them feel more accessible and maybe even more human. This is therefore useful research–as long as we don’t infer too much from the results.
Intent to purchase does not equal an actual purchase.
While I have always been partial to relevant event marketing, one must measure success or failure based on actual sales results, not stated intent.
Event Marketing gives you the chance to appeal to all five senses. Success is achieved when you appeal to consumers and their multiple senses. Nascar and other major sporting events hits both sound and feel with the load noises and base tones. In-store sampling hits both sight and taste. Hit more senses and you’ll achieve more success.
I’m a heavy supporter of event marketing IF it has relevance and value to the folks shopping the store or exposed to it. No, it doesn’t garner mass exposure, but it can create significant buzz and brand allegiance–which feeds directly into the “network effect” that many brands seek. It also moves shoppers quite nicely down the purchase funnel of awareness to experience and, therefore, ups the chance for sales in a big way. This said, more and more brands are seeking to do it and it’s important that retailers manage it and not turn stores into frenzy of activity that may or may not be valuable to their customers. Like everything else, planning, strategy and communications integration are key.
Event marketing can be a wonderful tool to engage target consumers, generate very positive imagery and feelings of goodwill toward a brand/service, and provide an opportunity for face-to-face interaction. It works best for companies who do the following: become involved in strategically-relevant events (i.e., powerbars, athletic apparel and energy foods for marathons) and create unique and memorable participation tactics. Event marketing can provide an ideal audience for a product with a narrow target audience. It can provide an opportunity for a lot of “quality time” spent with a very receptive consumer. And it can provide great ROI when smartly planned and executed.
It’s all about relevance. Personal interaction with a brand through an event can certainly raise intent if the brand has relevance and the event showcases it. For example, a brand of motor oil sponsoring a NASCAR event. Or, if the brand is a commonly purchased item (such as a soft drink or candy bar) and the event simply brings it to top of mind.
However, event marketing is only one element of a marketing program and it may not work as well for brands that lack connection to the event or relevance for the event goers.
The example says Purchase Intent goes from 11% to 52%–my calculator says that’s close to a 400% increase. Joy rightly points out that there is not a 1-to-1 correspondence between PI and sales. I’ve got to say, I don’t think anything increases sales 400% over the long term. I’d look closely at the research methodology before believing this data. That doesn’t mean event marketing is not a good tool, but expectations need to be realistic and 400% isn’t.
Companies are smart to include event marketing as part of their overall brand building strategy. As the study shows, experiential marketing is successful in that it creates an “emotional” connection with consumers–something which today’s consumers long for, yet are woefully lacking in nearly all of today’s marketing efforts and retail initiatives.
Since forever, bookstores and book publishers have built each other’s sales using event marketing: author tours, readings, book signings, book discussion clubs, etc. Paid advertising is almost always unprofitable in the book business. Author events generate free media publicity in newspapers, TV, radio and online. Shoppers are thrilled to see their authors in person, as celebrities, and the word-of-mouth is phenomenal. You can’t stop folks from talking about the authors they’ve seen in person. Any retailer that can use event marketing should never pass up the opportunity. When done well, the leverage can’t be beat.
I agree that event marketing should be part of an overall marketing plan. It needs to be measured to judge its true effectiveness as part of that plan. And it needs to be memorable. The recent launch of the last Harry Potter book provided numerous opportunities for event marketing in retail, shopping centers, book stores etc. which were truly memorable (and fun) for consumers and especially their children, the consumers of tomorrow.