Marketing textbook, chapter 8

Advertising impact research through geo-experiments using the example of Eucerin. Think with Google: How video advertising influences stationary sales: Eucerin increases sales by 10 per cent.

According to Nielsen, advertising expenditure in the „Pharmaceuticals“ segment rose by 1.3 per cent in 2018 compared to the same period in the previous year. Online marketing expenditure is also growing. Proof of effectiveness is becoming increasingly important for the industry to demonstrate the success of corresponding marketing measures. Among other things, advertisers want to know whether and how online advertising can influence sales in brick-and-mortar pharmacies. In a joint pilot project, Google and Eucerin have analysed the effectiveness and efficiency of YouTube ads using a geo-experiment. Result: 10 per cent more sales and higher ROI in a benchmark comparison.

We spoke to Melanie Schaub and Ludwig Brütting from Google as well as Kwesi Ofosu and Florian Renz from Eucerin. They present an example of success and the results of the project.

Think with Google: What relevance does online marketing have for cosmetics sold through pharmacies and what challenges do you currently see?

Kwesi Ofosu, Director Marketing & Digital, Eucerin Germany: Some people in the industry are hesitant about online marketing. While search engine marketing is an integral part of the marketing mix, we have observed that there is still a great deal of reluctance when it comes to other forms of advertising such as online videos. One reason for this is that it is difficult to prove success, especially the impact on sales. In the sector, most sales are generated via bricks-and-mortar pharmacies. This is why we are not only interested in KPIs such as impressions or clicks for online measures, but also consider the stationary sales figures to be crucial.

Think with Google: How did you measure the impact of advertising on sales in pharmacies?

Ludwig Brütting, Research Manager, Google: One approach that is used in many industries is based on so-called geo-experiments. The basic idea is as follows: A campaign is only played out in a specific region. The sales of this region are then compared with those of another, second region in which the campaign was not played out. However, one difficulty in the pharmaceutical industry is the availability of data, as sales take place in pharmacies and the manufacturer or advertiser does not have this data itself.

Florian Renz, Manager Consumer & Market Intelligence, Beiersdorf AG: "The need to prove the impact of online advertising on sales in pharmacies is one of the key requirements for market research. This is particularly true in our sector, which works with significantly lower advertising budgets than the FMCG sector. The methodological requirements in the pharmacy cosmetics sector are extremely high with an associated smaller reach. Not least because products sell much more slowly than in the mass market, traditional advertising approaches based on surveys are almost impossible. For this reason, we in Eucerin Market Research decided to work with Google and IQVIA to find out whether regional targeting is compatible with the regional sales data from the IQVIA pharmacy panel.

Think with Google: That sounds exciting. Can you describe the approach in more detail?

Brütting: The initial question of the project was whether YouTube video adverts can influence offline sales for the Eucerin brand. In order to answer this question, we first asked IQVIA to select a region that was as representative as possible for the whole of Germany in terms of Eucerin sales based on the sales data from their pharmacy panel. In the next step, we worked with Eucerin to set up a YouTube campaign that was only played out in this region - in our case, large parts of North Rhine-Westphalia - using geographically limited targeting. In order to analyse how Eucerin sales changed in this region, IQVIA identified a statistical twin - i.e. a very similar pharmacy in terms of sales volume and location - from the rest of Germany for each pharmacy in the test region.

Renz: The actual sales effect of the YouTube campaign was analysed by checking whether more Eucerin products - our Dermopure range products - were sold in the test pharmacies compared to the control pharmacies. For this purpose, Eucerin sales during the campaign period were compared with sales in a previous period of the same length in both the test and control pharmacies. In this way, seasonal influences could be excluded. In addition, we also checked the results for existing promotions and training of pharmacy staff. The difference in sales between the test and control pharmacies in the campaign and previous period ultimately resulted in the net effect: Eucerin sales in the test pharmacies were ten per cent higher than in the control pharmacies. This was a very good result for us. However, we were also interested in the efficiency of the campaign. The ROI of our Eucerin YouTube campaign was EUR 0.42 in relation to sales during the campaign period. In a benchmark comparison with other moving image channels, this is a really good value for our category. The long-term and loyalty effects were excluded, and the effect on online sales was not evaluated.

Think with Google: Can you perhaps give us a few more details about the YouTube campaign - what were the success factors from your point of view?

Melanie Schaub, Industry Manager, Google: Two YouTube videos were used: a skippable 15-second advert and a 6-second bumper ad. What both have in common is the strong focus on the Dermopure product and the call-to-action to ask for it in the pharmacy. It is also important to attract the user's attention. This was achieved by visualising the skin problem of acne. Targeting also played a role. For the campaign, we used signals that showed us that the user was ready to buy a face care product. Where possible, we even targeted the video playout on YouTube to specific searches for „blemished skin“, „pimples“, „blackheads“ or „acne“.

Think with Google: A really exciting project. Finally, do you have a conclusion for us?

Schaub: We have managed to achieve impressive results with the pilot. Sales for the Dermopure product range increased by more than ten per cent in the region with the YouTube campaign.

Ofosu: For the first time, we have succeeded in developing a methodology that shows the advertising impact of digital communication measures on bricks-and-mortar pharmacies. We were able to prove that even targeted digital advertising measures can increase sales in pharmacies. The ROI achieved during the short campaign broadcast is a very good result that exceeded our expectations.

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Sources:

• https://www.thinkwithgoogle.com/intl/de-de/marketing-strategien/video/eucerin-steigert-mit-youtube-kampagne-abverkauf-stationaeren-apotheken-um-10/ (as at 27 June 2022)