The Nielsen Company has found that high blog interest, or buzz around new product launches is closely related to paid media spending.
After examining blog buzz volume, ad spending, purchase intentions and actual product sales, Nielsen found the best indicator of blog buzz around a newly launched consumer-packaged goods (CPG) is a large advertising budget. The report “The Origin & Impact of CPG New Product Buzz” was from Nielsen BuzzMetrics and BASES, a provider of new product forecasting and consulting.
The report looked at 80 new CPG products across a number of subcategories, launched in the U.S. between 2005 and 2006. On average, the top 10 percent of products with the most blog buzz, spent close to $20 million on paid media for the launch. Companies that received the next 40 percent of blog buzz spent an average of $15 million and companies that were in the bottom 50 percent spent an average of $5 million.
“Splintering media sources along with emerging consumer-generated media are challenging one-way, mass-media advertising models,” said Robert Mooth, vice president of product development, for BASES, and an author of the study.
“However, our analysis shows that traditional mass media continue to play a critical role for most CPG brands. What has changed is that online buzz and consumer expression have entered the fray, resulting in a complex yet inseparable relationship within the overall marketing mix for many types of products.”
Not all CPG subcategories and products had the same level of blog buzz. Ten percent of brands accounted for 85 percent of total CPG blog buzz in the study. Over-the-counter drug brands have a higher blog buzz due to consumer’s involvement with them.
“Most CPG products are ‘everyday’ items, lacking in distinction and therefore propensity for buzz,” said Kate Neiderhoffer, director of methodology, Nielsen BuzzMetrics.
“However, there are some exceptions to the rule, as evidenced by brands like Red Bull, Altoids, Crystal Pepsi and Viagra. The CPG industry should challenge itself to bring more innovative products to market, cultivated with more innovative marketing. The buzz will follow.”
