What is halo, anyway?

Halo means that media that is supporting or “heroing” one product also has an ‘overspill’ effect on another. In (econometric) modelling terms that means that when for example a manufacturer advertises, say their fish fingers, it also has a detectable sales impact on their beef burgers.

” ‘Fish fingers,’ I said, ‘Sell. More. Fish. Fingers.’ And what do you give me? Beef burgers.” Somewhere, right now, this very exchange is taking place, and it’s all down to halo.

Why does this happen? At first glance it does sound like an odd thing. But much is bound up with two main themes, as follows.

1. The advertising architecture

If there is a very clear and strong advertising ‘device’ that a company uses for all its products, then it may be that consumers get a broader message (think Andrex puppies). The latest ad may be for quilted toilet tissue, but, when asked, consumers may just say, “Oh it was an Andrex ad, I can’t recall what for.” When the brand is modelled (not by us – this is purely a hypothetical example) we may see that sales increase across the whole Andrex range. The downside of this of course is that it may be hard to get across specific product messages under a strong advertising property. Consumers just say, “Oh, it was an Esso ad, with the tiger” or “Oh, it was a Go Compare ad with that annoying opera singer”.

Wayne auditions for the loo-roll gig but bombs out (“That’s wonderful, Wayne, really great, but we’re thinking we want to go in a different direction with this one.”)

2. Market structure

If you work on a brand that has many formats that all perform the same basic function and share the same basic positioning, but appeal to different users, then you may see that consumers see an ad for one format but translate that into their own buying preference. Hence if you advertise laundry tablets you may find that users of laundry liquid are impacted. If the usages are different however, this is less likely to take place. Think about something like Heinz baked beans and Heinz salad cream. We would not expect a strong halo here. More on market structure later.

So why do we care?

Advertising is a multiplicative effect. It uplifts proportionately to the ‘base’ (underlying) sales of each product it affects. So, if you advertise a small product and it doesn’t halo, then the ROI will be limited, regardless of how good the sales uplift for that product is.

A simple example helps illustrate this. In this case the ad we deploy generates no halo and produces an ROI of 0.1.

Product Sales (£000) Sales multiplier Media impact (£000)
A 5,000 10% 500
B 15,000 0% 0
C 25,000 0% 0
D 55,000 0% 0
Total 100,000 500
Media Cost 5,000
ROI 0.1

Now suppose we make another ad for Product A. We design it so that it talks not just about Product A but about the whole range. The uplift on A is not quite as good, but we start to get some halo.

Product Sales (£000) Sales multiplier Media impact (£000)
A 5,000 5% 250
B 15,000 3% 450
C 25,000 3% 750
D 55,000 3% 1,650
Total 100,000 3,100
Media Cost 5,000
ROI 62%

Now that’s better. We still spend the same on the media but the ROI is over 6 times better.

She thinks so, too

So why doesn’t everybody do this?

It’s difficult, creatively speaking. A good ad often focuses on the benefits of one product and dramatises that. You may have a specific claim you can make. It might be a new product that you want to support at launch. It’s just hard to make a compelling ad that works across a whole range and you may not want to dilute the focus of your communication anyway.

But the key thing here is that you must then set your expectations of the ROI you will get from a non-haloing ad for a small product i.e. not a lot. This is often an issue for new products. They are usually very small in comparison to the parent brand. Due to their negligible size at launch, they will never register as good an ROI the parent brand (although you do usually get a slightly higher % uplift for NPD). But you have to support NPD at launch, you have no choice. So can you make an NPD ad that also supports the whole range? Possibly, but it’s tough. And you may not even want to for a number of reasons.

In summary

ROI is all about maths. Media is multiplicative, so supporting bigger products almost always works better. You can’t escape that. Think about whether your portfolio is suitable to chase halo and if you even want to do it. Set your ROI expectations accordingly. Challenge your creative agency to think about ways of driving halo across the range.

Make your advertising work harder – come and say ‘halo’.

Tom Lloyd

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