Do you know what your ESOV is and how to capitalise on your current ESOV to improve the success of your business?
ESOV
As a business owner, how confident are you that your presence on social media brings you the returns essential for your business's sustainability?
Do you know what your ESOV is and how to capitalise on your current ESOV to improve the success of your business?
What is ESOV?
Extra Share of Voice (ESOV) is a marketing metric that measures your brand's advertising presence in the market compared to its overall market share. It quantifies how much your company is spending on advertising relative to its market share and is used to evaluate the level of advertising investment required to achieve your specific marketing goals.
How is ESOV calculated?
The Share of Voice (SOV) of your digital marketing is calculated as the goal completions of your current campaign (for example, the brand mentions for social media or click-throughs for organic search), divided by the total number of goal completions of all your competitors in that same amount of time:
Share of Voice = Brand’s visibility value (via relevant metric) divided by the total market visibility value
For example, if your brand was mentioned on social media 200 times in the last week, and every brand in your category was mentioned 2000 times, then you have a 10% Share of Voice in terms of social media mentions [1].
Your Extra Share of Voice (ESOV) is when your Share of Voice exceeds its share of the Market.
For example, if your brand generates 10% of sales in its category but owns a 15% Share of Voice, then your Extra Share of Voice (ESoV) is +5.
Two components to be aware of when looking at ESOV are:
1. Your Brand's Share of Advertising Voice: This represents the portion of total advertising in a specific market that is dedicated to your brand. It is typically measured in terms of your ad spend or impressions and shows how much you invest in advertising relative to your competitors.
2. Your Brand's Share of Market: Your brand's actual market share indicates its percentage of total sales or revenue within a given market or industry.
The importance of ESOV for businesses and brands.
ESOV is essential for businesses and brands because of its role in marketing strategy and brand growth. Numerous studies have proven that “overinvesting” in marketing by generating Extra Share of Voice is a powerful way to drive Market Share growth. On average, for every ten positive “points” of ESoV, a brand will gain 0.5% market share. In times of economic downturn, increasing market share for a brand can mean the difference between surviving and thriving or going bankrupt.
ESOV and mental availability.
Investing in ESOV drives market share growth because of a related concept: mental availability.
Mental availability is simply that in situations where the brand is relevant, the likelihood of it coming to the consumer’s mind is determined by how strongly it competes with everything else that may also fit the role [2]. For example, when people think of fizzy or carbonated drinks, the two most common brands that come to mind are Coca-Cola and Pepsi. By investing in ESOV, these two brands have created the situation where consumers, when thinking of buying a fizzy drink, will most commonly think of these two brands, as against all the other brands competing in that market space. Coca-Cola and Pepsi have used ESOV to ensure consumer mental availability.
This building mental availability is crucial for brand growth. Brands that have higher mental availability have higher market share.
How can businesses and brands improve their ESOV?
Businesses and brands can improve their ESOV in several ways.
1. Increase advertising budget.
Increasing the advertising budget is one of the most straightforward ways to improve ESOV. In other words, you can increase your brand's visibility by spending more on advertising than your market share would suggest. However, it is essential to remember that simply increasing the budget on a poorly executed advertising campaign will not necessarily bring a larger market share of growth. A poorly executed advertising campaign will turn customers away no matter how much money is spent on advertising. It is essential to ensure the campaign is on target with customers and messaging before increasing the advertising budget.
2. Focus on key marketing channels.
Not all marketing channels are effective for brands. Identifying the most effective marketing channels for your target audience and allocating a larger portion of the budget to those channels is essential. This ensures that your advertising efforts are concentrated where they can have the most impact.
3. Competitive Analysis
Monitoring your competitors' advertising spending and strategies when building your ESOV is essential. If the competition invests heavily in advertising, you may need to increase your spending to maintain or improve your ESOV. Not all companies or brands may have the time or knowledge to monitor and evaluate advertising spend and strategies. This is where engaging Tonic Digital can assist companies and brands in building their ESOV and ensuring that their advertising spend creates maximum mental availability in consumers’ minds.
4. Content Marketing
Investing in content marketing that creates valuable and engaging content to attract and retain customers is also paramount. High-quality content can drive organic traffic and enhance your brand's online presence. As mentioned above, ensuring your brand creates valuable and engaging content is essential.
On average, for every ten positive “points” of ESoV, a brand will gain 0.5% market share.
5. Knowing what you know, getting assistance for what you don’t know.
We have already spoken about the importance of conducting a competitive analysis to ensure your brand is investing its advertising dollars in ways that will bring the best return.
There are other areas within advertising and social media where assistance can ensure your brand is building its ESOV effectively. For example,
a) paid search advertising
This is knowing how to optimise your paid search advertising campaigns to ensure that your ads appear prominently in search engine results. Bidding strategies and keyword selection will influence your ESOV in this channel. With their expertise, Tonic Digital is well-placed to assist brands with bidding strategies and keyword selection to enable them to build their ESOV.
b) social media advertising.
Knowing how to leverage social media advertising platforms to target specific demographics and boost your brand's visibility is also essential in building ESOV.
6. Test and experiment
Building ESOV is not something that is done once. It requires experimenting with different ad formats, creative elements, and messaging to find what resonates best with your target audience and using A/B testing that can help refine your campaigns over time. This takes time, experience, and a deep understanding of the dynamics of social media.
As part of testing and experimenting to monitor the effectiveness of advertising campaigns, data analytics and key performance indicators (KPIs) can help make informed decisions about any changes that may be required.
7. Customer feedback.
Lastly, but most importantly, listening to customer feedback and adapting advertising strategies is essential. This can help you align your messaging and improve the overall customer experience.
Improving ESOV requires a strategic approach that considers your business goals, competitive landscape, and target audience. Balancing your advertising spending with your overall marketing strategy and financial resources is essential. However, neglecting ESOV can have several negative consequences for businesses:
1. Decline in your brand's equity
Brand equity is your brand's perceived value and reputation, which is often influenced by its online presence. Low ESOV can lead to decreased brand recognition and trust among your consumers.
2. Loss of Competitive Advantage
In today's digital age, many businesses rely on social media to gain a competitive edge. Ignoring ESOV means missing out on valuable opportunities to differentiate your brand from competitors, engage with your customers, and stay top of mind in your industry.
3. Missed Marketing Opportunities and Opportunities for Innovation.
Social media is a powerful marketing tool that allows businesses to reach a broad audience with targeted messages. Neglecting ESOV means missing out on effective marketing campaigns, customer acquisition, and lead generation opportunities.
Social media also provides insights into customer preferences, trends, and market developments. Hence, ignoring ESOV means missing opportunities to gather feedback and data to drive your brand's innovation and product development.
4. Negative Impact on consumers and the public.
Several negative impacts on the public and consumers will quickly kill a brand.
● Ineffective Social Media Strategies: Without monitoring and analysing ESOV, your business will not understand what works and what doesn't on social media. This can lead to ineffective social media strategies that waste time and resources.
● Decreased Customer Engagement: Social media is a platform for two-way communication between businesses and customers. Neglecting ESOV can result in reduced customer engagement. Consequently, customers may feel ignored or undervalued, leading to decreased loyalty and customer retention.
● Negative Public Perception: Negative social media activity, such as ignoring customer complaints or failing to respond to inquiries promptly, can harm your brand's reputation. Negative sentiments spread quickly on social media and, if left unaddressed, can impact public perception.
Ultimately, the consequences of neglecting ESOV can lead to a loss of revenue. A weaker online presence and diminished brand value can decrease sales and profitability.
To avoid these adverse outcomes, businesses should pay attention to their ESOV and actively manage their social media presence. This includes regularly monitoring social media channels, engaging with customers, analysing data, and adjusting strategies to ensure a positive and impactful online presence.
The ESOV you create on social media is essential to the profitability of your brand.
