Every peso counts: Study finds media underinvestment is costing Philippine brands ROI

Senior marketers and agency leaders are being urged to rethink how they allocate media budgets, as fresh data reveals that underinvestment – rather than channel inefficiency – may be eroding returns for consumer brands in the Philippines.

At a closed-door industry session themed “Every peso counts: Media that works for consumer brands in the Philippines”, organised by adobo Magazine, stakeholders examined how tightening budgets, declining television consumption, and mounting accountability pressures are reshaping media decision-making.

The discussion centred on new research from Analytic Edge, a C5i group company, which analysed marketing mix modelling (MMM) data across 11 FMCG brands in the country. The study was anchored on the principle of “media sufficiency” – investing at the level required for a channel to perform optimally, rather than spreading budgets too thinly across multiple touchpoints.

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Data points to misaligned investment

While television continues to command a dominant share of ad spend, the study noted that TV consumption in the Philippines is in decline. In contrast, short-form video platforms such as TikTok have seen rapid growth in both audience attention and advertiser interest. Media spend on short-form video has surged from just 1% to 17% over five years, reflecting the shift toward mobile-first viewing environments.

Yet performance contribution and budget allocation are not always aligned.

Across the 11 brands modelled, TikTok led ROI performance in roughly 70% of cases, delivering average returns of around 2.2 times. In consumer packaged goods, the platform recorded relative ROI levels of 2.42 times, and in some comparisons delivered up to 4.7 times the return of other media channels. Within food and beverage, its ROI was approximately 1.7 times that of total media.

Despite this, TikTok accounts for only 5–6% of total FMCG media spend, suggesting that investment levels may lag behind its sales contribution.

The modelling also found that many brands are operating below sufficiency thresholds, particularly in high-impact, full-funnel digital environments. For TikTok specifically, optimal performance was observed when investment reached between 86% and 160% of current levels, indicating significant headroom before diminishing returns take effect.

According to the analysis, underinvestment is increasingly becoming a key driver of lost ROI.

Extending reach beyond television

The study further explored the interplay between TikTok and linear TV. Audience overlap between the two channels stands at approximately 48–49%, meaning that more than half of TikTok’s reach is incremental rather than duplicated from television.

When both platforms were deployed together, the modelling showed an incremental awareness lift of around +24.6%, suggesting that diversified, sufficiency-led planning can enhance total campaign impact rather than merely repeating exposure.

In practical terms, this challenges the assumption that digital video simply cannibalises traditional reach. Instead, the findings indicate that integrated deployment may strengthen overall effectiveness when budgets are calibrated correctly.

From high-ROI channels to high-impact planning

Padmanabhan Ramaswamy, managing director for Southeast Asia at Analytic Edge, stressed that the core issue is not identifying which platforms perform well, but whether brands are funding them at the right level.

“What this study highlights is not simply which platform performs well, but whether budgets are aligned with modeled sales contribution. Media sufficiency is about investing at the right scale so that channels can deliver their full potential, rather than being underfunded and misunderstood,” said Ramaswamy.

The findings challenge conservative allocation habits rooted in legacy reach-based planning, particularly as media fragmentation accelerates and performance accountability intensifies.

For Philippine advertisers, the message is clear: effectiveness in today’s environment depends less on chasing new channels and more on calibrating investment levels with disciplined, data-led sufficiency thresholds.

As scrutiny over marketing performance deepens, industry leaders at the session signalled a growing consensus – the next competitive edge will come not from spreading budgets wider, but from investing them wisely.

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