Hello YouTube, there are some fundamental concepts around media that a lot of marketers either don't know or they don't realize why they are so important and one such measure is reach. Irrespective of whether you're in B2B or B2C marketing reaches something that is extremely critical to know because it's not just a measurement term but it is also an important part of the media strategy. And therefore in today's video I'll not only explain what reach is but also tell you why is it so important. My name is Rahul and I'm the creator of Decode Strategy Labs which is a marketing consulting and education company. There are three quick things that I need to tell you about before I start with today's video. One, I provide an online course on strategic marketing which is a must do if you are someone who wants to level up your marketing game and wants to earn that seat on the marketing decision table. There's a link below, check it out. Two, I've created a free guide to media fundamentals that you can download from my website. Again, check out the link below. And three, if you haven't already subscribed to this channel, that's a crime. Do it now. Around that note, let's move on with understanding what exactly is reach. Reach is the percentage of target audience who are exposed to an ad at least once within a particular time period on a particular media channel. This time period is usually one to four weeks. If you want to calculate reach, it can either be expressed in absolute terms or as a percentage and it is calculated on the basis of the number of individuals or households who are exposed to an ad at least once. So if someone is exposed to the same ad more than once, it is only calculated as one. Let me show you a quick example to explain this a little better. If the total size of the media market, that is the number of people who have access to some form of media channels is 10,000, the reaches 50%. And the total number of people who saw the ad will be 10,000 into 50%, which is equal to 5,000. But over here, it's important to understand that how is the reach data calculated? Let me explain that to you now. Reach data for most traditional media is collected through consumer panel research. They have data around the audience and the amount of content that this audience is consuming. This approximate data helps in planning media initially and the actual numbers are then evaluated against the planned reach data once the ads have been shown. The concept of reach remains the same even on digital, that is the total number of unique people who see your content at least once out of the total population of that digital media channel. It is not to be confused with impressions, which is the number of times your content is displayed. While the concept of reach broadly remains the same, some channels on digital calculated are little differently. And therefore you should always check these details with each of the media channels that you are using. In today's world, everyone talks about highly targeted and loyalty-led kind of approaches. It almost sounds like that's the holy grail and the be all and end all of marketing. However, recent research in the field of marketing throws up a lot of interesting facts that not only help clarify but also break down a lot of myths which exist. And they will also show you why is it that reach is so damn important. So let's look at what these are. Professor Byron Sharp in his famous book How Brand Scro shows that there is indeed an imbalance that exists between the biggest and the lightest users of particular brand. However, that imbalance is not how Pareto suggested to be, that is 8020, that imbalance is actually 6020. So what does that mean? Slightly more than half of a brand sale comes from the top 20% of its customers and the remaining sales comes from the bottom 80% of its customers. What does that mean? You cannot ignore the bottom 80% of your brand's customers. They account for almost half of your sales. Secondly, reaching all customers from heavy to light buyers of your brand is crucial for a brand to grow. The second thing which I found extremely interesting and I have to share is that loyalty campaigns are the least effective. What do I mean by that? With all the pressure on marketing resources, there seems to be a belief that a tightly targeted approach that drives brand loyalty with existing customers is a better approach. In a series of fabulous work done by Bennett and Field at IPA, they prove that broad reach campaigns are the best for driving top line growth, which is crucial to increase your profits. The most effective campaigns still talk to both new customers as well as existing customers together. That is, they reach the whole market. Professor Byron Sharp in how brands grow has also shown that brand loyalty is less important and to a large effect, it's a side effect of a penetration campaign. One's with higher penetration in the market tend to have better loyalty scores. So therefore if you chase loyalty, that might not be the best approach. Chase penetration, you will get loyalty as an outcome or a side effect of that. The third thing which is important for everyone to realize is that reach is not something which is only important in B2C marketing, but it is equally important in B2B marketing. Research conducted by the B2B Institute shows that even for the B2B businesses, loyalty strategy underperforms massively when compared to a reach strategy in terms of overall effectiveness. Talking to existing customers and non-customers together is the way to drive growth for a brand even in a B2B context. So let me summarize what is it that makes reach such an important concept for you to learn about. One, the bottom 80% of your customers result in almost 50% of your sale and therefore you can't afford to focus only on the most important or the top 20% of your customers you have to reach them all. Then highly targeted loyalty only approaches always under-deliver when compared to an approach which talks to existing customers and non-customers at the same time. This is true even in the case of B2B marketing. And therefore reaching all customers who are relevant to the category whether or not they are your existing customers is the best approach. And that brings me to the end of this video. Three things before you move on to the next video. One, you must check out my course on strategic marketing where I have poured 15 years of experience of working with multiple big and small brands. It's your shortcut to earning that seat at the marketing decision table. Two, like this video and subscribe to this channel and if you have any additional thoughts please put them in the comment section below. And three, there's a free guide to media fundamentals that I have very lovingly prepared for you. So you can click on the link below and check it out for sure. Thank you very much for watching and I'll see you in the next video.