'BS-proof' Millennials pose challenge

28 January 2015
LONDON: Millennials are the first truly digital generation and as they get older and possess more spending power marketers need to reassess how they can best reach them.

This challenge is addressed in Warc's Toolkiit 2015, a guide to six major marketing trends for the year ahead, produced in association with Deloitte. It suggests that this group can perhaps best be regarded as the "information generation".

"They're researching online for anything, from picking a pizza to choosing a home loan provider – meaning they're essentially bullshit-proof," according to Megan Averell from insights agency GALKAL.

"Before they show up at the store or transact online, they know what others just like them have said about a product or service: for example, how it will perform, what the experience will be like, and how the company will behave if something goes awry."

Beyond that, however, they are not a group that can be easily categorised, as they range from late teens to early thirties with differing media habits and different expectations of the working world

"Millennials are more diverse and heterogeneous than any generation before," says Julie Coleman, Customer Advisory Practice, Deloitte Digital. "Marketing to them based on a list of preconceptions will fail; a one-to-one approach at scale is needed."

That implies the use of online channels, and while it is true that Millennials use online and mobile more than older cohorts – with almost total dependence on mobile for some utilities and services – it is not the case that traditional media such as television no longer have a role to play.

The REVOLT digital cable network, for example, was set up expressly for Millennials. Jake Katz, vp/audience insights and strategy, explains that "the future consumer is engaged through TV, while digital provides reach".

"This is a massive paradigm shift, where digital used to provide the engagement and TV provided frequency," he says. "Those two things are now completely switched."

One result is that forward-thinking brands are re-evaluating their content marketing strategies, a development that also allows them to more easily address another of relevance to Millennials – purpose.

Combining a higher business purpose with a new model of marketing communications promises to be a major challenge for brands across industry categories in 2015, the Toolkit concludes. 

Warc subscribers can read the full Toolkit report at www.warc.com/toolkit2015. Non-subscribers can download a sample of this chapter here.


Data sourced from Warc

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Direct mail still has value

28 January 2015
LONDON: Digital media may have changed advertising but people still value the physical attributes of older channels such as mail and catalogues, according to new research.

Royal Mail MarketReach employed a variety of research techniques – including ethnography, quantitative and neuroscience research, interviews and analysis – over an 18-month period to produce a report, The Private Life of Mail, in which it argued that sending a direct sensory experience of a brand can mark a pivotal moment in the customer journey.

"Mail also has the kind of benefits you might have associated with above-the-line media, such as creating strong, emotional connections and brand associations," claimed Jonathan Harman, managing director at Royal Mail MarketReach.

People respond to mail more positively than their stated attitudes might suggest, the report said, as its physical nature "triggers largely subconscious responses".

This is the "endowment effect" in which a sense of ownership of an item they can see and touch leads to a person valuing it more highly. Royal Mail MarketReach's own research found that a majority of people consistently placed more value on mail than email.

They were, for example, three and a half time more likely to take physical mail seriously and more than twice as likely to have a better impression of a company that contacted them this way.

Reinforcing the notion that mail has more impact than people admit, nine out of 12 households participating in an ethnographic study claimed to ignore all mail, "yet all 12 can be observed interacting with mail" the report said.

This was confirmed in a quantitative follow-up which revealed that 62% claimed to reject advertising mail outright, but when asked about what they had actually done with the mail in their homes at the time of the survey, 64% had opened a piece of mail that day, and the majority who did went on to interact with it.

The tactile nature of mail can also transmit brand values, as the report noted how participants had discussed how layout and paper quality affected how they felt about the sender.

Data sourced from Royal Mail MarketPlace; additional content by Warc staff

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Social drives more web traffic

28 January 2015
BOSTON, MA: Social media platforms play an increasingly important role in directing online consumer traffic, as new research shows people now rely less on homepages and search engines than ever before.

According to content discovery specialist Shareaholic, based on data collected from more than 300,000 websites reaching a global audience of more than 400m unique monthly visitors, the top eight social networks – Facebook, Pinterest, Twitter, StumbleUpon, Reddit, Google Plus, LinkedIn, and YouTube – drove 31.24% of overall traffic to sites in December 2014, up from 22.71% a year earlier.

As one might expect, Facebook dominated the list, accounting for almost one quarter (24.63%) of all social referrals in December 2014, a share that had climbed by more than two percentage points during the quarter.

Not only has the total number of Facebook users grown in recent years but so too has their engagement, as Shareaholic noted how the time spent daily by the average user on the site had almost trebled over the past three years.

Only Pinterest offered any serious challenge to this ascendancy, with a 5.06% share, down from a high of 7.10% in March 2014. The remainder had less than 1% each, ranging from 0.82% for Twitter to 0.01% in the case of YouTube; their combined share was a mere 1.55%.

While the use of social media sites is generally fairly evenly divided between the sexes, with a slight bias in favour of men, Pinterest is skewed heavily in the other direction, in the US at least, and this, said Shareaholic, was limiting its mass market appeal. 

The platform has tweaked the site to make it more gender neutral and reports more of an even split in international markets such as Korea, India and Japan. But it faces an uphill challenge in the US, according to Robert Kozinets, a professor of marketing at York University's business school in Toronto.

"It's more stigmatising for a man to be on a woman's site than the reverse," he told the Wall Street Journal. "The perception is that it weakens a man's social standing."

Of YouTube, Shareaholic observed that it is no longer the sole gatekeeper of video views, as Facebook's autoplay videos have stolen much of its traffic. But it added that it still had a role and that marketers should look to maximise potential reach by publishing videos to both sites.


Data sourced from Shareaholic, Wall Street Journal; additional content by Warc staff

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Google gains with shopping ads

28 January 2015
SAN JOSE, CA: Spending on Google Shopping Ads rose sharply during the last quarter of 2014 as retailers turned away from text-based search spending to invest in image-based ad formats.

The quarterly Global Digital Advertising Report from Adobe Digital Index showed spending on shopping ads up 53% on the third quarter. And while this might have been expected during a holiday period when retailers are fighting hard for consumer dollars, it was also 47% up on the same period a year earlier.

At the same time Google Text Ad spending in the retail sector dipped 6%, indicative of a trend towards a more visual approach by retailers.

Text-based ads still dominate the SEM retail space, however, with an overall 80% share of clicks. Google takes the lion's share at 66% and Yahoo! Bing holds a 14% share.

Overall, Google Shopping Ads accounted for just 20% of all retail SEM clicks in the US, with Yahoo! Bing, which only recently added a similar feature, gaining a 0.7% share.

Tamara Gaffney, principal analyst for the Adobe Digital Index, predicted that shopping ads could constitute 30% of paid clicks by the fourth quarter of 2015, Forbes reported.

And, while Google Shopping Ads are currently focused on the retail industry, Gaffney suggested that similar image-heavy ads could work well in other sectors, such as travel and hotels.

The Adobe Digital Index report also looked how each type of digital advertising fared on different days of the week and highlighted some significant findings for marketers to bear in mind.

On mobile devices, consumer search click frequency was highest during the weekends, with share of mobile clicks on Sunday 17% higher than the average day.

Desktop search clicks ranked highest on Mondays, outperforming the rest of the week by 9%. And Friday had a higher share of Facebook posts, impressions, and interaction rates than any other day.

Data sourced from Adobe Digital Index, Forbes; additional content by Warc staff

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Tencent is China's most valuable brand

28 January 2015
BEIJING: The brand value of internet service company Tencent has almost doubled in the past year, pushing it to the top of the 2015 BrandZ rankings.

The fifth BrandZ Top 100 Most Valuable Chinese Brands, produced by Millward Brown and based on financial analysis and consumer research, noted how brands from private enterprises had come to dominate in terms of value growth, rising 97% since 2013, while those from state-owned enterprises (SOEs) declined 9% over the same period.

In the past year alone, Tencent's value leapt 95% to reach $66.1bn, while that of online search engine Baidu, in fifth place, increased 55% to $30.1bn. Another online business, newly listed retailer Alibaba, entered the rankings for the first time, shooting into second place with a valuation of $59.7bn.

All three are market-driven, but five years ago the top five were all SOEs. A related development is the rapid growth of certain categories.

Tech companies, for example, have become brand powerhouses and generated a 78% increase in overall brand value, pushing the technology category past financial institutions as the highest value category ($106.9bn) and contributing 23% of the Top 100's total value.

Retail has also surged ahead with Alibaba's inclusion (+3,827%), but even after removing its contribution the category grew by 64% after a year of successful innovation by brands.

And the car category grew 141% in value after new entrant Great Wall enjoyed success with its SUV sales, according to Millward Brown.

Apart from telecoms business China Mobile, ranked third, the rest of the top ten most valuable Chinese brands were either financial institutions or oil and gas companies.

In the former category, ICBC led the way in fourth place, followed by China Construction Bank (6th), Agricultural Bank of China (8th) and Bank of China (10th). All four saw their valuations fall in the past year.

Of the two oil and gas brands, Sinopec (7th) had seen its valuation increase 18%, while that of PetroChina (9th) had fallen 11%.

Millward Brown also observed how the gap between Chinese brands and multinational brands in China has been narrowing: five years ago the two were 26 points apart on the BrandZ Brand Power Index, which measures a brand's competitive position in its category, while today their scores are almost identical.

"Consumers increasingly accept Chinese brands because they see them as meaningful and dynamic, not only because they're well-known," said Doreen Wang, Global Head of BrandZ, Millward Brown.

"The big question now is what brands must do to be accepted in international markets.

Data sourced from Millward Brown; additional content by Warc staff

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AB InBev takes digital into stores

28 January 2015
NEW YORK: Anheuser-Busch InBev, the brewing group, is hoping to maximise the impact of its ads by introducing digital coolers – capable of showing content like TV spots and video – into physical stores.

Anson Frericks, senior director/brand activation at Anheuser-Busch InBev, discussed this topic at the latest ad:tech New York conference.

He framed the debate by looking at the firm's Budweiser brand, which secured a major advertising hit during the 2014 Super Bowl with a commercial featuring its iconic Clydesdales and a puppy.

While this effort generated considerable viral traction, Frericks reported, the returns measured in actual sales were rather more muted.

"Our consumer purchases beer generally in a very different environment than they consume advertising," he asserted. (For more, including further details about this digital solution, read Warc's exclusive report: AB InBev extends appeal from puppy commercials to in-store coolers.)

"What my team is tasked with doing is trying to figure out how we make our ads more relevant to the consumer at the time the consumer is going to purchase, taking into account the whole way the world is moving from a digital standpoint."

And engaging shoppers "in the occasion, when they're purchasing beer, with our ads talking to them directly" may well achieve that aim.

Indeed, Frericks suggested, digital solutions such as the connected coolers – which boast translucent screens and can be programmed from a central location – promised to deliver that result.

"It's really revolutionising how we are actually reaching our consumer at the point of sale," he said.

There is also a strong statistical underpinning to support the idea that these appliances could boost sales, further enhancing the possible benefits for the company.

"If you look at beer sales in the US, and you look at our sales at each convenience store, grocery store and packaged-liquor store, our percentage of sales at that store is directly related to the amount of cold space that we have in that store," said Frericks.

"And then if we can reach those consumers with our coolers with amazing digital strategies, we can even drive incremental volume to our advertising and reach the consumers when they're about to shop."

Data sourced from Warc

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Disney India escapes kids' category

28 January 2015
NEW DELHI: After ten years of focusing on the children's genre, Disney India is looking to extend its small-screen presence into family programming in a move aimed at widening audiences and increasing revenue.

"It's a clear progression and evolution," said Vijay Subramaniam, head of content & communication/Media Channels, Disney India told Impact.

"Everything we offer is complementary in nature and the idea is not to change our avatar, but to develop more avatars – those the brand inherently possesses."

A two-pronged approach will see children remain the focus during weekdays, while the whole family will be targeted at weekends.

"The strategy is to drive family audiences during primetime on the weekends and move Disney Channel into that new zone completely," explained Nikhil Gandhi, head of revenue/Media Channels. 

"We have got out of the rut of being typecast as a kids' entertainment business," he added.

Impact observed that the move was likely to gain Disney India not only a larger audience share at weekend but also a good quality audience that would enable it to broaden its advertiser base.

Children's channels account for 7.5% of total viewership but just 4% of advertising expenditure, with many of the products advertised on children's channels aimed at mothers, the passive viewers. Disney's weekend repositioning could turn them into active viewers.

But Gandhi wanted to shift the advertising-subscription balance away from the current 60:40 split. "Our business should be driven largely by distribution and ad-sales should just come in as an add-on," he said.

Another challenge Disney India faces is producing local content. There is no shortage of material from abroad which is all the Disney XD channel airs. Others, including the flagship Disney Channel and Hungama, have about 20% local content; only Bindass is 100% local content.

Subramaniam noted that many animated stories were universal but acknowledged that these did not necessarily meet all local preferences.

He pointed to "a steady focus on local animation and development", adding: "over the next six months, you will see five such initiatives being announced".


Data sourced from Impact; additional content by Warc staff

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Global adspend growth slows

27 January 2015
LONDON: The rate of growth in global advertising expenditure is expected to slow to 5.1% this year before picking up again to 6.0% in 2016, according to a new forecast.

Warc's Consensus Ad Forecast is based on a weighted average of adspend predictions at current prices from ad agencies, media monitoring companies, analysts, Warc's own team and other industry bodies.

A net growth in adspend in 2015 is predicted for 12 of the 13 markets covered – including Australia, Brazil, Canada, China, Germany, India, Italy, Japan, Russia, Spain the UK and the US – with only France contracting slightly.

Overall, the rate of growth has been revised downwards for nine countries since the last Consensus Ad Forecast in July 2014. At the same time, total forecast global adspend for 2015 has been raised 0.1pp since then.

BRIC countries will be the strongest performers this year, with India, China and Brazil expected to see all-media growth of 11.6%, 10.3% and 7.1% respectively.

Russia, however, has seen the single largest downgrade in expectations from the previous report, from 8.5% to a mere 1.4% as political and economic uncertainties take their toll.

The UK is forecast to show the fourth-largest growth rate this year at 5.7%, unchanged from July, while Spain was revised upwards by 1.2pp to 4.5%.

Of the remainder, only the US (+3.5%), Canada (+3.4%) and Australia (+2.7%) are expected to grow faster than 2% in 2015.

In terms of media, all except newspapers and magazines are predicted to record year-on-year growth in 2015, with Internet seeing the greatest increase, up 16.0%.

Newspaper is the only channel for which forecasted growth has been upgraded since July, although a rise of 1.2pp leaves it shrinking a slower rate of -3.6%.

TV, meanwhile, has seen the largest downgrade – by 2.7pp – with growth this year now expected to come in behind Cinema (4.0%) and Out of home (3.9%).

"The global economic outlook is more uncertain than six months ago, with eurozone stagnation, Russian sanctions and a slowdown in Asia all threatening growth," said James McDonald, research analyst at Warc. "It is therefore unsurprising that many market-watchers, including us, have revised down expectations.

"Despite the uncertainty, we should still see growth in global advertising expenditure of between 5% and 6% this year and next."

Data sourced from Warc

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Brits lead in European online shopping

27 January 2015
LONDON: British online shoppers are set to spend 43% more than the European average during 2015 according to a new report that suggests investment in improving the shopper experience and better targeting are paying off.

An international study by RetailMeNot, a marketplace for digital offers, covered eight European markets – France, Germany, Italy, the Netherlands, Poland, Spain, Sweden and the UK – as well the US and Canada, with 100 major retailers and 9,000 consumers being interviewed.

It said online sales would account for 15.2% of all consumer retail sales in the UK in 2015 and would total £52.25bn, a 16.2% increase on the previous year.

Average sales per British shopper are forecast to be £1,174, a rise of 9.6% on 2014 and well ahead of the European average of £820.

Further, Britons are predicted to shop online more often in 2015, with 21.2 purchases compared to 18.8 in 2014, making them the most frequent online shoppers in Europe.

Average spend per transaction, however, will fall slightly, down 3% to an average of £55.36. In comparison, Swedes will make only 10.4 online purchases but spend the highest amount per transaction, at £56.43.

Germany and Poland are the two fastest growing markets in terms of spend per shopper, with the former set to increase 14.9% to £1,023, and the latter 14.2% from a much lower base to hit £206, the lowest figure of any country considered..

Giulio Montemagno, svp/International at RetailMeNot, noted that in addition to Britons shopping online more frequently, their overall numbers continued to grow, so that 65.5% of them now shop on the web.

He further observed that strong growth online was compensating for falling sales in-store in all markets surveyed. Across Europe, store-based sales are projected to fall by 1.4%, but this will be more than offset by an 18.4% increase in online sales.

"Although in-store sales appear to be falling, many retailers are bucking the trend by embracing technology to better engage consumers," Montemagno said.

"In 2015, we expect to see even more retailers take advantage of mobile and further testing of beacon technology to target consumers while they are on the go, as well as in-store, by making the shopping experience more relevant."

Data sourced from RetailMeNot; additional content by Warc staff

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Linear TV dips below half of US viewers

27 January 2015
NEW YORK: Less than half of online US adults now watch linear TV as Younger Boomers and Generation X-ers adopt viewing habits previously associated with Millennials, a new report has said.

Forrester Research surveyed 3,166 adults aged 18 to 58 for the Making Sense Of New Video Consumption report and found that only 46% watched linear TV in a typical month. This trend was more pronounced among 18 to 34 year olds, with just 40% viewing TV this way, but even among older viewers the figure was 52%.

Streaming, whether from a paid or free service, was on a par with linear TV – at 40% – for Millennials, and these options were also proving attractive for Generation Xers and Younger Boomers, at 32% for free streaming and 30% for paid streaming.

Only recording on a DVR (37%) was more popular among older viewers, and even here, one third of Millennials continued to use this device.

That said, the report also showed that more than half (55%) of younger viewers still watched four hours or more of regular TV in the course of a week, with one third (34%) watching a similar amount online.

Business Insider reported Forrester's food-based analogy, with linear TV and DVR viewing forming the "main courses" for older viewers, and which were supplemented with "side dishes" and "desserts" across the online spectrum, while younger groups snacked on "smaller portions of a wider array of dishes".

Forrester analyst Jim Nail elaborated to Ad Exchanger. "There is clearly this trend toward watching on the network's app, the MVPD's [Multichannel Video Programming Distributor] app and Hulu, but clearly the content is still powerful and it still draws audiences advertisers want to buy," he said.

"It is trickling into agency thinking. They know they need to look beyond age-gender demos and look at new data sources, even if they're still buying ads in pods on ratings."

So, for example, advertisers might look at shows in the light of viewers' product buying habits rather than Nielsen ratings.

"You're selling individuals and the right individual is going to be worth a lot more than $10 or $15 dollars a thousand to the right advertiser," Nail noted.

Data soured from Business Insider, Ad Exchanger; additional content by Warc staff

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McDonald's leverages marketing layers

27 January 2015
OAK BROOK, IL: McDonald's, the quick-service restaurant chain, intends to overhaul its marketing approach in order to help turn around disappointing financial results.

Speaking on a fourth quarter earnings call, Mike Andres, president of McDonald's USA, said that no single initiative was going to drive improvements as he outlined the multilayered strategy the business is developing to create a better customer experience and differentiate the brand from other QSRs.

"You'll see disruptive value. You'll see new product news. You'll see service initiatives," he stated. "And then our regional management in our new structure is empowered to commit the resources to make these plans come to life."

He explained that in addition to the ongoing national messaging to build the brand, there would be a greater focus on co-op marketing and customised local activations.

Owner-operators are at the hub of their local communities, he said, and are "very important to our turnaround plan", as they devised ways to tackle their immediate competitors.

Local-co-ops form a third layer of marketing and here Andres was looking for an approach "that better coordinates the specific roles and deliverables of our co-op marketing plans using more sophisticated analytics and data".

Another major step, previously announced, is the simplification of what had become a sprawling menu and which, Andres reported, was leading to faster order times in test markets.

At the same time, however, it is offering greater personalisation through the Create Your Taste platform being rolled out in the US and Australia. CEO Don Thompson felt this "has the potential to lift sales of core classics, by bringing more customers into our restaurants".

The possibility this could lead to longer waiting times should be offset by "multiple order point strategies", as McDonald's introduces self-order kiosks and table service as well as mobile order and payments.

Create Your Taste, Thompson declared, "is a much broader piece than simply about the food itself. It is about the overall experience."

McDonald's is placing great importance on this last aspect: it is redirecting $800m of capital investment away from new restaurant openings into the McDonald's 'Experience of The Future' as it addresses the challenge of rivals such as Chipotle and Nando's.

Data sourced from Seeking Alpha; additional content by Warc staff

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General Mills taps consumer convergence

27 January 2015
NEW YORK: General Mills, the packaged-food group, believes tapping into the "convergence" between the millennial and multicultural audiences could become a powerful sweet spot for brands.

Ann Simonds, the firm's incoming CMO after Mark Addicks announced he would retire last year, discussed this topic at the Advertising Research Foundation's (ARF) Industry Leader Forum in New York.

There are many "differences and distinctions" currently reshaping the consumer marketplace, she argued, but the rise of millennials and shoppers from different cultural backgrounds is perhaps the most important.

"When you're trying to find and make markets, which is fundamentally my job," she said, "the reality is much of this millennial generation happens to be multicultural." (For more, including the firm's three-point recipe for success, read Warc's report: General Mills targets the millennial/multicultural mix.)

As a reflection of this fact, the goal for marketers should be to identify ways of taking youth-orientated and multicultural messaging out of any remaining silos.

"Inside any packaged-goods company," Simonds said, "the single biggest growth opportunity within your mainstream brands will be the convergence of these audiences – simply getting the same share of these households as you're getting from the households that grew up on these businesses."

One General Mills brand exemplifying such an idea is Cheerios, which caused an online stir by casting a multiracial family in a TV ad, and stood firm as a small – but vocal – minority criticised this decision.

Marketing with a clear purpose in mind, Simonds suggested, can help companies achieve similar results across the multicultural and millennial mix.

"Make no mistake: it's a point of competitive advantage for us to consciously choose to invest and nurture those communities," she said.

"That's the new competitive advantage for us in the same way we used to have the competitive advantage in Saturday-morning cartoon advertising for Lucky Charms.

"We just have a different version of it today."

Data sourced from Warc

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Malaysian consumer confidence plunges

27 January 2015
KUALA LUMPUR: Malaysian consumer confidence declined sharply in the last quarter of 2014, falling to its lowest level in five years according to a new survey.

The latest Global Consumer Confidence Index from research Nielsen, based on responses from 30,000 online users in 60 countries, showed a ten-point drop in the index for Malaysia, from 99 to 89, making it the least confident Southeast Asian country and well below the global average index of 96.

Confidence declined five points in Indonesia to 120, but this remained the most optimistic Southeast Asian country, along with the Philippines, up five points to the same figure.

Thailand (down 2 points to 111), Vietnam (up four points to 106) and Singapore (down three points to 100) also reported broadly optimistic outlooks.

"Consumers in Southeast Asia continue to be among the most confident nations globally," said Vishal Bali, MD of Nielsen's Consumerisation Practice in Southeast Asia, North Asia and Pacific.

The exception of Malaysia was, he explained, "likely due to consumers feeling the pressure of the introduction of GST later this year and uncertainty around any potential impact on the price of goods and the cost of living."

Malaysians were accordingly reducing their expenditure in certain areas, including clothing, where 65% were spending less, and out-of-home entertainment, where 56% had cut back.

Consumers in other countries were also finding ways to reduce spending – the survey reported that people in Thailand, Indonesia and Vietnam thought their country was going through a recession.

So they were switching to cheaper grocery brands, saving on petrol and electricity usage, reducing holidays and short breaks and delaying upgrades to technology,

"There is a collective sense of debt-avoidance in the region, and this is resulting in subdued purchasing of big ticket items," said Bali.

In the wider Asia-Pacific region, Indian consumers continued to gain in confidence (up three points to 129) to the point where they are now the most optimistic in the world.

In China, the other emerging giant of the region, the index fell four points to 107 in the fourth quarter, after four consecutive quarters at 111.

Confidence also dipped in the developed markets of Australia (down four points to 93), Japan (down four to 73) and South Korea (down four to 48).

Source: Nielsen, Mumbrella Asia; additional content by Warc staff

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Asian brands seek global agencies

27 January 2015
SINGAPORE: Asian brands are increasingly turning to international agency networks for their advertising needs rather than working with local shops, a new study has said.

This signals the acceleration of a trend that media monitoring firm Pearlfinders first noticed a few years ago. Its Global Index 2015 report is based on interviews with more than 10,000 marketing and sponsorship decision-makers across Europe, the US and Asia during the course of the past year.

"Initially, only a few global networks were able to capitalise on this demand," Mike Thorne, the firm's product director, told Campaign Asia-Pacific, "but more recently many of the big name players have established credible operations across Greater China, Singapore and Malaysia."

The shift is being driven in part by the majors' recruitment activity, according to the report, as they are looking to employ multilingual executives to run their brand-side marketing teams.

"A sizable opportunity exists for European and American agencies able to demonstrate best-in-class capabilities," it said.

The report also identified the FMCG sector as the category attracting the greatest marketing investment in Asia, although at 12% this lagged behind the global average of 16.9%.

"Even 12 months ago, FMCG brands were not seeing the budgets their western counterparts enjoyed but this is growing rapidly both in terms of advertising and brand development," said Thorne.

Other leading sectors for marketing investment included apparel (11.0%), travel, transport and hospitality (10.1%), consumer electronics (9.9%) and retail (7.4%).

And while many Asian marketers remain wedded to traditional television advertising, the report said that, increasingly, "social is the most effective channel to reach Chinese 'netizens'".

The extraordinary speed of change in that country's advertising landscape means creative shops need to review their clients, it added. "Once, tourism-driven industries like airlines and hotels, as well as luxury apparel, were the most lucrative new business prospects."

But now, "agencies should focus on the need for ATL campaigns at everything from carbonated water brands to kitchen appliances".

Data sourced from Campaign Asia-Pacific, Pearlfinders; additional content by Warc staff

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Transatlantic surge of online shopping

26 January 2015
LONDON/NEW YORK: Further evidence of the rapid rise of online shopping on both sides of the Atlantic has emerged in a new report, which also highlighted that pure play retail, not omnichannel, was the big winner of this trend.

Wipro Digital, a digital solutions company, conducted a post-holiday survey of 2,023 online adult consumers in the UK and the US and found that a significant majority in both countries did more than half of their 2014 holiday shopping online.

Close to three-quarters (71%) of British consumers did so last year, up from 45% in 2013, while 61% of American respondents said the majority of their holiday shopping was conducted online, up from 36%.

Furthermore, this trend is set to continue, the report said, with half of respondents in both countries reporting that they planned to do more shopping online during the holiday season in 2015.

By contrast, a mere 6% of consumers in the UK, and just 4% in the US, said they planned to increase their in-store shopping with bricks-and-mortar retailers.

Consumers also spent more online during the 2014 holiday season, the report found. UK consumers spent an average of £292 online compared to £179 in-store, while online purchases in the US averaged $400 and it was $302 in-store.

"Consumers continue their steady march online, finding few reasons to shop in-store rather than online for their holiday shopping," said Avinash Rao, global head at Wipro Digital.

And in a warning to retailers who rely on an omnichannel strategy, he added: "Even online, omnichannel retailers are losing customers to internet pure-plays. Bricks-and-mortar retailers are having difficulty delivering on the benefits of omnichannel retailing."

Supporting this assertion, the survey revealed that 44% of UK consumers and 47% of US online shoppers carried out more than half of their online shopping with pure play retailers.

A quarter said they do not even consider the websites of bricks-and-mortar retailers while more than half have not visited manufacturers' direct-to-consumer sites.

Greater convenience, better prices and ease of use were the three main drivers for this trend, although online pure play retailers did come unstuck by consumers' concerns about their delivery costs and reliability.

The survey said 16% of UK and 11% of US online shoppers did not receive their purchases in time for the holiday while nearly half hoped not to pay shipping charges in 2015.

Rao advised bricks-and-mortar and omnichannel retailers to focus on customer interactions and the benefits of the in-store experience if they are to counter the trend of consumers increasing their spending with pure play online retailers.

Data sourced from Wipro Digital; additional content by Warc staff

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Asda plans own ad exchange

26 January 2015
GLASGOW: Asda, the UK subsidiary of US retail giant Walmart, is laying down a challenge to traditional publishers with plans to launch its own fully operational private ad exchange that will include its grocery website.

The UK retailer is already selling display and video ads on three websites – the Asda storelocator site, the Asda Price Guarantee comparison site and Asda Direct – but wants to extend the offering to its grocery shopping site in the next few months.

Dom Burch, senior director of marketing innovation at Asda, told The Drum that the company wants to become a "credible publisher", similar to the Guardian or the Telegraph, "rather than just a retailer with a website selling banners to existing partners".

"What we'll be able to see over the next few months is which advertisers are highest performing and that will allow us to potentially go into private deals with them on the grocery site," he explained.

If trials are successful, Asda plans to establish its own fully operational private ad exchange by 2016 that would allow it to dispense with third party ad networks.

Ads on its three websites are currently sold via Google's DoubleClick for Publishers and a platform from Rubicon.

Burch said that 200,000 ad impressions were sold in the first few hours of launching the service. Competitors, such as Amazon and Tesco, have been blocked from buying ad space.

"Any digital advertiser worth their salt is asking for a greater degree of control and want to be able to optimise their creative in real time," Burch said. "We've discussed what would they require from their media buying perspective to have Asda as their media publisher."

Coinciding with news of Asda's initiative, The Drum also reported that the Association of Online Publishers (AOP), a trade body, has been in talks with British publishers to explore whether inventory could be pooled on a new private marketplace.

Although the idea is just in its early stages, the AOP confirmed that talks have been taking place and expressed confidence that, with the right planning and consultation, it could benefit the UK publishing sector.

Data sourced from The Drum; additional content by Warc staff

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Brands struggle to meet digital need

26 January 2015
NEW YORK: Just 11% of US consumers strongly agree that companies are effectively converging digital, mobile, social and traditional channels, according to a survey that reveals how brands are falling short of modern customer expectations.

Despite their efforts to improve products and services, brands have not been able to keep up with consumers' greater use of digital channels and their "always on" behaviour.

This, in turn, means that changes in consumer spending habits and their increased willingness to switch providers has created a "switching economy" in the US worth $1.6 trillion, a 29% increase since 2010.

These are the headline findings from Accenture, the management consultancy, which questioned more than 2,000 US consumers as part of its global survey of 23,665 people and their views about marketing, sales and customer service.

Looking at the US segment of the worldwide poll, Accenture found more than half (56%) say the number of brands they consider has increased significantly over the past 10 years.

Meanwhile, nearly as many (46%) say they're more likely to switch providers than 10 years ago and nearly a quarter (24%) want more digital interactions from brands.

Just over a quarter (28%) of US consumers say they feel very loyal towards their providers and only about a third (31%) are willing to recommend them to others.

Also, a similar proportion (34%) say they're open to purchasing products and services from non-traditional providers, such as online-only organisations.

Robert Wollan, senior managing director at Accenture Strategy, said many established companies are reacting too slowly to meet the needs of today's "non-stop customers" – an important consideration, given the $1.6 trillion "switching economy" Accenture identified as being up for grabs.

"While many companies have been chasing the opportunity digital brings, they have not addressed the root causes of the problems that are exposed when they don't execute well," he warned.

"Companies have been focused only on 'doing the same things better' when these issues really require them to 'do things differently'."

A good starting point, the research suggested, would be to address the top three US consumer frustrations for customer service.

These are a failure to resolve an issue quickly (86%), lengthy hold times (85%) and dealing with company representatives who cannot answer questions (84%).

Data sourced from Accenture; additional content by Warc staff

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Apple chases Samsung in Korea

26 January 2015
SEOUL/HONG KONG: Consumer demand for the iPhone 6 and 6 Plus devices has propelled Apple to capture a third of the smartphone market in South Korea, a country where rival Samsung has long been dominant, a new report has revealed.

It is the first time that a foreign brand has gone beyond 20% smartphone market share in the country and Apple's share would have risen to about 40% if there had been better supply of the popular models, according to Counterpoint Research.

The Hong Kong-based research firm analysed sales data up until the end of November 2014 in 33 countries, but the iPhone's success in South Korea, Japan and China was a highlight in its report.

Apple's market share in South Korea shot up from a low base after it launched the 6 Plus in September. At the same time, Samsung's market share declined to 46% in November, down from about 60% as recently as October 2014.

Meanwhile, in Japan, Apple took more than half (51%) of smartphone sales in November, leading the report to conclude that "it is becoming increasingly difficult for competition to challenge Apple's dominance in near to mid-term".

This dominance is expected to continue in Japan, the report suggested, when the Apple Watch smart device is launched in this "highly advanced consumer market".

In China, iPhone sales reached a record monthly high, growing more than 45% annually in November, to take Apple's market share to above 12%. This ranked the company third behind Chinese vendors Lenovo and market leader Xiaomi.

The report said Apple's growth was driven by rich, urban consumers, who "quickly warmed to the bigger iPhone form-factors", and it expected sales data for December to show further rises as supply of the iPhone 6 and 6 Plus improves.

However, Neil Shah, research director at Counterpoint Research, also forecast a "fierce battle" in the premium segment in China after Xiaomi launched its Note device, which is already winning comparisons to Apple.

Data sourced from Counterpoint Research, TechCrunch; additional content by Warc staff

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Identifying the drivers of TV viewing

26 January 2015
NEW YORK: How social media networks and other communication channels influence the likelihood of American TV viewers to watch a show has been mapped in a new academic study.

The Council for Research Excellence (CRE) found that Facebook and offline communications, such as the phone, have more impact on the likelihood of someone switching on their TV to watch a programme whereas Twitter and text messaging have more influence on those already watching TV, Advertising Age reported.

"When viewing, one is already engaged and this leads to both higher likelihood of viewing and communications," according to the report, which has not been released to the public.

CRE, an organisation of research professionals who are all media clients of Nielsen, the measurement firm, also examined what influencers lift viewing among regular and infrequent TV users.

Offline word of mouth (WOM) drives the highest lift, of about 2%, for regular viewers compared to about 1% lift from social media and even less from a one-to-one digital communication, the report said.

For infrequent viewers, offline WOM also drives the highest lift, but this time a lift of only 1%. The other main influencers for infrequent viewers are promotions, digital and social media – each registering a gain of under 0.5%.

CRE came to its conclusions after using unique methodology that involved self-reported diary entries from 1,665 respondents aged 15 to 54 combined with the actual viewing of 150 of them who were part of the Nielsen People Meter panel.

Conducted over a three-week period, CRE said it meant it could analyse more than 78,000 diary entries, which were all submitted via a mobile app, from nearly 1,600 TV shows.

"There's a ton of data that comes in through the app," said Beth Rockwood, svp market resources and ad sales research at Discovery, the entertainment company, and also chair of CRE's social media committee. "It's definitely a big data project."

Data sourced from Advertising Age; additional content by Warc staff

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Jiffy Lube taps 'hyper-specific' search

26 January 2015
NEW YORK: Jiffy Lube, the franchise group of automotive service centres, has successfully demonstrated how a "hyper-specific" approach to online search can yield extremely positive returns for brands.

Jeffrey Lack, the organisation's chief marketing officer, discussed this subject during a session at the latest ad:tech New York conference.

"There is no better medium to take your story and make it hyper-specific to a consumer than digitally," he said. (For more, including the results delivered by the firm's revised search strategy, read Warc's exclusive report: Jiffy Lube aggressively drives footfall with search advertising.)

When Lack assumed his current role at Jiffy Lube, its approach to search simply involved operating a single, nationwide pay-per-click program.

"We had an offer that had a budget that was fixed in a point of time; it started at eight o'clock in the morning and went until we ran out of money," he said.

That often left the firm's franchises on the West Coast at a disadvantage, as the difference in time zone meant the paid-search budget might run out part way through their working day.

Even with these limitations, however, the "small set of results" provided by this effort suggested pay-per-click could be a "very powerful and effective tool for us to drive traffic" to service centres, Lack asserted.

"So we went about to go create a program that not only scaled it up, but we wanted to allow both flexibility in terms of how we managed the budgets and customisability for the franchisees," he added.

Partnering with marketing group Sq1, it thus developed a new search solution capable of disseminating a wide range of deals to consumers based on their precise location.

"We went from having a single, national $5 offer that met the lowest common denominator everywhere to having over 900 programs nationwide," said Lack.

"The advantage of that is we get to marry up the best of both worlds: we take our national scale of buying and then we leverage the understanding of the consumer that franchisees have at a local level."

Franchisees were also given the ability to "enhance" purchases using a simple online tool. And, in combination, these efforts delivered significant upticks in clickthroughs, conversion and the number of vehicles serviced.

"It's very exciting; it's actually transformed a lot of different parts of our business," said Lack.

Data sourced from Warc

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Collaboration is key to service culture

26 January 2015
HONG KONG: A successful service culture is underpinned by a collaborative approach between customers, employees and employers, a new study has argued.

But quick and frequent feedback also has a positive effect on improving employee performance and customer service, according to research into service standards in Hong Kong and reported by Campaign Asia.

The Hong Kong Association for Customer Excellence (HKACE) and research firm Ipsos questioned 1,400 customers, employees and employers across key service sectors and brands in Hong Kong.

They pointed to the importance of collaboration between marketing departments and service departments to maintain and improve standards and said timely and frequent feedback to service staff helps to provide them with an immediate lift.

"The results of the study suggest that the service standard in Hong Kong has improved and remains quite high across the board," said Simon Tye, executive director at Ipsos.

"However, there's always room for improving service standards, especially beyond functional service and in the softer elements of service that deal with empathy," he added.

Encouragingly, the survey revealed that a full 83% of consumers in Hong Kong said they experienced positive customer service in 2014, although attitudes and demands vary between the generations.

Consumers below the age of 25 want to encourage the promotion of service culture, the report said, but they are the most likely to use social media to complain about poor service.

The over-45s, on the other hand, tend to be the most satisfied of customers and they are likely to share their experience with friends and family.

Data sourced from Campaign Asia; additional content by Warc staff

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January marketing activity up

23 January 2015
LONDON: Marketing activity showed a strong start to the year as the Global Marketing Index (GMI) for January revealed gains being made in all regions.

The Global Marketing Index, compiled by World Economics, provides a unique monthly indicator of the state of the global marketing industry because it tracks current conditions among marketers and their expectations in the three key areas of trading conditions, marketing budgets and staffing levels.

The headline GMI was up by 2.6 points on the December figure to reach 57.7, indicating that panellists across the world are experiencing strong and rising business activity.

The Americas performed particularly strongly, rising 4.1 to 57.3, although this was still slightly behind Europe, up 1.8 to 58.1, and Asia-Pacific, up 1.5 to 58.5.

Trading conditions were strong and improving in each region apart from Europe where the constituent index slipped 0.9 to 57.9, although this was still a good report. In the Americas, the index leapt 5.3 to reach a value of 59.4 while in the Asia-Pacific region it was up 2.0 to 61.4.

These high index values in each region signify that trading conditions are favourable and improving month-on-month.

The index for global marketing budgets rose by 1.8 to register a value of 55.6 in January. This represents solid growth in the resources devoted by companies across the world to marketing activities. It is also the 25th consecutive month that the index has registered that panellists were experiencing rising budgets.

This growth was most marked in Europe, where the index increased 2.9 to reach 58.2, approaching the record level seen in September 2014.

The Americas showed a similar rise, up 2.6 to 53.1, indicating recovery after being close to the no change level with a value of 50.5 in December. In the Asia-Pacific region, the index was effectively unchanged, dipping 0.1 to 56.3.

Finally, the staffing level index registered a value of 58.2 globally in January, up by 3.6 on the previous month indicating that payrolls are rising at an increasing rate. The rise in the rate of increase in employment occurred across all regions led by the Americas and Asia-Pacific.

Data sourced from World Economics, Warc

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UK drinkers shun innovation

23 January 2015
LONDON: UK marketers launching new alcoholic drinks face major obstacles to success, with a new report showing that eight in ten out-of-home drinkers rarely or never try such products.

This trend, according to market researchers Canadean, is "concerning", given the significant level of investment ploughed into new product development by the drinks industry.

Figures extracted from a recently published global report, show that 32% stick resolutely to those brands they know and trust. And when asked when they didn't try new products, 21% said they didn't like the innovations on offer while 14% weren't aware of them.

The sheer volume of options is also a problem, according to Sam Allen, analyst at Canadean: "In the face of all so many new drinks [consumers] often stick to tried-and-tested favourites," he said.

But there are several trends that manufacturers and marketers can usefully exploit, as the research highlighted those areas that are of interest to adventurous drinkers.

Over half (56%) of those who regularly or often try new alcohol drinks out of the home experiment with new flavours.

Allen noted that the sort of fusion seen across the FMCG market was being replicated in the drinks sector, with craft options exploring the use of coffee, chocolate and spices, while major brands offered variations on classic products.

One third (33%) liked to sample locally made products. "Many consumers are becoming bored with traditional flavours, particularly in beer, which has resulted in the rapid growth of smaller scale brewing and craft production," said Allen.

Larger brands tapping into this, he added, would need to stress such things as the source of ingredients and the care that had gone into the production process.

A third trend the report observed was a growth in seasonal offerings, with one quarter (25%) of adventurous drinkers regularly choosing summer fruit varieties or winter spiced drinks.

"Limited edition and seasonal options that offer fresh and exciting tastes will encourage more consumers to try products while they have the chance," said Allen.

Data sourced from Canadean; additional content by Warc staff

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Data initiatives stutter

23 January 2015
SAN DIEGO: Many businesses have invested in gathering data but are failing to convert that into insights according to a new survey which also says chief executives tend to have a rose-tinted view of how their data initiatives are proceeding.

A global study sponsored by data analytics business Teradata analysed the views of 362 senior executives holding a variety of roles, including 16% in marketing and sales, across North America, Asia-Pacific and Europe.

Almost six in ten (57%) thought their company did a poor job of capturing and disseminating important business data. There was little disagreement that access to necessary data and the ability to convert it into actionable insights are the greatest obstacles to data adoption and utilisation.

But there was a perception gap at the top level as to how this was being managed. Some 47% of CEOs believed that all employees have access to the data they need, while only 27% of all respondents agreed that they do.

Similarly, 43% of CEOs thought relevant data are captured and made available in real time, compared to 29% of all respondents.

And CEOs were also more likely to think that employees extract relevant insights from data – 38% of them hold this belief, as compared to 24% of all respondents and only 19% of senior vice presidents, vice presidents and directors.

Such disparities, said Teradata, impede success and imperil the competitive advantage companies hope to realise.

Even within data-driven companies there were issues around access to that data. Eight in 10 senior vice presidents, vice presidents and directors agreed that data were unequally available, while 42% of all respondents said access to data was cumbersome and not user-friendly.

Teradata identified several factors driving the top-performing companies, which were more likely to have data initiatives launched and driven by their corporate leadership and to have a centralised data and analytics group responsible for introducing and implementing data initiatives.

They were also twice as likely to have a culture of creativity and innovation and to share information quickly and freely.

"The survey is clear that organisations succeed when the data-driven vision and leadership are shared, and the benefits of data initiatives are consistently tracked, promoted, and most importantly, linked to corporate goals and business results," said Chris Twogood, vp/products and services marketing, Teradata.

Data sourced from PR Newswire; additional content by Warc staff

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Advertising boosts trust in FMCG brands

23 January 2015
SYDNEY: Consumer trust for FMCG brands is based on media exposure, such as advertising, rather than product use according to new research which also shows that first-hand experience is more important in other categories.

Macquarie University undertook a study to examine the role of brand exposure and experience on brand recall, mediated by three affectional drivers – brand trust, brand image and self-image congruence. Using original data collected from a survey of 219 consumers, brand recall models were tested in two product categories: FMCG and durable goods.

The results, revealed Dr Chris Baumann in a CMO blog, showed that consumers are heavily influenced by advertising when it comes to FMCG products and that in turn builds trust and brand recall.

Product experience is not so important in a sector where, he suggested, "the actual quality of many FMCG products is quite challenging to judge simply from everyday use … [and] there is little perceived difference between the products available".

In the case of a category like cars, however, consumers need to have driven them to build trust and brand recall. Baumann noted that a consumer in their early 20s might buy anywhere between five and ten cars in their lifetime so building a relationship with a car brand early had the potential to form a long-lasting loyalty.

When the affectional drivers were factored in, the research found that brand image did not increase brand recall for FMCG goods, despite the adspend frequently lavished on this area.

"Improving brand image is necessary for FMCG brands," said Baumann. "But marketers and brand managers need to focus on a more effective approach to ensure their brand image will ultimately also lead to brand recall."

Data sourced from CMO; additional content by Warc staff

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Super Bowl novices go all in

23 January 2015
NEW YORK: With a week to go before the Super Bowl, 15 brands have thrown their hat into the advertising ring for the first time, some ready to blow the annual budget on one throw of the dice.

At $4.5m for 30 seconds it can be a high-stakes game for smaller brands, but the calculation is that reaching 111.5m viewers at once – the number watching the game last year – makes the gamble worthwhile.

Among the newcomers is glue maker Loctite, which, the Wall Street Journal reported, has spent around $4m on main media advertising in each of the past two years, including three national TV ads in 2014.

"We didn't have the critical mass to deliver a message that would be seen by a majority of the American population," said Pierre Tannoux, director of marketing at Henkel, which owns the Loctite brand. "We thought it would be a better bet to try to put all of our dollars in one bucket."

The job of the first-time advertiser is made more difficult by the expectations raised by match-day veterans like Budweiser and Doritos which can afford to recruit celebrities and spend heavily on creative.

The man tasked with producing a message that will not only introduce the Loctite product but entertain the watching millions poised to issue an instant critique is Chris Lawrence, director of account management at the Fallon agency. "It's a chance to make a lot of friends very quickly," he said.

Others are taking the long view. For David MacNeil, chief executive of WeatherTech, a car floor mat maker, advertising in the Super Bowl could mean winning over a consumer buying a car in three years' time.

"We all love instant gratification, don't get me wrong, but I was doing it more from a branding standpoint," MacNeil said. "It's a long-term investment in our company's future." 

Data sourced from Wall Street Journal; additional content by Warc staff

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Brands turn to Facebook in Indonesia

23 January 2015
JAKARTA: In Indonesia, major brands such as Coca-Cola and Oreo are increasingly turning away from TV and looking to Facebook first when planning campaigns.

"The Facebook population in Indonesia is massive, and Coca-Cola's core target audience is engaged on this platform," Quinn Donato, media and interactive manager for Coca-Cola Indonesia told Campaign Asia-Pacific.

With 37m daily active users and 71m monthly active users, 89% of both groups on mobile, the country has one of the largest Facebook populations in the world. Almost all those who are online (98%) use the platform, compared to 54% for Google+ and 44% for Twitter.

Coca-Cola opted to use this platform last year during the FIFA World Cup when it wanted to highlight its role as a sponsor with teens and young adults. A music video – a local adaptation of a global idea – reached 32% of the target market and achieved measurable uplift in ad recall in message association.

"We had rich anthem video content," said Donato, "and Facebook's News Feed makes it easy to play videos particularly on mobile."

A similar demographic was the target for Mondelez when it launched Oreo Mini, a version of the popular biscuit brand.

"In Indonesia, it is common practice for Mondelez to use TV to launch products," according to Lisa Walton, regional strategy director at Dentsu Mobius. "However, TV is nearing 100% saturation for the target audience and clutter is a major issue."

Mondelez used Facebook to cut through that clutter and far exceed its target of reaching 13.7m young adults while also gaining a five-point increase in purchase intent for the Oreo brand.

"Real business results can be achieved through social media," said Walton. Another finding she reported from this campaign was that "the channel can be an important choice to activate mums rather than just reach the younger millennials".

Social is far from becoming the primary channel, although that could change within the next decade. "Indonesia as a whole is still a TV-first market," said Ian Loon, regional director of the digital leadership team for Southeast Asia at Starcom MediaVest Group.

"Within its cities, mobile is primarily driving internet-first societies. The country should become internet-first within the next ten years, driven by rising affluence and lowering affordability of devices."

Data sourced from Campaign Asia-Pacific; additional content by Warc staff

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THIRTEEN shows how to reach millennials

23 January 2015
CHICAGO: Channel THIRTEEN, the Public Broadcasting Service's (PBS) station in New York, has successfully shown how smart marketing can help brands with older audiences reach younger consumers.

Oliver Egan, North American head of strategy/partner at The&Partnership, discussed this topic at the 4A's (American Association of Advertising Agencies) latest Strategy Festival.

Until last summer, he served as head of strategy at CHI & Partners, the agency which spearheaded the "TV Gone Wrong" initiative for Channel THIRTEEN.

And he reported that the average viewer of the station before the campaign started came in at fully 61 years of age.

"That's an age that's been growing over recent years," Egan added. (For more, including the results of this effort, read Warc's exclusive report: How "bogeyman" insights revived New York's public TV station.)

"And younger cohorts are less apt to fill that place and become donators themselves."

Such a situation is especially undesirable given consistent pressure on government funding, meaning the donations made directly by consumers are assuming greater significance than ever.

"Our challenge was to engage the next generation of members by winning the heads, hearts and wallets of 25-45-year-old New Yorkers," said Egan.

This demographic often already pays for cable and satellite services, as well as for streaming services like Netflix. As a consequence, the competition for their money and attention is fierce.

"In a world of almost exponential growth of content options, this audience has an increasingly broad repertoire of content and they're less apt to be prepared to value one content provider over another," Egan said.

In response, THIRTEEN sought to reassert the importance of the cultural and high-quality programming it offers by running a campaign promoting a slate of spoof reality shows.

Rather than adopting a heavy-handed tone, it was thus able to "find an engaging and interesting and arresting way of delivering" the idea, Egan said.

The result included millions of earned media impressions alongside a substantial rise in memberships for the station.

Data sourced from Warc

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IIOT leads to outcome economy

22 January 2015
DAVOS: The industrial internet of things (IIOT) could add $14.2 trillion to world output by 2030 and produce radical changes to how businesses operate according to a new study.

Consulting firm Accenture surveyed 1,400 C-suite decision makers from some of the world's largest companies, including 736 chief executive officers, for its report Winning with the Industrial Internet of Things

The IIOT enables new digital services and business models based on intelligent connected devices and machines.

The survey found that 84% of respondents believed the IIOT would generate new, service-based income streams, but a mere 7% had developed a strategy with investments to match.

This lack of commitment was attributed to the difficulty of applying the IIOT to generate those new revenue streams; most business leaders see it rather as a way of making efficiency gains through improved employee productivity (46%) and reduced operational expenses (44%).

According to Paul Daugherty, chief technology officer, Accenture, the full potential will only be achieved if companies radically change how they do business. That means "working with competitors, forming partnerships with other industries, redesigning organisational structures and investing in new skills and talent".

The Telegraph noted that this signalled a move beyond simply supplying an item for purchase as businesses would have an ongoing relationship with a buyer and the product, as in the case of connected car tyres that report their status back to the manufacturer.

Daugherty elaborated: "As businesses move to this notion of the outcome economy, a company selling products, such as machinery or appliances, will change to a service company. This creates a major strategic shift."

It also relies heavily on data. As tech research specialist ARC Advisory Group recently noted: "IIoT projects often become Big Data projects."

Accenture advised establishing interoperability and security standards to ensure data can be shared with confidence between companies.

Further, new financial models will also be needed to support pay-per-use and other services-based offerings, it said.


Data sourced from Accenture, ARC; additional content by Warc staff

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CMO boardroom role questioned

22 January 2015
LONDON: Many chief marketing officers believe they should be in the boardroom but if they are not there, a leading industry figure suggests, it is because they are not up to the job.

"Marketeers have spent years bemoaning the fact that they aren't on the board, but it's probably because they just haven't been good enough," said David Wheldon, Barclays head of brand, reputation and citizenship, speaking at a London event organised by marketing consultancy Oystercatchers and reported by The Drum.

"It doesn't matter if they are on the board, everyone just needs to do their job properly," he added.

Another factor hindering the ascent to the boardroom was highlighted by Mike Hughes, director general at advertiser trade body ISBA, writing in the Guardian.

"Many marketers fail to appreciate the importance of learning the language of the boardroom," he said, "and even more fail to take the time to expand their knowledge of other functions in the business."

But he saw two developments working in favour of marketers: the fact that more companies understood the importance of putting the customer at the heart of the business; and the use of data to drive long-term growth.

The last point was picked up by Mark Phibbs, vp/marketing EMEA at Adobe Systems Europe, who pointed to an improved ability to measure the return on investment for marketing. "This will allow us to be increasingly seen as directors of customers and revenue, rather than the director of spending," he said.

Back at the Oystercatchers event, the chief executive of United Biscuits, Martin Glenn, believed strongly that marketers should be in the boardroom and argued that they have the skills to lead a company "if marketing strategy is put at the heart of what they [marketers] do".

He described marketers as "change agents" who brought "the inconvenient truth into the organisation".

As an example he cited the impact of discount grocers on the UK's big four supermarket chains. The threat had been ignored, he said, because no-one had argued against the prevailing business model – we have land so we'll build hypermarkets.

"There haven't been enough strong marketers in that situation, which is why I think they should be on the board," he said.

Data sourced from The Drum, The Guardian; additional content by Warc staff

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Search trumps traditional media

22 January 2015
NEW YORK: Search engines are the most trusted media source globally according to a new survey which shows them edging ahead of traditional media for the first time.

The 2015 edition of the annual Trust Barometer produced by PR firm Edelman was based on survey of 33,000 people (including 27,000 members of the general public and 6,000 identified as the "informed public") in 27 countries around the world.

It found that media was the least trusted industry sector, with just 51% expressing faith in it. Further, search engines (64%) emerged as more trusted than traditional media (62%), with millennials in particular (72%) likely to prefer them.

"The takeaway from that particular finding is as a company is thinking about their content or message, the findability of that is paramount and the pervasiveness of that across multiple channels is also critical," said Ben Boyd, president of Edelman's practices, sectors, and offerings.

He told PR Week that public trust in businesses, NGOs, media and government was falling across the board, the first time in 15 years this had happened.

"We have historically seen a seesaw," he explained. "When business is up, government is down and vice versa."

He attributed this development to the list of "unpredictable and unimaginable" events that took place in 2014, from the spread of the ebola virus in West Africa, to air crashes and disappearances, the rigging of foreign exchange markets, data breaches …

"The list goes on, and folks are feeling out of control," said Boyd. "They are waking up and going, 'Oh, yet again another thing'."

A related finding was that more than half of the global informed public (51%) think that the pace of development and change in business today is too fast.

But relatively few believed the changes have anything to do with improving people's lives (30%) or making the world a better place (24%).

Rather technology (70%), business growth targets (66%) and greed (54%) were seen as the main drivers of change.

"Trust is a forward-facing metric of stakeholder expectation," Edelman declared and suggested that business could raise trust levels by developing ideas and products that yield societal and personal benefits.

Data sourced from Edelman, PR Week; additional content by Warc staff

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Brands must be more 'socially apt'

22 January 2015
SINGAPORE: Mobile and social marketing is the future but marketers need to appreciate the constraints faced by many mobile users and to develop a more appropriate social presence.

Simon Kemp, managing partner/Asia of social marketing agency We Are Social, made the points in a blog introducing Digital, Social & Mobile in 2015, a report pulling together relevant digital statistics from around the world.

More than three-quarters of the world's mobile connections are still pre-paid, he said, and the costs of acquiring a phone and maintaining an active mobile connection represented a significant proportion of household expenditure in many developing nations.

Consequently, "content producers and marketers must balance their desire to provide 'rich' user experiences such as online video with the likely costs that this will entail for their audiences."

Further, 58% of the world's mobile connections still come from feature phones, meaning that many people are unable to access such content even if they want to.

Unilever is one company that understands this, as demonstrated by its award-winning Kan Khajura Teshan campaign in India. This free-to-use entertainment channel was activated by a missed call, with content delivered by mobile interspersed with communication about its brands.

The report also highlighted the advance of social media, with users in developing nations pushing penetration towards one third of the world's population by the end of 2015.

But Kemp said that few brands were using social effectively, especially in Southeast Asia, one of the fastest growing regions for social with monthly active users up 23% in 2014, compared to an average of 10% for the wider Asia Pacific region.

"Far too many brands use social as a broadcast channel, which is like expecting to be the centre of attention at someone else's party," he told Mumbrella.

Most brand activity he saw was focused on promotion and sales rather than attempting to understand the lives of those people they were connecting with, a situation he likened to infants who thought the world revolved around them.

Brands, he suggested, needed to grow up and "become a more socially apt entity … they need to learn empathy, consideration and generosity – not simply buy a stack of Facebook ads".

Data sourced from We Are Social, Mumbrella; additional content by Warc staff

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Always taps power of purpose

22 January 2015
CHICAGO: Always, Procter & Gamble's feminine hygiene line, has demonstrated the impact of purpose-driven branding with #LikeAGirl, a campaign helping drive social conversations and shift perceptions.

Karuna Rawal, evp/business director at Arc Worldwide, and Rachel Darville, global strategist at Leo Burnett, discussed this effort at the 4A's (American Association of Advertising Agencies) Strategy Festival.

While Always is the leader in its category – and is used, under various names, by over 220 million women worldwide – the brand wanted to build deeper connections with its target audience

"At shelf, we were being chosen by more girls and women than any other brand," Rawal said. (For more, including more details about campaign development and implementation, read Warc's exclusive report: P&G tackles a taboo with a digital conversation.)

"But we felt like our connection as a brand really stopped there – not surprising given the category that we compete in."

In an attempt to change this situation, Always decided to look beyond the category conventions of scientific demonstrations or idealised imagery.

"Just talking about functional superiority wasn't enough," Rawal told the Strategy Festival delegates.

"We really had to start thinking about a different way to elevate the brand to go from just functional superiority to what we call 'emotional superiority'."

Research revealed that a majority of girls lose confidence during puberty, a trend encouraged by put-downs and insults based around gender.

Indeed, only 19% of women have positive associations with the expression "like a girl" – something that Always sought to step forward and counter.

Working with documentarian Lauren Greenfield, Always created a video where men and women, as well as boys and girls, were asked to engage in actions such as "running like a girl" and "throwing like a girl".

The girls yet to experience puberty performed these tasks confidently and proudly, whereas older women and men erred towards re-enactments displaying considerably less assurance.

By tapping into this tangible and powerful difference, Always successfully prompted far-reaching online and offline conversations about the topic, and how perceptions might be changed.

Data sourced from Warc

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Netflix accelerates global ambitions

22 January 2015
NEW YORK: Netflix, the US-based OTT video streaming service, has announced its intention to expand into 200 markets around the world, up from the current 50, by the end of 2016.

The company reported it had added a net 2.4m international subscribers in the fourth quarter, following its launch in several European markets, and 1.9m in the US. It now has a total of 57.4m subscribers globally.

"Acceleration to 200 countries is largely made possible by the tremendous growth of the internet in general, including on phones, tablets and smart TVs," said chief executive Reed Hastings.

"Once we complete the expansion, we're going to have a very unique and compelling proposition to producers, which is we can get your content seen and loved around the world," he told the New York Times. "In Kenya, in Argentina, in Vietnam, in the Philippines, just everywhere in the world that we can."

That claim might not apply to Australia, however, where the planned March launch has been surrounded by suggestions that the company has been blocking viewers who use virtual private networks to access overseas versions of Netflix and that prime series such as House of Cards will not be available to local subscribers.

Nonetheless, such content is an integral part of the expansion strategy. "We see original programming travel and carry the Netflix brand around the world," said Ted Sarandos, chief content officer.

To that end, the company said it would triple the amount of original content produced in 2015 to around 320 hours.

Netflix also said it was "exploring options" in China, where it needs to secure a license to operate, but described its plans for that country as "modest."

Data sourced from New York Times, Financial Times, Business Insider, 9News; additional content by Warc staff

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FOMO drives China's internet giants

22 January 2015
BEIJING: A fear of missing out on the next big thing is driving the investment strategy of China's three internet giants, which are increasingly impinging on each other's patch as they strive to attract users.

An example of this trend comes in reports that ecommerce business Alibaba is looking to expand in social media by adding a new messaging feature to its Alipay mobile payment service.

That would take it into the territory currently dominated by social media giant Tencent and its WeChat app. At the same time, Tencent has been promoting WeChat's payment feature.

Reuters noted how Alibaba, Tencent and search engine Baidu have all recently invested huge sums in taxi-hailing apps and said group-buying services were likely to be the next battleground.

According to Taipei-based tech commentator Ben Thompson, it is all about gaining the most users and, consequently, the biggest returns. "Alibaba, Tencent and Baidu... don't want to miss out – or finish a distant second, which is just as bad – so they're investing heavily," he said.

The point was echoed by Duncan Clark, managing director of Beijing-based consultancy BDA. "What keeps people up at night is the fact that they might miss a certain trend or a certain hot company that really is going to bring all the attention and the users in," he said.

And in the world's biggest smartphone market, those users are largely mobile. "The fight to stay essential, to stay relevant, to stay on top of the home screen – it's what it's all about," Clark added.

Reuters also noted that promotions and marketing account for a significant proportion of investment in start-ups as companies chase users. In the first quarter of 2014, for example, Tencent's marketing costs almost doubled as it subsidised taxi-hailing app Didi Dache.

"It's right to question what are the limits of this," said Clark. "Not all these people can win."

Data sourced from Want China Times, Reuters; additional content by Warc staff

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Unilever seeks advertising efficiencies

21 January 2015
LONDON/ROTTERDAM: Unilever, the FMCG giant, achieved significant efficiencies in the cost of producing its advertising during 2014, and indicated this process will continue in 2015.

Reporting full-year results, the company said that, as a result, it had been able to "increase our share of spend whilst maintaining brand and marketing investment at 14.8%".

Paul Polman, its CEO, set great store by the company's marketing efforts. "We continue to invest behind our brands, increasing our share of spend relative to competitors in all four categories [personal care, food, refreshment and home care]," he said in a webcast.

"Of course, it's not just what we spend but how we spend that really matters," he added, noting that Unilever was the most-awarded advertiser at Cannes for the second year, and had taken a top Effie award for a third year.

Particularly successful in these terms was a campaign for Dove, the personal care brand. The much-lauded "Sketches", where an artist drew female subjects based on both a self-description and the views of people who had met the subject only recently, became a viral hit, as well as winning a Grande Effie and a Cannes Creative Effectiveness Lion.

"It's no coincidence that in the Kantar ranking of top global FMCG brands this year, Unilever has more brands in the top 50 than any other company in the world," Polman stated.

During the course of the year Unilever was shifting more of its marketing budget into digital – reaching 20% of the total in the third quarter, when Polman observed that digital, when done well, produced a better return on investment than traditional media.

At the same time, he had revealed that non-working media spend, including production costs and agency fees, had been reduced, saving the business £100m.

The need for such measures was underlined in the full-year results, which showed a slowdown in demand for Unilever's products in emerging markets, where it generates more than half of its sales. China was hit particularly hard, as trade destocking led to a 20% sales decline in the fourth quarter.

Polman was not overly optimistic about the coming year, either. "We do not plan on a significant improvement in market conditions in 2015," he said.

Data sourced from Unilever, Marketing Week; additional content by Warc staff

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Big data delivers

21 January 2015
LONDON: Retailers can boost online campaign margins by up to 900% - that is the extraordinary claim being made for a new predictive analytics engine that has been four years in the making.

Online retail specialist Summit worked with team of academic statisticians to develop Forecaster, which CEO Hedley Aylott described as a "crystal ball" capable of showing where and how to spend online ad budgets to deliver the greatest profit.

It takes vast amounts of internal and external data – from sources such as Google, transaction history, weather, location, stock availability and current TV ads – and then applies complex statistical models to predict the likely sales from a given marketing spend.

To achieve the predicted sales, the platform then recommends how to adjust the bid level and messaging for paid search, display and product listing ads so the profit from each channel is maximised.

Aylott reported that in trials with major retail clients Forecaster had increased margins from campaigns by as much as 900%.

He pointed to several unique features, including the number of customer buying triggers and the way it used TV.

"We 'fingerprint' TV ads by client and their competitors," he explained. "When a TV ad appears, we instantly make changes to the client's online ads."

So, for example, when a competitor advertises a tablet on TV, Summit can then increase bids for their client's tablet ads for a set period of time in order to capture people who go online to buy after seeing the TV ad.

Summit said the biggest increase in search volume occurs within ten minutes of an ad, particularly at peak viewing times between 8pm and 9.30pm. Further, 30-second ads were shown to increase search traffic by 11% more than 20-second ads.

It cited a campaign for catalogue retailer Argos, using the Forecaster system, which increased paid search traffic by 33%, sales by 31%, lifted conversion rates by nearly 5% and the average order value by 18%. Ultimately, the cost of each sale fell 14%.

Data sourced from Summit; additional content by Warc staff

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Walmart taps 'growth hacking' mindset

21 January 2015
NEW YORK: Walmart, the retail giant, has successfully tapped into the notion of "growth hacking" to create a range of powerful tools and solutions for its customers.

Brian Monahan, vp/marketing at Walmart.com, discussed this subject while speaking at the ad:tech New York conference.

"Certainly, our marketing has really embraced growth hacking," he said. (For more, including examples of how the firm has leveraged this idea, read Warc's exclusive report: Walmart taps the growth hacking mindset.)

"It's this interesting combination of makers, coders, doers, marketing strategists and consumer insights coming together."

Such an approach is typically associated with start-ups like Uber, Airbnb and Dropbox, all of which identified ways of utilising digital data and tech to create uniquely sticky products that serve unmet customer needs.

This process is intended to be iterative and provide solutions that are so useful and intuitive they naturally attract users and encourage organic word of mouth, instead of relying on communications for building awareness.

By solving widespread problems, they similarly ensure members keep coming back, thus enhancing loyalty levels.

For Walmart, developing a bespoke set of tools for consumers has the additional benefit of enabling it to stand out from rival retailers that are vying for their attention.

"If you want to colour outside the lines, you can't really buy shrink-wrapper, commodity products, because, by definition, it's not differentiated," Monahan said.

A profound advantage possessed by the retailer in this area is @WalmartLabs, a unit located in Silicon Valley that has completed roughly 15 acquisitions since 2011.

These include fashion app Stylr (which assists people in finding clothes they want in nearby stores), Adchemy (an ecommerce and product-search specialist), Inkiru (an analytics provider) and Luvocracy (a social marketplace).

The technology and talent housed within @WalmartLabs has helped it to "hack" numerous elements of the retail experience via powerful digital offerings.

"We have the engineering, data, resources to do more executions like that. I think that's really the key to trying to unlock these really transformational either expressions or marketing platforms," Monahan said.

Data sourced from Warc

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India TV market attracts US giants

21 January 2015
MUMBAI: The fast-growing India TV market is proving an attractive option for US media companies, which are increasingly looking overseas for growth as they face the prospect of more American viewers 'cutting the cord'.

Viacom is the latest to step up its presence in India, in a deal with the Reliance Industries conglomerate which will see it take a half share in five regional entertainment channels, according to the Wall Street Journal.

"There's no question that India's going to grow dramatically – and that the seeds are being sown right now," said Bob Bakish, president of Viacom International Media Networks, the unit that oversees the company's international assets.

"You have to believe India is one of the major markets of the 21st century," he added.

Those seeds include a shift to digital TV, with around 60% of the country now covered.

The spread of set-top boxes is expected to help produce more accurate viewing figures and also more accurate subscriber figures – many of the thousands of local cable operators are said to under-report the latter in order to avoid having to pay higher subscription fees to media companies.

These are among the factors that make India one of the world's fastest growing markets in terms of TV revenue: PricewaterhouseCoopers has forecast a compound annual growth rate of 16% between 2013 and 2018, with ad revenue growing at 13% a year.

Those figures have also drawn the attention of other overseas companies, including Sony which, like Viacom, is looking at regional Indian networks as a way of building its local portfolio.

"It's a primary focus of our growth strategy in the next couple of years," according to Andy Kaplan, president of world-wide networks for Sony Pictures Television.

And 21st Century Fox, already a major player through its Star networks, has invested heavily in Indian sports channels.

Despite the undoubted opportunities, however, India is a very fragmented market. As well as 40,000 "last mile" local-cable operators, there are 826 satellite TV channels, more or less evenly split between news and current affairs and general entertainment.


Data sourced from Wall Street Journal, IndianTelevision.com; additional content by Warc staff

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Programmatic complicates data handling

21 January 2015
NEW YORK: The growth of programmatic advertising has accelerated the adoption of automation tech, but marketers are still searching for the ideal mix with some using more than 30 different tools on a regular basis, according to a new whitepaper.

The findings of Marketing Data Technology: Cutting Through the Complexity are based on phone, online and in-person surveys of more than 50 advertisers, marketers, publishers, technology developers and marketing service providers carried out by the Winterberry Group for the Interactive Advertising Bureau (IAB), a trade body.

This report suggested that enterprise marketers are using, on average, a dozen distinct toolsets to support their collection, management and redeployment of customer data, with some working with more than 30.

Asked whether they preferred an integrated, stacked approach to adopting marketing automation technologies or an independent, bespoke tech solution, marketers were split down the middle.

Those opting for an integrated model cited the ability to measure return on investment, the lower cost of purchase and implementation and the speed and ease of implementation.

The independent approach might add day-to-day complexity but its proponents also felt it offered ease of integration with other licensed and proprietary advertising and marketing technologies used within their organisation, as well as with those used by business partners and clients.

More important than either of these, however, was a desire to support best-in-class functionality.

"No single 'one-size-fits-all' technology can address every marketer's need," said Jonathan Margulies, managing director at Winterberry Group, but he added that the research had found a lot of common ground.

"Marketers and publishers share a similar, overarching directive: put audience data to real use.

"And as data sources continue to expand, they expect the platforms powering that deployment will continue to assume a more central role as the centerpiece of their omnichannel marketing practices."

Accordingly, the IAB has announced its intention to develop technical standards to ensure that all digital marketing tools available can work in an integrated fashion.

Data sourced from IAB; additional content by Warc staff

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Chinese luxury market dips

21 January 2015
SHANGHAI: China's luxury market is undergoing a fundamental shift, as domestic spending on top-end goods dipped in 2014, even as overseas spending by Chinese consumers continued to boom according to a new report.

In its latest overview of this market, consultancy firm Bain & Company said that the ongoing crackdown on corruption and promotion of greater frugality among government officials were factors in the negative growth (-1%) in the domestic market.

This was especially true of certain segments that feature prominently in luxury gifting, notably watches and menswear. These two categories saw the greatest year-on-year declines, of -13% and -10% respectively, China Daily reported.

But other factors are also coming into play. Based on a survey of 1,400 respondents, Bain concluded that the character of the market is altering as the economy slows – the 7.4% figure for 2014 was the lowest in 24 years – and as consumer behaviours change and new brands emerge.

Logos, for example, are no longer regarded as essential, as luxury consumers grow in confidence and become increasingly adventurous.

Some 70% percent of the respondents to Bain's survey said they would like to try different brands and styles and nearly 45% said they plan to buy more emerging brands in the next three years.

Economic growth in 2014 at 7.4%, was at its lowest in 24 years, a

Spending outside China, however, continues to increase, by 21% in 2014, and Chinese consumers are now spending abroad more than three times as much as they spend at home.

"Travelling Chinese shoppers are the alpha consumers of global commerce today, with pent-up demand for high-quality goods at home leading them to overindulge in spending abroad," Sage Brennan, CEO of China Luxury Advisors, told Reuters.

Nor is the trend towards spending outside one's home market confined to Chinese consumers: a December report from Bain noted how, in most markets, the luxury goods industry is now driven by tourist spending. "Who the buyers are matters more than where they buy," it said.



Data sourced from China Daily, Bain & Company, Reuters; additional content by Warc staff

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Value is key for marketers

21 January 2015
CHICAGO: One-third of US shoppers consciously seek out private label products to save money and CPG marketers need to "keep value and affordability in the crosshairs", a new study has said.

According to a Times & Trends report from shopper information business IRI, US consumers spent a total of $120bn on private label products in 2014. This represented a 2.1% rise on the previous year but IRI said this growth was levelling off and was in any case largely driven by price increases.

It further noted that value did not necessarily equate to lowest price. "Affordability means something different to each unique shopper," it said, adding that CPG marketers had to "maintain a clear vision of how their most promising consumers and shoppers are defining affordability at each moment of purchase".

IRI also observed that marketers could look to fracture the concentration in this market, where the top 50 CPG categories account for 64% of overall CPG dollar sales and 67% in the case of private label sales.

It pointed to "outside-the-box product launches" that took businesses into new categories and cited the example of Procter & Gamble: the FMCG giant introduced a new sleep remedy, ZzzQuil, and gained 30 share points in the category, worth more than $120m, in one year.

National brands have shown some momentum in drug stores, IRI reported, with innovation particularly strong in beauty and vitamins.

Private label, on the other hand has been making inroads in the mass/super channel, gaining significant share in frozen departments (+5.3 unit share points) and lesser increases in refrigerated (+1.8) and general food reporting increases (+1.2).

"To ensure the right products are on the right shelves at the right time, CPG marketers must invest to understand shopping behaviours and key influencers of those behaviours at a very individual level and across CPG channels," said Susan Viamari, editor of Thought Leadership, IRI.

She also recommended that manufacturers and retailers work more closely together, suggesting they "participate in joint business planning to establish an optimal mix of categories, brands, pack sizes and price points within each unique marketplace".

Data sourced from Business Wire, IRI; additional content by Warc staff

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Digital divergence on personal tech

20 January 2015
DAVOS: Most internet users globally believe that personal technology is making the world a better place but a new survey also highlights some significantly different attitudes between consumers in developed markets and those in developing ones.

Tech giant Microsoft polled 12,002 internet users in 12 countries – France, Germany, Japan, South Korea, the US, Brazil, China, India, Indonesia, Russia, South Africa and Turkey – for its second annual report on how personal technology is changing our lives.

The positive impacts were centred round how we shop, work, learn and generally get things done.

Majorities in all 12 countries surveyed said they were able to find more affordable products (74%), while innovation in business (72%) and starting new businesses (68%) were also important pluses; education (67%) and productivity (65%) completed the top five positive effects.

Privacy was by some distance the biggest concern and this had jumped five points since last year's survey to 52% of all respondents; India was the only country surveyed where a majority did not express a negative view of this aspect of technology's impact.

The other most pressing issues were personal security (26%) and trust in media (24%), with the latter point also illustrating how perceptions differ depending on where one is standing.

Respondents in developing countries believed by a 2:1 margin that personal technology has had a mostly positive effect on trust in the media; but in developed countries respondents thought, again by a 2:1 margin, that the effect on trust in the media has been mostly negative.

The study pointed out that this was a consequence of differing media habits, with 70% of respondents in developing countries getting most of their news from social media, compared to only 31% in developed countries.

Other areas where views diverged were on how personal technology is affecting social bonds. People in developing countries were more optimistic in this regard: 60% thought it was having a positive effect compared to just 36% in developed markets.

Similarly, 59% of emerging market consumers welcomed new sharing economy services, such as Airbnb or Uber, far head of the 33% figure for developed countries.


Data sourced from PR Newswire, Microsoft; additional content by Warc staff

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Millennials invent parenting 2.0

20 January 2015
NEW YORK: Nearly 6 in 10 millennials are intentionally raising their children differently from how they themselves were raised, and they generally think they're better parents than their own parents were according to new research.

For its latest Prosumer Report – The New Dynamics of Family – marketing communications agency Havas Worldwide drew on findings from an online survey of 6,767 adults in 20 countries (Australia, Brazil, China, Colombia, the Czech Republic, Ecuador, France, India, Indonesia, Italy, Japan, Mexico, Portugal, Singapore, South Africa, Taiwan, Thailand, Ukraine, UK, and the US). 

"Nothing is more important than family. But that word has very different meanings for different people," said Havas Worldwide and Havas Creative Group Global CEO Andrew Benett.

"To contribute to consumers' lives in a meaningful way, brands must first understand the realities of family relationships and the complexities of parenting in today's digital environments."

Havas highlighted the finding that millennials are going out of their way to bring up their children in a different way from their parents. One might think this true of every generation but the proportion in this generation is higher than before: 59% of 18-34 year old parents agreed they were doing this, compared to 53% of 35-54 year olds and 47% of the over-55s.

This age group was also convinced of its own abilities in this regard, with 44% saying they were better parents than their own parents had been, compared to 16% who disagreed.

This gap was much smaller among older age groups, perhaps able to look back with a greater degree of detachment. Only 36% of 35-54 year olds felt they had done better than their own parents (19% disagreed) and 29% of the over 55s (19% again disagreed).

And while millennial and baby boomer parents could agree on some aspects of child rearing – the importance of raising them to be kind, honest, resilient and tolerant – there were other areas on which they placed very different emphases.

Thus millennials were looking to instil their children with a sense of adventure and creativity, while baby boomers looked to the value of hard work.

The role of technology got a mixed reception. Around half of respondents thought it important that parents give their children up-to-date technology, while a similar proportion were fearful of its impact on childhood.

Indeed, a majority agreed that digital technology and the internet were ruining childhood, with millennials most likely to think this. They were also more likely than older age groups to express concern that technology is destroying family life.


Data sourced from PR Newswire, Havas Worldwide; additional content by Warc staff

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MEA smartphone market booms

20 January 2015
DUBAI: The market for smartphones is booming across the Middle East and Africa, with 4G handsets gaining ground rapidly in Gulf states, according to new IDC research.

The latest figures from market intelligence firm International Data Corporation (IDC) show that smartphones now make up 75% of the phones shipped in the GCC [Gulf Co-operation Council]. Shipments of 4G LTE handsets have increased more than four times over the past year, to the point where they now account for almost half of all smartphones sold in the region.

"The GCC is less than a year behind the market development already seen in Western Europe," said Simon Baker, program manager for IDC's handset research in Central Europe, Middle East and Africa.

Competition and falling prices are major factors in boosting the uptake of 4G LTE in the GCC, as Samsung's current dominance of Android handsets is starting to be challenged by Chinese brands.

IDC research further showed that in Africa, Turkey and the wider Middle East beyond the GCC, the number of smartphones sold during the third quarter of 2014 was up 300% year on year.

"We are in the midst of a boom," said Isaac Ngatia, a research analyst at IDC Middle East, Africa and Turkey.

"The technology levels are more basic than those seen in the GCC and 4G phones remain relatively uncommon," he added, "but many consumers are now getting their hands on a smartphone for the first time."

The average price paid in these markets is around half that in the GCC and the brand situation is also very different.

"Beyond Samsung and Chinese brands like Lenovo, Huawei, and ZTE that are making a push in the region, many of the bigger players just focus on single countries or sub-regions and aren't well known beyond them," said Baker.

There are also regional brands focused on distribution and marketing and who source handsets from independent manufacturers in China. 

IDC noted the examples of Tecno in Nigeria and Kenya, whose smartphone shipments were up 269% year on year in Q3 2014, and Q-mobile in Pakistan, which has more than half the national market and posted growth of 42%.


Data sourced from IDC; additional content by Warc staff

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Brands need to educate customers

20 January 2015
CAMBRIDGE, MA: Helping customers learn can be as strategically important as learning from customers, a leading industry figure has said.

Writing in the Harvard Business Review, Michael Schrage, innovation expert and a research fellow at MIT Sloan School's Center for Digital Business, argued that many user experience design strategies fall short by limiting their approach.

While it is clearly important to use data and analytics to learn from customers and to improve usability and enhance satisfaction, brands could also do a lot more to coach customers themselves.

"Does anyone doubt that Steve Jobs, Jonny Ive, Jeff Bezos and Mark Zuckerberg have done a fantastic job of educating and training their best users and customers to (with apologies to TBWA/Chiat/Day) 'Behave Different'?" he asked.

Developing smarter and more knowledgeable customers has a number of benefits, from making the purchase process easier to increasing the ability to get value from an innovation.

"That may be a much better investment than boosting the smarts, knowledge or good manners of an employee," Schrage suggested.

Examples came from the airline and retail categories. He related how, in response to a question on what JetBlue's customers could do to improve the airline, an executive had replied they could be more polite.

It has now produced a series of videos to teach passengers about in-flight etiquette, with the aim of gently easing common areas of friction experienced in the air.

He argued that it was possible to use this strategy to create a competitive advantage. Hointer, a retail start-up marrying online and physical shopping in a new way, is, he said, "educating its shoppers to shop in a different way with different norms and different expectations".

The result was not only that these shoppers became more sophisticated, but that they were also more likely to become frustrated with other retailers where that experience was not replicated.

"That's where value-added differentiation and competitive advantage come from," Schrage stated.

Data sourced from Harvard Business Review; additional content by Warc staff

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Kraft tackles data integrity issues

20 January 2015
NEW YORK: Kraft, the food group, has implemented major steps to improve the quality of the data supporting its marketing campaigns – a move other brand owners may benefit from pursuing.

Julie Fleischer – the director/data, content and media at Kraft Foods – discussed this topic while speaking at Advertising Age's latest Data Conference.

And she challenged a received wisdom within the marketing industry that suggests the figures delivered by third-party providers are accurate approximately 60% of the time.

Kraft's investigations into this subject, by contrast, indicated such confidence was nowhere near justified – a fact which should worry suppliers and clients.

"Ninety percent of data is crap," Fleischer said. "Data integrity matters. And the data is crap." (For more details, including how Kraft is addressing issues around measurement, read Warc's exclusive report: Kraft tackles advertising's data integrity problem.)

Drilling down into this area, Fleischer was able to draw upon detailed internal analysis conducted by the manufacturer of Philadelphia, Gevalia and Cool Whip.

"We spent that last four months systematically vetting third-party data across simple segments like gender, age, income [and] some behavioural characteristics," Fleischer said.

"Over a series of 800 data polls checked across four providers, we found egregiously low levels of validity."

An illustration related to Gevalia coffee's launch of K-Cup capsules for Keurig's brewing machines. Given that the messaging for this product was useful only to people possessing the relevant appliance, precision was key.

Working with two ecommerce platforms, a coupon site and a specialist in grocery purchase data, however, proved extremely disappointing for Kraft.

"The level of accuracy on these datasets ranged somewhere between 14% to 20%," Fleischer said. "Eighty percent of this buy was spent against non-Keurig owners when our datasets were Keurig owners.

"This is unacceptable. The problems with third-party data are rampant. There is no single source of truth, so it's a wild, wild west."

Kraft's steps in addressing this issue have included creating a "data dictionary" outlining the methodologies and sources used by leading data providers, and employing digital tools from Starcom to "sit on top of" its data-management platform.

A more thoroughgoing remedy has involved tapping into Kraft's tranche of in-house information, from sales totals to consumer behaviour while they are looking at recipes online.

"Because third-party data is generally untrustworthy, we double down on first-party data," said Fleischer.

Data sourced from Warc

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India's rural consumers upgrade

20 January 2015
MUMBAI: From biscuits to televisions, the expectations of India's rural consumers are changing and price is taking a back seat to brand image and aesthetics a report has said.

Consulting firm Accenture Strategy India highlighted the shift in perspective, driven by the penetration of media and telecoms services, in the latest of its Masters of Rural Markets series, for which it carried out focus group discussions with rural consumers in ten Indian states and surveyed 2,800 rural respondents in eight states, as well as interviewing executives and business leaders.

"Rural consumers are changing in three fundamental ways," the report said. "They are far more aspirational, networked and discerning."

Some marketers no longer bother to make the distinction. "There is no difference between the urban and the rural consumer," Mayank Shah, group product manager at biscuit maker Parle Products, told Livemint. Consumption patterns are broadly similar – with more premium products being sold in rural areas and only total spend being less.

Accenture's research found that 71% of rural consumers buy branded products and the factors driving purchase are weighted 66:34 in favour of brand image, functionality and aesthetics as against price.

"The next generation of the rural consumer who is coming in has a higher exposure level than the previous generation," said Arun Pal, chief operating officer for domestic appliances brand Kenstar.

He cited the example of flat-screen TVs, sales of which are now split evenly between urban and rural areas, but just two years ago these were seen as an urban product.

This underlines another of the report's findings – that four in ten rural consumers are spending more in order to upgrade. In doing so, they are "defying conventional wisdom which says that rural consumers care most about getting the lowest possible price and will settle for sub-standard offerings to get the best deal," the report said.

While the old fashioned image of the rural consumer continued in one of four segments identified by the report – the traditionalist – the others – including steady climbers, young enthusiasts and village elites – were much more brand aware.

Brands need to extend not just their physical reach but their "mental reach" in order to grasp the opportunities offered by these new consumers, the report said.

Warc's recent series on Indian youth made a similar point, when Narayan Devanathan of Dentsu India Group argued that the urban-rural divide was a myth and that the real split was between traditional and progressive mindsets.


Data sourced from Livemint, Accenture; additional content by Wear staff

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'Exthetics' excites brands

20 January 2015
HONG KONG: While extreme pursuits and brands have developed strong working relationships in many parts of the world, Asia has tended to lag behind - at least until the rise of 'Exthetics'.

The term is a combination of 'extreme' and 'aesthetics', and was coined by a group which was virtually unknown six months ago, but has since worked with major brands, including - perhaps the ultimate accolade for their activities - Red Bull.

The Hong Kong-based trio shot to international fame with a selfie taken at the top of a skyscraper in the special autonomous region's business district, and have been approached by several brands eager to work with them in creating content.

But the three told Campaign Asia-Pacific they are careful to pick exactly who they partner with. "If a brand comes along and they fit with us and their product or service is useful to us, we'll be happy to consider working with them," said Daniel Lau, who took the original selfie." 

Those criteria led them to work with adidas, as the brand supplied clothing and merchandise for use in their urban explorations, which take in abandoned spaces and building sites as well as tall buildings.

Then followed Canon (they use the firm's cameras to record their projects), Palladium Boots and Red Bull.

"I think brands like Red Bull want more Asian brand ambassadors," said Lau. "There are not many Asians doing extreme sports or what we're doing." 

But, he added, the group wanted to work only with brands that shared their values in some way. "'There are still brands that approach us that have nothing in common with what we're doing or our style and approach," he said.

They are now celebrities in many parts of the digital world, attracting attention from as far away as Brazil. 

Celebrity endorsement is a common approach in China, although Millward Brown has reported that its effectiveness is decreasing, with likeability and brand linkage both falling compared to non-celebrity advertisements.

The main factors contributing to this, it said, include excessive use of celebrities, failure to use comprehensive selection criteria and poor matches between celebrities and advertised products.


Data sourced from Campaign Asia-Pacific; additional content by Warc staff

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