Android dominates global smartphones

1 August 2014
GLOBAL: Google's Android operating system has retained a commanding lead in Europe while also capturing a record 85% of global smartphone shipments, according to two new reports, one of which also showed Xiaomi challenging Samsung in China.

According to the latest quarterly smartphone data from Kantar Worldpanel ComTech, Android secured 74% market share in Europe in Q2 2014, followed by Apple (15.3%), and Windows took 8.8%.

While Samsung remained the dominant manufacturer of Android handsets with 44% share of Europe's five largest markets – the UK, Germany, France, Italy and Spain – Android received a significant boost from smaller vendors, such as Huawei of China, Alcatel OneTouch and Wiko.

Apple's share in Europe remained static, the report said, although sales of its iPhone 5C almost equalled those of the iPhone 5S in the UK.

"The iPhone 5C continues to attract a different audience from the 5S, with its customers tending to be female, mid to late-adopters and less affluent," explained Dominic Sunnebo, strategic insight director at Kantar Worldpanel ComTech.

Whereas smaller manufacturers have been taking market share from traditional vendors in Europe, the situation was different in the US where consumers continued to stick with the larger players, Apple and Samsung, which Sunnebo said had benefited from strong marketing.

"In the USA, Samsung's marketing power continues to play a key part in driving sales of the S5," he said. "Some 61% of Galaxy S5 buyers recall seeing TV ads relating to the handset while 40% remember seeing online advertisements."

By contrast, Chinese consumers showed less attachment to the large brands and local manufacturer Xiaomi surged ahead to take 27% market share of sales in urban China compared with 21% for Samsung.

Its budget Xiaomi RedMi model proved to be particularly popular and Sunnebo said Xiaomi's success "isn't expected to slow down any time soon".

Meanwhile, a separate report from research firm Strategy Analytics revealed global smartphone shipments grew 27% year-on-year to 295m units in Q2 2014, and Android OS took a record 85% global market share.

Neil Mawston, executive director at Strategy Analytics, said: "Like the PC market, Android is on the verge of turning smartphone platforms into a one-horse race. Its low-cost services and user-friendly software remain wildly attractive to hardware makers, operators and consumers worldwide."

It comes as Samsung, facing tough competition in China, announced its first quarterly year-on-year fall in net profit in nearly three years, the Wall Street Journal reported.

Net profit fell 20% to 6.25tr won ($6.1bn) from 7.77 tr won a year earlier while revenue fell 8.9% to 52.35tr won. Samsung hopes to restore the situation by launching two new high-end smartphones in the next six months.

Data sourced from Kantar Worldpanel, Strategy Analytics, Wall Street Journal; additional content by Warc

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Consumers engage with mobile ads

1 August 2014
NEW YORK: Nearly half of American mobile shoppers find mobile ads to be informative and helpful, up from 22% in 2013, and 40% click on mobile ads because they're relevant to their purchase research, a new study has revealed.

Now in its third year, the latest US Mobile Path-to-Purchase study also found that almost half of those who click on a mobile ad go on to conduct a secondary action, such as looking for more information, using a coupon, or visiting a website.

Based on a mix of survey responses and behavioural data from 6,000 US smartphone and tablet users, the study was conducted by Nielsen, xAd and Telmetrics, Marketing Land reported.

An infographic accompanying the report showed that just over half (51%) prefer ads that are relevant to their location and the top three reasons for mobile ad engagement are: coupons/discounts, brand recognition and local relevancy.

Among consumers who take action beyond clicking on mobile ads, the top five secondary actions are: visiting the advertised site (41%), looking for more information (38%), using a coupon or offer (28%), visiting a store (21%), and contacting the business (18%).

Consumers who take these actions after clicking on an ad are also likely to want to convert quickly and find businesses in their locality to make a purchase.

Over 70% look to make a purchase within a day, the report said, while half want to make a purchase within an hour. Two-thirds look for a business within a five mile radius, and 18% look for a location within one mile.

In perhaps a surprise finding, millennials are not the most receptive to mobile ads, the report found – just 37% of 18-24s and 41% of 25-34s agree that mobile ads are informative and helpful compared with half of 45-54s and 57% of 55-64 year-olds.

It also emerged that about 40% of clicks to ads are accidental, suggesting that clicks should not be given undue weight when measuring ROI metrics in mobile.

Summing up the report in comments to BizReport, Monica Ho, svp of marketing at xAd, said brands should be able to serve ads that are more relevant, engaging and effective than ever before.

"Marketers need to closely evaluate how to provide the right value when trying to reach their consumers, either through local relevance, free service, or even convenience," she said.

Data sourced from Marketing Land, Telmetrics, BizReport; additional content by Warc

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US programmatic to expand abroad

1 August 2014
NEW YORK: Nearly all (98%) large US publishers use programmatic marketing strategies to improve audience development in the US, but less than three-quarters (72%) have applied the same approach abroad, new research has shown.

A joint study, "Going Global: Programmatic Audience Development Around the World", was produced by the Interactive Advertising Bureau (IAB) and Winterberry Group, the strategic consultancy.

They conducted an online survey with over 145 leading publishers, advertisers and service providers (IAB members) and interviewed more than 36 programmatic experts between May and June 2014.

The report found that, although publishers' activity in the programmatic field is currently less active abroad than in the US, they intend to expand their overseas programmatic marketing programs over the next two years.

This will go beyond the English-speaking markets of the UK, Canada and Australia, with Brazil and China identified as two key countries for programmatic expansion.

Over half (52%) of the respondents regarded the "availability of third-party data" to be their top consideration for success in new markets, but other factors emerged as potential inhibitors.

Just over a third (34%) cited "lack of understanding of audience development" as an obstacle, 28% were concerned about a "lack of appropriate technology", although regulatory barriers were an issue for only 23%.

The report went on to identify seven key considerations to determine whether an overseas market is suitable for new or expanded development.

In summary, these factors covered: understanding the audience, programmatic know-how, an open market culture with protections against fraud, third-party audience data, technology and the means to use it, standards in measurement and valuation, and lastly, an opportunity to build scale.

Commenting on the report, IAB executive vp and COO Patrick Dolan, said: "It is clear that programmatic advertising strategies have paid dividends for US publishers, brand marketers, ad technology vendors and others in the industry, and now is the time for this practice to benefit marketplaces around the world."

A comprehensive guide to enable marketers to get the most from programmatic advertising – The Programmatic Primer – is available for Warc subscribers.

Data sourced from IAB; additional content by Warc

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Unilever: locals are main competitors

1 August 2014
LONDON: International rivals like Procter & Gamble and Colgate-Palmolive are not the greatest threat to Unilever, but instead the main competition comes from local brands in emerging markets, the FMCG firm's CEO has said.

In an interview with the Financial Times, Paul Polman said "regional players" in emerging markets have become the company's toughest competition, but he remained confident that Unilever has long-term opportunities in these markets.

For example, emerging markets will account for 80% of the world's population and new leaders in India and Indonesia have demonstrated the need for structural reform, which he said would help to accelerate growth.

Similarly, the Chinese government's drive for the country to become less dependent on exports will work to Unilever's advantage, he said, because "a company like ours is best served by inward consumption than by exports". So, "there is no cause for concern," he asserted.

Polman was speaking a week after Unilever reported its half-year results. While pre-tax profits rose 15% to €4.2bn in the six months to the end of June, boosted by disposals, analysts were disappointed that sales fell 5.5% to €24.1bn.

In order to boost sales, there has been speculation that the company would seek a major acquisition, such as Colgate-Palmolive, but Polman played down such talk.

"We always look at possibilities," he said. "Many people are focused on what they know of companies in the developed world, but there are many new companies that are coming along," he said.

Unilever currently derives 57% of its sales from emerging markets and Polman's strategy is to pursue organic growth in these regions to take the proportion to 75% while also launching premium and innovative products in developed markets.

Under his stewardship, the company has been selling off some slow-growth products from its food portfolio, such as Ragu sauce, but he cautioned against an assumption that this would extend to other categories, such as margarines and spreads.

He said: "Even if you don't like a business – and I'm not saying we don't – can someone else run it better than you? Otherwise, if you sell it and you don't get enough for it, it would not be the right thing."

Data sourced from Financial Times; additional content by Warc

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China online sales continue to grow

1 August 2014
BEIJING: E-commerce sales in China are set to rise by more than 45% this year to RMB2.76tr ($446.6bn), according to a new report from iResearch, the insights provider.

The company had previously predicted that online sales would increase by 32.4% on an annual basis to RMB2.45tr ($396.4bn), but it has now revised these figures upwards in light of new information.

More specifically, Alibaba Group, a leading player in China's e-commerce sector, has published a set of previously private figures in preparation for going public on the New York Stock Exchange.

"Based on the financial documents from Alibaba's coming IPO, we made an adjustment for our historical data and modified the market size accordingly," Jodie Ting, an iResearch analyst, told Internet Retailer.

Amongst the data revealed by Alibaba were that Taobao and Tmall, its online marketplaces, generated $248bn in sales last year.

This suggests their parent company was responsible for 81% of purchases completed by Chinese shoppers on the web in 2013 as a whole.

Drawing on the statistics provided by Alibaba, iResearch also upgraded its estimates for online retail sales in China for 2013 to RMB1.89tr ($305.8bn), compared with its original total of RMB1.85tr ($299.4bn).

Further evidence of the growth of this channel has come from the State Post Bureau of China, which reported that the amount of packages delivered nationwide rose by 60% in 2013, and 53.7% in the first half of 2014.

"In China, about 70% to 80% of parcel deliveries stem from online orders," said Wang Fang, of logistics consultancy China Express Consulting.

Data sourced from Internet Retailer; additional content by Warc

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Online community inspires TOMS

1 August 2014
DANA POINT, CA: TOMS, a "movement-driven business" active in sectors from shoes to eyewear and coffee, has progressed in these various categories thanks, in large part, to fostering a sense of community online.

Zita Cassizzi, chief digital officer at TOMS, discussed this theme while presenting at the Association of National Advertisers' (ANA) Digital & Social Media Conference.

TOMS' rise to prominence was aided by its distinct "One for One" model: every time a customer in a nation like the US purchased a pair of shoes, another pair was donated to someone living in an emerging market.

"We're a movement-based business," said Cassizzi. (For more, including other tips for connecting with millennials, read Warc's exclusive report: TOMS Shoes: five basic best practices for purpose-driven marketing.)

As a result of the company's core positioning, she continued, "community takes on a special meaning. Who are these guys? They're our customers; they're our potential future customers.

"They're leading this omni-channel and omni-connected world. They're 82m strong, between 18-to-24, and we know them well because they really have spread [information] about TOMS with a word-of-mouth [effort]."

According to TOMS' analysis, more than 80% of this demographic in America now utilise a smartphone and three-quarters make daily posts on social media.

To reflect the manner in which their mobile and social media habits are today effectively intertwined, Cassizzi's team has coined a new term: "mocial".

"We want to be social in our mobile, and mobile in the way we socially connect … and we do it early and do it fast," she said.

"These customers are expecting for you to be where they are … the moment that they want [to engage]. They're expecting this connection from you right away."

While TOMS has been able to stand out in a crowded marketplace, Cassizzi also warned the conference delegates that building a genuine sense of community is no simple task.

"Today, with lots of noise and distraction, this is very, very difficult to do," she said.

Data sourced from Warc

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Mercedes targets Indian youth

1 August 2014
PUNE: German automaker Mercedes-Benz is now selling more cars in India than ever and expects a series of measures underpinning its "Year of Excellence" to drive sales forward, the company's head of Indian operations has said.

Eberhard Kern, MD and CEO of Mercedes-Benz India, told Firstpost that the company has launched seven marques for Indian customers, is expanding its outlets to lower-tier cities, and expects its A-Class model to appeal to younger buyers.

"We are also conducting the Season II of Young Star Driver programme which encourages the youth who want to succeed in motorsports. This is in addition to our successful AMG Driving Academy," he said.

The company has invested heavily in its network of dealerships to modernise them and make them attractive for its younger customers, he said, adding that "the new design language of Mercedes-Benz represents a futuristic trend".

Interestingly, over half (55%) of the company's Indian sales come from markets outside the two large metropolitan areas of Delhi and Mumbai, it emerged.

Mercedes-Benz now has "full-fledged" dealerships in cities like Karnal, Coimbatore, Bhopal, Lucknow, Rajkot, Indore, Mohali, Raipur and elsewhere, and it views these newer markets and customers as its potential growth engine in the long-term.

"Our top three models comprise the E-Class, the C-Class and the M-Class, with E-Class still remaining the highest selling luxury sedan in India," he said.

He added that the company sold over 4,700 units in the first six months of 2014, which represented "healthy" year-on-year growth of 25% and expressed confidence about maintaining strong growth amid difficult market conditions.

Perhaps these measures will help Mercedes to regain its title as the number one luxury auto brand in India, a position it lost five years ago.

Data sourced from Firstpost; additional content by Warc

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Convenience drives UK retail changes

31 July 2014
SOUTHAMPTON: Convenience store sales in the UK will account for a quarter of the entire grocery market by 2019 while, over the same period, the market share for superstores is expected to fall from 42% to 34.9%, new research has forecast.

These are the key findings from the University of Southampton's Retail Research Group, which was commissioned by the government's Future High Streets Forum, to examine the performance and evolution of the UK high street.

It said there has been a "fundamental shift" in the way UK consumers view convenience shopping as they increasingly prefer quick "top-up" options at local stores and online shopping to large out-of-town shopping locations.

Online shopping and the growth of "click-and-collect" facilities are also encouraging consumers to opt for high street stores.

Within five years, seven out of 10 online shoppers would prefer to collect goods themselves rather than risk missing a delivery, the report predicted. That is double the current rate of 35%.

As reported by Internet Retailing, co-authors Professor Neil Wrigley and Dr Dionysia Lambiri, said: "To reach an increasingly digitally sophisticated and time-constrained consumer base, retailers have been forced to innovate and explore the omnichannel offer – and to embrace both click-and-collect services and showroom stores."

The high street has also witnessed a "modest resurgence" in specialist independent retailers, the report said, and it expected the leisure aspect of shopping trips to be a "significant driver of footfall".

It also expected the long-term shifts towards leisure, health and beauty – such as nail salons, hair dressers and gyms – to continue.

"New relationships are being established in town centres and high streets, creating opportunities and contributing to their resilience," the study concluded.

Penny Mordaunt, the recently appointed high streets minister, welcomed the study's findings, saying it showed the high street to be "adaptable, creative and resilient".

Data sourced from Southampton University, Internet Retailing, DCLG; additional content by Warc

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Amazon and Flipkart enter battle

31 July 2014
NEW DELHI: Coming just a day after Flipkart, India's largest e-commerce firm, announced that it had secured $1bn in extra investment, rival Amazon has said it will invest a further $2bn in its Indian operations.

Amazon, the world's largest online retailer, had earlier in the week announced that it plans to open five new warehouses in the country, which will double its storage capacity to over 500,000 sq ft, Business Standard reported.

The new warehouses, or "fulfilment centres", will be based in Delhi, Chennai, Jaipur, Ahmedabad and Tauru on the outskirts of Gurgaon – and they will complement the company's two existing centres in Mumbai and Bangalore.

However, Amazon says India is on track to be its "fastest country ever" to reach $1bn in sales and its new round of investment can be seen as a sign of its determination to expand in a growing market.

Jeff Bezos, founder and CEO of Amazon, said: "After our first year in business, the response from customers and small and medium-sized businesses in India has surpassed our expectations.

"We see huge potential in the Indian economy and for the growth of e-commerce in India. With this additional investment of $2bn, our team can continue to think big, innovate, and raise the bar for customers in India.

"At current scale and growth rates, India is on track to be our fastest country ever to generate a billion dollars in gross sales."

Flipkart is confident, too, about its prospects after sources said its $1bn of fresh funding gave it a valuation of about $7bn, the Wall Street Journal reported.

Co-founders Sachin Bansal and Binny Bansal, both former employees at Amazon, said it plans to hire more than 1,000 technology engineers over the next year and to make more use of data and analytics.

"We believe that India can produce a $100bn internet company in the next five years and we want to be that company," said Sachin Bansal, Flipkart's chief executive.

Data sourced from Business Standard, Wall Street Journal; additional content by Warc

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Amex pursues 'first-ever' experiences

31 July 2014
DANA POINT, CA: American Express, the financial services provider, has enjoyed considerable success on digital by forming partnerships that deliver "first-ever" experiences for its customers.

Andrea Zaretsky, vp/digital partnerships and development at American Express, discussed this subject at the Association of National Advertisers (ANA) Digital & Social Media Conference.

"We also want to bring American Express' assets to life by creating first-ever differentiating experiences," she said. (For more, including details of Amex's tie-ups with Uber, Foursquare and Twitter, read Warc's exclusive report: Amex continues to raise social bar higher and higher.)

"We want to go where our customers are. If it means a start-up, then we're going to roll up our sleeves and partner with a start-up. Or it could be the established company that's just changing its image."

The firm's success in this area is epitomised by "Small Business Saturday", an effort seeking to drive traffic to local enterprises that launched in 2010, and made effective use of Facebook to spread the word among shoppers.

A range of other tie-ups have followed this initiative – which took second spot in The Warc 100, a ranking of the world's best campaigns based on their performance in effectiveness and strategy competitions.

More specifically, American Express has worked with digital companies from microblogging platform Twitter and taxi app Uber to location-based service Foursquare and travel website TripAdvisor.

Each of these affiliations, Zaretsky reported, offered benefits for all parties: consumers, Amex and its digital partners. "It's all about identifying the non-replicable," said Zaretsky.

"With each of these partnerships, we're looking to do something truly different – something that we each bring to the table that's going to be very tough to copy, so we provide special unique value to our joint customers."

Among the wider advantages of pursuing such programmes are positioning American Express at the forefront of change and reaching new consumers.

"We're really trying to change the perception of our brand. We want customers to think this is not your father's card," Zaretsky said.

"We're modern, we're inclusive and we're not just a premium brand: we're going after all different types of segments."

Data sourced from Warc

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L'Oréal app provides direct contact

31 July 2014
PARIS: As part of its bid to seek a more direct relationship with its customers, cosmetics giant L'Oréal has developed and launched a free app that allows users to try out make-up products via an iPhone or iPad.

Launched in May this year, the "Makeup Genius" app has already been downloaded 250,000 times in France and is also available in China and the US before being rolled out to other markets, the Financial Times reported.

It effectively turns a customer's mobile device into a virtual mirror, so allowing the user to swipe through the L'Oréal Paris range of cosmetics, to experiment with the look, to share the results, and to seek advice.

L'Oréal's face recognition technology is so advanced, the app shows what the make-up looks like even when a customer moves their face or smiles into their device.

For L'Oréal, it hopes to gain direct access to its consumers, build engagement, gain feedback, and generate loyalty.

"Digital recreates a content and a relationship with the consumer that we have never had in the self-service world," said Jean-Paul Agon, LOréal's chief executive.

"People go into a store, they are faced with a wall of products and by definition they don't get any advice when it's self-service. We can create the digital beauty adviser that will help them choose," he added.

While retailers may worry that L'Oréal's new app could go some way to cutting them out of the consumer loop, Agon insisted that its main purpose is to provide a service.

"For customers who want to, they will be able to buy directly online. But I think it's going to stay marginal," he said, pointing to the L'Oréal Paris e-commerce site, which has made sales of only €1m in France since its launch a year ago.

Data sourced from Financial Times; additional content by Warc

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China online video ad revenues grow

31 July 2014
SHANGHAI: Online video advertising revenues in China recorded 45.9% growth in Q2 2014 on the previous quarter as well as year-on-year growth of 64.5%, according to new analysis.

The latest data from iResearch Consulting Group, the Chinese market research firm, also showed that overall revenues for the Chinese online video industry increased 38.9% in Q2 2014 – and almost three-quarters (73.6%) year-on-year – taking the total to 5.43bn Yuan (roughly US$880m).

Over two-thirds (71.5%) of this quarterly revenue came from advertising, which was worth 3.88bn Yuan, while 16.3% came from services, such as terminal sales and games. The recent FIFA World Cup made a sizeable contribution, the report said.

Mobile online video ad revenues also recorded strong growth, accounting for 830m Yuan, a rise of 53.2% compared with 540m Yuan in the first quarter of the year.

And mobile online video ads accounted for a fifth (21.3%) of total online video ad revenues, a slight increase on 20.3% in Q1 2014.

Looking ahead, iResearch said that mobile video will have considerable future potential for advertisers and video operators.

"Online video enterprises should further explore the huge potential of mobile video to monetise the mobile traffic," the report said. "Surging mobile online video viewers laid a solid foundation for the comprehensive mobile commercialisation of online video enterprises."

Online video app usage also continued to grow, reaching 240m in May 2014, almost double (95.5%) the number recorded in May last year.

It comes as a separate study from UK-based Digital TV Research forecast that online TV and video revenues in Asia-Pacific – again driven by advertising – will grow to $10.19bn in 2020, up from just $0.54bn in 2010 and $2.68bn in 2013.

Advertising expenditure will reach $4.61bn in 2020, the report said, with China ($1.96bn) and Japan ($1.2bn) accounting for two-thirds of the region's total.

Warc's Consensus Ad Forecast, released this week, found all-media advertising expenditure in China is forecast to rise 11.1% in 2014, with internet adspend also expected to rise this year, by 30%.


Data sourced from iResearch, Digital TV Research; additional content by Warc

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US standard of living could decline

31 July 2014
ARLINGTON, VA: An unwelcome combination of an ageing population, low workforce participation, and declining labour productivity, could mean the US standard of living in 2030 will be no higher than it was in 2000, a new report has warned.

According to global consulting firm Accenture, state governments need to develop strategies to improve the pool of talented labour to meet the country's requirements in the years ahead.

They should offer every job seeker a "personalised road map", provide real-time information about jobs, and co-ordinate all relevant agencies and budgets that focus on increasing the standard of living, it said.

"For the first time in our nation's history, the next generation may not be better off than their parents," said Peter Hutchinson, head of Accenture's state, provincial and local government division.

"For decades people have come to expect our economy and way of life to continue to improve, not decline. Our standard of living hinges on harnessing a skilled workforce to power our economies."

Accenture warned that, as Baby Boomers retire, the working age population in the US could see a decline of 9% by 2030, which would take it to the same level as in 1970. The problem is further compounded by unemployment among Americans aged 16-24, the report said.

Furthermore, workforce productivity is now at one of its lowest levels since 1960 and has fallen below 1% for five of the past ten years.

Accenture analysed 160 countries to form a baseline assessment and also a series of surveys in 11 developed countries with additional interviews in 12 US states and the Canadian province of Ontario.

Among its other findings, it revealed that almost three-quarters (72%) of US respondents have little or no trust in the ability of government to act quickly enough to address employment and skills issues.

Also, only 18% of employers said they had sufficient access to the skills they require while almost two-thirds (62%) of them do not believe government is anticipating the country's future requirements for skills.

Data sourced from Accenture; additional content by Warc

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Tablets, PCs drive conversion rates

31 July 2014
SAN FRANCISCO: Smartphones outperformed tablets for driving traffic to over 100 online retailers that use the customer network of MarketLive, the e-commerce software provider, but tablets proved to be better at converting visits to sales.

Online sales among MarketLive clients increased 19.4% year-on-year in Q2 2014 and smartphones accounted for almost a quarter (24.1%) of online visits, MediaPost reported, but conversion rates were three times higher on a tablet (at 2% versus 0.67%).

In further detail provided by MarketingCharts, other key comparisons between the two devices showed that tablets had a much higher add-to-cart rate of 11.5% compared with 4.9% on smartphones.

Smartphones also had a higher cart abandonment rate of 88% (versus 77% on tablets) and a checkout abandonment rate of 69% (versus 45% on tablets).

Significantly, the desktop PC continued to outperform both devices in terms of revenue – even though it generated 60.6% of traffic for the quarter, it accounted for four-fifths (80.6%) of revenue. Desktop also had a conversion rate of 2.22%.

Meanwhile, tablets accounted for 12.7% of revenue and smartphones for 6.7%, the report added.

In other findings, the checkout abandonment rate averaged 43%, up 3% since Q2 2013, although the average add-to-cart rate improved, rising 3.6% since last year to 8.2%. The average conversation rate also rose to 2.48%, up 4.7% year-on-year.

The news comes after a global study from Covario, a content marketing firm, revealed earlier this month that mobile search spend growth recorded 98% year-on-year growth in Q2 2014, including 31% growth in the Americas region.

Data sourced from MediaPost, MarketingCharts; additional content by Warc

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Global adspend will rise 5.8% in 2014

30 July 2014
LONDON: Global adspend is expected to increase by 5.8% in 2014 and by 5% next year, according to the latest Consensus Ad Forecast from Warc.

Overall, total global adspend growth for 2014 has recorded a positive 0.6pp rise in expectations since January.

The 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. The latest findings are available here.

It reveals a more positive outlook for the great majority of the 13 markets covered in the report since the last forecast was published in January 2014.

Brazil and the other BRIC countries have emerged as the strongest performers this year, and three of them are expected to record double-digit growth.

This includes positive growth of 12.8% in Brazil (up 2.4pp since January), 11.3% in India (+0.3pp), and 11.1% in China (-0.1pp).

Russia, which previously was expected to record double-digit growth this year, is now forecast to grow by 9% after a 1.7pp downgrade since the last report.

The UK and the US are expected to be the top performing markets after the BRICs this year, registering predicted growth of 6.4% and 5.5% respectively.

Growth in the major eurozone countries is expected to be more sluggish, however, with Germany expected to record 1.6% growth in advertising expenditure, followed by Spain (1.5%), and France (0.4%). Italy is the only country forecast a decline on -0.4%.

"After Brazil, the UK and the US have both seen total adspend upgrades since January, making them the best-performing markets outside the BRICs," said Suzy Young, data and journals director at Warc.

"By contrast, the established markets in Western Europe continue to struggle, although most should see growth in 2014," she added.

By media, all channels are predicted to record year-on-year growth with the exception of newspapers and magazines, which should decline by -4.1% and -3.5% respectively.

Adspend on the internet, the only channel for which forecasts have been upgraded since January's report, is set to rise 16.4% (up 2.3pp), followed by TV on 5.3% (-0.5pp), cinema on 4.6% (-1.2pp), out of home on 4.2% (-0.6pp) and radio on 2.0% (-0.3pp).

Data sourced from Warc

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Most consumers welcome loyalty apps

30 July 2014
NASHVILLE, TN: Saving money is the main motivation for American consumers willing to participate in a loyalty program, although the option of receiving rewards attracts more than a third, new research has shown.

According to a poll of 3,162 loyalty program users in the US by TechnologyAdvice, a Tennessee-based insights company, saving money and receiving rewards were cited by 57.4% and 37.5% respectively.

Earning VIP status came in as a distant third as a primary motivator (3.6%) while just 0.8% felt social recognition was an important driver.

Of particular interest for brands looking to expand the effectiveness of their card-based systems, or increase adoption of their physical rewards programs, the report found almost 6-in-10 (59%) would be more likely to join a loyalty program that offered a smartphone app.

This compared to just 41% who said they would be “less likely” or “much less likely” to join such a program.

Despite the clear majority being open to loyalty programs that offer smartphone apps, the report found a slightly higher proportion still preferred card-based programs (36.8%) over digital ones (33%). 

TechnologyAdvice concluded this could indicate that US consumers are open to digital, but may not want to rely exclusively on an app or lose the convenience of a physical card. A similar proportion (29.9%) was undecided or had no preference.

While consumers may be encouraged to join loyalty programs because of digital apps, the report also showed that they don't find social rewards appealing.

A full 83.3% said they would be either “less likely” or “much less likely” to participate in a program that relied on social rewards, such as Foursquare-style apps.

But more encouragingly for brands like Starbucks that operate loyalty programs based on exclusivity-based rewards, 56.8% said they would be “more likely” or “much more likely” to participate in such a program – although, of course, only a tiny proportion cited it as their primary motivation, suggesting it's seen as an “extra”.

Overall, more than four-fifths (82.4%) said they would be “more likely” or “much more likely” to shop with brands and retailers that offered loyalty programs.

TechnologyAdvice said this suggests that once consumers “buy-in” to a loyalty program, then they are “highly likely” to reward a brand with repeat business.

Data sourced from TechnologyAdvice; additional content by Warc

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UK firms 'fail' on social engagement

30 July 2014
LONDON: Only 15% of the UK's leading companies responded to tweets from customers and, of those who did reply, nearly two-thirds (64%) took more than an hour to respond, according to results from an undercover test.

In an experiment to check how seamless the customer experience is in the country, consumer experience solutions provider Webhelp UK also surveyed over 2,000 UK adults and found only 10% feel they can rely on social media to make complaints.

The research, conducted by YouGov, said almost two-thirds (62%) prefer to use email to make formal complaints while 46% rely on the phone, but this rises to 84% when it comes to general enquiries.

Furthermore, one-fifth (20%) of respondents aged under 44 said they expected companies to provide them with a web chat facility, but only 13% of firms do this.

David Turner, CEO of Webhelp UK, said that even though traditional forms of communication still play a predominant role, they should not be offered in isolation.

“People now expect to be able to contact companies though multiple channels, switching between them at their convenience,” he said.

“However, our report suggests while many businesses have developed new channels in response to customer demand, many still fall short of delivering effective customer support through them,” he added.

In a separate survey of customer experience professionals, Webhelp UK found nearly all (95%) respondents thought integration of channels into omnichannel is the most important issue facing the industry.

And three-quarters said better use of data on customer interactions is needed to improve customer experience.

Webhelp's findings chime with two recent reports which also highlighted the importance of social media for improving customer engagement.

Last month, management consultancy McKinsey polled 850 senior executives and found they regarded digital customer engagement as the top strategic priority among digital trends.

In another report released in June, Amdocs, a global provider of customer experience systems, said half of customers had tried to use social media to communicate with their service provider, yet three-quarters never received a response or resolution, forcing 80% to ring their call centre.

Data sourced from Webhelp UK, McKinsey, Amdocs; additional content by Warc

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Online consumers assist Santander

30 July 2014
NEW YORK: Santander Bank, the financial services group, has been greatly assisted in building its brand in America by turning to an online community of consumers when making a variety of decisions.

The company, which is headquartered in Spain, officially launched in the US late last year, as it rebranded branches and ATMs formerly run by Sovereign Bank, an organisation it acquired in 2009.

Kathy Klingler, Santander Bank's svp/cmo, discussed this topic with delegates at the Argyle 2014 Chief Marketing Officer Leadership Forum: Spotlight on Financial Services.

"This was really Santander's first introduction into the US market purchasing a retail bank. They had been here in the past, but this was the first time buying retail," she said. (For more, including what the company has learned from its community, read Warc's exclusive report: How an online community helped Santander Bank build its brand.)

One tactic Santander has used to enhance its knowledge about the needs of American consumers is partnering with Communispace, a firm which specialises in recruiting and running research communities for brands.

Santander's community contains hundreds of members drawn from diverse backgrounds. It was established in advance of the brand's formal US launch and remains a vital source of insight for the organisation.

"This is not a focus group or a quantitative research study. These are people who are engaged with us and have been engaged with us for about 18 months," Klingler said.

"This is an online platform where we're going in and getting to know them. They are co-creating our bank and our brand with us."

Such a commitment to understanding the views and opinions of consumers has extended from gauging the possible appeal of its marketing messages to informing the development of new products.

"These folks look at everything. If we're thinking about a product, we go into the community and talk to them about it. When we were testing our brand and our messaging, we went into the community,” said Klingler.

Recent initiatives involving this panel of respondents have included inviting members to attend an in-house innovation summit, and an insights-gathering exercise covering how the path to purchase is evolving.

"For us, this is not a one and done. We didn't put this community together just because of the rebrand; this lives and breathes for us," said Klingler.

"We still have many of the same members from the beginning, and we've recently refreshed it with more people who can give different insights and different perspectives as we move forward on our journey."

Data sourced from Warc

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Global brands face China challenge

30 July 2014
SHANGHAI: A number of leading international FMCG brands are finding themselves having to adapt to growing competition from Chinese brands and retailers, which are using their local know-how to appeal directly to domestic tastes.

As reported by Reuters, major brands affected by this challenge include Coca-Cola, Procter & Gamble and Colgate-Palmolive.

Consultancy Bain & Company, working with Kantar Worldpanel, released a report at the beginning of this month that showed 60% of foreign brands lost market share in 2013 with falls recorded in 26 out of the 106 product categories studied.

Speaking when the report was released, Bruno Lannes, a partner in Bain's Shanghai office, said: "The market implications for both foreign and domestic consumer goods companies in China are clear and direct: growth must come from share gain, and share gain comes from penetration gain."

Reuters highlighted privately-owned Jiaduobao Group (JDB) as an example of a Chinese company successfully taking on global brands in the canned drinks market.

Its popular canned herbal tea brand, which is marketed around the concept of traditional Chinese medicine, has become the top-selling canned drink in the country, the company said.

Overall, JDB's share of China's soft drinks market has grown from 4.2% in 2009 to 6.1% in 2013 by value, compared with PepsiCo's share of 3.9% and Coca-Cola's 13.1% share. Euromonitor said these figures represented falls of 1.8% and more than 3.0% respectively since last year.

"The good domestic brands are closing the gap really quickly and are able to play off the idea that they know how to develop something that a Chinese person is going to want," explained Ben Cavender, a principal at China Market Research Group.

Other products with a particular appeal to Chinese consumers include tea-flavoured toothpaste and those that use traditional flavours, such as pickled plum or snow pear, which has a mild sour taste.

However, some international brands have responded by forming local partnerships to cater for these tastes, notably Colgate-Palmolive's Hawley & Hazel joint venture, based in Hong Kong, whose Darlie toothpaste has green tea and jasmine flavours.

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

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Brands can tap the craft beer trend

30 July 2014
CHICAGO: Major breweries have been advised that they could see considerable growth if they develop craft-style beer as a recent report from Mintel reveals the US market will be worth $20bn in 2014.

The global market research firm said this meant craft beer sales have doubled over the past five years and found there is further potential because over half (55%) of respondents in its survey said they're willing to pay more for the product.

Although Mintel did not provide figures for its sample base, its research was a nationwide poll, covering different American regions and generations.

It found craft drinkers from the Midwest are significantly more likely to support a particular brewery (29%) while respondents from the South are least likely to prefer craft beer (16%).

Overall, almost one-quarter (23%) of respondents drink craft beer compared to 30% of consumers who only drink other varieties.

Interestingly, Mintel found that craft beer drinkers tend to have a strong "sense of self", believing that a particular brand says a lot about themselves, and over half (53%) like to share their knowledge via word of mouth and social gatherings.

This trend is most noticeable in western states, the report found, where 57% agreed that a choice of brand said a lot about you – a view shared by 70% of the 25-34 age group.

Beth Bloom, a food and drink analyst at Mintel, said there is a strong sense of community among craft beer drinkers, who like to share knowledge with each other and are "highly invested in the products that they choose".

"Not only that, but craft brands share exposure through collaboration, a practice almost wholly unique to the craft beer market," she added.

She said "style" is the leading purchase driver for these consumers, suggesting that the craft beer boom has much in common with the "wine renaissance" of the past decade.

"They may not be brand loyal in the strictest sense, but they enjoy supporting local breweries and sharing in that sense of community that the smaller breweries have instilled," she said. "This presents vast opportunity for product trial and customisation, which will keep the market interesting in the near future."

Data sourced from Mintel; additional content by Warc

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Sports sponsorship grows in APAC

30 July 2014
SINGAPORE: Sports sponsorship and marketing look set to grow in Asia-Pacific with the market expected to be worth US$18bn in 2014, a leading industry practitioner has said, based on estimates from consultancy PwC.

Writing in Campaign Asia, Paul Fisher from information company Nielsen, said PwC expects the sector to record a compound annual growth rate (CAGR) of 4.4%, which he said adds up "to a very lucrative, and growing, association between global and local brands and sport".

Brands are expected to spend two-thirds, or US$12bn, of this year's total spend on sports sponsorship with the remaining US$6bn spent by media owners on broadcast and digital rights for major sporting events.

Fisher, who is Nielsen's managing director of the Sports Industry Group for southeast Asia, North Asia and Pacific, also said sponsors and fans can look forward to a series of major sporting events in Australia next year, which will attract regional interest.

These include the 2015 AFC Asian Cup – the first time the football tournament will be hosted outside the continent of Asia – the Netball World Cup, as well as the Cricket World Cup, which Australia will co-host with New Zealand.

"The sports marketing and sponsorship industry looks set to grow in expenditure, investment and competitiveness to secure loyal audience following and brand advertising dollars," he predicted.

The challenges and opportunities of sports sponsorship in Asia formed the basis of the Sports Matters conference, which was held in Singapore in September last year and covered by Warc.

Greg Unsworth, the technology, media and telecommunications leader at PwC in Singapore, expressed optimism about the future of Asia's sports market, although he said the region had underperformed compared to others.

Referring to figures from 2012, he said: "We've got an average of about 5% across the globe, and the surprising trend that we got from the data is that the growth rate projected to 2015 is actually reasonably consistent and above North America and Europe."

"My sense is that we're going to see a fairly dramatic shift in this, and we will see the Asia growth rates starting to swell up," he told delegates.

Data sourced from Campaign Asia; additional content by Warc

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Brands 'miss' key cultural events

29 July 2014
LONDON: With British Muslims celebrating the festival of Eid al-Fitr over the coming days, new research suggests brands may miss out on the sales opportunities presented by this and other cultural events.

According to an online poll of 1,000 UK adults by creative agency Haygarth, nearly one-third (30%) of Asian or British Asian respondents intend to go shopping for Eid and Ramadan, the month of fasting that precedes it, Marketing Week reported.

This amounts to 3% of all UK consumers, leading Haygarth to warn that the retail calendar is becoming increasingly complex because of changing demographics, cultural trends and marketing techniques.

It found another 3% of UK respondents intend to shop for the Jewish festival of Passover, 7% will do so to mark the Chinese New Year, and 2% (or 26% of Asian or British Asians) will go shopping for the Hindu festival of Diwali.

"Brands are missing out," said Anthony Donaldson, planning director at Haygarth. "Ramadan is a fasting occasion but it's also a period when lots of food is consumed after the sun goes down … yet I don't know any food brand that has thought creatively about how it might link with the occasion."

Not surprisingly, the study found Christmas (83%) to be the most popular event among UK shoppers, followed by Mother's Day (54%), Easter (51%), Valentine's Day (45%) and Father's Day (44%).

However, less notable events also draw considerable interest, including Shrove Tuesday or Pancake Day (43%), St George's Day (11%), the celebration of England's patron saint, St Patrick's Day (10%), and Burns Night (6%), the celebration of the life and works of Scottish poet Robert Burns.

St Andrew's Day, recognising Scotland's patron saint, will be marked by 4% while 3% will shop for St David's Day, which celebrates the patron saint of Wales.

Interestingly, the report also found the American imports of Black Friday and Cyber Monday to be making headway among UK consumers.

These dates are the first Friday and Monday immediately following Thanksgiving that many Americans regard as the start of the Christmas shopping season. It seems a full 7% of UK shoppers plan to go shopping on one of these days, according to the report.

It comes as new research from national tourism agency VisitBritain has shown tourists from the Middle East are the top spending tourists in the UK, the Independent reported.

As visitors from the region arrive in the UK during Ramadan, VisitBritain found tourists from Kuwait and Qatar spend an average of £3,000 to £4,000 per visit and Middle Eastern holidaymakers are twice as likely to buy handbags and cosmetics.

Data sourced from Marketing Week, the Independent; additional content by Warc

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Leading brands test virtual reality

29 July 2014
NEW YORK: Coca-Cola, the soft drinks giant, TV network HBO and Japanese automaker Nissan are a trio of leading global brands that are exploring the marketing opportunities offered by new virtual reality (VR) technology.

While the current cost of virtual reality equipment is prohibitively expensive for everyday use – as well as being too bulky – the three companies have been experimenting on ways to use VR to augment the experience of their customers.

As reported in Advertising Age, they are drawn to VR because it could be transformative for the ad industry, allowing marketers to sponsor virtual experiences that consumers actively seek out.

Coca-Cola, for example, used the recent FIFA World Cup to stage a VR experience where participants entered a replica of the locker room at Brazil's Maracana Stadium and, once connected to VR Oculus Rift goggles, they could then virtually move from the locker room to "play" on the pitch.

"It's about the authenticity of being inside that stadium," said Matt Wolf, head of global gaming at Coca-Cola, adding that participants would recognise that the experience was "thanks to Coke".

Meanwhile, HBO has launched a world tour of a VR experience derived from its popular Game of Thrones series. This involves a virtual replica of a 700-foot ice wall complete with sound effects in a 90-second show that is estimated to have cost as little as $2m.

Nissan, too, has been working on using VR experiences to build its brand. Visitors to last year's Tokyo Motor Show and the Detroit Auto Show in January were able to wear Oculus goggles to virtually explore a Nissan IDx concept car.

However, while VR holds many possibilities for the entertainment industry as well as early adopters of technology, such as General Electric and German automaker Audi, Aaron Richard, innovation strategist at San Francisco agency Heat, cautioned that it is unlikely to be suitable for FMCG brands.

"If you're a packaged-goods company, I don't think people are really going to want to wander the aisles of a virtual grocery store," he said.

Data sourced from Advertising Age; additional content by Warc

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India set to be smartphone hotspot

29 July 2014
NEW DELHI: International and Indian smartphone vendors are optimistic that the market in India will soon grow substantially even though a number of obstacles remain, such as expensive 3G services and a patchy telecoms infrastructure.

John Sculley, the former Apple chief executive who recently launched the low-cost Obi smartphone brand in the country, told the Financial Times that India is experiencing "incredible" growth.

"I've been in and around mobile for many years, and this is the most exciting opportunity globally. India is growing incredibly rapidly with smartphones … it is going to be huge," he said.

Jayanth Kolla, a telecoms analyst at Convergence Catalyst, agreed that smartphone manufacturers are keen to expand in India.

"China is getting saturated," he said. "Most people already have smartphones, just like in the US. But hundreds of millions in India are about to upgrade to their first one, so manufacturers are piling in."

Obi Mobiles has ambitious plans for both India and other emerging markets and it wants the brand to account for about 5% of the Indian smartphone market.

"Our aspirations are to build an international brand with India being the beachhead and to go to all of the emerging markets, learning from our experience here with differentiation around branding and marketing," Sculley told the Economic Times.

Obi is now geared to compete in the market through advertising, marketing and point-of-sale campaigns, where social media will play a key role, he explained.

Other players are joining in – for example, Chinese manufacturer Xiaomi launched its flagship Mi 4 smartphone earlier this month while Google plans to launch its Android One in September.

They will join established brands, such as South Korea's Samsung, which has about one-third market share, Taiwan's HTC and China's ZTE, as well as cheaper domestic brands, such as Micromax, Karbonn and Lava.

However, international brands are not guaranteed an easy ride in India because the country's 3G services can be unreliable outside major cities.

Asim Warsi, vice-president of Samsung India, also warned them that they would have to work hard on their distribution because most Indian consumers buy handsets from small corner shops rather than purchase online.

Data sourced from Financial Times, Economic Times; additional content by Warc

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Finance brands must improve insights

29 July 2014
NEW YORK: Many brands in the financial services category are failing to focus on customer insights, according to a leading executive from Lincoln Financial Group.

Jamie DePeau, the firm's corporate chief marketing officer, discussed this theme at the 2014 Chief Marketing Officer Leadership Forum: Spotlight on Financial Services, an event run by the Argyle Executive Forum.

"People still aren't talking to customers," she said. (For more, including how Lincoln has pursued customer-centricity, read Warc's exclusive report: Lincoln Financial Group learns to put consumer insights first.)

"You have to talk to customers, and you have to talk with them frequently. It's not just 'disaster checks' before you go into the marketplace; you have to get that knowledge up front. Companies still don't do it."

As a result, marketers often roll out campaigns "without really understanding the marketplace" - and this means that, "nine times out of ten", they end up "saying the wrong thing".

One reason for this trend, DePeau suggested, is the long-standing emphasis that firms have put on their products.

"Historically, the industry has pushed messages out into the marketplace that are company-centric, product-centric, forgetting all about the customer. And a lot of people are still doing it that way," said DePeau.

The influence of product managers is one factor that has encouraged marketers to emphasise features and list facts in their messaging, rather than taking a more nuanced approach.

"I think that's part of the influence of product development and where marketing has historically sat in financial services," said DePeau.

Relying on old models, however, is an increasingly unwise strategy at a time when digital media is transforming patterns of customer behaviour.

"Your whole sales funnel is turned upside down," DePeau said. "And that has a huge impact on everything that we do, from channels to messaging."

Data sourced from Warc

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Chinese luxury e-retailer looks west

29 July 2014
BEIJING: Milan, New York and Paris are in line to host new stores catering for Chinese tourists after Secoo, China's largest luxury e-commerce firm, announced it has raised $100m investment to expand its foothold into Western markets.

It already has a series of shops in major Asian cities and the new financing, led by China-based CMC Capital Partners, will also help it to increase marketing spend and fund development of IT infrastructure, the company said.

Secoo CEO Li Rixue said: "The funds will mainly be used in our global strategic layout and overseas business expansions, as well as higher budget in marketing, developing its information technology infrastructure."

"In the future, we will try our best to meet the demands of high-end clients, both in mainland China and abroad, providing them with authentic, seasonal, and desirable luxury products," he added.

Founded in 2008, Secoo currently has over 3m high-end online customers, who spend an average 8,000 yuan (US$1,290) on luxury products, Internet Retailer reported.

Most of its customers are Chinese, or Chinese travelling abroad, and its "offline" stores – such as those planned for Western cities – "work as showrooms and places for high-end consumers to socialise," Li Rixue said.

The development comes as LVMH, the largest luxury company in the world, announced at the end of last week that it has seen a drop in demand from mainland Chinese shoppers as well as a slowdown in Hong Kong, where pro-democracy protests have deterred Chinese visitors, Reuters reported.

LVMH's overall sales growth was a worse-than-expected 3% in Q2 2014 while its operating profit in the first half fell to 18% from 19.8% last year.

Data sourced from Secoo, Internet Retailer, Reuters; additional content by Warc

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Consumer sales may triple in Nigeria

29 July 2014
LAGOS: Consumption in Nigeria could more than triple to almost $1.4 trillion a year by 2030, an increase of about 8% annually, a new report has forecast.

And if the country reaches its full potential, annual GDP could exceed $1.6 trillion in 2030 – compared to $510bn in 2013 – said the McKinsey Global Institute.

This would make Nigeria a top-20 global economy, with higher GDP than the Netherlands, Malaysia, or Thailand, with a consumer class numbering 160m people.

What's more, growth could lift 70m people out of poverty, McKinsey said, and bring 120m above its "empowerment Line", a level of consumption that constitutes a decent, economically empowered standard of living, which McKinsey calculates as $1,016 per person a year in the cities and $758 in the countryside.

However, for Nigeria to make these gains, the government must improve its delivery of programmes and services, the report warned. It will be a "critical initiative" for the country to adopt the best practices established around the world, it said.

"Nigeria has extraordinary advantages for future growth, including a large consumer market, a strategic geographic location, and a young and highly entrepreneurial population," said Reinaldo Fiorini, director and location manager of McKinsey's Nigeria office.

The consultancy firm went on to advise consumer brands wanting to tap into this opportunity that they should adopt a city and regional approach, rather than a national approach, reported How We Made It In Africa.

This is to take into account the country's distinct differences in culture, wealth and demographics, and McKinsey identified three major "clusters" of cities that together have population levels similar to the 15m residents of Lagos.

These three clusters are six cities based in the Niger Delta in the southeast, a second grouping of Ibadan, Ogbomosho and Ilorin, just north of Lagos, and thirdly, a northern corridor of Kano, Zaria and Kaduna.

Data sourced from McKinsey Global Institute; additional content by Warc

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Google's seasonal search trends

29 July 2014
ORLANDO, FL: Early May and July are when search volumes on Google peak in the US for the automotive industry while retail search volumes are at their highest during the autumn, recent analysis of the platform's seasonal search volumes has shown.

The WhosOn report, a live web visitor tracking service from Parker Software, examined US Google search data stretching back five years and checked search volumes and topics across four key industries – automotive, finance, retail and travel.

It found searches for financial issues tend to record their highest volume at the beginning of the year while November usually has the lowest volume of searches, MarketingProfs reported.

Volume searches for retail usually rise in September and reach a peak from the end of October onwards as consumers prepare for the winter holiday seasons, the report said.

And not surprisingly, volume searches about travel topics begin to rise in April ahead of the summer season, peaking in early June before slowly declining in November.

Looking at the keywords users search under, the study found the seasonal popularity of retail keywords often mirror significant holidays or events, such as Halloween or Mother's Day.

January sees a rise in searches for insurance-related topics while house-buying keywords increase from spring through to autumn.

Elsewhere, in the automotive sector, searches for auto-dealers are popular in spring, but winter-servicing records a higher rate in the early months of the year.

Data sourced from MarketingProfs; additional content by Warc

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Unilever plans an innovation drive

28 July 2014
LONDON: Unilever intends to put innovative products at the heart of its European strategy to stem a decline in sales caused by competition from discount retailers.

Speaking to investors in a conference call on Thursday, chief executive Paul Polman said the FMCG multinational is placing greater emphasis on innovation to improve its pricing mix and to increase sales, Marketing Week reported.

Second quarter sales fell 0.8% to €3.6bn in Europe, the company said, although there was a slight rise in the UK and overall global sales increased 3.8% to €12.7bn, including a 5.1% rise in emerging markets.

"In developed markets most consumers are not seeing a pick-up in the economy and they are increasingly value conscious. Competition is increasingly high," Polman said.

"We are taking balanced decisions on pricing, always with a watchful eye on consumer affordability," he added.

In a sign of where the Anglo-Dutch group may be heading, the company credited innovations such as its compressed deodorants and a new toothpaste brand, called Regenerate, for driving underlying sales growth.

Regenerate is supposed to have a "unique formula" that helps to rebuild tooth enamel. Priced at £10, and coming with a serum that costs £30, it is much more expensive than rival brands.

Innovation will take precedence in its European markets and Unilever said it is not planning to increase marketing spend to boost sales.

While marketing spend has increased in emerging markets and North America, the company said its brand-building efforts in Europe will concentrate on supporting its digital channels and moving spend away from non-working media.

"We are continuing to focus on innovation, portfolio reshaping and driving efficiency, doing the right things to adapt to a world that is increasingly volatile and unpredictable," said Polman.

Data sourced from Marketing Week; additional content by Warc

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Brands 'not ready' for digital era

28 July 2014
DANA POINT, CA: Many brands are still "not ready for the digital era" as their marketing departments lack the skillsets necessary to thrive in the connected age, a leading executive has argued.

Speaking at the 2014 Association of National Advertisers (ANA) Digital & Social Media Conference, Bob Liodice, the organisation's president/ceo, asserted that technology was a "critical enabler" for brands.

But exploiting the opportunities currently available – from formulating one-to-one conversations to driving innovation and pursuing purpose-driven branding – will require a significant shift in skillsets.

"We need to build skills," Liodice said. (For more, including insights from senior marketers from Unilever, Ford and more, read Warc's exclusive report: ANA's Liodice outlines challenges (and opportunities) for the digital age.)

At present, he continued, the majority of organisations do not have the requisite talent in place to move ahead at the desired speed.

"Survey after survey suggests that we're not ready for the digital era," Liodice said.

"We found, in one survey, that only 25% of marketers said that they have the skillset necessary to be able to take advantage of the opportunities that are now afforded to them."

Taking the next step, he reported, would demand a transition in mindset away from the existing marketing model towards a genuinely integrated approach.

"We essentially need to make a change from digital marketing to marketing in a digital age," the ANA's president/ceo asserted.

Marc Pritchard, Procter & Gamble's global brand building officer, has put forward a similar theory, as he reflected that traditional ideas of digital marketing were almost "dead".

Liodice drew attention to other marketers who had elaborated on such themes, like Joe Tripodi, evp/chief marketing and commercial officer at soft drinks giant Coca-Cola, who has called on brands to "embrace the values of millennials".

Antonio Lucio, global chief brand officer at financial services group Visa, has further asserted that millennials are the most "equipped" to drive change, adding that "digital natives will rule the world".

Yusuf Medhi, chief marketing and strategy officer for the XBOX games console at Microsoft, has equally encouraged marketers to "consume new technology – use it, spend time with it and learn from people it has benefitted".

Data sourced from Warc

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Most UK consumers will share data

28 July 2014
LONDON: More than half (58%) of British consumers are unconcerned about how much data they share with brands, a percentage which rises to more than two-thirds (68%) among 18-24 year-olds, a new survey has revealed.

According to a poll of 2,000 UK adults aged 18 and over by research firm Webtrends, just 23% of these younger consumers believe data-sharing will be viewed negatively in the future, Retail Times reported.

And nearly two-thirds (64%) of 25-34 year-olds are also relaxed about sharing data, although older consumers are more sceptical, the report found.

Half of consumers aged 55 and over object to sharing data with brands completely and another half (49%) believe data-sharing will be viewed negatively in the future.

John Fleming, marketing director EMEA and APAC at Webtrends, said it isn't surprising that young consumers are willing to share their personal information with brands.

"Younger generations have grown up in a far more connected, data-centric world and often recognise the benefits of sharing personal info with their favourite brands," he said.

The research also revealed the main drivers for encouraging UK consumers to share personal data. These include a discount on clothes (36%), free delivery (31%) or a discount on a holiday or travel (28%).

They are most willing to share their name and email address with retailers (64%), but this falls to just 17% when asked for more detailed information, such as their income level or home address.

Almost half (49%) would share information with a travel brand, but this declines to 10% when asked for more detailed data. They are most reluctant to share greater detail with charities – only 5% say they would do so.

"Brands often have to compete with legacy perceptions," Fleming explained. "For example, people may have had a bad experience with a charity using their information for persistent communications and telemarketing."

But he said brands could overcome these perceptions by making better use of the data they have available.

"Brands can personalise their communications, time them more appropriately and engage with their customers in the way they prefer, which leads to greater brand perception, loyalty and trust – a win-win-win," he said.

Data sourced from Retail Times; additional content by Warc

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Chinese consumers plan to spend more

28 July 2014
HONG KONG: Middle-class and affluent consumers (MAC) in smaller Chinese cities plan to spend more on products compared to last year while consumers in larger cities remain more cautious and selective, a new report has said.

Based on responses from 1,000 people in 12 cities, the Boston Consulting Group (BCG) found overall Chinese consumer sentiment has improved since last year, but it rose the most in lower-tier cities.

"Last year was the first time in recent history that more Chinese consumers wanted to cut spending than to increase it. This year, the balance has shifted back," said Youchi Kuo, an expert principal at BCG and a co-author of the report.

"The number of consumers who plan to spend more money in the coming year exceeds the number who plan to spend less," she said.

BCG found sentiment between the smaller and larger cities to be widening, China Daily reported – the percentage of MAC respondents in big cities who plan to spend more over the next 12 months has fallen to 28% from 31% last year and 35% in 2012.

By contrast, the percentage of MAC consumers in smaller cities who plan to spend more has grown to more than a third (34%) compared to just 26% last year.

It appears that the more stressful lifestyle of big city residents is responsible for the difference, as the survey uncovered that they have more anxiety about the future and more concerns about job security.

Although big city MACs have become more cautious and selective about their spending intentions, they are willing to spend more than before on high-priority categories, the report said.

However, they are no longer interested in trading up in non-essential categories, such as packaged food, beverages or entertainment.

There is also strong demand in the large cities for lifestyle categories, such as baby products, fresh produce, cars, home renovation and tourism, BCG added.

Data sourced from BCG, China Daily; additional content by Warc

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Confidence varies in Australasia

28 July 2014
SYDNEY/AUCKLAND: Consumer confidence in Australia fell to a record low in Q2 2014 while sentiment remained stable in New Zealand, a regional breakdown of Nielsen's latest global consumer confidence index has shown.

With a score of 100 used to signal optimism, Nielsen found consumer confidence in Australia declined four points to 85, the country's lowest score since it began measuring global sentiment in 2005.

It was the fourth consecutive quarterly decrease and also represented a 13 point fall since the 98 points recorded in the same quarter last year.

By contrast, consumer confidence in New Zealand fell just one point to 99 in Q2 2014, although this was six points higher than the same period in 2013, Scoop reported.

The majority (56%) of New Zealanders were optimistic about their job prospects and personal finances whereas only one-third of Australians felt the same about job opportunities and less than half (48%) were optimistic about their personal finances.

The proportion of people who intend to buy over the next 12 months remained a minority in both countries, although Nielsen noted that this sentiment has not been reflected in underlying consumption activity – at least not in Australia.

Only 37% of Australians said they intend to buy over the coming year, down four points, but Nielsen said consumption expenditure had increased at an average 5.1% over the past year while retail sales growth also accelerated.

In New Zealand, however, where 41% of consumers intend to buy over the next 12 months, Nielsen found sentiment had not translated to increased spend.

"Compared to 2013, New Zealand had a relatively positive first half of the year," said Rob Clark, managing director of Nielsen NZ.

"However, there's still more people who see it as a bad time to buy things they want and need than good. Sentiment hasn't translated to an increase in spend, instead New Zealanders continue to direct spare cash into savings and paying down debt."

The survey also found that more than a third (34%) of Australians believed the rising cost of utility bills to be their biggest concern – up from 29% in Q2 2013 – making it the highest rate in the world.

Data sourced from Nielsen, Scoop; additional content by Warc

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Unlocking Brazil's Twitter potential

28 July 2014
NEW YORK: Marketers have a "unique and valuable" opportunity to win the attention of Twitter users in Brazil who are already following brands on the platform, but not yet engaging with them directly, a new report has argued.

That is the conclusion of digital marketing agency 360i, which analysed how Brazilians used Twitter as part of its ongoing series exploring social media behaviour in the country as well as in India, South Korea, the UK and the US.

It found Brazilians have some unique cultural and social habits when it comes to using Twitter – for example, using it more as a means of self-expression rather than as a means of connection.

Compared to the other countries surveyed, Brazilian Twitter users are less likely to interact directly with other users, the report found, and they post a higher proportion of status updates about themselves and their personal views.

Also unique to Brazil is that the volume of tweets peak during the mealtime hours of breakfast, lunch and dinner whereas volumes peak during the evening in the US and are more consistent throughout the day in the other three markets.

And unlike in the UK and the US, where emotions other than joy are less likely to be shared publicly on social media, Brazilians are inclined to share any emotion they feel, suggesting they have a higher level of comfort with online self-expression.

In another key finding, the report found a majority of Brazilian Twitter users follow brands to keep updated about new products or share their opinions, but their level of engagement is comparatively low.

Only 3% of tweets in Brazil involve mentions of brands compared with 6% in the UK and as much as 15% in India, but the report expected an increase in brand engagement and brand presence as Brazil's economy continues to develop.

Data sourced from 360i; additional content by Warc

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Broadband users engage video apps

28 July 2014
PLANO, TX: Almost half (49%) of US adult broadband users watch some form of mobile video app at least once a month, but engagement depends very much on age, a new report has found.

According to research from The Diffusion Group (TDG), a Texas-based technology firm, nearly a fifth (17%) also watch mobile videos every week while a similar proportion (16%) does so daily.

Not surprisingly, younger users are more inclined to use mobile video apps, both in terms of general uptake and frequency of use.

TDG said nearly two-thirds (63%) of Late Millennials (18-24s) say they use mobile video apps at least once a month, compared with 56% of Early Millennials (25-34s), 55% of 35-44s, and 41% of users aged 45 to 54.

The portable computer is the most popular device for engaging mobile video apps, the report found, leading TDG to advise brands and marketers not to concentrate exclusively on tablets and smartphones.

Over a third (39%) of US mobile video-watchers use a portable computer, compared with 30% who use a tablet, and 22% who rely on their smartphone.

“Too often the industry conceives of mobile app-based viewing as something done on a tablet or smartphone, while leaving portable computers out of the mix,” said Michael Greeson, TDG president and author of the report.

“This is unfortunate, as portable computers are by far the most common platform for using mobile video apps,” he added.

Elsewhere, TDG found online service apps are the most popular type of mobile video app. They are used by 40% of adult broadband users in the US, compared with broadcast network apps (25%), cable network apps (19%), and TV operator apps (16%).

Data sourced from TDG; additional content by Warc

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Coke tops World Cup brands

25 July 2014
LONDON: Coca-Cola, an official sponsor of the recent FIFA World Cup, has emerged as the most recognised brand of the tournament, according to post-event research.

An online poll of 5,000 consumers in the UK and Brazil by Millward Brown's Consumer Neuroscience practice found the soft drinks giant was recognised as a sponsor by 81% of consumers in the UK and an impressive 92% in Brazil.

Furthermore, consumers associated Coke with the tournament 52% faster than average in Brazil and 34% faster than average in the UK.

Millward Brown's methodology involved measuring consumers' intuitive feelings about a brand, using the speed of reaction to questions as a test of the linkage between brand and event.

The research highlighted that while non-sponsor brands and those with an association with other football competitions scored highly before the event, they were subsequently outscored by official sponsors.

For example, both Nike and Champions League sponsor MasterCard were strongly associated with the World Cup in both the UK and Brazil before the tournament, but they were later outscored by official World Cup sponsors Visa and Adidas.

Visa "massively boosted positivity towards its brand with its sponsorship activity", the report said, rising by 300% in the UK, while MasterCard's emotional bond, which was initially higher in both markets, decreased as the tournament went on.

"This research shows that when brands try to piggy-back major events like the World Cup, they are not guaranteed success," said Sarah Walker, global director at Millward Brown's Neuromarketing practice.

"But the post-event wave of research showed that by its conclusion, consumers had intuitively grasped who was a genuine sponsor. It was these sponsors who then gained the most in terms of feelings of positivity," she added.

Another brand considered to be a winner from the event included Yingli, the Chinese solar power company.

Before the tournament, it was recognised by only one-in-ten consumers in the UK and 11% in Brazil, but then scored 21% in the UK and 30% in Brazil in the second wave of questioning, which took place just before the semi-finals and continued until the end of the final match between Germany and Argentina.

Data sourced from Millward Brown; additional content by Warc

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Final Innovation Prize judges named

25 July 2014
LONDON: Six leading agency practitioners as well as two client-side senior marketers from PepsiCo and Unilever will join a full complement of 14 judges for the Warc Prize for Innovation 2014.

Chaired by Peter Espersen, head of community co-creation at Lego, the judging panel will assess case studies that demonstrate how marketing innovation delivered meaningful results for a brand.

Entries are welcome from any country, communications discipline and product category and there is a Prize fund of $10,000. The deadline for entries is Friday 15th August and full details are available on the Prize website.

The latest judges to join the panel include Neeraj Kalani, global market insights director at PepsiCo, and Hamish Priest, manager of global communications planning for Unilever's Dove skincare brand.

From the agency side, the new judges include Alastair Beattie, European president of Tribal Worldwide and head of strategy and innovation at DDB Europe, and Nigel Jones, global chief strategy officer at FCB, who until last year was chairman and CEO at Publicis UK.

Also participating is Awane Kawana, general manager of the Business Innovation Center at Hakuhodo, the Japanese ad agency, and Sonja Lakner from Swedish agency North Kingdom.

Sophie Maunder-Allen, chief executive of direct marketing agency VCCPme, also joins the group along with Leesa Wytock, vp and head of digital at Jack Morton Worldwide.

Commenting on the Prize, new judge Alastair Beattie said: "The Warc prize attracts diverse original thinkers that demonstrate that innovation is the life-blood of our industry. It's where we see all our possible futures taking shape before our eyes."

A full list of the judging panel, including those already announced, is available here and further information about previous winning cases and their common themes can be found in Warc's Innovation Casebook.

Data sourced from Warc

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Getting sponsored content right

25 July 2014
NEW YORK: Brand familiarity, trust and subject matter expertise are the main drivers for consumers open to in-feed sponsored content on news sites, although positive opinion about a publisher's credibility also matters, a new survey has found.

The Interactive Advertising Bureau (IAB) and market research firm Edelman Berland questioned 5,000 consumers who visit US news sites from PCs and showed them mock in-feed ads that resembled those that appear on business, entertainment and general news sites.

It emerged that when respondents had a positive opinion about the credibility of a news site, the perceived credibility of ads on the site increased by a third (33%).

And nearly two-thirds (60%) said they would be more open to advertising on sites that focus on a story rather than selling a product.

When it came to what factors generated interest about in-feed ads, or sponsored content, the vast majority (90%) cited relevancy.

Brand familiarity and trust were important for 81% while subject matter expertise was a key issue for 82%.

Respondents were also asked whether the mock content shown to them made it clear if it was sponsored or not, and the study revealed significant differences between those who viewed a general news site compared with the others.

A full 59% of those viewing a general news site found it difficult to recognise if content was sponsored or not, compared with 15% of those looking at entertainment sites and 18% of those on business sites.

"This new study shows that in-feed sponsored content can be a win for both brands and publishers, when consumers' viewpoints are taken into account," said Sherrill Mane, senior vice president of research, analytics and measurement at IAB.

"News publishers get greater impact when they work with familiar and trusted brands. By the same token, marketers see greater lift when publishers are perceived by consumers as credible news outlets," she added.

Data sourced from IAB; additional content by Warc

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Chinese economy set to overtake US

25 July 2014
SHANGHAI/LONDON: China is expected to leapfrog the US to become the world's largest economy in 2014, at least in terms of purchase power parity, a white paper from Euromonitor International has forecast.

It predicted that the two countries will account for 37.5% of global real GDP growth up to 2030 and that China will add US$18,026bn in GDP over that period – equivalent to the size of Western Europe – while the US will add $US8,658bn.

However, there remain important differences between the two countries, with China lagging significantly in key areas, such as income and consumer expenditure. Also, even in 2030, per capita GDP in China will still be less than half that of the US.

The report found China's large population is gradually beginning to fulfil its mobile potential on the back of rising incomes as well as greater affordability of services and devices.

And China is rapidly catching up with the US in terms of research, development and patents – total patent grants stood at 256,943 in 2013, up from 93,706 in 2008, and compares with the 264,960 patents granted in the US.

In terms of consumer expenditure, Euromonitor found China's per capita gross income was 10.5 times lower than that of the US in 2013, yet was surprised that its per capita savings rate was only 2.7 times less.

China is expected to remain a nation of savers, the report said, and the country's savings ratio will remain high, at more than a third (35.7%) of disposable income in 2030.

It concluded this showed Chinese consumers are not spending enough, especially as much of the country's growth, unlike in the US, is mainly investment driven.

Even by 2030, consumer expenditure will account for less than half (40.9%) of total Chinese GDP, the report said, meaning it will not be a driver of growth.

But with China likely to surpass the US this year in terms of overall economic size, Euromonitor described the development as an "economic milestone".

"This year is a landmark year for the world economy, one when the dominance of the USA appears to be over as China becomes the world's largest economy," said Sarah Boumphrey, head of strategic, economic and consumer insight, Euromonitor.

"Taken together, the two economies play a crucial role in driving global growth. A strong China in conjunction with a strong USA, whichever is nominally the larger of the two, is central to a stable, well-functioning global economy," she added.

Data sourced from Euromonitor International; additional content by Warc

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Australian retailers miss out mobile

25 July 2014
SYDNEY: Even though most Australian retailers recognise the importance of developing a mobile strategy, the great majority are unprepared and no more than 30% have mobile-enabled websites, a new report has found.

A joint study from the Australian Retailers Association (ARA) and NetSuite, the cloud-based software company, also found only a fifth (21%) of the country's retailers have developed a mobile app despite 65% of Australians owning a smartphone.

Conducted by market research firm Frost & Sullivan, the "Mobility: The New Opportunity for Australia's Retailers" report questioned 120 ARA members, of whom most were from smaller companies with fewer than 50 shops.

Although Frost & Sullivan welcomed the discovery that over half have a website and nearly a third (30%) offer online purchasing, it warned retailers that they are falling short on mobile and the omnichannel shopping process.

It found only 9% of smaller retailers offer free in-store Wi-Fi and only a fifth (22%) have capacity for using Quick Response (QR) codes.

Mark Dougan, managing director for Australia and New Zealand at Frost & Sullivan, warned that the rapid growth in ownership and usage of smartphones is revolutionising the way Australian consumers shop.

"The ability to access the Internet whilst on the move has transformed many aspects of consumer behaviour," he said. "Consumers are increasingly using their smartphones for shopping to research, compare, share, purchase and pay for merchandise."

Reflecting this development in the omnichannel experience, the report also noted the mobile features and services that Australian consumers most valued.

Over two-thirds (68%) want access to free Wi-Fi while their other requirements include stock level information (58%), directions to relevant departments (57%), customer reviews (50%), product information (48%), and being able to purchase using their smartphone (43%).

"Australia's consumers are demanding that retailers provide services and features to support them in their omnichannel shopping process," continued Dougan.

"Those retailers who fail to respond to the new era of mobility in shopping face being isolated and left behind as the behaviours of their customers change," he said.

Data sourced from Australian Retailers Association, NetSuite; additional content by Warc

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Dell takes social out of the silo

25 July 2014
DANA POINT, CA: Dell, the information technology giant, is using insights gathered from social media to shape its broader digital marketing efforts, and vice versa, according to a leading executive at the company.

Ana Villegas, Dell's marketing director/North American Commercial Business, discussed its strategy at the 2014 Association of National Advertisers (ANA) Digital & Social Media Conference in Dana Point, California.

"Social has really become part of the DNA of the organisation. Where we are going next is: how can we keep growing our footprint?" she said.

“But, at the same time, we're integrating [social] with everything else that's going on … across marketing." (For more, including details of Dell's approach to tracking social ROI, read Warc's exclusive report: How Dell recovered from a disastrous social start.)

Generating impressive metrics on platforms like Facebook, Twitter and LinkedIn is "great", she continued, but brand custodians must also look at "where [social] fits within everything else you're doing" in marketing. "You cannot work with social media in isolation," Villegas asserted.

Rather, it is essential to consider how this activity fits in with their other digital tactics, so as to ensure they are integrated and mutually supportive. And this requires assessing each channel carefully.

"What are you doing in search? What are you doing in lead generation? What is your email strategy? What is your print strategy? Your management strategy?" Villegas asked.

"It's a two-way street: you can use social to gather insights from how your customers … are engaging and talking about [your product] and driving your demand."

For Dell, the goal is to tap data and insights from social to influence its output in areas like paid search and the content of its marketing emails – and to use information yielded by these sources to impact its social strategy.

"Based on what [we] have learned from search and the keywords that customers are engaging [with] more, [we] make sure that those keywords are also something [we're] investing in on the social front," Villegas said.

Data sourced from Warc

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Digital wallets fail to attract users

25 July 2014
KETTERING, OH: Although nearly 80% of consumers are aware of "digital wallets" such as PayPal, only about a third (32%) have ever used them as a payment option, a new survey has revealed.

Based on responses from more than 2,000 US smartphone, tablet and desktop users, the 2014 Digital Wallet Usage Study found security to be their leading concern (46%).

Finding it easier to pay by cash or card is the second main reason for not using digital wallets (37%), followed by not considering the option (32%), said Thrive Analytics, which released the survey.

Jason Peaslee, managing partner at the Ohio-based marketing consultancy, said this presented a "vast opportunity" for digital wallet providers and retailers to educate consumers about their benefits.

"The key to increasing consumer and overall market adoption is understanding and operationalising critical demographic usage profiles and purchase patterns," he said.

For example, the survey found half of all consumers carry less than $20 on a regular basis and three-quarters of those who carry no cash at all are aged under 40.

PayPal is by far the most-used digital wallet, at 79%, followed by Google Wallet (40%), Groupon (26%) and Apple Passbook (17%).

Women tend to use apps from stores like Macy's to obtain coupons and discounts while men use them mostly for browsing and service related activities.

The survey coincides with news that internet retailer Amazon will be launching a new app, Amazon Wallet, which allows users to store loyalty cards or gift cards, the Wall Street Journal reported.

The app will be preinstalled on its Fire smartphone, which is set to be released on Friday.

Data sourced from Thrive Analytics, Wall Street Journal; additional content by Warc

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Global marketers remain upbeat

24 July 2014
LONDON: Confidence among global marketers remained positive in July, according to the latest Warc Global Marketing Index (GMI), which found marketing optimism to be particularly high in the Americas and Europe.

The headline GMI figure, which assesses marketers' expectations in three main areas – trading conditions, marketing budgets and staffing levels – held steady at 56.6 this month, but this was still a 2.3 point increase over the year.

Warc's GMI is a unique monthly indicator of the state of the global marketing industry which tracks conditions among marketers within their organisation and region.

A reading of 50 indicates no change from the previous month, while a reading of 60 indicates rapid growth.

In this month's report, optimism was the highest in the Americas for the fifth consecutive month. The region returned a GMI of 57.7, which indicated improving conditions overall despite representing a 1.6 point decline from June.

Marketers in Europe were also upbeat about conditions – Europe recorded a GMI reading of 57.2, up 1.5 since June – although the headline index for Asia-Pacific remained largely flat on 55.1 (+0.2 points).

Looking at the component parts of the index, strong trading conditions in Europe and the Americas helped both regions to record positive readings of 59.9 and 59.7 respectively while Asia-Pacific was also positive with a score of 57.8.

However, the index for marketing budgets contracted 0.9 points globally to 53.2 in July, even though this still represented the eighteenth consecutive month of budget improvement.

Europe was up 1.3 points to 54.1, the Americas fell 3.7 points to 52.8 while Asia-Pacific also declined by 0.6 points to 52.5.

Interestingly, there was a sharp decline in net budgeted spend for TV in the Americas, where the channel's individual index fell 8.6 points to 42.8 in July. Globally, the index for TV budgets stood at 49.6, the first indication of declining spend since October 2013.

The Americas region was more positive about staffing levels, the GMI's third component. Its GMI for hiring staff was the highest on 60.5, followed by Europe (57.5) and Asia-Pacific (54.9), creating a global average of 57.6 (+1.6 points).

Commenting on the figures, Suzy Young, data and journals director at Warc, said: "The global headline GMI remains consistent with June data on 56.6. Within this, the indexes for all featured regions have stabilised significantly since the end of 2013, with marketers generally upbeat about their business environment."

Data sourced from Warc

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Highest consumer confidence since 2007

24 July 2014
NEW YORK: Global consumer confidence rose one point to 97 in Q2 2014, its highest level since the first quarter of 2007, the latest Nielsen Global Consumer Confidence Index has revealed.

Based on responses from 30,000 online consumers across 60 markets, the Nielsen survey also found half of consumers globally expect their job prospects to be good or excellent for the coming year since last polled in the first quarter.

With a score of 100 considered to be the benchmark signalling optimism, Nielsen found confidence to be highest in Asia-Pacific (106), followed by North America (103, up 3 points), Middle East/Africa (93, -1), Latin America (90, -3), and Europe (77, +2).

Although Europe lagged world sentiment, consumer confidence rose in 72% of its 32 markets and only six reported declines, including a sharp increase in Italy (51, +6).

Denmark (106), Belgium (80) and Romania (73) all reported six-point increases while the UK saw an impressive year-on-year rise of 11 points to 90 as its economy outperforms those in the euro-zone.

The Netherlands (81), Ukraine (61) and Croatia (50) each reported five-point rises while confidence in France rose for the second consecutive quarter to 60. However, Portugal (48, -3) was the most pessimistic.

In North America, US consumer confidence continued an upward trend that began in Q1 2013 and half (49%) of Americans said it was a good or excellent time to spend, the highest level reported since 2006. Confidence in Canada rose three points to 102.

"Steady gains across confidence metrics within parts of Europe and buoyant increases in North America strike a positive note with regard to economic recovery in mature markets," said Dr Venkatesh Bala, chief economist at the Cambridge Group, a division of Nielsen.

Turning to Asia-Pacific, India (128, +7) overtook Indonesia (123) to become the most confident market in the world, although Hong Kong (103) and Japan (73) saw the largest declines from the previous quarter, each falling eight points.

Confidence held steady in China (111) and increased in the Philippines (120), South Korea (53) and Malaysia (93), but fell in Australia (85, -4), the country's lowest score since Nielsen began its measurement in 2005.

Colombia (95, +2) was the only country in Latin America to record an increase in the second quarter while Brazil (100), Chile (92) and Venezuela (72) all fell by six points. Mexico fell one point to 85 and Argentina declined by three points to 68.

South Africa (85, +3) posted the only regional confidence increase in MENA, although UAE scored 109, down five points, while confidence held steady in Saudi Arabia (102) and Pakistan (99).

In sub-Saharan Africa, Nigeria (121, +1) was the highest, followed by Kenya (111, +1) and Ghana (103, +6).

Data sourced from Nielsen; additional content by Warc

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'Brand love' drives MINI forward

24 July 2014
DANA POINT, CA: MINI, the auto marque, has been able to maximise the impact of a comparatively limited marketing budget by tapping directly into "brand love" among its most passionate fans.

Lee Nadler, marketing communications manager for MINI USA – a division of BMW – discussed the brand's strategy at the Association of National Advertisers (ANA) Digital & Social Media Conference.

"About half of our owners name their car," he revealed. (For more, including details and results from MINI's "Final Test Test Drive" campaign, read Warc's exclusive report: MINI breaks the car-launch marketing rules.)

"How many of your customers would have the kind of relationship with your product or service where they would actually name it or invite it into their life in some special way?" Nadler also asked the event delegates.

Given that such loyalty is at a premium in any category, MINI is aware of its potential value. "We don't take that for granted," said Nadler.

Indeed, actively leveraging this enthusiasm on the part of its core customer base has helped MINI make a significant impact with a budget that is lower than that possessed by many rivals.

"We're outspent ten-to-one by other car brands. So we have to be really smart with our dollars. And we have to be nimble," said Nadler.

One indicator of how the brand engaged its passionate followers – who often describe themselves as "MINIacs" – came with the unveiling of the 2014 Cooper Hardtop.

"What we said is, 'Before we bring this car [to market] – before the dealers even get to drive it – we're going to ask our owners how they would want to test it.'"

The resultant competition asked MINI owners to customise designs of the Cooper Hardtop online, and to suggest novel ways in which it could be put through its paces prior to its official launch earlier this year.

Such a strategy, he reminded the conference audience, marks a considerable departure from the category norm when introducing a vehicle.

"They bring it to their dealers. They bring it to an auto show. They do a big press event. The dealers have a party and they invite people – current owners and new prospects – to the party," he said.

"But most dealers don't enjoy the brand love that MINI does."

Data sourced from Warc

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Chinese lose faith in Western fast-food

24 July 2014
SHANGHAI: Up to 69% of Chinese consumers say they will no longer eat at a Western fast-food restaurant after poor practices have emerged at a US-owned food supplier to KFC and McDonald's.

This was one of the key findings in an online poll of 25,000 people by news portal Sina Shanghai, South China Morning Post reported.

The poll also revealed that over three-quarters (77%) thought the Western brands were aware of what was happening at the Shanghai Husi Food Company, which a weekend TV report revealed to be processing meat beyond its expiry date.

An investigation has been launched by the Shanghai Food and Drug Administration and both KFC and McDonald's released a statement emphasising that they have halted use of all products from Shanghai Husi.

This is another setback for KFC, which had been working to improve its image in China after another scandal in December 2012 revealed it had served chicken containing unapproved levels of antibiotics.

Meanwhile, US coffee chain Starbucks, Burger King, Pizza Hut, Swedish furniture chain Ikea and Chinese fast-food chain Dicos all sought to provide clarity about food they had received from Husi.

Starbucks said its only affected product was a chicken and apple panini sandwich while Ikea used its Weibo account to say it had previously sourced meat from Husi but stopped in September, the Financial Times reported.

And in a further development, it emerged that the plant also supplied meat for about a fifth of the Chicken McNuggets sold by McDonald's in Japan, prompting the Japanese authorities to announce that imports will be blocked and they will take "firm measures to ensure food safety".

Data sourced from South China Morning Post, Shanghaiist, Financial Times; additional content by Warc

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Indians use smartphones 3 hours a day

24 July 2014
NEW DELHI: Indian consumers spend more than three hours a day on their smartphones and a quarter check them over a 100 times a day, a new survey has revealed.

About one-third of the time they spend on smartphones is for using apps and this trend is expected to continue, said Ericsson ConsumerLab.

The technology insights firm polled 4,000 smartphone users across 18 Indian cities from April to June 2014 and found they spend 191 minutes a day on their devices, compared to 128 minutes a day watching TV.

The report said there had been a 20% rise in the average time spent by smartphone users over the past two years as well as a 63% increase in app usage.

Social and chat apps are the main drivers for buying a smartphone, the report said, but consumers are not just using mobile data for social purposes, but also for business and online shopping.

A full 40% of mature smartphone users say their usage is no longer just for social purposes and a quarter (24%) use mobile apps for business.

"Maturity is an important dimension in mobile broadband behaviour," said Ajay Gupta, vp strategy and marketing at Ericsson India.

"Mature users consume almost twice as much data as new users," he continued. "As consumers explore more apps and services relevant to their interests and needs, mobile broadband usage is set to grow."

However, network performance and app coverage were also found to influence perceptions with satisfied users experiencing three times better web page load times.

They also spend more time streaming videos via apps and staying connected using mobile for longer.

"Interestingly, smartphone users prioritised the service provider's ability to solve mobile data issues as and when they arise over cheap mobile data tariffs or plans," Gupta said.

Data sourced from Ericsson; additional content by Warc

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MTN is top valued brand in South Africa

24 July 2014
JOHANNESBURG: MTN has retained its status as South Africa's most valuable brand in an evaluation of the country's top 50 brands that gives the mobile operator a brand value of more than twice that of its nearest rival.

According to the South Africa Top 50 study from consultancy Brand Finance, MTN has a brand value of US$5.4bn compared to second-ranked Sasol, the chemicals firm, which has a value of $US1.9bn.

Coming in third is Vodacom, another telecoms company (US$1.7bn), followed by Standard Bank (US$1.6bn), Absa – or Barclays as it is known in the rest of Africa (US$1.22bn) – Nedbank (US$1.19bn), First National Bank (US$1.05bn) and Mediclinic (US$899m).

Rounding out the top ten are Investec and Woolworths. Taken together, the top ten account for over half (52%) of total brand value.

Brand Finance calculates brand value using the "Royalty Relief" methodology, which involves estimating the future revenue attributable to a brand and calculating a royalty rate that would be charged for the use of the brand.

Miller Matola, CEO of Brand South Africa, paid tribute to the nation's top brands.

"In large, the measure, the strength of the country's reputation is attributable to some of its global corporate, product and service brands – most of which appear in our Top 50," he said.

Financial services account for 26% of total brand value in the study even though only 13 brands feature from the sector, htxt.africa reported.

The telecoms sector follow (25% value, five brands) and then food and beverages (22% value, 16 brands).

"The pan-African dominance, global reputation and success of the Top 50 shows that South Africa has the creativity, skill and experience to continue building great brands and a great, growing nation," concluded Thebe Ikalafeng, chairman of Brand Finance Africa.

Data sourced from Brand Finance, htxt.africa; additional content by Warc

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Beacon tech lifts Hillshire Brands

24 July 2014
CHICAGO: Hillshire Brands, the food manufacturer, has seen an improvement in several core brand metrics as a result of using beacon and geofencing technology to connect with consumers in retail stores.

The firm worked with BPN, its media agency, and inMarket, a company that operates a network of beacons – electronic transmitters capable of two-way communications with smartphones – on the recent in-store campaign.

"We started experimenting with location-based technologies and increased focus on mobile a year ago, recognising that location is key to engaging with our consumers," David Ervin, director of integrated marketing for Hillshire Brands, asserted on BPN's blog.

Its beacon-led effort, run for American Craft Link Sausages, was active from April to June in ten major markets across the US, and was aimed at members of the brand's primary target audience.

These shoppers were given the chance to receive digital coupons, add the sausages to their shopping list or earn points for engaging with the product.

Purchase intent among people exposed to campaign messaging rose 20 times, a figure 500% higher than the norm for mobile advertising engagement in the consumer packaged goods sector.

Brand awareness also leapt by 36% and the brand experienced a "lift in overall sales" as well. Fully 6,000 in-store engagements were recorded during the first 48 hours of the initiative alone, too.

One motivation behind the campaign was the knowledge that members of American Craft Link Sausages' customer base were becoming less likely to reclaim traditional printed coupons.

"By engaging with shoppers while they are in-store in a timely and relevant manner, we are elevating the conversation past seeing a traditional advertisement to shifting the discussion to include our clients into consumers' everyday actions," said Chris Hiland, chief growth officer at BPN.

As a result of this successful test, Hillshire Brands is planning to extend the beacon programme to a campaign for its Jimmy Dean brand later this year.

Data sourced from BPN; additional content by Warc

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Record entries for Warc Asia Prize

24 July 2014
SINGAPORE: The Warc Prize for Asian Strategy has received 183 entries in 2014, a record total for the competition.

Entries came from 13 different markets around the region. As in previous years, India was the biggest single source of entries, accounting for 73 of the 183 entries. Next came China (37) and Singapore (23).

Now in its fourth year, the Prize is the region's leading showcase for strategic thinking in marketing. Entrants had to submit a case study showing how smart strategy had delivered brand success. It is free to enter, and the winners will share a $10,000 prize fund.

"The record number of entries to this year's Prize show how important it is becoming for brands and agencies to prove their creative thinking is rooted in sound strategy," said David Tiltman, Warc's head of content.

"Over the four years we have run the Prize, we have noticed a growing sophistication in the case studies we receive. It is clear that strategy is growing in importance in Asian marketing."

The entries have been sent to the judging panel for first-round scoring. The judging panel comprises senior client-side marketers and agency-side strategy experts. This year's judges are led by Freddy Bharucha, chief marketing officer of Procter & Gamble Asia.

The Prize hands Gold, Silver and Bronze awards to the best entries. The author of the overall Grand Prix will win a $5,000 cash prize, and there are a further five $1,000 prizes for entries that show excellence in specific areas. Full details of the Prize, plus videos from last year's competition, can be found on the Prize website.

Warc expects to announce the shortlist in early September, then the winning entries in early October.

Data sourced from Warc

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