Asians buy, South Americans browse

28 August 2014
GLOBAL: Almost half of internet users around the world plan to make an online purchase in the next six months, but those in Latin America are more likely to restrict themselves to browsing than buying, unlike their Asian counterparts, according to new research.

The Nielsen Global Survey of E-commerce polled more than 30,000 internet respondents in 60 countries to examine the online shopping and purchasing intentions of consumers worldwide.

Both Latin America and Asia-Pacific surpassed the global average for all 22 categories considered when it came to online browsing, but actual buying rates were among the lowest in Latin America and among the highest in Asia-Pacific. 

Nielsen noted that in 14 categories buying rates in Asia had exceeded browsing rates, so comfortable were consumers there with buying online. This was particularly true of China, which Patrick Dodd, Nielsen China managing director, described as "one of the furthest along on the e-commerce maturity curve".

John Burbank, president of strategic initiatives at Nielsen, said the online retail infrastructure in Latin America had yet to catch up with offering conversion opportunities. "Other barriers to e-commerce success include internet access, shipping costs, high taxes and problematic delivery logistics," he added.

One possibility that could encourage greater take-up of ecommerce in developing markets, he suggested, was to use mobile to attract new buyers, as this provided greater and faster access to more people.

Online browsing and buying percentages were similar in western Europe and North America, where online retailing is now simply one more channel competing for market share. The Middle East and Africa, however, were lower than average, largely because of a lack of opportunity.

The categories most likely to feature in online purchase intentions over the next six months were clothing (46%), and airline (48%) and hotel (44%) reservations, and Nielsen noted a largely one-to-one correlation between browsing and buying for these.

Consumable products had lower online browse/buy intention rates than non-consumable products, but their browse-to-buy correlation rates were equally strong. Thus, 33% of global respondents said they browsed cosmetics, with 31% buying; 31% browsed personal care products, 29% bought; 30% browsed groceries, 29% bought.

The browse-to-buy spread became more significant for high-priced items, such as consumer electronics and cars.

Burbank pointed out that strong online browse-to-buy conversion rates translated to loyal repeat customers. "Now is the time to create omni-channel experiences for consumers who are actively using both digital and physical platforms to research and purchase," he urged, "as consumers increasingly don't make a distinction between the two."

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


Marketers underuse digital technology

28 August 2014
NEW YORK: A majority of senior marketers feel their businesses could do more to hitch digital technology to both their own marketing efforts and to associated areas, new research has said.

Forbes Insights, part of the Forbes Media publishing group, and Wipro, the IT and consulting business, surveyed 125 C-level executives from global consumer goods companies with revenues of over $1bn, covering the US, Europe and Asia Pacific, as well as carrying out a series of one-to-one interviews for its report The Race Is On: Keeping Pace with Consumer Goods Leaders in Digital Marketing and Technology.

It found that almost two thirds of respondents (65%) thought there was scope for their companies to harness digital technology to improve marketing effectiveness. A broadly similar proportion (61%) felt the same way about complementary areas such as product development and logistics.

"Many companies still have a long way to go to realize the full potential of digital marketing," observed Bruce Rogers, Chief Insights Officer and head of the CMO Practice for Forbes Media.

His Wipro colleague acknowledged the complexities faced by marketers, who were having to not only deal with "integrated website, mobile and social media strategies alongside well-conceived and executed data privacy and security strategies but also concepts such as omni-channel and analytics".

But, said Hiral Chandrana, Wipro's VP & Global Business Head, Consumer Goods, "the collective capabilities of these technologies to grow and optimise sales and marketing are too important to be ignored … How well businesses are able to implement digital technology has a direct impact on business results and will keep them ahead of their competitors".

Fragmentation emerged as an important factor limiting the ability of businesses to utilise digital technology to its fullest. Some 42% said their current approach to digital marketing was too disjointed and that figure only increased as the organisation got bigger.

Part of this was due to internal structures, with digital marketing often established as a separate function (37%); ecommerce frequently operated as a separate business unit (39%).

Turf wars were also a feature – 43% of executives believed their IT departments were too busy to help with digital marketing technology needs, while 50% were able to report one or more instances when digital marketing had failed to integrate with essential back-end processes.

Despite all this, 20% of companies described themselves as transformative, and these, said Forbes, were the leaders, whose embrace of digital was transforming not only sales and marketing but also the overall business.

Data sourced from Forbes; additional content by Warc staff


UK social users mostly spectators

28 August 2014
LONDON: More than half of Britain's adult population engaged in social media does little to increase brand interest and create positive associations with brands online, new research has found.

Research group Kantar Media delved into its TGI Clickstream study of online consumer behaviour to analyse the social media connections and engagement of over 50m adults aged over 15 and identified six groups of social media users, ranging from 'passive socialites' at one end of the spectrum to 'connected engagers' at the other.

According to Richard Keogh, Head of Kantar Media TGI UK, "The different segments show that clicks and connections alone will not reveal consumers' actual engagement levels".

The single biggest set of users was the 'social spectators', who accounted for just over half the total. They were described as "a disengaged group with a respectable number of connections" but were not very likely to buy goods online, or to read or update their social media accounts. Nor did they post product reviews or follow brands online.

This group tended to be older, said Kantar Media, and, because they didn't carry high economic or cultural capital, were unlikely to have much clout or spending power for brands.

The group holding the most interest for brands was dubbed 'online experimenters', who had a crucial combination of purchasing power and online engagement. They accounted for 10% of all users, again tended to be older but these were particularly likely to engage with brands and to buy products online.

The 'connected engagers', who made up 3% of users, also held potential for brands, having the highest level of connections and influence and being most likely to spread the corporate word online. But because they lacked economic and cultural clout, they were unlikely to be big spenders.

'Connected dabblers' represented 10% of all users, had a high level of connections and followed brands on social media but were less likely to post reviews about products and brands. 'Passive socialites' accounted for 4% and also had a high level of connections but as they tended not to follow brands or post reviews, that meant they had a low level of influence.

Finally, 'credible contributors' – 22% of all users – had an average level of connections and engagement and were highly likely to follow brands and post reviews online.

"Marketers need to look beyond widely accepted metrics to specific evidence of engaged online activity to determine how valuable consumers are," said Keogh. He advised that they "review who they are targeting online to ensure they are directing their social media activities (and marketing budget) at the most appropriate audience".

Data sourced from Kantar Media; additional content by Warc staff


Facebook utilises signal strength

28 August 2014
NEW YORK: Advertisers using Facebook to reach a mobile audience now have another variable to consider in their media planning as the social media giant has introduced an option allowing them to target users based on the strength of their phone signal.

That means, for example, that they can avoid wasting time and money serving data-heavy video ads to people who might only have a 2G connection, a factor that will be of benefit to marketers in emerging markets where mobile phone networks are less developed and where feature phones still predominate.

Reporting the development, Advertising Age also noted the "yawning gap" between where the majority of Facebook users are located and where most of its money comes from: the US, Canada and Europe account for just 38% of monthly active users but 72% of ad revenues.

In addition, it said, Facebook's user base in developing markets was growing at four times the rate of its combined user base in its main western markets.

The company's increased focus on emerging markets was also evident last month when it reported that it had been trialling 'missed call' ads in India – where the user rings a number and then hangs up to activate a return call that delivers a pre-recorded audio message – which had generated 16 times more calls than all other media combined.

CEO Cheryl Sandberg indicated then that the service would be rolled out in other developing markets, such as Indonesia and Brazil.

Similarly, it created Facebook for Every Phone, an app for feature phones which is faster than the mobile site and feels more like a smartphone app.

According to a spokeswoman, the new facility for targeting mobile signal strength works across all of the company's ad units and also in conjunction with all other targeting options as well as enabling advertisers to target ads across Facebook's mobile network of third-party apps.

Data sourced from Advertising Age; additional content by Warc staff


'Super consumers' key to rural India

28 August 2014
MUMBAI: Marketers need to identify and target a new category of Indian rural consumer, one who is connected digitally, who appreciates branded goods and, crucially, who can influence others to make similar choices.

Nielsen India surveyed 2,000 rural opinion leaders across Andhra Pardesh, Gujarat, Maharashtra and Punjab, and found that where once these would have been successful farmers, they were increasingly including non-agricultural workers such as doctors, teachers and even retailers, depending on the advice being sought.

"The parameters of success have changed," Ashish Bhasin, chairman and CEO - South Asia, Dentsu Aegis Network, told the Economic Times. "The guy building the biggest house or the man who bought a motorcycle is a bigger influencer than the village elder who used to be the know-all for financial decisions or even political choice."

Nielsen also observed that there were other areas where marketers might need to rethink their views on this market, one example being the widespread belief that rural consumers only need education about those categories they are unfamiliar with. But Ritesh Sahu, Nielsen India director, reported that "Many of them said they needed more information even about the core area of farming".

His colleague Adrian Terron argued that it was now easier than ever before to identify the "rural super consumer", who was "both economically and emotionally more engaged with a category and brands within it".

He described this consumer as one who wanted a more city-like lifestyle, a desire fuelled by greater connectivity and information availability, and for whom branded goods connoted reliability and utility. This consumer, he said "will lead others to your brand if you manage to capture his imagination and disposable income".

The marketer's task was made simpler, he suggested, by the fact that the country's rural potential was not spread evenly: 72% of rural FMCG sales take place in just 10 states, for example, while two-thirds of branded soft drink sales come from just 19,000 villages, or 3% of the total.

Terron added that smart marketers were using syndicated vehicles to acquire and share data. "They use modelling techniques that link consumer intelligence, trade intelligence and pragmatic approaches to segmentation that can be translated into sales force activation," he said, practices he expected would come to redefine rural marketing.

Data sourced from Economic Times; additional content by Warc staff


Premium brands escape Thai slowdown

28 August 2014
BANGKOK: High levels of household debt have slowed consumer spending in Thailand but premium brands have not been affected, new research has revealed.

Consumer research business Kantar Worldpanel surveyed 4,000 households for its annual shopping behaviour survey and found that the current economic slowdown had hit rural Thailand and non-essential purchases hardest but upmarket brands had emerged unscathed.

On average, Thailand's 22.5m households made 4.1 shopping trips a week, with urban consumers setting out 3.3 times and rural consumers 4.8 times. And urban consumers spent 132 baht per trip, while rural consumers spent half that.

Kantar general manager Howard Chang noted that growth in the number of shopping trips had slowed from 7% to 3% in the year to July as the economy continued to struggle to recover.

He highlighted mounting household debt as an issue, even though rural Thais had cashed in on a rice-pledging scheme, where the government bought rice at a fixed price and then resold it, and the minimum wage had increased to 300 baht a day.

He reported that rural Thais had reduced purchasing of non-essential items such as hair conditioner, facial cleaner, mouthwash, laundry additives and toilet paper.

They were also buying less often and in fewer categories, reducing their quantity and paying less for different products, and seeking out more promotions and different channels.

"Thailand urgently needs the interim government to add money to the fiscal system such as cash coupons or infrastructure projects," he said, comparing the current situation to previous economic crises when recovery had been long and slow.

The good news, he said, was that premium segment had not been affected, and he urged brands not to delay new product launches. Consumers will pay for items once they understand their value from marketing pitches, he declared.

Separately, a conference devoted to e-commerce heard that this sector was growing at 20% a year as increasing numbers of consumers went online via mobile. Smaller businesses could benefit especially but would need to market themselves online in "at least" Thai and English and preferably Chinese and Burmese as well.

Data sourced from Bangkok Post, The Nation; additional content by Warc staff


Twitter increases Europe ad offering

27 August 2014
DUBLIN/SAN FRANCISCO: Twitter is expanding its advertising network to 12 additional markets in EMEA with an emphasis on Central and Eastern Europe, the social networking site has announced.

This means the availability of Twitter Ads in Europe will more than double from the eight European markets it currently operates in and takes the total number of EMEA countries where it is active to 35, the Financial Times reported.

The new countries that will soon join Twitter's ad system are Austria, Bosnia and Herzegovina, Bulgaria, Croatia, the Czech Republic, Macedonia, Portugal, Romania, Serbia, Slovenia, Switzerland, and Ukraine.

Ali Jafari, Twitter's vp of direct sales for Europe, said advertisers would be able to use direct sales support teams and gain access to services, such as promoted tweets, mobile app promotion and TV conversation targeting.

"We've heard positive feedback from brands around the world about how our recent product developments have helped accomplish goals like driving engagement or direct-response actions like website traffic, video views, leads and sales," he said.

The move comes almost a month after Twitter announced better-than-expected results for Q2 2014 of $312m, an increase of 124% from the same period in 2013, although this still represented a loss of $145m over the quarter.

It also reported that it had 271m monthly active users, a year-on-year increase of 24%, and that about three-quarters of them are located outside the US.

But as international users contribute only about a third of Twitter's total revenue, it is a logical step for the company to expand its advertising system to new markets.

Data sourced from Financial Times, Twitter, TechCrunch; additional content by Warc staff


Mobile commerce rises 47% in US

27 August 2014
RESTON, VA: Mobile commerce in the US grew by 47% in Q2 2014, boosted by increased usage of tablets and bucking a seasonal trend for slower rates of growth during the second quarter, new industry data has shown.

In what it described as a "massive increase" in m-commerce spending growth, research firm comScore said it significantly outpaced both total discretionary retail growth (+3%) and desktop-based ecommerce (+10%).

Andrew Lipsman, vp of marketing and insights at comScore, said in a company blog that the 47% growth rate was "impressive", although m-commerce as a percentage of total digital commerce was "not exceptionally high" at 11.1%.

Tablets accounted for 46% of m-commerce spending in the second quarter, he said, and achieved a growth rate of 75% since the same period in 2013. This compared with growth rates of 29% and 10% for smartphones and desktops respectively.

As well as noting the increasing importance of tablets for m-commerce, Lipsman also pointed out that this year's second quarter figures showed a less pronounced seasonal dip in growth as a proportion of total ecommerce.

M-commerce's Q2 share of 11.1% (down 0.4% from Q1) compared with 8.6% in Q2 2013 (down 1.9% from Q1 2013) and 8.1% in Q2 2012 (down 1.2% from Q1 2012).

Lipsman suggested this might be a sign that the "base of m-commerce buyers is finally solidifying and becoming more consistent throughout the year", which could lead to a better foundation for growth in the coming months.

Although he thought it "highly unlikely" that there will be a growth rate of 40% or more in the next two quarters, he expected it will remain in the 30% range.

That would mean m-commerce spending in the US will head towards about $35bn, he said – not far behind the size of the entire digital advertising market.

Data sourced from comScore; additional content by Warc staff


China plans its own PC system

27 August 2014
BEIJING: China plans to release a new operating system for PCs as early as October this year in a bid to end its reliance on imported software from Western companies like Google, Apple and Microsoft, a leading Chinese official has disclosed.

Ni Guangnan of the Chinese Academy of Engineering told the People's Post and Telecommunications News that the OS will be introduced first on desktop devices and later to smartphones and other mobile devices, Reuters reported.

"We hope to launch a Chinese-made desktop operating system by October supporting app stores," Ni told the trade paper, which is run by the Ministry of Industry and Information Technology (MIIT).

He said he hoped software developed in China would be able to replace Windows XP desktop operating systems within one to two years and Android mobile operating systems within three to five years.

"Creating an environment that allows us to contend with Google, Apple and Microsoft – that is the key to success," he added.

The development comes after China banned Microsoft's Windows 8 from government use in May amid unconfirmed suspicions about US cyber-surveillance techniques.

Mutual suspicions between China and the US escalated over the past year following revelations by Edward Snowden, the former NSA contractor, that US-made hardware had been planted with surveillance tools.

Meanwhile, in a further sign of growing mistrust, Tech Times reported that the Chinese authorities are currently investigating Microsoft for alleged antitrust violations.

The Chinese government has also raised concerns that Android has too much control over the local market.

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


Mobile boosts French ecommerce

27 August 2014
PARIS: Ecommerce sales in France hit year-on-year growth of 14% in 2013, with mobile accounting for 12% of the market, recent research has shown.

These were the key findings in a study published as a company blog in July by CCM Benchmark, the French online media group, eMarketer reported.

CCM studied 50 ecommerce retailers, including those of major companies like Carrefour and Air France, and found almost two-thirds (60%) believed mobile was the main driver of growth over the year, having risen from 7% of total online sales in 2012.

As consumers in France become more open to shopping via mobile devices, eMarketer expected French B2C ecommerce sales to grow 10% this year to $47.65bn.

While these annual growth rates are expected to decline slowly over the next four years, eMarketer also estimated the value of these sales will be worth $52.30bn next year and $64.17bn in 2018.

Even though French digital retailers confirmed the importance of mobile as a driver of sales growth, they also told CCM that they were not relying on it as an exclusive channel or customer service.

Personalised offers, for example, were used by over half (56%) as another source of growth in 2013 while 46% said expansion overseas contributed to improved results.

All of them (100%) offered home delivery, over half (53%) allowed shoppers to collect their purchase in-store, while two-in-five diversified their product range to improve growth, and 14% used social media to raise their profile.

Turning to how personal care brands could improve their reach to French mobile consumers, a separate report from digital think tank L2 advised them to focus on creating a mobile optimised site rather than an app.

Nearly three-quarters (73%) of French consumers said they prefer to use a laptop to make online purchases compared to 15% who prefer to use a mobile app, L2 said, adding that those who do use mobile devices prefer to use a brand site rather than a mobile app.

According to its analysis of information from eMarketer, L2 said 63% of French consumers use mobile devices to find out more information about a product, 58% compare prices, while 54% use sites to evaluate different products before purchase.

Data sourced from eMarketer, L2; additional content by Warc staff


US media groups rely less on ads

27 August 2014
CHARLOTTESVILLE, VA: A number of major US media groups have taken a strategic decision to reduce their reliance on advertising revenues, according to new analysis.

After studying the Q2 2014 results and earnings conference calls of CBS, Walt Disney and several other media conglomerates, financial analysts SNL Kagan concluded that some want to boost other sources of revenue, including subscriptions.

Among the examples highlighted in the study, CBS CEO Les Moonves told investors that the company is now "much closer to a 50/50 split of advertising and non-advertising revenue".

Revenues in its entertainment division fell to $1.84bn in Q2 2014 from $2.01bn in Q2 2013, and CBS intends to earn more from licensing and syndication revenues.

"One of the things that clearly has changed about our businesses is that the back end of the show's revenue is now as important, if not more important, than the front end from advertising," Moonves said. "Ownership of content is the key to our success."

Similarly, Walt Disney is moving to diversify its revenue streams, SNL Kagan said, pointing to recent comments from Disney CEO, Bob Iger.

"We've made a conscious decision as a company to essentially not be as reliant on advertising as we were in the past. So it represents probably somewhat in the neighbourhood of the low-20% range of our total revenue," Iger said.

Disney has become less reliant on advertising partly because of increased revenues from other sources, such as its theme parks.

Despite this, Iger said Disney will continue to participate in digital advertising although he thought traditional advertising platforms would continue to come under pressure.

When looking at some other media groups, the report said NBCUniversal Media had a weak quarter in terms of advertising revenue, which fell 2.2%.

And there was a mixed picture for 21st Century Fox, which posted both big declines in advertising revenue in its TV segment but large increases for its cable networks.

Data sourced from SNL Kagan; additional content by Warc staff


Big Bazaar focuses on small cities

27 August 2014
MUMBAI: India's smaller cities and towns have been prioritised in the expansion plans of Big Bazaar, one of the country's largest retailers, its head of marketing has said.

Speaking to Pitchonnet, Big Bazaar CMO Rashi Bisaria said cities like Lucknow, Kanpur, Agra, Gwalior and others all have potential and are seen as "critical for the Big Bazaar establishment".

Lucknow and Kanpur, in particular, make an important contribution to the company's annual revenue, he said, adding that Big Bazaar has gained from consumers in mid-level cities being open to the modern retail format.

With about 18 to 20 stores located in tier-II and tier-III towns in northern India, he explained that the company's prime focus is to understand consumers in these target areas.

In some northern towns, for example, the company sought to position itself as a fashion retailer by hosting activities, such as educational workshops to help consumers choose particular fashions.

"We study the profiles of consumers entering each store and try to provide favourable offerings for that consumer," he said. "It is important to understand the local tastes and aspirations."

Already operating 300 stores in India, Big Bazaar plans to build up its portfolio to 500 stores by the end of this year and, although TV remains "very important" as a promotions channel, the company still sees a substantial role for print campaigns.

Print makes up 80% of its marketing spend, Bisaria said, because it is the medium that the company believes connects with the entire market.

"For Big Bazaar, we have covered 37 to 41 markets through print advertising, perhaps the largest depth to which any brand has ever gone in the country via the medium of print," he said. "Our reach via print is quite strong."

Data sourced from Pitchonnet; additional content by Warc staff


Amazon eyes ad market

26 August 2014
NEW YORK: Online retail giant Amazon could be preparing for a major expansion into the online advertising market, with tests of a new ad placement platform expected to commence later this year.

According to reports, Amazon Sponsored Links will initially operate as an in-house system, taking on the role currently fulfilled by Google's AdWords product. Observers believe it will eventually move beyond that to challenge Google itself.

"Amazon could use the data it has about buying behaviour to help make these ads much more effective," Karsten Weide, an analyst at researcher IDC, told the Wall Street Journal. "Marketers would love to have another viable option beyond Google and Facebook for their advertising."

Reid Spice, vice president of media at digital agency iCrossing, echoed those thoughts. "Amazon knows a lot about how people are searching on the site and consumer preferences and histories," he said. "It can use that to tailor advertising in ways that probably nobody else can."

In addition to the ads that Amazon places on its site, it displays text-based keyword ads placed by Google and other third parties. Amazon Sponsored Links could enable it to step this up a gear, and not only displace Google-placed ads on its own platform, but also emulate Google by placing ads on third-party sites.

Apart from the revenues this may generate, Amazon would also retain greater control over the data generated by consumers searching and clicking on advertisements. While it buys traditional text ads on Google, the firm avoids enhanced product ads, according to analysts, because it doesn't want to share the information required to run them.

The Journal noted that the two internet behemoths increasingly resemble one other, with the product ads on Google looking more like those on Amazon – with images, prices and customer ratings – and Amazon offering online storage services and a smartphone.

Writing for Warc, Mark Curtis, chief client officer at service design consultancy Fjord, argued that digital brands such as Amazon, Google and Apple were all essentially customer-centred platforms that had shunned traditional business models to build powerful and direct relationships with their customers.

He said that the real motive behind Amazon's Fire phone was to draw customers deeper into its own multichannel platform. "The smartphone itself is really a means to an end – it's the services and the seamless relationship the product allows that really matter," he stated.

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


Premium auto marques lose their cachet

26 August 2014
PARIS/BERLIN: Leading German car marques have become victims of their own success, as the likes of BMW, Audi and Mercedes-Benz have been drawn into a sales war that could undermine their brand image and create opportunities for new challengers.

"The German premiums have sacrificed some of their exclusivity by entering smaller, volume segments like compacts," Bernd Hoennighausen, an automotive consultant, told Reuters.

And with this interest in the volume segment comes an entry into the corporate fleet market. "They've pushed volume with fleet discounts of around 20%," Hoennighausen explained. "This may open the door to newer players like Jaguar, who are starting to offer fleet-relevant products."

The need for luxury automakers to sell smaller cars in order to meet tighter carbon-dioxide emissions targets - and avoid fines - is also pressing. And none are discounting harder than German brands, Arndt Ellinghorst, an analyst with ISI Group, asserted.

"Steep discounts and attractive financing show how non-exclusive premium cars have become," said Ellinghorst, who added that if this trend continued, then "the race to sell more vehicles will eventually damage brand equity and profitability".

This "inherent contradiction" had also been noted by an analyst at UBS, the Swiss bank. "Buyers of premium-branded cars are looking for some degree of exclusivity that will set them apart from less fortunate car owners," said Philippe Houchois.

He predicted that an emerging group of challenger brands - including Maserati, Alfa Romeo, Infiniti, Volvo, DS and Tesla, as well as Jaguar Land Rover - would account for almost one third of global premium sales growth over the next four years.

Members of this group were bullish about the outlook, with Eric Neubauer, joint-CEO of France's Neubauer Group, citing his dealerships' experience with Land Rover as proof that Germany's market-leading brands can be challenged.

The Land Rover Evoque, he said, had been successful in wooing clients away "from BMW, Mini and everywhere else in the premium universe. The strength of Land Rover is that we win new customers who then become loyal."

Andy Palmer, the executive leading the promotion of the Infiniti brand, had a different take. "Our theory is that there's room for something visibly different that is styled in a more provocative manner," he said. And he thought this was especially true in China.

Data sourced from Reuters; additional content by Warc staff


Cinema engagement threatened

26 August 2014
LONDON: The cost-cutting changes introduced by some cinema chains have angered marketers, who claim they are having an adverse impact on their ability to keep viewers fully immersed in their advertisements.

With traditional ushers rapidly becoming a thing of the past, more cinema chains are reported to be keeping the houselights up during both the ads and the trailers that presage the main show in order to enable customers to find their seats.

Darren Hayday, a marketing consultant at Competitive Edge Marketing, was among the executives concerned by the trend.

"What on earth is the point of a brand manager choosing this medium to target a captive audience when to try and cut costs the cinema chain introduce this process which doesn't benefit anyone other than senior management?" he asked Marketing Week.

His remarks were echoed by a client-side marketer who felt that cinema was "one of the last remaining opportunities for a fully-engaged ad audience, and when you factor in the site-specificity of movie trailers made especially for cinema audiences, [keeping lights up] is doubly concerning."

Another bugbear for marketers is the growing trend towards allocated seating, which they fear will mean more and more viewers arriving later. 

"This means fewer bums on seats at the time when the ads are running," said Mario Yiannacou, media and advertising manager at the Incorporated Society of British Advertisers (ISBA), a trade body.

"The fuss factor of people trying to locate their seat numbers – even with the lights up – makes it even more difficult for advertisers to hold the attention of the audience and keep eyes on screen."

One way around this may be to tap into the predilection for dual-screening, as Digital Cinema Media (DCM), the specialist advertising firm, has done with an app that pushes content to viewers whose phones pick up a sonic message from the cinema screen.

Data sourced from Marketing Week; additional content by Warc staff


Millennials stressed by finance

26 August 2014
CHERRY HILL, NJ: A significant proportion of US millennials are failing to make adequate financial provision for major health and life events, two new surveys have found.

According to TD Bank, which polled 1,006 consumers aged 24-34-years-old, many wish they had been better prepared for events such as going to college (31%) or having a child (27%), while the ramifications of starting a new job had not fully registered with 21%.

"Major life events such as getting married or starting a new job require solid understanding of personal finance," said Nandita Bakhshi of TD Bank, "and if millennials are telling us they aren't prepared for this, we need to help find solutions."

Apart from buying a new house, millennials appear reluctant to seek professional financial advice, preferring instead to ask family or friends (65%) or carry out online research (48%). Only one third sought out more formal types of financial guidance.

In fact, only around 12% said they looked to their bank for advice around major life events, but 38% turned to this source when buying a home.

Nandita noted that around one quarter of millennials felt they didn't need financial education and believed they didn't have time for it. But, she said, they "need to be proactive in finding education that fits their needs so they can be more prepared for the events they will experience throughout their lives."

And if that was true of the events that millennials could see coming, it was equally the case for those they couldn't. A separate survey of 1,003 US adults, carried out for the website, found that one quarter (24%) of Americans aged 18-29-years-old did not have health insurance.

"This could be a costly mistake, especially because this group has easy access to health insurance," said Laura Adams, senior analyst, 

"Young people typically pay much lower prices to obtain coverage via the health insurance exchanges and can receive subsidies depending on their income. Plus, they can stay on their parents' health insurance policies until age 26."

They were also less likely than all other age groups to have health, auto, life, homeowner's, rent and disability insurance.

While there are often specific circumstances to explain this fact - for instance, living with parents or having fewer assets to protect – insuranceQuotes stated that "there is ample evidence that millennials are unprepared for potential financial risks."

Data sourced from PR Newswire; additional content by Warc staff


India cracks down on misleading ads

26 August 2014
NEW DELHI: The Indian government has distributed a list of over 40 television spots that should not be aired as they make misleading claims - a crackdown that could soon extend to other forms of media.

Acting on advice from the Advertising Standards Council of India (ASCI), the Information and Broadcasting Ministry decided that ads breaching the ASCI's voluntary code also broke the advertising code enshrined in the Cable Television Networks (Regulation) Act of 1995, and thus could not be carried on TV channels.

"We found that some advertisers on television channels, especially teleshopping networks, were not complying with ASCI's decisions," said Partha Rakshit, chairman, ASCI, in remarks reported by Livemint.

This was particularly true of businesses making exaggerated claims for health products and for solutions to financial problems.

Similarly, the ASCI recently issued strict guidelines on advertisements covering fairness creams, instructing brands to refrain from showing dark-skinned people in a negative light. 

Shweta Purandare, the ASCI's secretary general, warned that broadcasters who ignored the ruling could face legal action. And, she added, the ASCI is now looking at extending its review to look at ads in other forms of media.

The financial implications for broadcasters are potentially significant in a market where television shopping is worth a reported $500m and growing at an annual rate of around 50%. The head of one Hindi news channel told Livemint that a channel could lose up to Rs6 crore a year, depending on its viewership numbers.

But Manu Agarwal, chief executive of teleshopping platform Naaptol, was more optimistic. "The first generation of the teleshopping industry for a long time has been known for magical remedies," he said. "With this move of the government, that will go away and pave the way for next generation teleshopping."

Data sourced from Livemint; additional content by Warc staff


Insurance allays China's food scares

26 August 2014
BEIJING: As Heinz becomes the latest brand to face a food safety issue in China, recalling an infant cereal after concerns regarding the levels of lead it contained, one innovative retailer is offering an insurance policy to help reassure worried shoppers.

Suning Commerce Group, which owns the Redbaby chain of stores, has moved to address its clientele's fears by offering insurance to customers who buy infant milk powder.

The insurance is being given away for free with the first 40,000 cans of baby formula sold. After that, customers can buy it online.

The policy stipulates that if a brand of milk powder is recalled, customers who bought cans from any Redbaby store, or its ecommerce site, will be paid up to 2,000 yuan ($325) per can, with payments capped at 100,000 yuan.

This particular concern dates back to 2008, when formula milk powder was found to be contaminated with melamine. At least six infants died as a result of consuming the adulterated product, and thousands more were hospitalised.

Part of the problem food manufacturers face is that the country does not possess the facilities to chart the progress of food from farm to fork.

"Standardised traceability of food products does not currently exist in China," David Mahon, of investment firm Mahon China, told the China Daily. "It's a long way from it."

Where other markets have developed a system based on barcodes - which record details of farm of origin, storage and shipment - the high cost of implementing this across China's scattered supply chain of small farms has limited its uptake.

And the fragmented nature of this chain means that even when a manufacturer thinks it is in control of the situation, there is still scope for error, if, for example, a supplier decides to top up its harvest with the help of an unaudited neighbour.

"When supply chains are so large, you can't always prevent a supplier buying from someone else if someone else has a cheaper price," according to a former industry executive. "It's a matter of one guy doing things wrong and the product is contaminated."

Data sourced for China Daily; additional content by Warc staff


Instagram offers ad analytics tools

25 August 2014
GLOBAL: Instagram, the Facebook-owned photo-sharing network, has announced plans to roll out a suite of measurement tools to help advertisers gain better insights into how their campaigns work with users.

Three new tools will be launched over the "coming weeks and months" that can be accessed from a special dashboard interface and, significantly, they will provide data in real time, Marketing Week reported.

An "Account Insights" tool will provide advertisers with data about non-paid content and how they perform through impressions, reach and engagement.

An "Ad Insights" tool will enable them to measure the performance of paid campaigns using metrics such as reach and frequency.

Meanwhile, an "Ad Staging" tool will enable creatives to preview their ads before launching them and to collaborate on upcoming campaigns.

Instagram first introduced ads 10 months ago and currently only works with a handful of brands in the US, Canada and Australia, but its new offering is based on feedback it received over the past six months, the Wall Street Journal reported.

"It's important for us to provide measurement to really prove the platform," said Jeff Kanter, product manager at Instagram.

"We heard from brands that they wanted more insight into how people engage with their organic content and ads," he added.

In a recent paper for Warc that covered the Advertising Age Digital Conference 2014, brands were advised that Instagram's focus on high-quality visuals and imagery made it a particularly suitable platform for high-end campaigns.

Jim Squires, Instagram's director of market operations, told delegates that one of its main characteristics is the ability to capture the attention of consumers with visuals which encapsulate moments and emotions.

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


UK internet users 'tolerate' ads

25 August 2014
LONDON: Nearly all (98%) internet users in the UK would not be willing to pay the estimated £140 that it would cost each of them if the internet was not supported by digital advertising, new research has revealed.

In a survey that also found high levels of ad avoidance, video ad platform Ebuzzing based its estimate on a division of the UK's digital adspend in 2013 (£6.4bn) by the number of UK internet users (45m), the Telegraph reported.

Based on the responses of 1,400 UK consumers, the study concluded that they are prepared to accept ads to avoid paying an extra £140, which is roughly equivalent to the compulsory BBC licence fee.

But that does not mean UK consumers warm to ads as they use the internet, Ebuzzing warned.

It found nearly two-thirds (63%) skip video ads "as quickly as possible", which rises to 75% among 16-24 year olds, and 16% of all internet users employ ad blocking software.

Furthermore, over a quarter of all respondents said they mute their sound and one-in-five scroll away from a video, leading Ebuzzing to warn advertisers that they need to improve their formats.

"It's clear the ad industry has a major role to play in keeping web content free, but we have to respond to what consumers are telling us," said Jeremy Arditi, UK managing director at Ebuzzing.

"We need to get better at engaging, not better at interrupting," he added. "That means introducing new formats which consumers find less invasive, more creative ads that are better placed, and giving consumers a degree of choice and control."

More positively, the report also found that just over a third (34%) of respondents would be more likely to watch online video ads if they are personally relevant while one-in-five are open to "being able to select the ad I watch".

Data sourced from the Telegraph; additional content by Warc staff


Mobile users focus on just a few apps

25 August 2014
CHICAGO: American smartphone owners use their favourite app for 42% of all the time they spend accessing apps, a new report into iPhone and Android behaviour has revealed.

According to the US Mobile App Report from comScore, the internet technology research firm, app usage now accounts for over half (52%) of all digital time in the US, but only a few well-known app brands dominate overall usage.

As reported by MediaPost, six big tech brands – Facebook, Google, Apple, Yahoo, Amazon and eBay – account for nine of the top 10 most-used apps, 16 of the top 25, and 24 of the top 50, with Facebook leading for both the largest base of users and the most time spent.

Nearly three-quarters of the time US smartphone users spend with apps is concentrated on just four apps, the report also found, while more than half (57%) access apps every day.

While Facebook and some other brands remain dominant, smaller apps can still achieve success, said Adam Lella, a marketing insights analyst at comScore.

"It certainly means there might be some challenges for smaller players on this medium, but success is also very possible," he said in comments reported by AdExchanger.

He explained: "We have seen some standalone apps achieve huge audiences on mobile, for example SnapChat and Pandora, while others have found ways to monetise through non-advertising business models that don't require competing with the larger companies on audience size, like Uber and certain gaming apps."

The report also noted some behavioural and demographic differences between iPhone and Android users with the former being younger and wealthier.

The median iPhone user earns $85,000 a year compared to $61,000 for Android users, and 43% of iPhone users are aged 18 to 34 versus 39% of Android users.

iPhone users are more likely to use apps to consume media, such as general news and social networks, while Android users focus more on apps for search and email, which comScore attributed to the strong presence of Google Search and Gmail on the platform.

Data sourced from comScore, MediaPost, AdExchanger; additional content by Warc staff


Gap plans to expand in India

25 August 2014
BANGALORE: Gap, the US apparel retailer, has announced plans to open 40 franchise-operated stores in India after forming a partnership with a subsidiary of Arvind Limited, the textile manufacturer.

Mumbai and Delhi, the two largest cities in India, are expected to be the first to host Gap-franchised stores with Arvind Lifestyle Brand Limited, the San Francisco-based company said in a statement.

According to the statement, India, as the world's second most populated country with more than 1.2bn people, represented an important platform to bring American casual style to consumers around the world. Gap was also drawn by the country's youthful demographic.

"India is an emerging, vibrant market and an important next step in our global expansion strategy," said Steve Sunnucks, global president of Gap.

Ismail Seyis, vice president of Gap Global Franchise, added: "More than half of India's population is under 25 and they are actively embracing fashion in today's retail environment."

Since launching its first franchise-operated store in 2006, the retailer has built up a worldwide portfolio of almost 400 of these stores alongside its roughly 3,200 company-owned stores.

It currently has 231 Gap stores across Asia, the BBC reported, and has plans to open another 110 stores this year across China, Hong Kong and Taiwan.

Meanwhile, in a separate development reported by the Wall Street Journal, Amazon, the ecommerce giant, has announced that it has signed an agreement with the Chinese authorities to launch a cross-border ecommerce platform in Shanghai's free trade zone.

It means the US retailer will be able to expand its presence in an ecommerce market dominated by domestic competitors, such as Alibaba, but also will be able to expand exports of products from Chinese companies.

Commenting on the company's ambitions, Doug Gurr, president of Amazon China, said: "We seek to be the most customer-obsessed online shopping platform with vast selections, competitive price and most convenience in China."

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


American women embrace digital era

25 August 2014
BOSTON: A full 90% of American women aged 45 and over search for items online via Google or other search engines before making a purchase, a new report has found.

And a similar proportion has a Facebook account and use text messages, according to a joint survey conducted by Influence Central, the digital consultancy, and Vibrant Nation, an online community for women aged 45 and more.

Based on responses from 600 American women of this age who do not have children living at home, Influence Central suggested this "Empty-Nester" generation is far more digitally savvy than conventional thinking assumes.

It found nearly 80% are more likely to make a purchase if a product receives a high-star rating in a retail ecommerce review while nearly 75% respond in the same manner if a product receives a positive first-person review.

Furthermore, nearly half (45%) are more likely to purchase a product if it is recommended by a blogger they follow.

In another sign of how much this generation has adapted to new technology and social media, the study found more than 80% spend more time browsing for products online than in a physical store.

Nearly two-thirds (65%) use their smartphone to research product information while 72% use them to visit social media sites, the report said.

Stacy DeBroff, CEO of Influence Central, advised marketers to recognise that there is now a "profound disconnect" between how this generation sees itself and how it is viewed by others.

"Today's Empty-Nesters feel confident, tech-savvy, and highly connective online, yet marketers still stereotype them as passively consuming traditional media and swept up in advertising," she said.

With the report demonstrating the importance of first- and third-person reviews for this generation, Influence Central warned that nearly two-thirds (65%) are sceptical about traditional advertising and just 12% are more likely to purchase a product highlighted in a compelling ad.

"Empty-Nesters are embracing social media and today's online recommendation culture, ignoring and disliking advertising, and completely redefining their consumer journey," DeBroff said.

Data sourced from Influence Central; additional content by Warc staff


Emerging Asia open to m-commerce

25 August 2014
JAKARTA/STOCKHOLM: Increasing urbanisation in largely cash-based emerging Asian economies has boosted interest among consumers about using mobile payments, but take-up varies across the region, a new report has found.

According to a study by research firm Ericsson ConsumerLab into m-commerce activity in Bangladesh, Indonesia and Vietnam, Indonesians are the most frequent users of money transfer services although Bangladeshis are the most interested.

It found over half (54%) of respondents in Indonesia have used money transfer services compared with 45% in Vietnam and 34% in Bangladesh – yet 97% of consumers in Bangladesh are interested in using mobile payments.

Just under half (49%) of Indonesians are interested in mobile money transfer services, the report found, while 26% of Vietnamese feel the same.

Patrik Hedlund, senior adviser at Ericsson ConsumerLab, explained that growing urbanisation is driving much of the demand for quick and reliable money transfer services.

"While some family members move to the city, others stay in the countryside and remain dependent on those who moved, particularly concerning financial matters," he said.

"In these developing markets, where incomes are typically low, there is a need to quickly send and receive money," he added.

Other influences making consumers in these markets open to mobile financial services include concerns about receiving counterfeit cash and overcoming the inconvenience of having to go to a particular office at specific opening times.

This prompted up to 78% of respondents in Bangladesh to say they are interested in using mobile payments for service bills – a view shared by 57% of consumers in Indonesia and 37% in Vietnam.

Data sourced from Ericsson ConsumerLab; additional content by Warc staff


Music streaming numbers double

22 August 2014
LONDON: The number of subscribers to music-streaming services in Europe and the US has doubled in the past two years, according to new research, and the sites are exploring new ways to monetise their content.

Research firm Futuresource Consulting expected the number of paid-for subscriptions in these markets to pass 20m in 2014, twice the figure of 2010. At the same time, spending was predicted to reach $3bn, a 59% increase on 2013.

Most users were now using service provider apps on smartphones or tablets to access and play out music, according to David Sidebottom, senior market analyst at Futuresource Consulting.

"Wireless audio hardware is in the driving seat," he added, "with devices like wireless speakers key to the development of streaming music subscription services, providing an additional layer to the user experience beyond a personal listening experience via headphones or a standard docking station."

SoundCloud has become the latest streaming service to introduce advertising, with Red Bull, Jaguar and Comedy Central among the first brands to appear. Top-tier music creators will be given an option to have advertising shown alongside their content and to be paid a percentage of the money paid by advertisers.

"We wanted to avoid this being a bunch of unthought-through ads in your face," chief executive Alexander Ljung told The Guardian. "You won't open the site up and see a bunch of banner ads plastered everywhere. It's elegant."

A new feature offered by market leader Spotify – a 'Tastemakers' tab aims to "surface user playlists that hit certain engagement criteria" – does not currently have a commercial element but Techcrunch noted that Spotify had already considered how it can help brands become more like tastemakers on the platform "so that may be something to watch for".

That was a reference to remarks made last year by Gary Liu, Spotify's global ad product strategy director, who told Marketing Week that "users are looking to Spotify for people to tell them what great music to listen to and brands have proven that they can help with that".
But the ability of a standalone site like Spotify to survive was questioned by Quartz which saw streaming music becoming "a pawn in a high-stakes chess match involving the true titans of the tech world" as Apple, Google and Amazon entered the market and it ended up as a loss-leader for other, more lucrative business activities.

Data sourced from PR Newswire, The Guardian, Techcrunch, Marketing Week, Quartz; additional content by Warc staff


Mobile modifies millennial mindset

22 August 2014
LONDON: Mobile and social media have changed the boundaries of what is regarded as socially acceptable behaviour among millennials, almost three quarters of whom have to have their mobile phones with them at all times.

A study by media agency Havas Media and mcommerce platform Weve surveyed 3,000 people in the UK and found that two-thirds of 16-24 year-olds checked their phones during a lull in conversation with friends or colleagues and nearly as many (61%) felt it was OK to use their device during dinner with family or friends.

The great majority of this age group (81%) thought it fine to use their mobile in a quiet zone, on a train, for example, or in a library and a similar proportion (79%) saw nothing wrong in using these while on the toilet.

Another noteworthy change was a widespread failure to plan ahead, with 35% not bothering to do so and instead relying on their mobile phones.

Nigel Clarkson, Weve's commercial director, observed that the importance people placed on their phones was not news. "What is interesting though is a shift to almost total dependence on the mobile for so many different utilities and services," he said.

"Given the contextual capabilities of mobile, like location data, immediacy, and presence in apps and content sites, we believe there is still so much more the marketing community can do to fully take advantage of this huge cultural shift in behaviour," he continued.

They could note, for instance, that 41% of young people agreed that it was acceptable for brands to send text messages based on location as long as permission had been granted. And one third preferred ads on social networks and mobile to look the same as the content they were consuming

Amy Kean, Head of futures at Havas Media Labs, added that mobile had changed the human psyche and that as a result "marketing should be changing too".

"It's the brands who understand the complexities of this new narcissistic, spontaneous and mobile-dependent consumer that will stand out amongst the noise," she said.

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


Cable embraces real-time marketing

22 August 2014
NEW YORK: The trend towards real-time marketing has taken another step with cable music channel MTV dedicating a production truck to the creation of content during the annual MTV Music Video Awards show.

"We are really beefing up the infrastructure," Stephen K. Friedman, president of MTV, told the New York Times, with a team of up to 40 people working on this area during the show. "Our advertiser partners and sponsors want to be part of the conversation," he added

In particular, he said, they were looking to "capitalise on combustible moments", such as the furore that erupted following the performance of Miley Cyrus and Robin Thicke at last year's show.

"We used to talk a lot about 'share of voice,' how much we're spending on advertising versus others in our space, but now the way to think about it is winning the share of conversation," explained Adam Harter, vice president for partnership engagement of the Pepsi-Cola North American Beverages division of PepsiCo.

Pepsi is among the brands that have already lined up content for Sunday's event with the aim of starting a conversation through its tie up with the artist known as Usher. His performance will be promoted with a hashtag in social media and then followed up with a commercial pointing directing viewers to unlock that particular song from a yet-to-be-released album and extra material about the creation of the performance.

"We do a lot of work measuring the value of real-time, contextually relevant moments," said Harter. "Our creative is more relevant and effective when it's delivered that way."

He added that this was especially so with the MTV target audience of millennials. This group, he said, "finds it important to get social currency, something valuable in the moment, that they can share while watching live shows on a TV set with a tablet or mobile phone next to them."

MTV is also working on on real-time marketing initiatives with Verizon Wireless, three Unilever brands and CoverGirl, a Procter & Gamble brand

Data sourced from New York Times; additional content by Warc staff


SE Asia sees programmatic surge

22 August 2014
SINGAPORE: Brands and agencies across Southeast Asia are picking up on programmatic buying for mobile as new statistics reveal rapid quarter-on-quarter growth on one platform's network.

Figures from TubeMogul show that mobile inventory across the region leapt 720% from the first to second quarter of 2014, with several countries recording four-figure rates of increase.

The most spectacular growth had come in the Philippines, up 5,820%, but similarly impressive results could be seen in Indonesia (+2,950%), Malaysia (+2,800%) and Thailand (+1,600%).

Clearly, these increases came from a low base but nonetheless Brett Wilson, CEO Tubemogul, was confident they signalled a significant change in the region. "In many other parts of the world, programmatic buying of mobile video is nascent," he told Campaign Asia-Pacific. "Southeast Asia is one of the few markets where brands are closer to actual [media] consumption trends."

His views are backed by investors who recently poured SG$1m into a Singapore-based start-up, ADSKOM, whose CEO, Italo Gani, declared that "digital advertising in Asia today is at an inflection point, with marketers and advertisers turning to programmatic advertising to shape their strategies, as well as evaluate campaigns".

One of the great advantages of programmatic, according to Wilson, is that it makes it easier for brands and agencies to enter new markets, something that Southeast Asian businesses are thinking about ahead of ASEAN economic integration next year. "Now they can log in from anywhere and put a plan together in minutes that used to require a lot of local knowledge," he said.

Another benefit was highlighted by Phu Trong, managing director TubeMogul, Southeast Asia, who pointed out that in the past many smaller agencies did not have a media department, but they didn't need to with programmatic.

"They have the ability to buy media in the exact same way at the exact same scale as GroupM," he said. "They don't have to build a team in every single market any more. They can have a team of five people and one login."

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


Digital coupon use grows

22 August 2014
NEW YORK: Four in ten US smartphone owners will use that device to redeem a coupon during 2014 according to digital intelligence business eMarketer.

It estimated that a total of 59.2m US adult smartphone users would do so over the course of the year, representing a 37.5% increase on 2013, and said these mobile coupons were being used for both online and offline shopping.

Separately, Forrester Consulting recently carried out in-depth surveys with 500 digital coupon users for, the digital coupon site, and found that most redeemed a digital coupon code within three days of receiving it, and nearly one-third redeemed it immediately.

The most common method of redeeming digital coupons was by purchasing something on a computer (33%), but over one quarter (27%) made a trip to a store for this purpose. Some 25% used a smartphone and 14% a tablet.

The primary source of coupons was passive receipt via an email from retailers, cited by 57% of respondents, but this was only just ahead of the 55% who actively sought them out using search engines on their smartphones. And around one third relied on coupon-related apps or emails from a coupon company.

Forrester also said that younger shoppers were leading the way, with fully 60% of consumers under 35 ultimately redeeming a coupon on their phone. "This points to a new emerging future of shopping, with mobile at the center of the experience," said the report.

Customers were also found to be inclined to spend more than anticipated in-store when using coupons, making customer service an important part of the overall process.

"Easy redemption, mobile-formatted coupons, and a balanced marketing plan will drive users to the store and online properties which, in turn, provides opportunities for conversion and increased spend by consumers," the report concluded.

Data sourced from eMarketer, Forrester Consulting; additional content by Warc staff


Messaging apps take off in India

22 August 2014
BANGALORE: Almost all smartphone owners in India who use messaging apps use them frequently every day and are increasingly likely to make in-app purchases, new research has said.

InMobi, the mobile advertising platform, surveyed 455 smartphone users in India and found that 95% of messaging app users accessed these multiple times in a day and that messaging apps were the preferred method of communication, bypassing even social networks and voice calls.

Staying in touch with friends was the main reason for downloading mobile messaging apps, cited by 44%, just ahead of sharing photos and videos, a factor for 39%. Other factors included staying in touch with family (30%), group messaging (21%) and cost (18%).

Nor were they restricting themselves to just one messaging app. "A healthy average of three messaging apps per user indicates that messaging platforms are evolving into audience platforms that can be leveraged for entertainment and commerce," said Jayesh Easwaramony, Vice President & General Manager, APAC, Middle East and Africa, InMobi.

Unsurprisingly, young mobile users in the 18 to 24 age group were leading the charge on using messaging apps, but an older generation of 35-44 year olds was also taking to these apps, driven by their ease of use.

The survey further revealed that around 20% of respondents had already made an in-app purchase when using a mobile messaging/chat application, while a similar proportion (18%) were likely to consider doing so.

"With 38% of users likely to make a purchase on these platforms as well as a higher smartphone penetration, there will be an increase in offerings to enrich consumer experience," said Easwaramony.

"We also see advertisers using these platforms for emotional engagement as well as experimenting with launching services that they have already done in their home markets like Japan and China," he added.

That is exactly the approach Viber is taking. The messaging app was acquired by Japanese internet giant Rakuten earlier this year and is growing fast in India. CEO Talmon Marco told the Times of India that stickers and games were the ways in which the app was being monetised, but "in future, we'll do things which are related to Rakuten's business, like e-commerce, travel, and finance".

InMobi found that current in-app purchases were usually add-ons like emoticons, games, stickers and virtual currency, with typical prices points between Rs 71 – 129 (US$ 1-2).

Data sourced from BusinessWire, Times of India; additional content by Warc staff


Global marketer confidence dips

21 August 2014
LONDON: Confidence among global marketers dipped in August, according to the latest Warc Global Marketing Index (GMI), although optimism about trading conditions in Europe continued to strengthen.

The headline GMI figure, which assesses marketers' expectations in three main areas – trading conditions, marketing budgets and staffing levels – was down 2.2 points from July to 54.4, and down 1.2 points on the same time last year. A reading of 50 indicates no change from the previous month, while a reading of 60 indicates rapid growth.

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.

While confidence was slipping in every region, it remained highest in Europe, at 56.0, down 1.2 points on the previous month. Larger declines in the headline index were recorded in the Americas, down 2.5 points to 55.2, and in Asia Pacific, down 3.3 points to 51.8.

Each region's decline was marked by a sharp movement in one of the component parts of the index. Thus, in the case of Europe increased optimism about trading conditions and budgets was more than offset by concerns about staffing levels.

After two months of declining positive sentiment about budgets, the Americas was likewise rebounding but was also less optimistic regarding staffing levels.

Nonetheless, in all these instances the relevant index remained above 50.0, indicating a generally positive feeling. Only in one case did an index fall below 50: in Asia Pacific the index for marketing budgets plunged 4.3 points to register 48.2, the first month of declining budgets in the region since September 2013.

This sudden decline was largely attributable to a tightening in budgeted spend on mobile.

"Despite a fall in headline indexes this month, industry consensus is that things remain on the up, with trading conditions in particular proving favourable for marketers in all regions," said James McDonald, Research Analyst at Warc.

Data sourced from Warc


Young annoyed by poor retail service

21 August 2014
GLASGOW: Almost one third of UK consumers have become less loyal to retail brands in the past five years, with poor service the most commonly cited reason and younger consumers disproportionately affected according to a new survey.

KANA Software, a customer service specialist, surveyed 2,000 UK consumers and identified the need to repeat complaints to numerous different people within the same organisation as a particular bugbear.

Almost half of respondents (48%) said they had to repeat information during their last communication with a retailer. And while all age groups said this was a problem, it happened most frequently for customers under the age of 35 where one in 20 repeated themselves at least five times.

That need for repetition showed "poor management of customer data, channels and context, but more fundamentally a lack of ownership of the consumer's problem and lack of appreciation for their effort levels," according to Steven Thurlow, head of worldwide product strategy for KANA.

Only 30% of younger customers had their issue resolved after one interaction. By contrast, 64% of customers over the age of 65 did not have to repeat their complaint at all, feeling satisfied after first contact.

This disparity had a clear impact on loyalty: of those who felt less loyal to retail brands, 37% of 18-to-24-year-olds cited service as the key factor versus just 20% of those aged 65 and older.

"The younger generation has higher expectations of digital channels, collaborative and social communications and asks 'how hard can it be.' They won't take seriously an organisation that is unable to do the basics right, and these expectations are rising all the time," Thurlow said.

In the past six months, more than 10% of those surveyed had used at least five different customer channels to contact a retailer, emphasising the need for companies to be connected as well as customers.

"Without a true sense that different channels of communication are linked, people feel that they are wasting their time and, ultimately, this leads to an erosion of loyalty in the retail brand," Thurlow concluded.

That is also illustrative of a common failing in brands' relationship with consumers. Writing in Market Leader, Nichola Raihani of University College London, argued that too many businesses did not understand the need for reciprocity with consumers. Thus, even when a consumer knew they were at fault, in a long-standing relationship with a brand they would expect some leniency.

Data sourced from BusinessWire; additional content by Warc staff


HDFC Bank is India's most valuable brand

21 August 2014
MUMBAI: HDFC Bank has been named India's most valuable brand in the first such ranking by BrandZ which is dominated at the top level by services companies.

The Top 50 Most Valuable Indian Brands, compiled by marketing and brand consultancy Millward Brown in conjunction with WPP, assesses not just the financial worth of a brand but also takes account of consumers' opinions. It said that India had evolved into a "brand powerhouse", with these top 50 having as much Brand Power – defined as consumers' predisposition to choose that brand over another – as the global Top 50, while also being ahead of other emerging economies.

Despite that, WPP chief executive Sir Martin Sorrell said that "India is underbranded in our view – it's underadvertised", as he explained adspend constitutes a steady proportion of GDP in mature markets but is growing faster than the wider economy in emerging markets.

With a value of $9.4bn, HDFC Bank was the clear leader, ahead of wireless telecoms brand Airtel, in second place worth $8.2bn, and the county's largest commercial bank, State Bank of India, was third, worth $6.8bn.

Banks and telecoms brands took another four of the top ten places, including ICICI Bank, in fourth worth $3.5bn, telecoms business Idea in eighth worth $1.9bn, Kotak Mahindra Bank in ninth worth $1.7bn and Reliance Communications, another telecoms brand, in tenth worth $1.6bn.

Overall, services businesses such as these, including banking, telecoms and insurance, made up 30% of the top 50, with 12 banks and insurers accounting for 37% of their combined brand value of almost $70bn.

Two auto brands also made the top ten – Bajaj Auto, in sixth place worth $3.0bn, and Hero Motor Corp, in seventh worth $2.2bn. Asian Paints, in sixth spot and worth $2.8bn, rounded out the leading ten brands.

Across the top 50, brands from a total of 13 different categories featured, including 17 multi-national corporations, 26 private Indian brands and seven state-owned brands.

"Any global manufacturer that makes the effort to understand the diversity of the Indian consumer's needs, tastes and aspirations, and which can build a proposition that is both meaningful and appropriately differentiated, will succeed in building a strong brand," said Prasun Basu, Millward Brown's Managing Director – South Asia.

Another crucial aspect of the market was highlighted by David Roth, CEO of The Store, WPP. "With the second highest number of social networking users in the world, and the third highest number of users of mobile devices, developing an e-commerce strategy that focuses on social and mobile platforms is essential for brands in this region," he said.

Data sourced from BrandZ, Financial Times; additional content by Warc staff


Most unpaid social gets no engagement

21 August 2014
NEW YORK: Almost all engagement with unpaid social media updates is focused on just 1% of posts, a new study has found.

SocialFlow, a social media optimisation platform, analysed 1.6m non-paid social media posts across Twitter, Facebook and Google+, for its report Data Drives Social Performance. These reached a total of 361m users and generated nearly 1.5 billion social actions, but 99% of the posts generated little to no engagement.

Even among the remaining 1%, most of the Likes, retweets, shares and comment came in the last 0.5%.

It was not a surprise that media and entertainment companies featured heavily in this top group, since their entire business is based around the dissemination of information and entertainment designed to engage consumers.

Marketers in other industry verticals could still achieve success, however, through the creation of more posts that were only modestly successful, the report suggested.

"The massive scale of the most successful 1% of posts makes everything else look small by comparison," Jim Anderson, CEO of SocialFlow, told VentureBeat.

Anderson added that this was not really the issue. "To use a television analogy, most every show's ratings look weak if you compare them to the Super Bowl," he explained. "But that doesn't mean that everyone else should just give up on creating great programming – and the same is true with social."

The report argued that media and entertainment companies were best placed to utilise real-time marketing on social media and that other industries needed to consider using a data-driven approach to social publishing, rather than the scheduled posts that most currently employ.

Its findings showed that data-driven posts delivered 91% greater reach and 25% greater engagement than scheduled posts. This was partly because companies were able to publish more content and partly because they were able to better match posts to the type of content the audience was already engaging with.

Organic social publishing should be as data-driven as the rest of a business's marketing, the report concluded.

Data sourced from SocialFlow, VentureBeat; additional content by Warc staff


Consumers warm to wearables

21 August 2014
CHICAGO, ILL: Wearable fitness devices are leading the US consumer charge into the internet of things, with over one fifth already owning one or planning a purchase by 2015.

According to the 2014 State of the Internet of Things Study, carried out by digital marketing agency Acquity Group, part of consulting firm Accenture, that figure will hit 43% within the next five years, making "fit-tech" devices a truly mass market product.

More than 2,000 consumers across the US were surveyed to gain insight into their preferences for and barriers against use of the internet of things (IoT). After fit-tech, the other areas expected to see the most take-up were smart thermostats, from a projected 13% adoption in 2015 to 43% in the next five years, and connected security systems, from 11% to 35% over the same period

Smart clothing and heads-up displays were expected to see the least overall adoption, with only a 3% projected adoption in the next year, and 14% and 16% in the next five years.

The survey also revealed that even self-identified "late adopters" were planning to take the plunge, not just tech enthusiasts. For example, 75% of consumers and 62% of late adopters said they would purchase a wearable device in the next five years; those figures fell to 42% and 24% respectively for purchases within the next two years.

Men were more likely than women to buy wearable technology in the coming five years – 53% against 45% – but women were more likely to already own a fit-tech device – 8% versus 7%.

"The growth of these devices will have a major impact on customer experience innovation across industries," said Jay Dettling, president of Acquity Group. "Adoption of IoT technologies can provide digital businesses high-quality brand engagement opportunities with customers and drive more revenues," he added.

An alternative view of where this market stands came from market intelligence business CCS Insight, which described the wearable tech market as being in the Stone Age.

"There needs to be huge improvements to broaden their appeal," Marina Koytcheva, CCS Insight director of forecasting, told Marketing Week. She added that the market could change "beyond recognition" if a player such as Apple entered.

"History shows us that when Apple enters a market it can reshape the way people think about a product," she said.

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


Phablet role challenged in Asia

21 August 2014
SINGAPORE: There are signs that the rise of the phablet in Asia may be short-lived as new data indicates a nascent trend to the use of tablets with cellular voice capabilities.

A year ago, International Data Corporation (IDC) was reporting that sales of phablets in the region had doubled and stood at the same level as tablets – devices with a screen size of seven inches or more – and laptops combined.

But it has now found that tablets which have voice calling built in are taking an increasing share of shipments to Asia Pacific (excluding Japan).

According to its Worldwide Quarterly Tablet Tracker report, some 13.8m tablets were shipped in the region in the second quarter of 2014. Of these, almost 25% included a voice calling option as standard. IDC said that this was equivalent to 60% growth on a year-on-year basis in unit terms for this category of tablets.

The surge in terms of both shipments and vendors since the beginning of this year, has been particularly noteworthy in some markets, including India and Indonesia, where shipments of voice-calling enabled tablets are approaching a 50% share.

The concept is not actually new, noted Avinash K. Sundaram, Senior Market Analyst IDC Asia/Pacific's Client Devices team, as earlier Samsung devices offered the option via a Bluetooth headset.

But he thought the shift being observed presaged a new development, as consumers in emerging markets were increasingly interested in having a single mobile device for all their needs, "be it watching movies and soap operas, taking pictures, texting or making calls, even if the device has a huge 7" screen on it".

That raised an image of users almost having to use two hands to hold a device to their face when making a call.

"It also helps that these devices are quite affordable, playing in the entry-to-mainstream price bands in most markets," Sundaram added.

That combination of addressing a need and offering a competitive price means that IDC believes this trend shift will continue to gain momentum.

A final point to note is that these devices are currently all Android-based. It remains to be seen whether devices based on other operating systems follow this route.

Data sourced from IDC; additional content by Warc staff


UK bucks European FMCG trend

20 August 2014
LONDON: Volume sales of FMCG brands are rising in all major European markets except the UK according to new data which suggests that a reduction in promotions is having an effect.

Figures for the second quarter from the Nielsen Growth Reporter, reported by Marketing Week, showed the average European volume growth in FMCG sales was 1.6% year on year but that for the UK was -1.1%.

Germany and France registered the greatest volume growth, each at 2.0%, while Italy was on 1.8% and Spain on 0.9%.

Relative price inflation figures played a role as this was higher in the UK, at 2.3%, than in any other country. Only Germany, on 1.5%, came close to that; France was on 0.2%, Italy was flat and Spain recorded a decline in price inflation of -0.6%.

Overall, nominal FMCG sales value was growing at its slowest rate for five years in the UK, up just 1.2% year on year in the second quarter, well below the below the 3.8% average for the whole of Europe. Only Spain was lower, on 0.3%.

Jean-Jacques Vandenheede, Nielsen's European director of retail insights, attributed part of the increase to Easter. "While we estimate this calendar anomaly accounted for about 1% of extra volume sales," he said, "a 'normalised' view is that overall sales value is still up around a healthy 2.8% – which is more positive than it has been recently."

Another interpretation is that a move away by the giants of the FMCG sector, such as Unilever and Procter & Gamble, from price-led promotions in the UK is finally having an impact, albeit at the expense of volume sales.

Last year, Irwin Lee, P&G UK managing director said the thing that kept him awake at night was "the amount of value given away via ever deepening promotional offers".

"We believe promotions win quarters," he declared, "but true innovation wins decades."

Data sourced from Marketing Week; additional content by Warc staff


Publishers diverge on programmatic

20 August 2014
LONDON: UK publishers are taking widely differing approaches to programmatic advertising, as evidenced by the pronouncements from two different sources this week.

At the Daily Telegraph, senior executives felt the need to write to advertisers reassuring them of the newspaper's commitment to full transparency in this regard. While at magazine publisher Dennis Publishing, the company's head of digital sales warned of the risk that programmatic trading would lead to standard ad formats becoming "too commoditised".

The Drum revealed the contents of a letter from the Telegraph publisher's sales and trading director and its client director in which they addressed the concerns surrounding online ad fraud, including the viewing of ads by bots.

The new Telegraph Customer Charter, they explained, was a guarantee to all advertisers that its trading, whether programmatic-based or direct sales would be fully transparent and accountable and would deliver real readers.

Dennis Publishing, however, remains wedded to direct display advertising, which accounts for 70% of revenue; programmatic takes just 4% and native advertising the rest.

Gary Rayneau told The Drum that Dennis currently offered the option of programmatic trading only in conjunction with direct spend.

"I think it will become the default way of buying impressions if the focus is direct response … and I completely understand the legitimacy of programmatic from that perspective," he explained. For brand-led advertising, however, he felt that direct buying would continue to have a role.

But he added that if it came to the point where display advertising became too commoditised, "we'll get to the stage where we won't run standard formats and we will just run partnerships and native placements".

He pointed to the example of Buzzfeed, "the brand that everyone's talking about right now", which does not run display advertising.

"There are definitely plenty of other ways to make money in this market, you don't have to just run straightforward advertising, you don't have to be fully programmatic," he concluded.

Data sourced from The Drum; additional content by Warc staff


OTT ad views triple

20 August 2014
SAN MATEO, CA: Viewing of digital video ads on OTT devices in the US more than tripled in the year to June, but desktops and laptops continue to account for over three quarters of the total, research has shown.

The quarterly Video Monetization Report from FreeWheel highlighted a year-on-year growth of 236% for ad views on OTT devices, with consumers proving particularly keen to invest in streaming set-top boxes and dongles in order to watch online video.

But even with this stellar rate of growth, OTT devices still only accounted for 4% of the total. Ad views via smartphones grew 93% to take a 13% share, while tablets increased 26% to a 7% share.

Ad views on desktops and laptops declined only 1%, and with an overall 76% share these devices remain by far the most important for marketers.

FreeWheel said the US was lagging behind the UK, where "publishers have done a remarkable job at monetising content across devices". Some 40% of UK ad views came on smartphones, tablets or OTT devices in the second quarter.

It also remarked on the trend in the UK to long-form content, of 20 minutes or more: this accounted for 75% of ad views compared to 53% in the US. The respective figures for mid-form content (5 to 20 minutes) were 5% and 8%, and for short-from content (less than 5 minutes) 20% and 39%.

US publishers and video distributors might well look to the UK not only for hints on monetisation, the report suggested, but also for proof that future of digital video was likely to resemble linear TV.

In one sense that was already evident, as Freewheel noted that ad break lengths were getting longer and that more ads were being shown. An average of 2.7 ads in a 68 second break in Q2 2013 had increased to 3.7 ads in a 98 second break a year later.

Publishers were looking to emulate the viewing experience that consumers were most used to. "Viewers have proven receptive thus far," the report said, "acknowledging that TV is TV, regardless of screen."

Data sourced from Freewheel; additional content by Warc staff


Mobile payments are inevitable

20 August 2014
PHILADELPHIA, PA: Mobile payments will be as unremarkable within ten years as credit card payments are today, according to two leading academics who warned retailers to heed the technology's increasing popularity among millennials.

Responding to the findings of a PwC study that suggested consumers were reluctant to store money in a mobile wallet because of concerns about security and privacy, Wharton marketing professor David Reibstein argued that this was simply another manifestation of people's "paranoia to things that are new".

Consumers were no longer worried about credit card companies knowing what they were buying for example. Similarly, restricting liability to $50 in the event of fraud had alleviated security worries.

"It's just a matter of people making an adjustment," Reibstein said. "I think 10 years from now, we'll look back at it and say, 'Hasn't this always been here?'"

His colleague John Zhang highlighted the take-up of mobile payment technology by millennials, who are using mobile wallets to transfer funds between friends and to store tickets for events.

"In fact, you can combine mobile payments with social networks," he said, with apps such as Venmo enabling peer-to-peer transfers – ideal for splitting the check in restaurants, for example.

For a demographic that has grown up with social media, this is quite natural behaviour. Bloomberg even remarked on how, among the younger age group, Venmo was on the way to becoming a verb – 'venmo me' – in the same way that people talk of 'googling' or 'tweeting'.

While consumers generally have been slow to adopt the mobile wallet – partly because of engrained habits, partly because of the confusion of proprietary technologies available and partly because of security – consulting firm Accenture said that it could "mend the seams of consumers' disjointed omni-channel experiences".

And with millennials already embracing the technology, the only choice retailers face is effectively one of timing – when do they step up to the plate and offer the service.

As Zhang pointed out: "If you don't [accept mobile payments], you're going to be passé. You're going to lose lots of your [future] customers."

Data sourced from Knowledgte@Wharton, Bloomberg, Accenture; additional content by Warc staff


Indian ad outlook positive

20 August 2014
MUMBAI: The outlook for India's advertising expenditure is bright following some uncertainty at the start of the year ahead of a general election, a leading industry figure has said.

In its latest This Year, Next Year report, GroupM, the media management investment operation of WPP, revised upwards its predictions for growth in India, from 11.6% to 12.5%, the Economic Times reported.

"After a cautious start to the year, the overall sentiment in the country is positive following the general elections and a new stable government," according to CVL Srinivas, CEO, GroupM South Asia.

In particular, he anticipated that the retail sector would contribute strongly to this trend. "With FDI in multi-brand retail taking a backseat, the market will see a surge of local players in this sector," he said, "specifically e-commerce players that are investing heavily in above-the-line advertising along with digital media."

Other sectors expected to register a growth in adspend included FMCG, auto, telecom and banking, financial services and insurance.

Digital media is projected to show the greatest increase, at 35% year on year. TV advertising expenditure has also been revised upwards, from 12% to 14.8%, as a proliferating number of channels accompanies the ongoing digitisation of the nation's broadcasting network.

In the print medium, regional publications and local advertisers are forecast to lead the growth for dailies. Government spending and retail will also continue to increase spending in print.

Not everyone was convinced by GroupM's figures, however, as the chief executive of one broadcast company noted that, despite the optimistic sentiments, advertisers were being cautious.

"Most of them are yet to increase advertising spends," he said. "We will know the real advertiser sentiment in the upcoming festival season," he added.

Warc's International Ad Forecast, released in June, put all media adspend growth in India at 14.0% this year, slowing to 13.5% in 2015. Digital will see the largest growth in 2014, at 36.8%, while TV is forecast to record growth of 13.7%.

Data sourced from Economic Times; additional content by Warc staff


Samsung is Malaysia's top brand

20 August 2014
KUALA LUMPUR: Consumer tech companies dominate the upper echelons of Malaysia's top brand rankings with Samsung, Sony and Apple occupying the first three spots, according to a new study.

The list of top 100 Malaysian brands, part of a wider Asian survey compiled by Campaign in association with Nielsen, is based on consumer attitudes to brands in terms of trust and reputation.

Panasonic and Canon were two more consumer tech companies appearing in the top ten, in fifth and sixth places respectively.

Food and beverage businesses also featured prominently, with Nestlé in fourth, 100 Plus, an isotonic drink, in seventh and seasonings brand Maggi in ninth. Air Asia (8th) and Nike (10th) rounded out the top ten.

Campaign Asia-Pacific highlighted the often contradictory nature of consumers in that diverse country, where a largely young, multi-ethnic population is ready to embrace meritocracy and modern commerce and ideas while an older tradition looks to religion, family and connections.

The most successful brands, according to Milan Agnihotri, chief catalyst for creative strategy and innovations at Leo Burnett, are those that can understand a 'Malaysian' way of life rather than skewing their appeal towards any particular ethnic group.

"Malaysians always relate to brands that are able to demonstrate a clear purpose beyond profits," he said.

He cited Petronas (ranked 47th) as an example of this. The company, he said, had "defined its role to support nation building by promoting social cohesion". To that end it had developed an approach centred on festive communications which showcased human stories and highlighted social issues.

This was now "the benchmark in festival advertising in Malaysia and part of people's everyday conversations," said Agnihotri.

Other strategies he highlighted included treating Malaysians as people rather than consumers – "brands are incidental in people's lives and at best can play enabler" – and encouraging participation – whether that was for a simple smartphone game to save a melting ice-cream (McDonald's, 32nd) or using sports personalities to get people to take more physical exercise (100 Plus).

Ultimately, it was about building relevance and emotional equity, he advised.

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