Wal-mart gets personal with shoppers

LAS VEGAS: Wal-mart, the retailer, is aiming to use smartphones to deliver personalised service to customers, including the automatic creation of shopping lists for them via a mobile app.

Gibu Thomas, Wal-mart's global head of mobile, told a CTIA Wireless trade show that the retailer planned to use mobile to improve the in-store shopping experience.

He cited several independent studies which indicated that in-store buying influenced by mobile use will be twice as big as e-commerce by 2016, and he expected such sales to reach $700m at Wal-mart, reported Techworld.

"It's about a personalized experience for each shopper delivered through the smartphone," he stated.

More than half of Wal-mart's customer base already own smartphones, and those that use the company's mobile apps tend to be more loyal and active, making four more trips and spending 77% more in store each month.

Thomas also highlighted a feature of the Wal-mart app – a smart shopping list, which offers customers a shopping tally and running total, intelligent voice recognition, statistics on local pricing, and information on where to find certain items.

By analysing customers' previous purchases, he expected the app would soon be able to automatically compile a shopping list when it was opened.

"The best shopping list is one you don't have to create, so that's the one we're working on," he declared.

The company is also testing a feature that allows customers to scan each item as they shop and then check out and pay with a single scan at the register, which could drastically cut in-store wait times, reported CNet.

But Thomas also warned against a focus on technology and insisted that Wal-mart was taking a "very customer-centric approach".

"Our goal is to create shopping tools that become second nature to customers," he said.

Data sourced from CNET, Techworld; additional content by Warc staff , 24 May 2013

Euro online adspend up 11.5%

BARCELONA: European digital adspend rose by 11.5% to €24.3bn in 2012, according to new figures from IAB Europe, the trade body.

The AdEx Benchmark research showed that digital took a 25.6% share of the all-media total across the 26 European markets measured in 2012, beating newspapers, which took just 19.3%. TV remained the largest medium in adspend terms with a 28.1% share.

Digital adspend growth was slightly down on 2011's increase of 15.3%, but nevertheless outperformed both the traditional media (which dropped -4%) as well as broader GDP across the 26 nations (+3.8%).

Kimon Zorbas, CEO of IAB Europe, said: "Our sector is bucking the trend in Europe."

Daniel Knapp, Director of Advertising Research at IHS Electronics and Media, added: "While the macroeconomic situation in Europe pointed to a challenging year for the media industry in 2012, online advertising tells a better story."

In 2012, growth was most rapid in central and eastern Europe, up 26.6% year on year, while western European markets were up 9.5%. Russia was the fastest-growing nation, overtaking Italy to become the region's fourth-largest online ad nation in 2012, with €1.5bn spent there, 34% higher than a year before.

But almost half of Europe's overall digital adspend came from the "big two" nations of the UK (€6.6bn, a double digit percentage point increase on the year before) and Germany (€4.6bn). France was third on €2.8bn.

Only four nations, Spain, Slovenia, Croatia and Greece, suffered a net decline in digital adspend for 2012. Each has been among the bigger sufferers in the broader European economic volatility of recent years.

Within the individual types of digital ads, search registered the strongest growth, up 15.5% year on year and taking an overall digital adspend share of 49% (€11.9bn). Display was the next biggest segment, up 9.1% (€7.8bn), within which online video rose by just over 50% from 2011 to €662m, taking a double-digit share of the display total for the first time.

Mobile advertising experienced a still more rapid increase, up 78.3% to €392M.

Knapp said: "Search is always in the picture - and mobile search is a huge driver as well. [But] video and mobile are now crucial factors in overall display growth."

Zorbas added: "Display advertising has continued its renaissance, driven both by the recognition of online display as a branding medium and the explosion of the big data economy."

Data sourced from IAB Europe; additonal content by Warc staff, 24 May 2013

Category leadership vital in Indonesia

JAKARTA: Consumer goods brands looking at Indonesia as the next big emerging market will need to establish category leadership among a newly developing middle class, two industry experts have said.

Nader Elkhweet, a partner at consultants Bain, told a consumer product conference in Jakarta, reported by the Jakarta Globe, that the country was growing rapidly and could become the ninth largest economy in the world within a decade. Retail sales rose 10.3% in March and 13.5% in February.

He advised brands to seek to capture the millions of consumers moving out of poverty by building "a category leadership, based on deep consumer, categories and retail landscape understanding".

Among the particular understandings that Elkhweet offered were that Indonesian consumers were characteristic in six areas. He said they were ready to pay more for brands, they were homogenous in what they bought, had strong brand loyalty, a high purchase frequency and were influenced by social media.

They also had a preference for small pack sizes, a possible reflection of the Indonesian retail landscape.

Elkhweet noted that 85% of consumer product purchases were made in traditional markets, where shelf space was limited and where brands would have to compete for a presence.

His colleague Vijay Vishwanat observed that in addition to the differences between emerging markets such as Indonesia and developed markets there was also an element of convergence, which included the rapid use of "premium" to drive sales.

Similarly, he pointed to the growing importance of point of sale since purchase was increasingly decided after customers had entered a store.

Separately, a recent McKinsey survey found that consumer buying habits vary greatly across Indonesia, meaning brands will have to consider localising products and value propositions down to the regional level.

Data sourced from Jakarta Globe, Economic Times; additional content by Warc staff , 24 May 2013

Mobile ad metrics questioned

NEW YORK: A high percentage of advertisements served to mobile devices are failing to display properly but advertisers are still paying for them because the industry lacks agreed reporting standards.

A recent comScore report found that 30% of display ads are never seen by the target audiences. "It is more important than ever for advertisers to evaluate campaign viewability to improve optimization and maximize the return on their media spend," it said.

At issue is the counting process, with ad servers typically using "server-side counting" where an ad impression is counted as soon as it is requested, while advertisers would usually prefer to see "client-side counting," where an ad impression is only counted when it is successfully delivered to a device.

Apple's iAd mobile network is one that only charges for those ads that render fully on users' screens and it has become one of the first to gain accreditation from the Media Rating Council (MRC) as adhering to new standards laid down by the Interactive Advertising Bureau and the Mobile Marketing Association.

"We were favourably impressed with the range of metrics that iAd provides and their quality," David Gunzerath, senior VP and associate director of the MRC, told Advertising Age.

"It gives the buy and the sell side confidence that the measurements are accurate and can be relied upon as currency."

Others in the industry have their own take. Jim Payne, CEO of Mopub, a third-party ad server, said his company did not work with publishers whose discrepancy rate – the gap between the ads paid for and the ads that never render on a device – was above 5%.

And the Weather Co, a mobile site, said it compensated advertisers for discrepancies by offering more ad inventory than they paid for on the understanding that some would fail to render.

Another development that is likely to help digital marketers is the uptake of responsive ad units, which allow a single piece of creative to adapt itself to the device it's being viewed on.

Not only will these reduce the creative development time for multiscreen campaigns, they are also likely to enable publishers to more easily sell cross-platform packages rather than device-specific media.

Data sourced from Advertising Age, comScore, Digiday; additional content by Warc staff , 24 May 2013

Electronic Arts is most social brand

LONDON: Electronic Arts, the gaming company, has been named 2013's most social brand, heading a list in which travel and retail brands featured heavily among the top ten.

Social Brands 100 was compiled by Headstream, the specialist social media agency, and tracked 715 brands and their interactions with consumers across the leading social networking platforms, Facebook, Twitter and YouTube.

Travel companies took four of the top five slots, with American Airlines, Lufthansa, Thomson Holidays and Thomas Cook UK, in that order, following Electronic Arts.

Argos, at seventh, Tesco at ninth, and Dr Martens, at tenth, constituted the retailers in the top ten.

Innocent, at sixth, was the sole FMCG brand, while SEAT Mexico, at eighth, represented the automotive category.

Just 20 points separated the first and 100th rankings, indicating, the report said, that high performing brands are being more consistent in their approach.

"It feels like a far greater proportion (of brands) are getting to grips with engagement compared with a year ago," Steve Sponder, managing director of Headstream, told Marketing.

"They are getting their customer service right and creating content that, in some cases, is becoming as valuable as the products or services they are selling."

Simon Stokes, director of web and communities for Europe at Electronic Arts, said that social media had been the most significant change in its marketing for Battlefield 3.

He added that the biggest challenge was to accept that the brand was not in control. "The conversation out there would happen without us. It would also happen if we tried to stop it from happening," he said. "All we can do is facilitate and stimulate it, and try to be positive and encouraging."

The presence of so many travel and retail brands indicates the role of customer service in social media, but with the Met Office, the public sector weather forecaster, and Dogs Trust and ARKive, two charities, also featuring in the top 20, it is clear that a diverse range of brands can utilise the marketing aspect of social media to their advantage.

Data sourced from Social Brands 100, Marketing; additional content by Warc staff , 24 May 2013

Indian attitudes to luxury alter

NEW DELHI: Indian consumers are changing their attitudes to luxury goods, shedding a disdain for conspicuous consumption, opting for seasonal items and embracing bright colours that stand out.

A number of factors are at work, including a generational shift, the increasing visibility of high-end items and innovative marketing.

Jamal Shaikh, editorial director of the Robb Report India, told Little India that "luxury magazines have exposed what was traditionally considered obnoxious spending to a people that believed that being frugal was the only way to live."

In addition, hybrid malls, which mix luxury and non-luxury stores with customized service, have reached a new set of buyers. "The customer who shops at Zara here also shops at Burberry," noted Atul Ruia, managing director of Phoenix Mills, a Mumbai mall owner.

"Hybrid malls have been a huge driver of luxury goods' sales," he added. "The numbers are surprising the luxury companies themselves."

While the economic developments of the past decade have hugely enriched some people, it is their children who will drive the luxury goods sector, argued Vispi Patel, group director, Louis Vuitton Moet Hennessey India.

"The new, young, upper middle class who will spend rather than save will be new-generation, first-time customers for luxury products. They will fuel growth," he said.

Such buyers are also likely to become more interested in changes in fashion. "Some come to our stores every season to buy the same bag or shoes in different colours which proves that luxury is becoming fast fashion in India and a way of life," Priya Sachdev, creative director of TSG International Marketing, told the Economic Times.

Luxury sales are no longer reliant on the main metropolitan areas as brands develop innovative marketing to reach into Tier 2 cities. Judith Leiber, the luxury handbag maker, for example, ran an exclusive trunk show in Indore and shifted a tenth of its annual sales at one event.

"India is an investing market," said Patel. "If you set up a particular store or brand, even one that is relatively unknown, if you choose the right location, stock it adequately and promote it sufficiently, there will always be demand."

Data sourced from Little India, Economic Times; additional content by Warc staff , 24 May 2013

P&G brands win gold at Effies

NEW YORK: Procter & Gamble, Kellogg's and Kraft were among the major brand owners who picked up golds at the 2013 North America Effie Awards.

But the top Grand Effie went to the video game Call of Duty: Modern Warfare 3, for its "The Vet and the n00b" launch campaign. This targeted both younger core and older casual gamers, and benchmarked its success by beating sales targets within the first few days of release.

Overall, 80 brands and 60 agencies won awards across 50 categories, including the specialty Health and Media Awards, and the Global and Shopper Effie competitions.

Warc subscribers can access a selection of winning case studies, including 14 golds, 13 silvers and 18 bronzes.

Among these, Procter & Gamble, the household goods company, won gold in the Yearly Topical category with Proud Sponsors of Moms, a corporate-brand-led campaign based around its sponsorship of the London Olympics.

The Olympics also featured in a campaign for Febreze, the company's odour eliminator brand, which won two silvers in different categories. Febreze aligned with the Azerbaijani Wrestling Team to demonstrate its effectiveness to US mothers.

And P&G picked up a third gold in the Hispanic category for its Tide laundry detergent brand. The Mi Tide campaign took a very targeted approach to communications, promoting different brands within the Tide range according to consumers' levels of acculturation.

Kraft also won a gold in this category with a campaign for its Macaroni & Cheese pre-prepared food brand, which sought to counter perceptions of being 'foreign food' and contrary to the Hispanic tradition of preparing food from scratch.

Kellogg's, the cereal manufacturer, won gold for the Back To School Program it ran with Walmart, centred around the creative message of 'Feed their Imagination', which supported the offer of a free children's book with the purchase of two Kellogg's products.

And Etch A Sketch, the iconic drawing toy, picked up a silver for a near-real-time reaction in the Single Impact Experience category. A chance - and potentially damaging - reference to the toy during the 2012 US presidential election campaign was swiftly spun around by the brand and increased sales by 30%.

Data sourced from Effie North America; additional content by Warc staff, 23 May 2013

India's ecommerce sector grows

BANGALORE: Online retailers and consumer brands such as Nike, Puma and Wrangler are finding themselves in an increasingly interdependent relationship as India's ecommerce sector grows beyond the main cities.

Technopak, the advisory services firm, has predicted that online retail will be worth $76bn by 2021 and account for 5% of total retail sales.

And individual brands are already registering a sharp growth in sales through this channel.

"Three years ago, about 1% of total sales came from online channels. Now, that number stands at 15%," Rajiv Mehta, Puma's managing director for South Asia, told the Economic Times.

"Today, no brand can ignore the online channel," he declared, noting that e-sales were growing almost twice as fast as the brand overall.

Wrangler, the denim clothing brand, currently garners 3.5% of sales from online sites but anticipates this will increase significantly. "Online channels have grown by many multiples in recent months. It has been amazing," said Puneet Khosla, a business head for Wrangler.

Footwear brand Nike works only with online retailers such as Jabong and Myntra. Ganesh Subramanian, chief merchandising officer at Myntra, explained the benefits of being the preferred online partner of a large brand.

"The brand's marketing and planning team work closely with our team," he said. "The brand also invests resources, gives us pick of products, does exclusive launches and promotions."

Etailers have also noted a change in attitude. "Earlier, top brands were sceptical about online retail," said Mukesh Bansal, co-founder of Myntra. "Now, it has become part of their mainstream strategy."

One of the drivers of growth has been consumers in lower tier towns and cities starting to buy online since they do not have access to physical stores stocking top-end brands.

"About 50% of sales for online sites come from cities and towns beyond the top eight metros," said Pragya Singh, associate director at Technopak.

Data sourced from Economic Times; additional content by Warc staff, 23 May 2013

Europeans lag in mobile mind shift

LONDON: Consumers in Europe are lagging behind those in the US in the transition to a mobile mindset, new research has claimed.

Forrester Research describes the mobile mind shift as the expectation by customers that any desired information or service is available on any appropriate device in context and at their moment of need.

It identifies three components in this – the number of connected devices, the frequency of access, and the diversity of locations in which connections occur.

Josh Bernoff, Forrester's senior vice president, Ideas Development, revealed new European data which indicated that only 16% of Europeans had made the shift to a mobile mind set, compared with 22% of Americans.

He said that while Europeans had more connected devices, they actually connected significantly less frequently and in fewer locations than their US counterparts.

He postulated that this "appears to be a result of the data plans on European mobile devices, plans that interfere with users' natural desire to access mobile everywhere as a matter of habit".

Forrester's Mobile Mind Shift Index divides consumers into six segments, with the bottom three – Disconnecteds, Dabblers and Roamers – constituting consumers who do not show clear signs of a change in attitude, while the top three – Adapters, Immersers and Perpetuals – are shifted and have high expectations for their mobile experience.

The European Mobile Mind Shift Index showed Germany to be the least shifted country in Europe, followed by the UK and France, which are both slightly more shifted but still below the European average. At the highest end of the index, Sweden is more shifted than the US.

Forrester suggests that companies whose customer base falls largely into the shifted segments need to have a plan in place to provide mobile services.

"For marketers, meeting the needs of this demanding customer base in a mobile setting is a marketing imperative," it said.

Data sourced from Forrester; additional content by Warc staff , 23 May 2013

Virtual currencies gain ground

SAN FRANCISCO: Mobile consumers would rather engage with adverts than pay money to receive virtual rewards and premium content, according to new research into the fastest-growing segment of the virtual currency economy.

The study, titled Redefining Virtual Currency, was carried out for Tapjoy, the mobile advertising and publishing platform. It investigated virtual rewards, including loyalty points, credit card points, airline miles and app-based virtual currencies.

It estimated that the virtual currency economy is worth $47.5bn, and will grow to $55.4bn by 2017. Within this, advertising engagement is expected to be the fastest-growing segment, increasing more than 200% to nearly $900m by 2017.

The study found that 20% of mobile device owners engaged with advertising on a daily basis in exchange for virtual rewards and premium content, while almost half did so at least monthly.

"Mobile device owners have demonstrated that they're willing to interact with a brand by exchanging their time (ad-views) and personal data for free digital content," said Jordan McKee, an analyst with Yankee Group and author of the report.

"Since users choose to take part in this exchange, the engagement can be far more meaningful and powerful than pop-up, banner or television advertisements," he added.

Specifically, 54% of smartphone users and 41% of tablet users had paid for in-app premium content. But given the option of receiving the same content for free in exchange for advertising, both sets overwhelmingly preferred engaging with advertising.

Respondents also demonstrated a willingness to engage with advertising to receive digital content. For example, 77% were prepared to engage with ads to earn a tablet app, 73% to get tablet in-app premium content, 73% to receive music and 67% to get smartphone in-app premium content.

Despite campaigners' concerns about privacy, mobile users were also prepared to trade personal information, such as email addresses, to advertisers in exchange for virtual rewards and premium content.

Some 70% of smartphone owners and 53% of tablet owners had provided such data in order to download a paid app for free.

Peter Dille, chief marketing officer at Tapjoy observed: "We expect this virtual currency model will continue to grow through mobile beyond games and into other types of content, such as music, print media and video content."

Data sourced from PR Newswire; additional content by Warc staff , 23 May 2013

Loyalty programs can do more

MELBOURNE: Loyalty programs do not equal customer loyalty, but there are significant opportunities for retail brands to become more valuable to consumers by offering multiple emotional and transactional benefits, a new report has argued.

For Love Or Money?, from strategic marketing company Directivity and digital agency Citrus, examined Australian loyalty programs, based on the findings from an online panel of 1,010 Australians over the age of 16.

It found that while 80% of consumers buy more from retailers with loyalty programs and 55% choose brands that have a program compared to those without, just 46% feel more loyal to the retail brand despite being a member of their program.

Some 41% of respondents felt loyalty programs had improved in recent years and offered good benefits to members. The authors suggested that this presented an opening for loyalty programs to "strive to be more valuable".

Unsurprisingly, most consumers rated financial rewards highly, with 80% saying discounts were very important when making purchases.

Points-based programs where members can redeem points for vouchers, products or other rewards were the second most popular benefit, on 77%.

The unexpected was also rated highly, in third place with 67% valuing surprise gifts or rewards that arrived without making a redemption.

"Basic monetary rewards give retailers a 'ticket to play' in the loyalty game," said Adam Posner, CEO of Directivity, "but the real opportunity lies in building deeper engagement with members through more personally relevant, unexpected and emotional rewards."

"This plays out in the research which shows surprise rewards such as a gift on your birthday, exclusive offers or special experiences go a long way to overcoming the belief that programs don't offer any real value," he added.

His words were echoed by Citrus CEO Peter Noble, who observed that while financial rewards were the motivation for joining loyalty programs, "a winning program is one that also has multiple emotional and unexpected benefits creating an element of 'surprise and delight' and tailoring offers based on consumer needs and preferences".

Coles Flybuys, Woolworths Everyday Rewards and Qantas Frequent Flyer were the loyalty programs most mentioned by respondents as 'doing a particularly good job'.

Data sourced from Directivity, Citrus; additional content by Warc staff , 23 May 2013

Global marketing budgets improve

LONDON: Marketers are showing continuing confidence in the state of the industry, with Warc's monthly headline Global Marketing Index remaining steady in May and that for marketing budgets reaching a new high.

The headline Global Marketing Index (GMI) reading, which combines trends observed in trading conditions and staffing levels as well as marketing budgets, stood at 56.5 in May, on a scale where values above 50 indicate a positive trend.

Regionally, the Americas continued to have the most positive outlook, with an index value of 58.6, with Asia-Pacific not far behind on 56.7, having shown another month of improvement. Europe, however, fell back from 55.1 in April to 53.2 in May.

The global index of marketing budgets rose for the fifth consecutive month to reach 54.3, its highest value since the index began in October 2011.

In the Americas, the index for marketing budgets reached 58.0, the highest regional figure for marketing budgets recorded so far. Asia Pacific's index also increased, to 53.8. Europe, on the other hand, slipped back below 50 to 49.7.

The less optimistic European figures come on the back of recent adspend data showing that the Italian and French markets have both had a difficult first quarter.

Italian adspend dropped 19% year on year, with leading businesses anticipating this trend would continue at a slower pace in the second quarter. Only internet and outdoor advertising showed any growth.

And in France, adspend was down 9% with all media in decline. IREP, the trade body, expects the full year to record a fall of between 3% and 4%.

Of the other constituents of the GMI, the index of global trading conditions again performed strongly in May, registering a value of 59.1, while the index of staffing levels was also positive, at 56.0.

Suzy Young, Data and Journals Director at Warc, said: "Global marketing budgets have been raised for a fifth consecutive month but, while budgets show growth in all global regions, European marketers are slightly less optimistic than they were in April. It will be interesting to see whether this trend continues next month."

Data sourced from Warc , 23 May 2013

Admap Prize winners announced

LONDON: The Admap Prize 2013 has been won by Mike Follett, for his essay titled 'Thinking in 3D'. Follett, currently studying for an MBA at Imperial College Business School, was formerly head of planning at DDB in India and planning director at The Red Brick Road in London.

Entrants to the Admap Prize, which was sponsored by Kantar, were asked to write an essay addressing the question 'Can brands maximise profits and be a force for social good?' Follett argued that marrying multiple objectives together three-dimensionally is the route to business success rather than the single goal of profit.

Colin Mitchell, worldwide planning director at Ogilvy & Mather and an Admap Prize judge, described Follett's work as "an education" with "a strong central idea".

"Companies have different objectives and these require trade-offs," he said. "Trade-offs feels closer to the truth and a more practical way of thinking about policy, than, say, a Balanced Scorecard."

The Silver award was won by Andrew Curry, a director of The Futures Company, and Andy Stubbings, global consumer insights manager at Bacardi, with an essay titled 'The brand: the machine that makes a difference'.

They suggested that the concept of businesses simply chasing shareholder value was relatively recent and flawed, but those that also had a social purpose stood out more, engendered loyalty and achieved greater heights than they would otherwise attain.

The judges were tied on Bronze and so decided on two awards. Guy Champniss of Meltwater Consulting took one for an essay titled 'Social Good, Personal Best: how a basic selfish desire may be just what business and society need'. A second went to Brian Millar of Sense Worldwide for his essay titled 'Syrup, cows and the voice of the commons: how planning skills can save the world for fun and profit.'

A further two essays were commended by the judges: 'What do you do for a living?' by JWT's board planning director Claire Jackson and 'The rise of the new billion dollar brands' by Ogilvy & Mather's group planning director Freya Williams.

Admap Editor Colin Grimshaw said cause marketing and its role in commercial enterprises was a hotly debated issue and a major challenge for brands, big and small, across every region in the world.

"The question for brands is, are the pursuit of profit and doing social good conflicting objectives, or does one beget the other? Does corporate social responsibility directly add value and grow the business, or is it simply a marketing/PR expense, a cost of doing business?"

The Gold award and a $5,000 cheque will be presented to Follett at a special Admap Prize celebration event at Cannes Lions on June 19th.

All the awarded and commended essays will be published in the June issue of Admap and online at www.warc.com/admap from June 1st. Visit www.warc.com/admapprize2013 for more details.

Data sourced from Warc , 22 May 2013

Mobile adspend lags in Canada

NEW YORK: Mobile advertising expenditure in Canada is currently lagging behind the increased penetration of tablets and smartphones but is forecast to grow significantly through to 2017.

A new report, Canada Mobile: Advertisers Trail Users' Uptake of Mobile, from eMarketer, the insights provider, said that in 2012 mobile adspend was up 115% to C$133.3m and for 2013 it predicted an 88.6% jump to C$251.5m.

A compound annual growth rate of 57.1% for the years 2012-17 will see total mobile adspend top C$1bn within four years.

The anticipated rate of growth is based on soaring use of mobile devices across the country.

Smartphone usage stood at 47% of internet users in January 2013, up from 34% a year earlier and more than double the penetration of two years before.

Tablet usage was also on a fast track, more than doubling from 10% of internet users in January 2012 to 21% in January 2013.

Even with increased adspend and penetration of mobile devices, eMarketer said that Canada's spending rate per mobile internet user in 2013 was just 40% that of the US and the UK, both of which spent US$49.

Japan and Norway each spent US$30 per mobile internet user and Denmark US$25, while Canada was on a par with Sweden on US$20.

The report also noted that funding had been an issue for marketers in Canada, as finance departments wanted proof of payback before committing cash to mobile campaigns.

Indeed, late last year research from Millward Brown showed Canadians to have the least favourable views of any nation about ads on mobile phones and tablets.

Just 11% of mobile phone users and 9% of tablet users in Canada had a good opinion of these ads, well below the average figures of 23% and 29% and far behind the 48% and 55% registered in Kenya.

Mobile strategists suggested that one way to address the funding challange would be to offer mobile as part of a wider digital strategy.

Data sourced from eMarketer; additional content by Warc staff , 22 May 2013

4G to catalyse Indian ecommerce

MUMBAI: The advent of 4G in India will bring major benefits to smartphone users, catalyse ecommerce and boost the online advertising market, a leading industry figure has said.

Rob Norman, the chief digital officer (global) for GroupM, part of WPP, told Livemint that the existing broadband infrastructure was neither particularly fast nor well-distributed.

"Even in affluent districts in Mumbai, you get very variable Internet connections that hold India back," he noted.

But Norman also said he expected 4G to change all that. "I think the future from the (view of) smartphones is going to be a very big benefit in India," he said.

"All of those things will catalyse e-commerce," he added. "And it's a key stage in the online advertising market, particularly it's where e-commerce becomes a significant part of GDP."

Norman said he did not expect this to take place at a uniform rate across the country, foreseeing instead a "three-speed digital development", based around economic and geographical factors

The fastest growth of ecommerce would be in "places where you have dense populations and significant economic activity and wealth", in part because the logistics were more easily manageable.

Places with a dense population and no wealth would be a second speed, followed by the third, "massively distributed populations in rural India".

Norman said he was also interested in the possible impact of a proposal by the Indian regulator to reduce the amount of advertising on television to 12 minutes per hour.

He expected to see some advertising move from TV to other platforms such as online video but added that an improved TV viewer experience could lead to higher audiences, in which case "television will carry on capturing very large amounts of money".

Data sourced from Livemint; additional content by Warc staff , 22 May 2013

Publishers turn to welcome ads

NEW YORK: Publishers are increasingly looking to welcome ads as a source of revenue, as homepage takeovers decrease in relevance.

Digiday observed that "we are in a post-homepage era" as visitors to websites now tend to arrive on article pages. It noted that this was especially true of business-oriented site sites, such as Forbes which describes welcome ads as a "gateway" that can grab attention before people enter the site.

"Publishers are seeing downward pressure on standardized ads, so this is one area they can control more closely and try to maintain a premium around," said an agency source, adding: "It's not surprising they want to bombard users with as many of these as possible."

"They're interruptive, but it's usually relatively easy to click past them," Ben Kunz, vice president of strategic planning at Mediassociates, told Digiday.

"You can use them to get in people's faces," he said, "but I don't feel like they anger users as much as some other ads."

The issue of intrusiveness runs counter to recent buzz around the concept of native advertising as spending on banner ads declines and marketers are urged to think more like journalists.

But Yahoo! research presented at Warc's Online Research: Now and Next 2012 conference found that a McDonald's ad featuring a takeover and an animated background was the most intrusive in theory but had the highest likeability in practice.

Welcome ads command a premium for publishers but many appear to be overdoing that with prices above $150 CPM not uncommon.

"The costs are crazy, so we don't usually recommend them to clients," said Kunz, adding that clients could often get a return on investment buying standardized inventory or through exchanges.

Data sourced from Digiday; additional content by Warc staff, 22 May 2013

No future for digital agencies

PARIS: The current crop of marcoms students expect standalone social media and digital agencies will be a thing of the past within a decade as they are integrated with other agencies or become full service themselves, a new survey has found.

The Next Generation of Marcoms report from The Mediaschool Group, a European business school, polled 2,000 marketing students aged 20-25 in the UK, France, Spain and Belgium on five different themes, including digital and the next generation, the future of marcoms, career, ethics and inspiration.

Almost 90% of respondents did not think of social media as a separate discipline but rather one that all marketers should be using. And 85% thought that would lead to the end of standalone agencies over the next ten years.

A similarly high proportion, 90%, agreed or strongly agreed that in ten years' time the agency they work for would be full service where practitioners would be comfortable creating strategies in advertising, direct, social, digital and PR.

A majority saw a future focused on content marketing and "PR thinking". Fully 81% believed that content marketing would be essential part of their job in ten years, while 70% anticipated that PR thinking would dominate how agencies responded to briefs.

But this did not mean the end of television, as 68% disagreed or strongly disagreed that TV advertising would be 'irrelevant'.

Interestingly, this generation of students did not regard themselves as digital natives with 70% believing the next generation, ten years younger than them, will be the true masters of digital media.

This "should send shock-waves through the industry and eradicate any lingering sense of complacency among modern marketers," said Scott Wilson, UK CEO and EMEA managing director of Cohn and Wolfe, the communications agency.

Anne Pflimlin, director of The MediaSchool Group noted that this generation was agnostic about channel or medium and that trust, word of mouth and content seemed to matter so much more.

"It behoves an industry that is so often transfixed by questions of youth and channel relevance to listen carefully," she observed.

Future employers might also note that 86% said the agency they want to work for would have to be as much about the creation of social good as about creating profit for brands.

Coincidentally, this is also the subject of the 2013 Admap Prize, the winners of which have been announced today.

Data sourced from PR Newswire; additional content by Warc staff , 22 May 2013

Shell develops branded content

KUALA LUMPUR: Shell, the global oil company, is moving into branded content in Asian countries as it seeks to take advantage of the fast-growing market for its products in the region.

To promote Shell Advance, the motorcycle lubricant, the company has launched a six-part series that examines local motorcycle culture. Freedom Riders Asia will air on Star Sports, a Fox channel.

"We are looking at doing things differently," said Koh Kar Tai, Shell Advance global brand manager.

He told Campaign Asia-Pacific that he wanted to go beyond a 30-second commercial and make an emotional appeal to the target audience.

"We don't want to do what our competitors do," he explained, "because it's not about closing the gap but about surpassing it."

He also suggested that the series was "spend effective", despite costing rather more than an ordinary TV spot.

The series will be accompanied by additional promotional activities in those markets where the brand has little awareness, such as India where the show will be co-hosted by a local biker and actor, Gul Panang.

The six countries visited are among Shell's planned top ten growth markets, and the region is forecast to account for 80% of new motorcycle sales in the next two years.

Vineet Puri, vice president of Fox One Stop Media, Fox International Channels' integrated advertising sales arm, described the program as a travelogue but said it was being aired on a sports channel to give viewers more diversity.

"This series would appeal to motorbike enthusiasts as the channel has many motorsports fans tuning in regularly," he said.

Data sourced from Campaign Asia-Pacific, The Sun Daily; additional content by Warc staff , 22 May 2013

Apple is most valuable global brand

NEW YORK: Apple, Google and IBM head the list of the 100 most valuable global brands in 2013, which together have a combined brand value of $2.6tr, according to a new report.

The annual BrandZ Top 100 Most Valuable Global Brands study, commissioned by WPP and conducted by Millward Brown Optimor, used the views of potential and current buyers of a brand, alongside financial data, to calculate its value.

Brands in the technology category took the top three places, with Apple remaining in the number one spot with a valuation of $185bn.

Its growth in the past year, however, slowed to only 1%, a performance that contrasted with the 51% increase in value of Samsung, its main competitor in the smartphone market. Even with this extraordinary rise, Samsung's valuation of $21bn put it at number 30 in the rankings.

Nick Cooper, Managing Director of Millward Brown Optimor, noted that Samsung had spent $1.6bn more on advertising in the last year, but observed that "Apple's ability to maintain its number one position demonstrates the value that having a strong brand brings to business".

Google overtook IBM to reach the number two spot, growing 5% to a value of $114bn. Close behind, in third place, was IBM with a brand value of $112bn, although this had slipped back 3% on 2012.

The only other technology brand in the top ten was Microsoft, which dropped from fifth to seventh, as its value of $70bn was 9% less than the year before.

Food and drink brands also featured in the top five. McDonald's value slipped 5% to $90bn but it retained its fourth position, while Coca-Cola crept up from sixth to fifth as its value rose 6% to $78bn.

Telecoms brands took the sixth and tenth spots. AT&T eased upwards from eighth to sixth with a value that had increased 10% to $75bn, while China Mobile remained in tenth with an 18% rise in value to $55bn.

Marlboro, the tobacco brand, slid from seventh to eighth, as a 6% drop in value made it worth $69bn.

The final brand in the top ten was Visa, the credit card, which recorded a substantial 46% rise in value as it jumped from 15th to ninth pace.

David Roth, chief executive of The Store at WPP, said the rankings highlighted the return on investment that brands gave businesses.

"It shows that strong brands bring market share growth, increased profits from being able to command a price premium and greater shareholder returns," he stated.

Data sourced from additional content by Warc staff , 21 May 2013

Agencies look anew at Asia

SINGAPORE: Two WPP-owned agencies have come together in an initiative aimed at developing a range of communication solutions to reach rural and low-income consumers across South East Asian markets.

Mindshare, the marketing and media network, has teamed up with OgilvyAction, the brand activation company, to carry out operations across India, Vietnam, Indonesia and Thailand.

Mindshare will be responsible for strategy, using its proprietary tools to cover groundwork and rural research, including task maps, ethnographic studies, brand health parameters and quantitative studies covering brand relationships, consumer demographics and media consumption.

Mindshare has also developed tools to capture rural TV viewership rather than the people meter widely used in urban areas.

Both companies noted the growing value that was being placed on this level of consumer.

"We know low-tier consumers are an increasingly important segment for our clients," said John Goodman, President of OgilvyAction Asia Pacific.

Describing the region as "one of the most promising growth engines", Ashutosh Srivastava, chairman, Asia Pacific and CEO for Emerging Markets at Mindshare, said the partnership offered great potential to clients.

"It is relevant to all our stakeholders who want to leverage insights on low-income consumers and deliver breakthrough media innovation and activation," he said.

Activation and planning solutions are being provided for select clients already, with fully realised rural-specific research expected to be available in the next six months across all ASEAN markets.

In a separate development in the region, WPP's PR company, Burson-Marsteller, has installed a new Asia-Pacific leadership team.

Patrick Ford, regional chairman, explained to Campaign Asia-Pacific that the aim was to get a diverse perspective and experience from the company's most effective leaders.

At the same time, he noted that the business environment was changing. "The digital revolution has applied a sense of urgency and time sensitivity for clients to engage with stakeholders, employees and customers through various digital channels," he said.

"Clients are looking for agencies that have strong passion for their brand and great ideas to lead positive business results," he added.

Data sourced from Asia Media Journal, Campaign Asia-Pacific; additional content by Warc staff , 21 May 2013

Retailers underuse customer data

CHICAGO: Many retailers are failing to successfully exploit the volume of customer data that is available to them, whether that is collected by technology or comes in the form of interactions between customers and staff, a new report has claimed.

The Achieving Excellence in Retail Operations (AERO) Study, from consultancy A.T. Kearney, examined the strategy, tactics, and execution of retailers in multiple sectors in more than 20 countries.

It established that there are many underutilized sources of customer data; and, to take full advantage of these resources, retailers need to increase investment in technology and skills.

The report pointed out, for example, that less than half of retailers collected social network data from third-party domains, while just 8% felt this was "very important" in generating insights.

Leading retailers were found to be the best at collecting data, measuring activities, acting on their insights, and measuring again to see the results.

Joel Alden, A.T. Kearney partner and co-author of the study, commented, "Leading retailers encourage measurement of the right data, invest in the skills to gain insights from that data, and use those insights effectively to frame future actions."

As well as dealing with the proliferation of technology and vast quantities of store and customer data, retailers were advised to maintain their focus on the basics of retailing, namely the interactions between employees and customers.

The study found that retailers that most actively engaged their employees and customers were the most successful.

Few retailers, however, were seen to take full advantage of the insights of frontline staff who deal with customers daily and gain valuable insights into their needs.

"The problem today is a lack of formal requirements or processes to gather these employee insights," said Adam Pressman, A.T. Kearney principal and co-author of the study.

The study also looked at how retailers operated in a multichannel environment, where customers return products ordered online to a brick and mortar store, or ask a store employee to order an out of stock item through another channel.

When employees are not measured on the success of non-store channels, they have little incentive to encourage the growth of those channels, A.T Kearney said.

Data sourced from A.T. Kearney; additional content by Warc staff , 21 May 2013

Brands face mobile shortfall

LONDON: Brand owners need to invest in mobile relationship strategies as well as increasing the amount of advertising expenditure directed to this channel, a leading industry figure has argued.

Writing in the Guardian, Thomas Enraght-Moony, CEO at Lumata, the mobile marketing consultancy, warned of a "serious risk" of a disconnect developing between a brand's mobile advertising spend and its mobile relationship investment.

"If that happens, mobile ad spend will become far less effective and mobile will be seen as delivering below-par return on investment," he said.

"Worst of all, customers are likely to become disillusioned with brands using mobile as a marketing channel," he added.

Data sourced from the Guardian, GoMo News; additional content by Warc staff , 21 May 2013

PC sales up in India

BANGALORE: Some 2.7m PCs were shipped in India during the first quarter of 2013, representing year-on-year growth of 7.5%, according to latest data.

Figures from IDC, the research business, showed that the commercial sector was driving growth, as sales of branded desktops had increased thanks to several large deals, primarily in the banking, financial services and insurance sector as well as the IT and government verticals.

The consumer market remained largely flat with a marginal quarter-on-quarter growth of 1.5%.

"High inventory in the beginning of the quarter and weak sales towards the closing weeks largely pulled back the growth witnessed in Q1 2013," said Kiran Kumar, Research Manager, IDC India.

Hewlett-Packard was the leading vendor, with a 22.5% share of total shipments, followed by Acer and Dell, both on 13.8%, and Lenovo, on 11.7%.

"In addition to their success in the consumer business, HP picked up key wins and witnessed the execution of large deals in Government and BFSI verticals in Q1," said Manish Yadav, a market analyst at IDC India.

"Most importantly, the vendor picked up the special deal on laptops in the state of Uttar Pradesh, which cemented its position in the top spot," he added.

Referring to the performances of the second and third placed brands, Manish stated that they had both played to their strengths.

"Acer remains strong in the commercial business while Dell was seen riding high on its price cuts, specially on notebooks", he said.

IDC anticipated that stable prices and back-to-school campaigns would produce an uplift in the consumer PC market in the coming months.

While Kiran remained optimistic about commercial spending on PCs, he was cautious about the impact of new launches from Microsoft and Intel.

"We've seen in the recent past that some of the new launches like slim notebooks have struggled to make an impact because of the price premium," he observed.

"Hence, it'll be imperative for these new launches to remain affordable while highlighting the new/differentiating features."

Data sourced from Business Standard, IDC; additional content by Warc staff , 21 May 2013

Turkey attracts global brands

ISTANBUL: Coca-Cola, Nestlé and IBM are among the global brands that have taken advantage of Turkey's strategic location as well as its sizeable domestic market, a new survey has found.

An Ernst & Young attractiveness survey, based on the tracking of actual foreign direct investment (FDI) projects as well as interviews with 201 international decision makers, established that Turkey's position at the crossroads of Europe, Asia and the Middle East was a major attraction for many businesses.

Over half of respondents to the survey were considering establishing or developing additional activities in Turkey over the next year. And 44% of respondents expected Turkey to become a regional and global business hub in the next 10 years.

Coca-Cola's Eurasia and Africa Business Unit, which covers 96 countries ranging from South Africa to Russia, is based in Istanbul, as is Coca-Cola İçecek, the company's sixth-largest bottler in terms of sales volume.

Hüseyin M. Akın, President, International Operations, Coca Cola İçecek, said the company had invested more than $700m in Turkey over the last seven years.

IBM and Nestlé, meanwhile, have invested in the Bursa region in order to serve the greater Middle East and North Africa market.

Turkey is also among the most-visited tourist destinations in the world, a fact that has encouraged Hilton Worldwide to plan 13 hotels in the country by 2014.

The survey found that while just over a quarter of planned activities are in sales and marketing, the sector commands over half of actual FDI projects. Ernst & Young argued that this gap highlighted "investors' appetite for new market opportunities, and is consistent with Turkey's overall perception as an operational hub".

The number of projects increased at an average annual growth rate of 53.8% between 2007 and 2012, with investment coming mainly from the US, Germany and the UK.

Few of those surveyed, however, thought that Turkey had a highly developed technological infrastructure, with 11% referring to this aspect, and fewer still, just 6.8%, regarded it as a leader in R&D and innovation.

In addition to the country's role as a hub, it is expected to lead a new wave of rapid-growth markets. Ahmet Ashaboğlu, the chief financial officer of conglomerate Koç Holding which has interests in the automotive and consumer durables sectors, pointed to such features as the "young population, mostly underpenetrated sectors, developed entrepreneurial skills" and "the ability to adapt to domestic and global dynamics".

Data sourced from Ernst & Young; additional content by Warc staff , 21 May 2013

Mobile video to reach 2bn

BASINGSTOKE: Rising mobile device ownership will result in more than 2bn consumers regularly watching mobile TV and video within four years, a new study has claimed.

The report, Mobile/Tablet TV & Video: Content, Broadcast & OTT Strategies 2013-2017, from Juniper Research, the research and analytics company, looked at latest developments in the mobile TV and video sector and examined how the market is evolving.

It found that mobile is increasingly being used as the primary screen for consuming TV and video content among younger demographics and that streaming services are increasingly integrating with social networks.

"Sharing content via handsets or tablets has become an intuitive experience for many," Juniper said.

At the same time, the success of video streaming providers, such as Netflix, in offering multi-screen experiences via smartphones and tablets is threatening traditional pay-TV services.

App stores have also been able to establish themselves as VOD services by negotiating the rights to sell access to TV and video content, while YouTube, the world's largest online video platform, has begun to offer subscription channels.

"This will have incredible repercussions throughout the mobile space," said Siân Rowlands, the report author, "given YouTube comes preinstalled on an immense number of devices and the Android platform's billing options."

In a separate development, Digiday reported that YouTube has introduced a tool that lets consumer goods brands feature relevant products alongside their branded videos, giving consumers the option to get more information, price compare and buy the products.

Another important factor in boosting the number of viewers towards 2bn will be how mobile develops in emerging markets, according to the Juniper report.

In many developing regions, fixed broadband penetration remains low but the uptake of wireless devices is higher. Mobile handsets are frequently the only device capable of accessing video content such as news, sports and music.

While the smartphone ownership is not yet widespread markets, better quality displays and faster processors in feature phones mean that watching mobile TV and video possible for feature phones.

Developed markets, in contrast, will see increased penetration of tablets like the iPad, Juniper suggested.

Data sourced from Juniper Research, Digiday; additional content by Warc staff , 20 May 2013

Online ad measurement battle heats up

NEW YORK: Ratings companies Nielsen and comScore have attracted high-profile clients for their online ad measurement systems as marketers seek to track ads effectively across multiple screens.

Starcom MediaVest Group and ZenithOptimedia, both part of Publicis Groupe, have opted for comScore's Validated Campaign Essentials system, while US network ABC backed Nielsen's Online Campaign Ratings.

ABC said Nielsen's product was "quickly emerging as the standard for online campaign measurement" and added that the deal with the measurement company would include the development of a new service covering mobile video ads, MediaPost reported.

"An increasing amount of our digital video viewing comes from apps on mobile devices, so the ability to understand who sees ads is crucial for our business," said Geri Wang, president of sales at ABC.

She added: "This trial with Nielsen is a significant next step in allowing us to help advertisers see the whole picture."

The move by Starcom MediaVest and Zenith is potentially significant, however, as the Wall Street Journal noted they spend around $32bn a year on ads in the US alone on behalf of brand owners such as Coca-Cola and Anheuser-Busch InBev.

Explaining its decision, Starcom said it was important that the comScore service was offered in more countries and also that it could collaborate with the digital research firm to create new measurement products.

"It's a multi-screen, mobile world and we need to be able to measure audiences fluidly and seamlessly," said Laura Desmond, SMG's chief executive officer.

"Traditional industry measures and players fall short on delivering the innovation we need for our clients," she added.

Data sourced from Wall Street Journal, MediaPost, ClickZ; additional content by Warc staff , 20 May 2013

Smartphone sales soar in Southeast Asia

SINGAPORE: One in three mobile phones sold in Southeast Asia in the last year was a smartphone, as total handset sales in the region grew 8% to 108m units.

Research company GfK found that the overall market for mobile phones in the region, including Singapore, Malaysia, Indonesia, Philippines, Thailand, Vietnam and Cambodia, increased 14% in value terms, with smartphones rising sharply, at 61%, with sales worth $11bn.

Indonesia was the largest market with 37% of overall sales, but smartphone take-up rates varied across the region, ranging from 30% in Indonesia to 146% in the Philippines and 140% in Thailand.

Gerard Tan, Account Director for Digital World at GfK Asia, described the growth in demand for smartphones as "exponential" as Southeast Asian consumers switched from basic feature phones to the latest technology.

He said growth was being driven by smartphones that retailed between $100 and $200, but that there was also growing market share for local brands in the $50 to $100 price range.

Key factors for Southeast Asian consumers were demand for bigger screens of 4.5 inches and above, which currently account for 20% of total sales, plus growing popularity of the Android operating platform. Seven in ten smartphones now operate on Android.

"Given that there is a substantial two-thirds of the region's population who have yet to make the switch, there is still a sizeable potential market for manufacturers to capture and convert to smartphone users," said Tan.

He added: "Consumers in the developing regions will continue to be the driving force of the smartphone sector's strong double or even triple digit growth performance in the coming years."

Data sourced from GfK; additional content by Warc staff , 20 May 2013

Connectivity brings new opportunities

SAN JOSE: Increased connectivity, of both people and devices, will transform how consumers shop, how businesses handle data and how individuals deal with privacy issues, according to industry experts.

Raymond Velez, global CTO at digital agency Razorfish, described the "internet of things" as the biggest innovation in the digital world.

"We've just started to tap the surface for what a new world will mean when every physical touchpoint has some sort of representation or capability to talk to each other, to talk to consumers, to talk to brands," he told Digiday.

Padmasree Warrior, Cisco Systems' chief technology and strategy officer, told McKinsey that just 1% of what can be connected is actually connected and the next decade would see "significant progress" in connecting the remaining 99%.

"That will be a lot more information on the network," she observed and that needs to be usefully analysed in order to "drive better processes, better decision making for businesses, and better lifestyles for users and consumers."

Every single vertical – manufacturing, retail and transport – would be very different as a result.

She pointed to how the retail environment had already changed with the advent of ecommerce and mobile platforms and gave an example of how it might continue to change with the introduction of sensors for indoor location.

This would, she said, enable the retailer to know which aisles consumers visited and whether or not they bought anything there.

"And so if we can analyse that data and tell you when there's a sale going on, that benefits you as a user as well as the retailer," she stated.

"It's really a combination of a recommendation engine, or a preference engine, of a coupon or a discount engine, and a loyalty program, combined with indoor location," she suggested, currently discreet applications that would make retail a very different experience in the future.

On the issue of personal data, Warrior noted that the argument was focused around simply opting in or out, but she argued that in future this would be a more nuanced debate with consumers having greater choice.

"And I may want to change my mind," she added. "I may opt in at the beginning but as I find what that data is being used for, I may opt out."

All of this would require sophisticated analytics and a different way to present data. "Up until now, it has not been the problem most creative people have been handling," she observed.

Data sourced from McKinsey, Digiday; additional content by Warc staff , 20 May 2013

Automakers adapt strategies for India

NEW DELHI: Fiat, Skoda and Ford are among the global motor manufacturers which have begun to adapt their strategies and product range in response to a volatile passenger car market in India.

Fiat Group has announced that it plans to expand its network of dealerships from 54 to 125 by the end of this year and aims to achieve a 5% market share in the next three years, additionally driven by new product launches.

"Fiat India is aggressively focusing on increasing its footprint in India and this launch is in continuation of rapid expansion strategy," said Nagesh Basavanhalli, the President and MD of Fiat Chrysler (India).

The revamped strategy follows a fall in sales volumes from 16,000 units in 2011 to just 6,000 in 2012. The company intends to stem the decline with a focus on nine models, including hatchback and jeep varieties.

The news comes as Volkswagen appears set to shake out its brand portfolio by discontinuing its Skoda Fabia model, which has proved expensive to produce, in favour of promoting the VW Polo.

"While globally VW as a brand is considered to be stronger than Skoda, in India it is vice versa and that has impacted the sales of Volkswagen cars," said a source. "The VW Group is looking to change this strategy."

Ford, meanwhile, is launching its EcoSport sports-utility vehicle into one of the few growing sectors of the market. It marks an attempt to reverse a 17% fall in overall sales to 77,225 vehicles in the last financial year and to generate exports.

Automakers are also having to take notice of changing government regulations on fuel which have narrowed the price gap between diesel and petrol and resulted in fewer diesel-powered vehicles being sold.

"This is a major shift," said Rajesh Singh, GM India vice president. "Companies that have flexible engine plants will adapt to the change. Others will find the going tough."

Data sourced from Business Standard, Livemint, Wall Street Journal, Times of India; additional content by Warc staff, 20 May 2013

Luxury brands look to long term

MILAN: Global sales of luxury goods are expected to slow in 2013 as the Chinese market stabilises and the European market remains flat, forcing brands to re-appraise their strategies, a new report has argued.

The Luxury Goods Worldwide Market Study, from Italian luxury goods association Altagamma and consultants Bain, predicted that sales of luxury goods would slow to 4% or 5% in 2013, down from 10% in 2012.

"We are seeing a more even distribution of global growth," said Claudia D'Arpizio, a Bain partner in Milan and lead author of the study. "In turn, brands are refocusing from short-term, reactive hot spot thinking to long-term sustained growth strategies."

In particular, China's rate of growth will slow from 20% to around 7% following the government's clampdown on the giving of expensive gifts by functionaries, a step which has especially affected the luxury watch sector.

D'Arpizio also said that some luxury brands had acquired a "negative image" thanks to comments by microbloggers in China and that logos were no longer regarded as so desirable.

"There is a fatigue of the logo business," she told the Financial Times. "Aspirational consumers are shifting to more accessible luxury and premium brands which are also benefiting from the rise of a new middle class."

The fastest-growing region is likely to be South East Asia, where a 20% uplift will be driven by new store openings and the growing strength of second-tier markets.

Japan is anticipated to return to 5% growth and the Middle East to grow steadily as Dubai continues to attract wealthy visitors from Russia, Africa and India.

The Americas are forecast to grow between 5% and 7%, with the US benefiting from economic recovery and an increased focus by luxury marketers on digital channels.

Europe will suffer doubly, as local luxury consumers cut back due to the region's economic difficulties and as the number of Chinese tourists falls.

Bain advised a relentless focus on three luxury goods management principles if brands are to succeed in the next 10-15 years. These included superior customer service, flawless retail management and people excellence.

"We are entering a new phase in the evolution of the luxury market" concluded D'Arpizio. "More markets, more segments, and more diversity of tastes all combine to create more variables to solve for when pursuing the right strategy for growth."

Data sourced from Altagamma, Bain, Financial Times; additional content by Warc staff , 20 May 2013

Dual screening grows in India

BANGALORE: The proportion of Indian consumers who engage in dual screening has more than doubled within the space of a year, according to new research.

InMobi, the mobile advertising network, surveyed 2,004 mobile users in India as part of a wider global study and found that 63% of users were actively spending time on mobile devices while watching TV, compared to just 26% in 2012.

This included 57% users who engaged in social networking while watching TV.

In all, nearly a third of their media consumption time was spent on mobile devices and the survey established that 65% of Indian mobile web users are now as comfortable with mobile advertising as they are with TV or online advertising.

"The tiny mobile phone has overtaken the mighty TV in India from a media consumption perspective," observed Phalgun Raju, Vice President and General Manager, India, and Southeast Asia at InMobi.

Noting the 850m active mobile connections in the country, she commented: "The mobile marketing channel presents marketers an unprecedented opportunity to engage with the always-connected consumers."

"The onus is now on brands and content agencies to create compelling, engaging mobile rich media to capture consumers' attention," she added.

A separate survey from the Associated Chambers of Commerce and Industry of India and Yes Bank predicted that wireless connections would comprise nearly 90% of all internet connections added between 2012 and 2017.

Some 80% of InMobi's respondents noticed mobile ads on their smartphone, while a majority of users, 48%, experienced these ads on mobile apps specifically.

"Our research shows that on average 7.1 apps are actively used by Indian consumers over a 30-day period," said Raju.

"This has huge implications for both publishers and advertisers as they seek to garner an audience for their offerings and monetize through advertising," he concluded.

InMobi's survey also revealed that 79% of Indian mobile web users planned to conduct m-commerce during the next 12 months.

Data sourced from Media Mughals, ASSOCHAM; additional content by Warc staff , 17 May 2013

Hispanic TV adopts celebrity strategy

NEW YORK: Hispanic consumers have been targeted by media companies during the annual upfronts, including one channel recruiting actress and singer Jennifer Lopez as its chief creative officer.

NuvoTV chief executive Michael Schwimmer said Lopez's role would be to generate "buzz around the network" by working on "brand, brand direction, on-air look and feel" as the channel seeks to increase its presence among Hispanic viewers whose primary language is English.

He added that her role was neither "gimmick" nor a "stunt" and that she would play a full part in the channel's strategy as well as appearing in a consumer marketing campaign.

"We're all kind of tired of the stereotypes," Lopez told the New York Times, adding that these reflected who American Latinos once were rather than "who we are now".

Meanwhile, Fox Hispanic Media, which operates four Latino-focused networks and is part of News Corporation, said it would offer "real choice" to Spanish-speaking American Latinos and the advertisers who want to attract them.

Tom Maney, executive vice president of advertising sales, said the media situation was "very complicated" with consumers confused by thousands of messages a day.

Research from Havas Media has shown that 51% of Hispanic adults prefer to see ads in Spanish, while the highest television consumption is found in LatAm Soccer with 63% penetration.

The Latino Influence Project has also noted that the process of acculturation works two ways and that marketers should consider not only adapting general campaigns for the Hispanic audience but should incorporate Hispanic insights into strategies and creative from the beginning in order to influence general market consumers.

Data sourced from the New York Times; additional content by Warc staff, 17 May 2013

Unilever boss wants rethink on Africa

CAPE TOWN: A leading Unilever executive has attacked the "soft tyranny of low expectations" that brands adopt when considering the continent of Africa and called for new business models to drive growth.

"I believe the African consumer has been underestimated and under-served for far too long," said Frank Braeken, executive vice president of Unilever Africa, writing in How We Made It In Africa. And he called for marketers to "break the perception of Africa as a single, unsophisticated, market best served by basic products".

"I can accept that many Africans don't have much money," he added. "I can't accept they are any less intelligent or sophisticated consumers than the rest of us."

He argued that businesses often made "blunt assumptions" about what people needed, while "well meaning but unsustainable business models … simply do not take the African people seriously as consumers".

If a business is serious about Africa, he said, it "needs to become part of efforts to drive equitable and sustainable growth".

He referenced his own work which had, he stated, "underscored to me time and again the enormous energy that can be released by sustainable business models".

He cited the example of black hair care products, which a few years ago had been more easily available in London or New York than in Abidjan or Nairobi.

"And the concept was of 'black' hair as though Africans were all physically and culturally identical," he remarked, noting that this attitude applied in many categories "with few companies bothering to tailor brands to different African tastes or develop better, safer and more nutritious products".

Not many people, he pointed out, had anticipated the mobile phone boom across the continent, which had created a whole new economy because they met people's needs.

"I want to drive the same kind of revolution in retail trade," he declared. Unilever's ambitions, he said were to "double our business sustainably, increase local sourcing and production, and accelerate the development of products tailored to different African markets and aspirations".

"Modern business thinking can drive economies of scale, consumer understanding and product development to provide what poor people want and, by so doing, create new markets," he concluded.

Data sourced from How We Made It In Africa; additional content by Warc staff , 17 May 2013

Mobile games offer marketing prospects

WHITING: Over half of US tablet and smartphone owners play games on their devices and one in ten does so more than once a day, new research has revealed.

The online survey, by Harris Interactive for CouponCabin.com, polled 2,058 adults and found that 51% of mobile owners play games on occasion, with 11% playing more than once a day, 21% at least once a day, 41% at least once a week and 10% once a month or less.

Separately, the Wall Street Journal has reported that users spend on average two hours a day on apps, including games, and this is set to grow.

This is a trend that mobile marketers can exploit, according to Brendan O'Kane, chief executive of mobile analytics group OtherLevels.

In an article for The Fast Company, he suggested that they could utilise the "gamification" employed by the wider gaming industry to good effect.

This could include introducing points scoring into non-games areas of marketing, such as book sales, which he said could drive brand awareness and sales, as well as encouraging users to spend longer on site.

"Fun can blur the line between marketing and entertainment, creating a more compelling experience," he declared.

But spending a good deal of time on gaming can be expensive. Jackie Warrick, senior savings adviser at CouponCabin.com said: "App purchases, even though they're often low priced, should be factored into an overall entertainment budget."

And the survey showed that while 61% of American adults who have paid to download a game over the last year spent no more than $10, 11% had spent over $50.

There is the additional problem of children purchasing apps without permission or by mistake, with 12% of adults surveyed saying their children have bought a game app by mistake, and 10% intentionally without their permission.


Data sourced from CouponCabin, The Fast Company; additional content by Warc staff , 17 May 2013

Spirits brands see digital openings in Asia

BEIJING: Hennessy and Johnnie Walker are among leading spirits brands that have invested in Asian content and mobile loyalty schemes and so elevated themselves to the top of the digital rankings in the region.

In its report Digital IQ Index: Spirits APAC, the thinktank L2 sought to quantify the digital competence of 57 spirits brands across China, Japan and Taiwan and established that Hennessy was in the top spot in all three countries, while Johnnie Walker was second in China and Taiwan, fifth in Japan.

L2 found that brands had underinvested in mobile across the board, despite the widespread use of these devices in the region and only a handful had developed local language apps.

Only four brands, it said, offered a mobile optimised and non-Qwerty-based, age-restricted gateway. These were Glenfiddich, in Japan and Taiwan, Glenmorangie, in Taiwan, Hennessy, in all three countries, and The Balvenie, in Taiwan.

In addition, only Hennessy offered mobile search and even then not in Japan.

Brands were also underinvesting in video, according to L2, noting that two-thirds of those surveyed had no local content on Japanese sites, even though the Japanese consume 1.5 times the global average of video content.

Taiwan fared best in this regard, with 24% of brands providing video content in the local language.

Johnnie Walker, which has targeted the premium whisky market in China, was the only global brand with local language video content in both that country and Taiwan, including material featuring local celebrity Chen Kun to highlight their "Keep Walking" campaign.

Ecommerce was noted as an area that is not open to spirits brands in the US and Europe but has potential in Asia.

Local brands Moutai, in China, and Choya, in Japan, have brand sites with a direct-to-consumer offer, while Suntory, the Japanese drinks giant, has a multi-brand e-commerce destination in China.

Among western brands, Pernod-Ricard and Bacardi host Tmall stores on Taobao, the Chinese ecommerce site.

China has a reputation for counterfeit goods and two local brands, Moutai and Wuliyangye, have taken steps to deal with this, developing digital and mobile tools to help verify a product's authenticity.

Data sourced from L2; additional content by Warc staff, 17 May 2013

Online video drives digital ad growth

LONDON: UK digital publisher advertising revenues rose 16.2% in the first quarter of 2013 compared to the same period in 2012, with online video being the main driver of growth, according to new research.

The Digital Publishers' Revenue Index study, produced by the Association of Online Publishers (AOP) and Deloitte, tracked actual digital revenue across 27 AOP publisher members and found that while 66% of respondents reported positive total advertising growth in the first quarter of 2013, fully 100% of AOP board members expected to see growth in the second quarter.

The strong start to the year was primarily down to online video, which grew four times as fast as other formats, at 56.4% year on year.

Display increased 13.7% while sponsorship was up 12.3%. Recruitment advertising followed on 11.0%, with other forms of classified advertising growing 3.1% during the same period.

"Despite taking a fairly cautious view of growth earlier in the year, Q1 results actually indicate a strong upside for publishers," said Tim Cain, head of research and insight for the Association of Online Publishers.

"This has fuelled a more positive expectation for the coming twelve months," he added.

Howard Davies, Deloitte media partner, noted: "We're starting to see greater optimism across the market and the digital advertising industry continues to grow strongly as new formats and concepts become embedded."

Breaking the figures down further, the B2C sector demonstrated an acceleration in growth: 20% in Q1 2013 compared to 8.7% in Q1 2012. In contrast, B2B growth had slowed to 2.1% from 6% in the same periods, largely due to the slowdown in growth of display advertising for the B2B group.

"The differences between B2B and B2C sectors are perhaps starker than some would expect but probably reflect the shift in the B2B sector towards more data driven revenues," remarked Davies.

While AOP board members were unanimously positive about digital growth in the current quarter, they expected to see the highest increases in the FMCG, Retail, Telecoms, and Automotive advertising sectors over the coming twelve months.

Data sourced from AOP; additional content by Warc staff , 17 May 2013

CORRECTED: Heineken aligns TV and web

NEW YORK: Heineken, the brewer, is looking at ways to align its TV and online marketing, including the production of more original content for online channels and more long-form digital programming.

Ron Amram, Heineken's senior media director, told AdExchanger that most of the brand's advertising remained focused on TV, but added: "What we're trying to do now is have a secondary line of communication, one that's more targeted."

He outlined some of the steps being taken, including more original spots for online and more sponsorships, but came back to the primacy of television.

"The trick is to do all that and still have a unified message that reflects the brand's TV messaging," he said. "That's the balance we're constantly attempting."

He also noted the scale of activity and engagement happening online and the debate about matching media investment with consumer behaviour.

"But it's harder to change brand behaviour without real consumer insight," he stated.

To that end, Heineken is working with Tremor Video, a video advertising technology company, whose head of market strategy, Doron Wesly, explained there were differences in viewing patterns, with engagement rates slightly higher for content made specifically for the web (2.72%) compared to TV content that had been repurposed (2.68%).

He also noted that made-for-web content generated as much engagement with ads as did made-for-TV shows that had been repurposed for the web.

Tremor found that 91% of ads run during repurposed TV content were watched in full compared to 83% of ads shown during made-for-web content.

Heineken's search for balance has also been aided by the quality of online ad inventory which both men observed had been improving in the past two years.

"There is a higher degree of curated sites, for one thing, plus the spending that's flowed into video for the past few years have helped elevate the space," said Wesly.

TV and video were becoming "friends with benefits", he suggested, in a reference to a recent research study undertaken by Tremor Video, which found that video on demand could add to the reach of TV and extend campaign messaging when television advertising is off air.

Heineken's work in this area gives further weight to a recent thinktank report that said the brand was the most digitally engaged beer in the US.

CORRECTION: This story was amended on 22/02/2013. Paragraph seven now refers to differences in viewing patterns for content (not ads as stated in the original). Paragraphs eight and nine add new data.

Data sourced from AdExchanger; additional content by Warc staff , 16 May 2013

Diageo backs premium brands in Asia

SINGAPORE: Diageo, the drinks giant, is continuing to focus on premiumisation across its entire brand range as a driver of growth in the Asia-Pacific region.

Gilbert Ghostine, President of Diageo Asia-Pacific, told analysts that there would be a "particular emphasis on accelerating super and ultra premium price points".

Premium variants were one aspect of this, and he outlined the success of two recent scotch launches targeting specific price points. Johnnie Walker Platinum Label, at $85, sold 100,000 cases, while Johnnie Walker 21 years old, at $100, sold more than 50,000 cases.

He explained that Diageo had also doubled the value of its reserve brands since 2010 and that these now accounted for around 30% of advertising and promotion spend in the region.

He cited the marketing for the launch of John Walker Odyssey, a rare triple malt costing more than $1,000, which involved recreating the journey of ship captains who were paid on commission by the Walker family to sell Johnnie Walker across the world.

As well as generating media coverage and online engagement, he said the campaign had created "an active impact on perception of luxury by associating the brand with the global elite".

In addition to such marketing, he pointed to a "focused and differentiated approach to the critical 4,000 trend-leading outlets in the region". More than 2,000 bartenders had been trained in the company's reserve brands, he added.

Diageo has also opened two of its own "outlets" in China in the form of Johnny Walker Houses. These "embassies for whisky culture" were, Ghostine revealed, "oversubscribed in terms of high net worth Chinese individuals who have expressed interest to visit them".

Further down the socio-economic scale, a growing middle class across Southeast Asia and India was opening up new opportunities for the company's brands.

"We are doing lots of work to understand consumer needs, consumer insights, and we come with variants and brands to meet their expectations," said Ghostine.

He offered the example of Eva, a wine-based ready-to-drink brand launched in Thailand and which "delivers against the female expectations in this market".

Data sourced from Seeking Alpha; additional content by Warc staff , 16 May 2013

Gen Y thinks ahead financially

PENNINGTON: Affluent young consumers in the US have adopted a conservative approach to their finances and are focusing on saving for retirement, according to new research.

Merrill Edge, an online brokerage owned by Merrill Lynch and Bank of America carried out a study of "mass affluents", the 25m US households with investable assets of between $50,000 and $250,000.

It found that 77% of Generation Y, those aged 18-34, planned to grow their retirement savings over the next 12 months.

This was significantly ahead of other financial commitments like investing in the stock market (57%) or making a major purchase such as a car (57%).

Paying down the mortgage was a focus for 45% of Gen Y while 44% expected to contribute more to their children's college fund.

This group started saving for retirement, on average, at the age of 22 and now has $55,000 put aside. They also anticipate a comfortable old age, having saved $2.5m by the time they retire, compared to an average expectation of $860,000.

"Given that many Millennials are delaying their decision to have children and the associated financial responsibility, affluent Millennials have the opportunity to save more and have seen the market improve nicely," Jeff Fromm, EVP at employee-owned advertising agency Barkley, told MediaPost.

But even those with a family were exhibiting prudent financial behaviours. Those in the sample with young children expressed a readiness to cut back on family vacations (47%) or a new car (45%) in order to contribute to a college fund for their children.

The experience of US mass affluent Gen Y contrasts with the UK where people in their 20s and 30s are delaying significant life stages. The average age for taking out mortgages, getting married and having children is getting steadily older, while increased numbers of people aged 20-34 continue to live with their parents.

Separate research released recently by the Future Foundation has noted an increase in offers from financial services firms to Gen Y consumers with the explicit aim of helping young customers reach important landmarks.

Data sourced from MediaPost, Merrill Edge; additional content by Warc staff , 16 May 2013

Nigerian ecommerce has local twist

LAGOS: The Nigerian middle class is taking to the internet to purchase brands like Samsung, Ralph Lauren and Zara from Amazon-style websites, which have had to adapt their business models to local conditions.

"It's not so much there's this appetite for online shopping, as that there's an appetite for shopping," said Sim Shagaya, who set up Konga.com less than a year ago.

"Retail here is still mostly informal, fragmented and inefficient," he explained to the Financial Times. "People want convenience, which gives us the opportunity to leapfrog with e-commerce."

Growing internet penetration – up from 6.8% in 2007 to 28.4% in 2011 according to the International Telecommunications Union – is helping fuel an e-commerce boom but one that has a particularly home-grown flavour.

"We have captured a lot of early adopters, but there's a much larger market out there that still needs to be educated about buying online," said Tunde Kehinde, joint managing director of Jumia Nigeria, a rival to Konga.com.

The way Jumia goes about this is to equip a sales team with tablets and send them out to businesses, churches and homes to show potential customers what they can buy. This includes a range of brands that the company has struck agreements with, such as LG, Samsung, BlackBerry, Nokia, Ralph Lauren and Zara.

As well as mobile phones and clothing, these sites typically sell household goods, books, DVDs, toys and cosmetics.

Other Nigerian twists include cash-on-delivery, since online payment is rare as many people do not have bank cards and are, in any case, concerned about fraud. Ecommerce sites have also had to build their own delivery fleets because the postal service is unreliable.

While Konga and Jumia stock a large range of items, specialist sites are looking to corner particular markets.

Olumide Olusanya set up Buycommonthings, an online grocery store that delivers the same day to customers in Lagos, the Nigerian capital.

"Everything has come together at the right time for e-commerce here," he said. "We are still paddling ahead of the wave, but when it comes it is going to be huge."

Data sourced from Financial Times; additional content by Warc staff , 16 May 2013

Indian car advertising lacks creativity

MUMBAI: Indian marketing executives have criticised the current quality of advertising for the nation's automotive brands.

"We haven't seen powerful stories being told by car brands," Avers Sourabh Mishra, national planning head and group chief strategy officer, Bates CHI & Partners, told the Economic Times.

In a reference to a campaign for the Volkswagen Vento, he added that it was clear the category was facing a creative challenge when a talking newspaper was the "creative high point" for an iconic brand.

Data sourced from Economic Times, Financial Times; additional content by Warc staff, 16 May 2013

Italian adspend plummets

MILAN: Italian advertising expenditure fell sharply in the first quarter of 2013 with leading businesses anticipating this trend will continue at a slower pace in the second quarter.

Total advertising for the quarter amounted to €1.6bn, an 18.9% drop on the same period in 2012, according to latest figures from Nielsen, the measurement company.

Only two areas escaped declines of this magnitude. Internet advertising rose 2.1% to reach €120m, while outdoor advertising increased 8.4% to €20m.

Otherwise, the figures were bleak. Television advertising, which accounted for over half of all advertising expenditure, fell 19.1% to €906m.

Press advertising suffered most, falling 24.8% compared to a year earlier. Dailies fared worst, down 26.1% to €227m, but periodicals were not much better, slipping 22.3% to €126m.

Radio advertising was down 19.2% to €77m and cinema down 19.9% to €6m.

Nielsen's figures were released as Italian broadcaster Mediaset was reporting a 19% drop in gross advertising sales in Italy in the first quarter and warning that the decline would continue, although at a slower rate.

"The trend is forecast to remain negative, with probably a high single-digit fall," said Luigi Colombo, head of Mediaset's Italian advertising arm Publitalia.

Mediaset's Spanish operations were also under pressure as gross television advertising revenues there declined 13.6% in the first quarter.

The company was cautious about making any long-term predictions, beyond indicating that ad sales could perhaps stabilise in the coming months.

But it argued that "the scarce visibility, uncertainty and economic instability in the two countries do now allow us at present to make reliable forecasts regarding the evolution of advertising sales on a yearly basis".

Data sourced from Bloomberg, Reuters, 4-Traders, Gazzetta del Sud; additional content by Warc staff , 16 May 2013