Digital drives strong UK ad growth

21 April 2015
LONDON: Digital growth across all channels helped the value of UK advertising increase 5.8% in 2014, the highest rate of growth since 2010 according to data from the Advertising Association and Warc.

Full-year figures from the Advertising Association/Warc Expenditure Report – a definitive measure of advertising activity in the UK, being the only source that uses advertising expenditure gathered from across the entire media landscape – show that UK advertising revenues hit £18.6bn last year.

Internet advertising (+15.0%) and mobile (+58.9%) continued to grow strongly but digital advertising through traditional channels also took-off in 2014.

Broadcast video-on-demand (+15.1%), digital national (+16.4%) and regional (+24.7%) newsbrands were stand-out performers but the upward trend was also reflected in magazines and outdoor.

"It's time to stop thinking of digital as something that lives on the internet," declared Tim Lefroy, chief executive of the Advertising Association.

"In cinemas, outdoor, news, television and elsewhere, advertising is seizing the opportunity of new technology – that trend is transforming our media, driving growth and keeping UK advertising ahead of the global competition."

Mobile now accounts for just over 22% of internet spending on £1,623m (up from a 10% share in 2012) and the report expected this share would increase to just over one third by 2016, with growth rates of 43.8% and 34.2% forecast for the next two years.

TV spot advertising benefited from last summer's football World Cup, increasing 5.4% year on year to reach £4,463m. But growth is expected to slow to 4.4% in 2015 before starting to pick up again in 2016, to 4.6%.

Broadcaster VOD, which advanced 15.1% in 2014, is set to pick up more rapidly in subsequent years, with AA/Warc predicting increases of 17.2% and 20.6% for 2015 and 2016 respectively.

Out of home adspend rose 3.0% last year to pass the £1bn mark for the first time, helped in no small part by a 27.3% growth in digital revenue, which now accounts for over a quarter of the total.

While digital ad revenues had risen rapidly at national newsbrands (+16.4% to £214m), this was not enough to offset the decline in print (-7.7% to £1,156m).

The Report did see an end in sight, however, as continued digital growth was slowing the overall decrease in spending, to -1.8% in 2015 and just -0.2% in 2016.

A similar picture emerged among regional newsbrands, although with total adspend projected to decrease -3.7% this year and -2.4% in 2016 this sector will not have bottomed out by the end of the forecast period.

Total UK adspend is set to grow at 5.6% in 2015 and 5.4% in 2016, by when it will have exceeded £20bn.

"Overall growth of 5.8% last year was the strongest since the start of the economic recovery in 2010," James McDonald, research analyst at Warc, noted. "We expect this to maintain, with one of the best growth periods forecast for more than a decade.

"Two in every five pounds spent on advertising in 2014 were via digital channels. With digital aiding growth across all media, brands and marketers have been chameleon-like in their adaptation to new technology."  


Data sourced from AA, Warc

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Consumers expect greenness from brands

21 April 2015
GLOBAL: Three quarters of consumers globally expect brands and companies to be environmentally responsible, with around two thirds claiming to only buy products and services that chime with their own beliefs and values, according to new research.

GfK asked over 28,000 people aged 15 or older across 23 countries about how strongly they agreed with specific statements, and found that few were willing to disagree with the idea that brands and companies should be environmentally responsible.

Only 6% felt brands do not have to be, compared to the 76% who thought the opposite. And around three in ten (28%) said they 'strongly' agreed that brands ought to have a green approach.

And the most vociferous support was to be found in perhaps unexpected quarters: in Brazil 47% strongly agreed, while the comparable figures for Turkey and Russia were 46% and 40% respectively.

The highest overall agreement came in Asia, where almost all consumers in India (94%) and Indonesia (93%) give their backing to the notion of brands' obligations to the environment.

And when it came to their own actions, some 63% of consumers globally said that they only buy products and services that appeal to their beliefs, values or ideals.

Once again the greatest level of agreement was to be found in India, where 94% claimed to only buy such products, well ahead of the next nearest countries – Indonesia (78%) and Ukraine (78%). Indian consumers were also most likely to agree strongly with this (47%).

Clearly there is a disconnect between what people say they do and what they actually do, and at least sometimes they are aware of that.

On the question of personal responsibility, nearly two thirds (63%) of consumers internationally said they felt guilty when they did something that was not environmentally friendly, including 17% who agreed strongly this was the case.

And it was 15-19 year olds who showed the highest percentage in this regard, at 18%, indicating greater awareness amongst teenagers than previous generations that protecting the environment is a personal responsibility.

Data sourced from GfK; additional content by Warc staff

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Video streaming beats TV

21 April 2015
NEW YORK: Three quarters of US owners of connected TVs say streaming video offers a viewing experience at least as good as traditional television, while a significant proportion also cite the relative lack of advertising as another plus.

For its new report, The Changing TV Experience: Attitudes and Usage Across Multiple Screens, the Interactive Advertising Bureau (IAB) carried out an online survey among 651 adults and subsequently conducted discussions with 13 participants in an online forum.

The results showed, said Sherrill Mane, svp/Research, Analytics, and Measurement at IAB, how "connected TVs and multiscreening are irrevocably altering TV viewing".

One in three adults now owns either a smart TV or a device that streams video to their TVs. And two in five (38%) of those individuals spend at least half their TV viewing time streaming video to their television.

Half of connected TV owners reported that viewing experience was as good as traditional TV while one quarter said it was better.

Greater control of their viewing (cited by 33%) and better selection of content available (29%) were among the factors leading them to this view, but advertisers will also note that half of connected TV owners were streaming content because there are fewer commercials, while 40% considered commercials on these platforms to be less intrusive than standard TV ads.

And the streaming trend is growing fast: over a third (35%) of connected TV owners are now streaming more video to their TV than a year ago. One in four smartphone and tablet owners, and one in five computer owners, said the same.

Meanwhile, one in five adults (19%) stated they were watching less traditional TV year-over-year.

Alongside this, the study's results confirmed an upswing in multiscreening, with 40% of smartphone users saying they have increased such activity over the past year. The rise year-over-year was similar for tablet users (39%), with a solid increase among computer users (28%) as well.

Overall, fully 78% of US adults are now simultaneously using another device while watching traditional TV, with browsing the internet being the most popular activity across devices and smartphones serving as the predominant second screen.

And a significant portion of the actions they are taking relate to the TV shows or commercials they are watching, whether discussing with friends or looking for product reviews.

Data sourced from IAB; additional content by Warc staff

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Carlsberg aligns consumer and shopper

21 April 2015
SINGAPORE: Brands need to avoid a "pendulum" approach to marketing, where their focus swings between the shopper and consumer, and instead ensure that insights around both are aligned with brand equity, according to a leading industry figure.

Priyadarshini Sharma, international brand director for Premium Brands, Asia at Carlsberg, explained that the brewer had for some time been investing in shopper marketing, as regulatory issues in various Asian markets preclude traditional ATL approaches.

"It's important for us to be able to talk to our consumers in the only forum where we can reach them – in-store," she told Singapore's Marketing magazine.

"You have less than five seconds to intercept a shopper on a mission, hold their attention and close the sale with your message," she noted, which meant looking at the creative development process in a different way.

But Sharma cautioned that putting all one's efforts into shopper marketing could mean missing out on those consumer insights that help build brand affinity.

Brands, she advised, need to have a balance, "keeping in mind how your path-to-purchase works and leveraging the right insights for each touch-point".

And there should be consistency across those touchpoints – she recalled examples of brands seeking to build a premium image in their advertising but then presenting a quite different picture in-store with poor quality executions or excessive discounting.

"The other thing to understand is that consumer and shopper behaviour is not the same thing, even if you're referring to the same person," Sharma said.

So, for example, enlisting the services of a movie star might be ideal for projecting a certain image for a beer, but driving sales at the supermarket requires a little more: "they need a reminder on the price or chilled availability rather than just seeing the movie star on a poster".

Data sourced from Marketing; additional content by Warc staff

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Shell Lubricants taps media flexibility

21 April 2015
CHICAGO: Shell Lubricants has boosted its marketing flexibility via corporate trade – an approach that converts pre-planned media buys, products or other assets into cash and credits to spend on brand programs.

Mark Pyle, brand and communications manager at Shell Lubricants – which boasts a portfolio including Pennzoil and Quaker State motor oils – discussed this approach at IEG's 2015 Sponsorship conference in Chicago.

He outlined various initiatives the company had pursued with The Midas Exchange, a firm that buys assets – from ad inventory, sponsorships or even cars and buildings – from clients, and takes control of placing pre-planned media in return.

One way to use this strategy, he reported, is a "cash deal", whereby the client gets up to full book value for assets in the form of funds which are then directed to new marketing initiatives. (For more, including further examples, read Warc's exclusive report: Shell Lubricants: Making media the new oil.)

Exchanging assets, whether in the media space or physical objects like "old and slow products", for trade credits is another possible application of this approach.

For example, Shell Lubricants has sold $1.2m of its planned cable TV advertising to The Midas Exchange, and used the cash to support an activation at South By Southwest 2014 on behalf of Pennzoil.

Based on guidelines provided by MediaCom, a media agency network owned by WPP, The Midas Exchange then placed over $10m of ads as a component of the deal.

At this stage, The Midas Exchange makes its money by securing better rates than were anticipated in the original media plan. Media guarantees and audits are also put in place for the client, which pays no extra fees.

As these efforts can ultimately outperform the original media plan, it is possible for brands to generate even greater value from their investment through corporate trade, according to Pyle.

"I would have spent ten [dollars] anyway, but now I've got nine dollars of media, I've got the ten-dollar value and I have a dollar left that I can spend on something else," he said.

Such an approach is often seen in the same light as media bartering, a tactic that has traditionally left marketers with concerns about the quality of the inventory they are likely to receive.

But as The Midas Exchange is part of GroupM, WPP's media arm, it can access swathes of trends, costs and futures data, as well as tapping its parent's significant in-house expertise and buying power.

"Typically, barter media is confused with remnant media," said Pyle. "That's not the kind of media we're talking about."

Data sourced from Warc

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Gas savings go on groceries

21 April 2015
JACKSONVILLE, FLA: With the US enjoying low gas prices, many Americans are choosing to spend the money they save on filling up their vehicles on groceries instead according to new research.

The latest edition of The Why? Behind the Buy report produced by sales marketing agency Acosta, based on research using a nationally representative random sample of US shoppers via its proprietary ShopperF1rst online survey, highlighted the impact of lower fuel prices on shopping habits.

The effect was most pronounced among millennials, fully 72% of whom intended to redirect any savings on fuel into grocery spending.

Colin Stewart, svp at Acosta, said that consumers had reported saving an average of $67 per month, which was being spent instead on food and groceries, paying bills and going out more.

Brands and retailers could convert those extra dollars into incremental sales, he advised, with a better understanding of current shopper behaviours and purchase drivers.

"Grocery shopping has become a complex, consumer-centric matrix of options as Americans have more choices today than ever before," he added.

The research showed that the average shopper had visited about seven different store locations to buy groceries in the past six months. And while most were still focused on a regular supermarket (95%), "the generational tide is turning with Gen X and Millennial shoppers".

These groups are showing more in drug stores, convenience stores and natural/organic grocers than total US shoppers.

Many shopping decisions are not made until entering a store: around 70% of shoppers make category shopping decisions at home but 55% don't decide what brand to buy until they are in the store itself.

There is a certain degree of brand loyalty but most shoppers (65%) will simply switch if the specific item they want isn't available. One in five will wait until their next shopping trip and 11% will go to another store.

Data sourced from Business Wire; additional content by Warc staff

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Brands can't ignore net neutrality debate

21 April 2015
NEW DELHI: Marketers cannot afford to sit on the sidelines of the current debate about net neutrality, which observers suggest has itself had an impact on the brands most directly involved.

Brand consultant Harish Bijoor told Best Media Info that Airtel and Flipkart had come close to becoming "the poster boys of the 'biased-net' movement". And even though they had retreated from their original positions, "both brands have a canker on them as of now".

Santosh Desai, MD and CEO of Futurebrands India, agreed that their brand images had been affected but doubted there would be any long-term damage, partly because they were well-established brands and partly because "only a certain portion of their audience has an issue" with the subject.

Ecommerce business Flipkart last week stepped back from talks with telco Bharti Airtel about using its Airtel Zero platform, which would see Flipkart users access its app contents free, the company paying the data charges involved.

Airtel CEO Gopal Vittal has meanwhile emailed customers outlining the company's position and affirming a commitment to net neutrality, although campaigners have been quick to dismiss his claims.

Impact laid out the implications for marketers of not having net neutrality, which it said would make things more difficult for brands both large and small.

For the latter, it explained, "there is the prospect of being unable to meet the financial standard set by the giants in your field", which would be able to pay for priority bandwidth.

Larger brands, meanwhile, face taking a hit on ROI and profitability if they have to pay for users' data charges.

"For an international brand, this could get a bit complicated," Impact noted, "as each ISP around the globe will have to be paid in order to ensure that customers always have access to the brand's products, services and content at reasonable speeds at the regional level."

At the same time, it pointed out that new opportunities could arise. If brands were subsidising access to a platform like YouTube, non-ad-supported services like Vimeo could well embrace the option, so opening up new inventory to media buyers.

"Ultimately a brand could end up with a higher proportion of all screen time available to advertisers and the ISPs could spend the incremental revenue and reinvest in providing bandwidth so that consumers have a great experience. That could be a decent value exchange."

Data sourced from Best Media Info, Economic Times, Exchange4Media, Impact; additional content by Warc staff

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Brands 'must respond' to Google change

20 April 2015
LONDON: Brands need to get the technical basics right, improve their content and adopt responsive design if they are to make the most of tomorrow's change to Google's algorithm, an SEO expert has said.

Addressing an event organised by the UK's Content Marketing Association (CMA), Britt Soeder, head of owned media at iProspect, the digital agency, said that brands should take into account the fact that people performing searches on mobile devices do not spend so much time reading results as those browsing on a desktop.

"Make sure you have everything that's important in your first paragraph if you can," she advised. (For more, including all of Soeder's guidance for brands, read Warc's report: Three SEO issues every brand should know about: the view from iProspect.)

Google's latest algorithm update, which was announced in a blogpost earlier this year and comes into effect tomorrow (April 21st), is set to include mobile responsiveness as a key ranking criteria – meaning that publishers with non-mobile-optimised websites could see their search performance suffer.

Specifically, websites using responsive design – and therefore look good on screens of all sizes – are set to benefit from the algorithm change.

Soeder pointed out that Google has also offered some general pointers on what type of content is boosted by the algorithm, and what is penalised.

"The user focus is really important," she explained. "Whenever you publish content, make sure it's for the user, not the search engine. Content is king. When I joined the search industry eight years ago, nobody believed that – it was all about buying links. Now it's about publishing something great."

In other words, organic, rather than paid, link-building is therefore the way to go. "Backlinks are still an important ranking factor, though if I had to say if that's going to be the case in 10 years' time? I don't think so," Soeder added.

She also told delegates at the CMA event to disregard SEO myths, such as "keyword density" – that there is an ideal ratio of keywords to content.

"If you've been scared by this, don't be," she said. "There are no given rules on keywords."

According to its latest financial report, $59.1bn of Google's $66bn revenues in 2014 were from advertising. Within the advertising total, $45bn was derived from Google's own websites.

Data sourced from Warc

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Mums shift to mobile

20 April 2015
LONDON: Mothers in the UK spend more time on their smartphones than on laptops or watching television, according to new research which also reveals they are doing more shopping online and making use of money saving offers.

For its 2015 State of Modern Motherhood Report, parenting website BabyCentre surveyed mothers with children aged 0 to 8 across five countries – the US, Brazil, Canada, China and the UK – including 1,880 in the UK, of which 953 were millennial mums aged 18 to 32.

It found that the smartphone has eclipsed the laptop as the go-to digital device for this group: 93% are regularly using smartphones compared to 76% using laptops.

Mums are also spending twice as long on this device – an average 2.1 hours a day on their smartphone as against 1 hour on a laptop; this is also more time than the 1.9 hours they spend with live TV.

Motherhood brings with it some changes in attitude towards advertising. Nearly three in five millennial mums said they are now more likely to skip TV commercials.

This particular age group did, however, were more attentive to digital ads. The research found they were 26% more likely than General X mothers to pay attention to digital ads and 51% more likely to pay attention to ads on their smartphones.

Motherhood and pregnancy also shifts shopping habits, with half shopping at different retailers than before, while 60% shopped online more; 44% said they regularly bought things using the mobile web or apps on their tablet.

Six in ten (62%) were also using mobile in-store, mostly to look for better prices. In a related finding, three quarters of respondents said the sorts of ad most likely to grab their attention were those featuring deals, sales or other money-saving offers.

"With millennials making up the majority of new mums, brands and agencies need to think of this valuable demographic as tech-savvy and mobile-first, if they want to earn their interest and loyalty," said Julie Michaelson, BabyCentre Head of Global Sales.

"This means building mobile into the centre of their advertising plans and specifically designing for these platforms, rather than using cut-down television or rich-media campaigns."

Data sourced from BabyCentre; additional content by Warc staff

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Red Bull Media House opens doors

20 April 2015
CHICAGO: Red Bull Media House is giving third parties the chance to tap the content expertise which fuels the marketing for its namesake energy drink – an opportunity that has attracted brands like adidas and Nokia.

Alexander Koppel, Red Bull Media House's chief commercial officer – a standalone firm responsible for Red Bull's content efforts – discussed its evolution and approach at IEG's 2015 Sponsorship conference in Chicago.

"What is probably new and worthwhile noting is that we are now engaging – large-scale – in sponsorship and in brand partnerships," he said. (For more, including how storytelling forms the basis of these tie-ups, read Warc's exclusive report: Red Bull Media House opens its doors to brand partners.)

"We're allowing third parties to access a very engaged audience – and what I believe is a very attractive target group."

One operator quick to take up such an offer was adidas, which last year became the first third-party brand to run a campaign on Red Bull Media House's digital properties with its "Open All Winter" initiative.

Elsewhere, Nokia has allied with Red Bull Photography in order to show off the capabilities of the cameras featured on its Lumia smartphones.

Founded in 2008, Red Bull Media House has its own targets – financial and otherwise – to hit. But it is able to draw on many of the strengths possessed by the beverage business it supports.

"In today's world, we're competing for audience and we're competing for advertisers at the same time. We are a true global company, built on the backbone of a phenomenal organisation in 67 countries," said Koppel.

"So it's not separate; it is well-integrated. And I think this is making us unique: it is offering and allowing you as a client – [or] as a potential client or us as a Media House – to access these phenomenal resources.

"What we set sail for is creating an independent media company … Our focus is to compete for audience and advertisers and create phenomenal storytelling."

As an indicator of its success in this endeavour, Koppel reported that the Media House boasts nearly 500 commercial partnerships on the content side alone.

"We have hundreds of clients now globally. We have established a licensing business, a rights business," he said. "So, we're growing the business."

Data sourced from Warc

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China's automakers fight back

20 April 2015
SHANGHAI: China's automakers are fighting back against the widespread perception that they are of inferior quality to foreign brands, with a range of new models incorporating local and overseas design to be unveiled at the Shanghai Motor Show.

"Chinese manufacturers are managing to improve their product quality and design quickly and make them almost comparable to international brands while keeping their price much lower," according to John Zeng, an industry analyst at market intelligence firm LMC Automotive.

And the strategy appears to be paying off: Geely, which acquired the Volvo brand in 2010, reported the number of vehicles sold under its own brand jumped 57% in the first quarter.

SINA listed similar advances at other Chinese automakers, with February sales at Changan up 78% on the previous year, while Great Wall Motor's Haval brand was up 79%.

Foreign brands have also been losing some of their shine recently, being criticised for overcharging at service centres, while Jaguar Land Rover was accused of knowingly selling models with faulty gearboxes.

Overall, LMC said, Chinese brands now accounted for 43% of the country's light vehicle market, up from 38% at the same time last year.

The new approach being taken by Chinese firms is evident in Geely's Borui sedan, which it will be showing at this week's Shanghai Motor Show. The company described it as a "true international car brand in terms of design", with input from a 200-strong team across studios in China, Sweden, Spain and the US.

Zeng highlighted the price – around 110,000 yuan ($18,000), compared with 170,000 yuan to 300,000 yuan ($28,000 to $49,000) for a similar foreign brand sedan. "That basically is providing the market with a mid-size car at the price of a compact car," he said.

The design process is also working in the opposite direction as overseas brands start to develop models aimed specifically at sections of the Chinese market.

Nissan, for example, will unveil the Lannia, a mid-size sedan it described as its "first product specially created for the youth generation in China." And Volkswagen also intends to show a new model designed for this country.

Data sourced from SINA English; additional content by Warc staff

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US TV ad market bright

20 April 2015
NEW YORK: The US advertising market rose only slightly in the first quarter of the year but when the impact of last year's Winter Olympics is stripped out a much brighter picture emerges, new data has shown.

Figures from Standard Media Index (SMI), the advertising data group which captures 80% of the total national ad spend from global agencies, showed that the overall market was 1% up in Q1 2015 compared to the same period a year earlier.

And when it excluded the effects of the Sochi Winter Olympic Games, held in February 2014, SMI said that Q1 TV revenues showed "solid growth" in both broadcast (+7%) and cable (+4%).

In particular, advertisers had boosted their spending in the scatter market across both broadcast (+13%) and cable (+9%), with the overall scatter market up 11%.

"A nice uptick in scatter dollars fuelled national TV growth in March, which is certainly a good sign for the health of the ad marketplace," said Scott Grunther, SMI's executive vice president of media.

"The solid growth figures when you remove the impact of the winter games from last year provides reason for networks to be more optimistic heading into upfront season," he added.

SMI's data also showed that, in addition to TV, digital had contributed significantly to the growth of the overall ad market, registering a 23% increase for the quarter in Q1; digital's market share of total ad dollars also jumped five points.

This increase had been driven mostly by ad networks and ad exchanges which rose 39% in Q1, alongside large increases in social networking sites (+41%) and pure play video sites, such as YouTube.com and Hulu.com (+38%).

Automotive, the largest advertising category, remained soft, down -3% for the quarter, while consumer electronics and business services and recruitment both jumped +17% to emerge as the fastest growing categories.

In other media, ad spend on magazines declined by -7% and on newspapers by -2%. Radio was also on the losing end with advertisers dropping off by -1%, but there was better news for out of home as ad revenues rose by +1% in Q1.

Warc's Consensus Ad Forecast, based on a weighted average of predictions from various sources including advertising agencies, media companies and industry bodies, expects growth in US adspend of 3.5% this year, with a further rise of 6.0% forecast next year.

Digital is seen to be the key driver this year, with 15.4% growth, while TV adspend is expected to record milder growth of just 0.7%.


Data sourced from SMI; additional content by Warc staff

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Mobile banking popular with cognoscenti

20 April 2015
NEW YORK: Mobile banking is increasing popular with those people already using it but few new customers are coming on board a new study says, and few are bothered about using mobile devices to make in-store purchases.

A survey by banking data and analytics service RateWatch gained responses from 711 adult US consumers as it sought to understand consumers' use and views of mobile banking as well as the burgeoning service of mobile payments.

The resulting report, Mobile Banking, Mobile Payments, showed that, over the past two years, the number of people using mobile banking rose only 2%, but the number of those using it at least once a week climbed from 37% to 45% over the same period.

Overall, around eight in ten financial institutions offer a mobile banking service, but more than one third (36%) of consumers say they are still not using it.

Those who are using these services are more likely to be graduates and to be in the younger age groups. Those aged 18-29 are more likely than any other to access online banking multiple times per day while those 45 and older are most likely to have never accessed online banking.

And it may be some time yet before the ubiquitous phone takes over from the old-fashioned wallet. Just one third of those surveyed were interested in making in-store purchases with their mobile devices.

The features of mobile banking that held most attention were more traditional: checking account balances, transferring between accounts, paying bills and receiving account alerts.

The fact that respondents were also keen to locate ATMs suggests the role of cash isn't about to disappear just yet.

But the report expected that, as long as safety concerns are addressed, consumers would continue to increase their demand for mobile banking.

And as that happened, Kimberly Myszkewicz, marketing manager at RateWatch, noted that "it will become even more crucial for banks to offer mobile services, or risk losing customers to competitors".

"The more a person is engaged in the service, the more likely they are to stick with that institution for other services," she said.

Data sourced from RateWatch; additional content by Warc staff

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IPL viewership surges

20 April 2015
NEW DELHI: Two months of non-stop cricketing competition have not dulled the passion of India's cricket fans as viewing figures for the India Premier League (IPL) have surged ahead alongside IPL merchandise sales.

Data from TAM Media Research, the audience measurement firm, show that the average television viewership rating (TVR) for the opening games of this year's season was 4.4, a 42% increase on the figure for the first five games of last year's competition, IPL7. 
 
And the Financial Express noted that more people were watching games on Multi Screen Media's Sony Max, which carries a Hindi commentary, than on Sony Six, the dedicated sports channel of the broadcaster which has an English language commentary.

Additionally, MSM's new sports channel Sony Kix is broadcasting games in Tamil and Telugu feeds, while a Bengali feed is available on Sony Aath.

This strategy emulates the approach taken by Star India during the recent ICC Cricket Word Cup, when it offered feeds in four languages to attract more viewers and more advertisers.

The enthusiasm for IPL8 is also being felt by sports merchandisers who are reporting significant increases in orders. According to the Economic Times, sales of IPL merchandise are expected to grow 30% on last year.

And while the greatest volume of sales will take place at match venues, most of the growth will come in ecommerce, as fans in lower tier cities purchase jerseys, caps and armbands.

Partnerships between teams and ecommerce sites are helping boost sales. "The tie-up blends well with the customer segment and our target, which is the male in the age group of 18-35 years," explained Vishal Sharma, vp/operations at Shopclues, the official e-commerce partner for Chennai Super Kings.

"This also helps to increase our reach," he said, adding that Shopclues had seen 200% year-on-year growth in orders from tier II and tier III cities.


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

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Mobile leads desktop in UK

17 April 2015
UK: This year will see a tipping point in the media consumption habits of UK adults as the (non-voice) time spent on mobile devices overtakes that spent on desktops and laptops.

The latest estimates of media consumption from insights provider eMarketer indicate that during 2015 UK adults will spend an average of 2 hours and 26 minutes a day on mobile compared to 2 hours and 13 minutes on desktop/laptop.

Since 2011, time spent on the latter has increased by only a few minutes each year, while that spent on the former has leapt ahead between 20 and 30 minutes every year.

Most of the time spent on mobile is with smartphones – 62% in 2015, the same as in 2014 – while tablets make up the majority of the time left. Feature phones are still being used, however, accounting for a consistent seven minutes of the total in recent years.

Bill Fisher, analyst at eMarketer, highlighted a particular trend that had informed the figures.

"UK adults aren't moving their media consumption habits to digital platforms at the expense of traditional ones; rather, they are adding it to their overall media day," he explained.

"This also holds true for platforms like social media, with time spent via mobile adding to time spent via laptops and desktops."

Taken together, time spent on digital, at 4 hours and 39 minutes in 2015, is now well ahead of that spent on non-digital television, at 3 hours and 12 minutes (a two minute drop on 2014 and a seven minute drop since 2011).

That equates to almost half (48.6%) of the time spent daily with major media. Smartphones alone account for 15.8% of media time with tablets on 8.4%.

And while time spent with tablets will continue to lag that spent on smartphones, the gap is slowly closing: eMarketer said the time spent with them was growing faster than the time spent with smartphones, although the rate of increase was slowing as the tablet market matured.

Data sourced from eMarketer; additional content by Warc staff

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One in ten ads blocked

17 April 2015
LONDON: As many as one in ten digital ad placements are blocked from being served on unsuitable websites according to soon-to-be released research.

Integral Ad Science, a company supplying media evaluation intelligence and technology, said that 11% of ads it monitored in the UK were stopped from appearing on sites alongside content that advertisers deemed inappropriate, Marketing reported.

The issue has gained prominence following a story in the Sun newspaper which said it had found ads for leading brands, including British Gas and O2, on sites "devoted to paedophilia, incest, bestiality and racism".

A recent survey suggested that marketers have not been greatly worried by this aspect of programmatic technology.

When Infectious Media polled senior marketers across Europe in February, they were most concerned about a lack of transparency around financial matters (65%) and the complexity of the ecosystem (55%). Issues around brand safety were mentioned by only 25% of respondents.

That attitude may now be changing given the adverse publicity. As MediaPost noted: "It's one thing to be embarrassed by being seen on a 'paedo' site, it's quite another to realise that your brand name is financially supporting it."

Niall Hogan, the UK managing director of Integral Ad Science, said this highlighted the need to work a content verification vendor, adding that he was aware of "many instances where buyers only choose to use the basic monitoring tool set because they feel that the full suite is cost prohibitive".

But he argued that the full costs were not that much greater and could prevent a much worse scenario.

"We are talking about a difference in pennies in the CPM here, not pounds," he said. "I am sure that each of the brands singled out in the [Sun] article would happily pay a small difference for the full blocking capabilities of the technology now."

The UK's Joint Industry Committee on Web Standards awards brand safety seals to companies that declare and independently verify how their processes minimise the chances of ads appearing next to inappropriate content.

Data sourced from Marketing, MediaPost; additional content by Warc staff

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Auto buyers ready to purchase online

17 April 2015
NEW YORK: Three quarters of car owners looking to purchase a new vehicle are ready to do everything online, from research to negotiation, financing and delivery, according to a new survey that identifies after-sales as a particular area in need of improvement.

Consulting firm Accenture polled 10,000 car owners in eight major countries – Brazil, China, France, Germany, India, Italy, Japan and the US – found that 80% percent of respondents in the market for a new car are using some form of digital technology to research their buying preferences.

And some 62% are already initiating the car-buying process online, including consulting social media channels, before entering a dealership.

There appears widespread enthusiasm for taking the digital approach further, as 75% of drivers polled said they would consider conducting the entire car-buying process online.

Accenture said this indicated a need for manufacturers and dealers to increase their focus on online engagement with consumers.

The research highlighted several areas where consumers felt improvements could be made, including making online research easier by delivering more tailored information and offering more virtual demonstrations.

The one thing that consumers around the world were least interested in was having an online chat with a dealer.

This aversion to talking to dealers extended to the showroom itself as more than half of respondents (53%) said they would be interested in using an interactive touch display that provides information on the available models, while 48% liked the option of taking a virtual test drive when there.

One of the weakest links in the digital car-buying experience, survey respondents felt, was the after-sales process. Accenture said addressing this is critical, arguing that poor performance in this area can make or break brand loyalty.

"The impact of the digital customer is becoming pervasive, disrupting the traditional car-buying experience and the competitive landscape," said Christina Raab, global managing director for Digital Consumer Services in Accenture's Automotive practice.

"In order to grow business in this environment, OEMs and dealers will need to pursue an aggressive digital strategy online, in the showroom and in after-sales, while creating a seamless, integrated experience to accommodate all customer needs."

Data sourced from Accenture; additional content by Warc staff

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India now a multi-sport nation

17 April 2015
MUMBAI: Cricket remains by far the most popular sport in India, but the growth of the overall sports industry is being driven by football, kabbadi and tennis according to a new report.

The Sports Sponsorship Report 2015, from GroupM ESP and Sportzpower, looked at trends and developments in advertising and sponsorship, and said that the sports industry was worth Rs. 48,069m in 2014, a 10% increase on the previous year.

This increase is largely down to the emergence of various new sports leagues which are driving consumer interest and attracting brands, including football's Indian Super League, the Pro Kabaddi League and World Kabaddi League, the Champion's Tennis League and Indian Premiere Tennis League.

These saw the value of their team sponsorship and franchise fees leap 1,064%, from Rs. 70m to Rs. 745m.

"Sports marketing is finally coming of age in India,” declared CVL Srinivas, GroupM South Asia CEO. "Even though cricket has shown the way and continues to be the dominant sport, newer leagues are helping broad base sports and make it a great platform for brands.

"Digital, especially social media, is helping build a fan following much faster,” he added.

For example, the well-established IPL had over 550,000 social conversations last year the report said, while the ISL had around 200,000 conversations even though it was only in its first season.

But a comparison of sponsorship generated by these two sports illustrates just how far football still has to go to rival cricket in the nation's affections: cricket's on-ground sponsorship stood at Rs. 4,647m in 2014, while that for football was Rs. 500m.

The role of digital will be extensive, as the report noted a blurring of lines between digital and TV with, for example, the ICC Cricket World Cup attracting 25m views on digital.

It also suggested the in-stadium experience would become more social, pointing out that 70% of cricket fans brought a mobile device with them and would likely be using it during games.


Data sourced from IndianTelivision.com; additional content by Warc staff

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Apple Watch clocks 6% purchase intent

17 April 2015
NEW YORK: Around 6% of US adults have indicated their intention to buy an Apple Watch, with almost 1m having pre-ordered the device since that became possible a week ago.

Ipsos polled 1,829 US adults online from April 8–14 about the latest addition to Apple's portfolio, and found that men were twice as likely as women to express a clear interest in buying one (9% v 4%).

Reuters noted that these figures equated to possible US sales of 15m in the first year, while analysts' estimates have ranged between 10m and 32m globally.

The highest interest in the Ipsos panel was among men aged 18–29-years-old (34%), and the same group gave the watch the highest "cool factor" at 53%, compared to an average of 42%.

But the most likely buyers were 30–39-year-olds, some 13% of whom said they planned to buy an Apple Watch, compared to 10% of the younger group.

And while iPhone owners were the most likely buyers – 15% of this group intended to buy one – some 8% of non-owners said they would consider switching to an iPhone in order to purchase an Apple Watch.

Van Baker, an analyst at tech research firm Gartner, said it was likely that many potential buyers would wait until the second version of the watch appeared.

"We may see a high level of interest. Apple will sell a few million fairly quickly, but then things might flatten out a little," he said.

Separately, Simon Farthing, head of consultancy at Profusion, the data science consulting firm, cautioned that the combination of wearable tech and data science raised a host of ethical and strategic issues.

Writing in Marketing, he posited a scenario in which marketers could work out, via raised stress levels, poor sleep and a combination of other behaviour, that a couple's relationship was in trouble, and then target them with divorce, reconciliation and dating services.

"Highly targeted ads that leverage very personal information from wearable devices will be one of the marketing industry's biggest ethical challenges and opportunity over the next few years," he said.

Data sourced from Reuters, Marketing; additional content by Warc staff

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Aussie outdoor passes newspapers

17 April 2015
SYDNEY: Outdoor was among the strongest performing advertising media in Australia during March and has overtaken newspapers in terms of expenditure by main media agencies.

Latest figures from Standard Media Index (SMI) show that total media agency ad spend for March was up 1.9% to A$653.4m; for the first quarter overall it increased 4.3% to A$1.7bn, Mumbrella reported.

Within that, outdoor advertising in March was 26.1% up on a year earlier at A$68.7m. And over the whole of the first quarter outdoor revenues rose 16.1% on the previous year to a total of A$178.5m, for the first time putting it ahead of newspapers.

The Outdoor Media Association itself recently reported first quarter ad revenues up 22.4% to a total of A$149.4m.

Print media, meanwhile, continued their downward path during March, with newspapers tumbling 15.8% year on year and magazines 19.7%.

Radio also grew during the month, up 12% to A$55.5m, as more people tuned into local commercial radio, while cinema benefitted from a strong movie release schedule ahead of the Easter holidays and leapt 46.8% to A$5.4m.

Television spend was flat, registering a marginal 0.4% increase to A$310.3m, while digital rose 4% to A$133.8m.

The particular interest in television was the elevation of the Nine Network to the top position in terms of advertising revenues. Its 41% share put it ahead of rival Seven, on 37.2%.

This was almost a reversal of the situation a year ago, but Nine's boost may be only temporary, given that it has benefitted from its coverage of the ICC Cricket World Cup which Australia won, and from the start of a new rugby league season.

Warc's Consensus Ad Forecast, based on a weighted average of predictions from various sources including advertising agencies, media companies and industry bodies, expects the growth in Australian outdoor adspend to be 4.4% this year, ahead of the all-media growth of 2.7%


Data sourced from Mumbrella, The Australian; additional content by Warc staff

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Aflac Duck takes flight on social

17 April 2015
AUSTIN, TX: Aflac, the insurance provider, has successfully given its duck mascot a voice on social media – and thus translated the engagement its avian ambassador generates on TV into a range of online opportunities.

Kip Havel, Aflac's vp/communications and content marketing, discussed this subject at South By Southwest (SXSW) in Austin, Texas.

And he reported that giving its much-loved spokesbird a presence on platforms like Twitter, Facebook and Instagram has added a significant new dimension to the character.

"You've seen the Duck in quirky situations, you've seen it doing things on TV," he said. (For more, including details of the brand's "Duck dossier" that guides its strategy, read Warc's exclusive report: Giving Aflac's Duck a voice on social media.)

"But social and those channels really give us an opportunity to take a look at where the Duck lives, what does it do on a daily basis, and how can you take its humour in ways we never could on TV, and extend it.

"With social media and the ability of the Duck to 'type' its thoughts and take pictures of where it's going every day allows for new areas to be explored. I think we're really just scratching the surface of it."

As the Duck has only said Aflac's name in TV spots over the last 15 years, one extension of its personality has involved vocabulary. And its on-screen antics gave an indication of what form its digital lexicon should look like.

"The Duck is this pop-culture icon who likes to have fun, is a bit witty [and] sarcastic," said Havel.

Having secured over 635,000 "likes" on Facebook, as well as 68,000 followers on Twitter and a fan base of nearly 2,000 people on Instagram, the appetite to hear from Aflac's mascot is evident.

But in order to retain that interest, Aflac must carefully manage which subjects it discusses. "The Duck is not going to speak about healthcare reform. That's not the Duck's place," said Havel.

"We know where the engagement levels are very high is when you see the Duck talking about what it might have had for dinner last night or what trip it is taking."

Data sourced from Warc

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'Pet condom' campaign wins at REGGIEs

17 April 2015
CHICAGO: San Francisco's Society for the Prevention of Cruelty to Animals (SPCA) took the top "Super REGGIE" honour at the 2015 REGGIE Awards for a "pet condom" campaign devised with agency Geometry Global.

Organised by the Brand Activation Association (BAA), the REGGIE Awards are an annual competition seeking to recognise the best campaigns activated by brands and agencies.

The San Francisco SPCA received the top prize for installing what looked like a dispenser of free condoms for pets in a park in its home city.

People using this contraption, however, actually received brochures – albeit in the shape of condoms – talking about the option of spaying and neutering.

In just 36 hours, this effort had attracted 30,000 visitors to the organisation's website, secured 2,500 Facebook shares and generated social buzz in 166 countries – as well as becoming the number one trending topic on Reddit.

Alongside the "Super Reggie", the campaign claimed Gold in the "Best Cause, Green or Corporate Responsibility Marketing Campaigns", "Local, Regional Market Campaigns" and "Small Budget Campaigns – Budget less than $250,000" categories.

It also garnered a Silver in the "Experiential Marketing Campaigns – Budget under $1 million" category.

Bonnie Carlson, BAA President and CEO, remarked that many of the judges had said of the winning campaign, "I wish I had thought of this myself" – the ultimate compliment from very senior agency executives, she added.

The REGGIE Awards were presented on the final night of the BAA's annual Brand Activation Showcase in Chicago, where a total of 70 awards were presented across 23 different categories.

Formerly known as the Promotion Marketing Association, the BAA was founded in 1911 and became a division of the Association of National Advertisers (ANA) in July 2014.

Data sourced from BAA; additional content by Warc staff

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Marketing outlook positive

16 April 2015
LONDON: UK marketing budgets increased at an accelerated pace in the first quarter of the year, according to a new report which also says the overall growth registered during the 2014/15 budget year was the best in a decade.

The Q1 2015 IPA Bellwether Report, researched and published by Markit Economics on behalf of the Institute of Practitioners in Advertising and based on original data drawn from a panel of around 300 UK marketing professionals, revealed that budgets rose for the tenth successive quarter.

A net balance +11.8% of companies registered an increase in budgets during the quarter, almost twice the +6.1% figure of the previous quarter and almost back to the levels seen in Q3 2014.

Overall growth for the 2014/15 budget year was the best recorded since 2004/05 with a net balance of +21.8% of companies indicating that budgets had risen over the 12-month period.

The highest upwards revisions to marketing budgets in Q1 2015 were made to internet, recording a net balance of +8.4%. Events budgets were also revised higher, recording a net balance of +5.7%, as were direct marketing (+5.5%) and main media advertising (+2.9%). 

Sales promotions was only just in positive territory (+0.6%) while 'other' (-7.1%), PR (-1.8%) and market research (-1.3%) all recorded downward revisions.

"While many commentators await to see what form Britain's post-election economic landscape takes, marketing executives seem to be shrugging off any uncertainty," remarked Paul Smith, senior economist at Markit and author of the report.

The outlook for the coming budget year appears equally positive, with a net balance of +28.0% of panellists forecasting an increase in their marketing budgets relative to 2014/15.

This is the most upbeat assessment signalled by the panel for eight years, according to the IPA, and all Bellwether categories are forecast to gain, with events and main media advertising predicted to be the greatest beneficiaries.

Overall, the Bellwether survey predicted a real-term increase in UK adspend of +4.2% in 2015 before growth cools slightly in 2016 to +3.6%.


Data sourced from IPA; additional content by Warc staff

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Google faces abuse claims

16 April 2015
BRUSSELS: Europe's competition commissioner has moved to take action against internet giant Google in regard to its search practices, while the music industry has accused its YouTube video-hosting service of abusing copyright law.

Google Shopping is the first target of commissioner Margrethe Vestager, who said the company was exploiting its dominant position in search to achieve higher rates of growth to the detriment of rival comparison shopping services.

"I am concerned that the company has given an unfair advantage to its own comparison shopping service, in breach of EU antitrust rules," she said. "Google now has the opportunity to convince the commission to the contrary."

And, in what the Financial Times said could become "a defining competition case of the internet era", she indicated that EU investigations were ongoing as regards other Google services.

The concerns are not restricted to Europe, however, as Vestager made clear US companies had also complained about Google's practices.

At the same time Vestager announced the opening of an investigation into Google's Android mobile platform amid allegations it forces handset makers into uncompetitive contracts if they want to use its software.

Earlier, the International Federation of the Phonographic Industry (IFPI), the body representing the world's biggest record labels, said YouTube was one of several digital platforms that were abusing certain exemptions to copyright law.

Frances Moore, IFPI chief executive, identified "a flaw in the legislative environment" which prevents internet service providers and hosting companies from being liable for copyright infringement by users – so-called "safe harbours" – having only to remove infringing content when notified by a rights owner.

YouTube is "abusing the safe harbours in order to not pay for full licences," she argued, pointing out that it and other digital platforms enjoying these exemptions paid $641m in revenues to record companies in 2014, less than half that paid by subscription services like Spotify and Deezer.

While the IFPI wants the system reformed, removing the safe harbour exemption would place the copyright onus back on the digital platforms. But the sheer volume of material being uploaded to such sites – more than 300 hours of video are uploaded to YouTube alone every minute – means it is impractical, if not impossible, for any platform to check every piece of content.

Data sourced from Financial Times; additional content by Warc staff

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Experiments trump tests: BBDO chief

16 April 2015
NEW YORK: Brands seeking to understand consumers may benefit from using live experiments rather than relying on more traditional forms of testing, according to Andrew Robertson, president/ceo of the BBDO agency.

Robertson discussed this topic while speaking at the Advertising Research Foundation's (ARF) Re:think 2015 conference in New York.

"In 'testing,'" he said, "what you're trying to do is get people to respond in an artificial environment to a stimulus that, you then extrapolate, will result in something else." (For more, including four ways data is enhancing marketing, read Warc's report: BBDO's Andrew Robertson: experimenting trumps testing.) 

"With 'experimenting,'" by contrast, "you actually put it out there. You see what happens. You either adjust, kill or double down on the work that you're doing."

If "testing" has typically represented the dominant mode of behaviour for brand custodians, that situation is being transformed by digital platforms and data.

"We're going to be able to experiment much, much more efficiently than we'll be able to test. So we'll do much more of it," said Robertson.

The specific factors driving such a shift include the ability to implement and assess different strategies at speed, providing for near-immediate insights into the most successful tactics.

"We'll be experimenting, measuring and optimising against real returns on that investment as measured by the stuff that matters – like what's selling – in a way in which we've never been able to do it [before], and proving, or otherwise, whether the work is working," said Robertson.

As evidence of these trends in action, the new demands of experimentation are already "changing the way we're working with each other," Robertson suggested."The media agencies and creative agencies have to work much more closely now than they ever have before," he continued.

"By definition, there are so many more options now. But having upfront clarity on the things that we should do – rather than on the things that we could do – has never been more important."

BBDO Worldwide was recently named as the best agency network in the Warc 100, which tracks annual performance in effectiveness and strategy competitions. More information on the rankings is available here.


Data sourced from Warc

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Consumption patterns shift in China

16 April 2015
BEIJING: Retail sales in China grew at a slower rate in March than the first two months of the year, but at the same time an official noted consumers shifting away from the bottom end of the market.

According to data from the National Bureau of Statistics, retail sales rose 10.2% in the last month of the quarter, compared to 10.7% in the first two (and 12% for the whole of 2014), leaving overall Q1 growth at 10.6%, Xinhua reported.

Rural retail sales were increasing faster than those in urban areas, at 11.6% compared to 10.4%, reflecting disparities in income growth: per capita disposable income for rural people was up 10% in this period, while that for urban residents rose 8.3%.

Online retail sales of goods and services continued to grow strongly, at 41.3% in Q1, but this was down on the 2014 annual figure of 49.7%.

Sheng Laiyun, a spokesman for the National Bureau of Statistics, felt that consumption patterns were shifting, with people more willing to buy high-end products and services.

"We have never lacked areas for consumption growth, the problem is how to fully achieve that potential," he said.

At the top end of the market, however, some participants have bemoaned the "democratisation of luxury" and the encroachment of premium brands into their territory, arguing that this creates confusion for buyers.

One panellist in a discussion reported by Campaign Asia-Pacific also accused luxury brands of having "grown fat and lazy" during the years of double-digit growth and not being prepared to cope with the new normal of single-digit growth.

China's economic future may include a round of job cuts, according to the South China Morning Post, which noted that China had recorded its slowest quarterly growth in six years – the 7% for Q1 is the same as the annual target of the year – and warned that any further slowing could lead to job losses as companies tackled high financing costs.

Data sourced from Xinhua, Campaign Asia-Pacific, South China Morning Post; additional content by Warc staff

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Millennials seek financial independence

16 April 2015
DES MOINES/AUSTIN: The majority of US millennials think young adults should have cut the purse strings to their parents by the age of 25 and more than half want a credit card by the age of 20, according to two new surveys.

The Principal Financial Group polled more than 800 people aged 23 to 35 for its Millennial Research Study and found that 83% felt that adults should be financially independent by the time they're 25; just over one third (35%) favoured a lower limit of 21.

Cellphone bills turned out to be the expense most often picked up by parents, ahead of car and health insurance and rent or mortgage payments.

Almost half (46%) reported that the financial topic they struggled most with was the basic process of living from paycheck to paycheck.

Some people might choose to use credit cards if they experience difficulties in making it to the next payday, but a separate survey of 1,000 adults for CreditCards.com found that more than one in three 18-29 year-olds have never had a credit card, although six in ten (58%) believe they should have their first card by 20.

"Millennials' financial views were forged during the Great Recession and in the apocalyptic job market that they and their friends have faced," said Matt Schulz, CreditCards.com's senior analyst.

"That skittishness has pushed them away from credit cards towards debit and prepaid cards."

Interestingly, Principal's research also found that the millennials' preferred method of interacting with companies was email, which was far ahead of postal mail, social media, phone calls, online chat, text messages or in person.

Over 40% chose this route whether contacting financial institutions (43%) or retailers (47%), compared to just 2% who opted for social media when contacting a financial institution, rising to 6% for a retailer.

Marketing Land noted that email had the advantages of being dependable and device-agnostic, while at the same time serving as an arm's-length tool that prevented brands from "trespassing" on personal networks. 

Data sourced from Principal Financial Group, Marketing Land, Credit.Cards.com; additional content by Warc staff

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M&A focus shifts from brands

16 April 2015
CAMBRIDGE, MA: Strong customer relationships are more highly valued than brands, according to an analysis of a decade of mergers and acquisitions.

Christof Binder, CEO of Swiss IP business Trademark Comparables, and Dominique M. Hanssens, Professor of Marketing at the UCLA Anderson School of Management, looked at data covering over 6,000 mergers and acquisitions worldwide between 2003 and 2013.

Writing in the Harvard Business Review, they reported that brand worth had almost halved as a proportion of enterprise valuation between 2003 and 2013, falling from 18% to 10%.

Over the same period, however, customer relationship values had doubled, climbing from 9% to 18%, with all other categories of intangibles remaining stable.

"Acquirers have decisively moved from investing into businesses with strong brands to businesses with strong customer relationships," said Binder and Hanssens.

They suggested that this trend was being "powerfully reinforced by digital technologies" which not only enable marketers to have more direct engagement with consumers at lower cost than traditional branding and media campaigns, but are also more effective.

And, coming from the other side, the easy availability of information means consumers are more likely to make purchase decisions based on facts rather than simply brand image.

"Customers still value strong brands, but what constitutes a strong brand is now more dependent on customers' direct experience with an offering, and with their relationship with the firm that produces it," they said.

And, while this suggested marketing resources might be better deployed away from brand building to reinforcing relationships, they cautioned against going too far down that road.

"Brand equity needs to stay strong to perform its overall integrative role," they said, adding that strong brand communications would still be important in attracting new customers.

They also hoped their analysis might lead to a "reality check on some of the gigantic brand values now published by leading brand valuation companies".


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

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India fails to innovate in FMCG

16 April 2015
NEW DELHI: Out of almost 17,000 product launches in the FMCG sector in India in 2012, a mere 23 can claim to have been a success according to a new study.

The second India Breakthrough Innovation Report from researcher Nielsen looked at 16,914 new launches across 80 FMCG categories in 2012 and decided that just 0.14% could be classified as Breakthrough Innovation Winners, compared to around 0.2% in 2011.

Winners needed to score on three counts: demonstrate relevance by generating first-year sales in the top 0.5% of all new FMCG launches; demonstrate endurance by generating revenues in the top 0.5% after 18 months; and demonstrate distinctiveness by delivering a new value proposition to the market.

Nielsen director Amit Bali noted that overall sales from new launches were down: In 2011 the year one benchmark for the top 0.5% was equivalent to Rs 125m but in 2012 this had fallen to Rs 105m.

The Economic Times highlighted five reasons why the great majority of FMCG innovations fail to take hold, the first being that marketers are often looking in the wrong direction.

"The trend in India of late is that consumers take a backseat," said Prof Prashant Mishra of the Indian Institute of Management Kolkata. "This in spite of a lot of talk about consumer-driven innovation when it's in fact driven internally or by competition."

"India is one of the fastest growing FMCG markets compared to similar ones in Asia Pacific or Australasia but many of the innovations are either focused on trying to bring in a value for money offering or line extensions," he added.

Other factors include a failure to build thinking about innovation into the everyday running of an organisation, a tendency to become trapped by existing ways of thinking about markets and consumers, taking an overly narrow category view, and not allowing enough time for significant innovations to come to market.

Hindustan Unilever emerged as one of the most successful innovators with five winners, including Tresemme shampoo, Lifebuoy Clini-Care soap, Pepsodent toothbrush and Pepsodent Expert Protection toothpaste and Rin Ala Fabric Whitener.

Data sourced from Economic Times; additional content by Warc staff

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Touchpoint numbers stymie brands

15 April 2015
LONDON: The growing number of touchpoints is a significant obstacle in the way of companies and brands fully understanding the customer journey according to new research.

Market researcher Econsultancy, in association with call analytics service provider ResponseTap, polled almost 2,000 marketers and ecommerce professionals around the world for its report, Understanding the Customer Journey: More Than Just Online.

This found over than one third (35%) saw the complexity and number of touchpoints across the digital and physical worlds as the major barrier to their attempts to join up the customer journey.

Just 12% of companies rated themselves as being 'advanced' at understanding the customer journey, compared to 51% who said they were 'intermediate' and 32% who classed themselves as 'beginner'. A further 6% described their understanding as 'non-existent'.

Only a few were using a variety of methods for joining up online and offline customer journeys, including loyalty schemes and point-of-sale data collection. And less than half of companies with call centres were using telephone call tracking as a way of connecting online and offline.

Econsultancy also reported that there had been little improvement in the integration of channels within organisations since a Multichannel Customer Experience survey it had carried out four years ago: 38% of responding companies said the "customer journey is understood but with little management across touchpoints".

Bhavesh Vaghela, ResponseTap CMO, suggested this lack of progress might be due to marketers being overly focused on digital to the detriment of more traditional channels.

Indeed, almost half of responding companies (47%) said the digital part of the business was driving customer journey initiatives, twice the proportion of companies citing 'traditional marketing or other offline parts of the business' (23%).

Among offline channels, call centres were most frequently used, by 66% of responding companies, although only 28% were using them to map website visitors and customers who are engaging both online and offline.

"It is becoming essential to make the link between all the businesses' activities," Vagehela declared. "It's now, or never."

Data sourced from Econsultancy; additional content by Warc staff

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Online video to surge in MENA

15 April 2015
DUBAI: The online video category is set to grow "exponentially" in the Middle East and North Africa in 2015, according to an industry figure, with other key trends including the rise of programmatic buying, more ad-free content models and precision marketing.

Writing in Gulf News, Jochen Bischoff, digital director at media buying group SMG, observed that online video was benefitting from faster consumer connectivity, superior media ROI and innovation in video formats.

And he expected that competition for video budgets would only increase as various social networks weighed into the battle to take money from traditional TV budgets.

At the same time, however, regional channels such as BeinSports, OLN.tv and Dubai.tv are looking to expand their TV audiences online in order to ensure they don't lose out.

Bischoff also noted that penetration of smart TVs in MENA is forecast to hit 40% of households in 2015, "hinting at the role connected systems will play in distributing digital messages on TV sets".

He predicted that programmatic media buying would become "the fastest growing lane in MENA's digital industry" as the focus shifted from "performance advertisers" to more mainstream brands and as more premium publishers developed their programmatic offering.

And he also anticipated the region's media owners would explore the possibilities of ad-free content models, following the trend set by the likes of Netflix and Spotify. Already Shahid Premium and Anghami Plus offer regional examples of, respectively, video on demand and music streaming apps that offer an ad-free service to subscribers.

Marketers would also, he suggested, have to respond to the greater levels of transparency made possible by mobile.

For example, some 90% of Saudi mobile consumers and 60% of Egypt's use their phones to check prices and product reviews while shopping, Bischoff reported. And, as a consequence, three quarters had interrupted a purchasing process.

Marketers would therefore have to "turn in-store media efforts into precision marketing" while at the same time ensuring "positive experiences for consumers making product and service queries and comparisons".

Data sourced from Gulf News; additional content by Warc staff

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AOL moves to simplify digital

15 April 2015
NEW YORK: AOL is consolidating its brand portfolio and is launching an open, unified programmatic platform in what it claims is a significant step towards simplifying the digital ad space for marketers, agencies and publishers.

The introduction of the ONE by AOL programmatic platform is aimed at assisting marketers in their efforts to optimize against campaign goals across all screens, formats and inventory types.

At the same time, the various offerings within AOL's technology stack, from its data management platform to Adap.tv, are being rebranded under the ONE by AOL banner.

A digital dashboard allows marketers to assess the impact and ROI of their advertising and look at how varying budget allocations across media might affect any particular campaign.

Bob Lord, AOL president, said the new platform would help solve real business problems for marketers. "ONE allows advertisers and agencies to use data as the foundation of their marketing strategy," he explained, "looking at consumers through a single, media-agnostic lens, from Web to TV.

"Connecting audience data to media exposures throughout the purchase path lets brands accurately measure return on their marketing dollars," he added.

AOL is keen to stress the open nature of the platform – the various components can be combined with those of third parties, allowing brands to customize their own programmatic platforms while maintaining control of their own data – but the Wall Street Journal said this was also the case with the ad technology offered by Google and Facebook.

And while the idea of a simplified, single ad platform is theoretically attractive, some observers sounded a note of caution.

"Whether this product is explicitly biased or not, if I'm a sophisticated marketer, and I think technology is integral to what I do, I'm going to wonder if it makes sense to have a media seller make recommendations on where I spend money," said Bryan Wiener, chairman of the digital agency 360i.

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

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Net neutrality debate raises passions

15 April 2015
NEW DELHI: The future of internet access and usage in India has become a topic for heated debate in recent days, with activists issuing calls to "save the internet" following a decision by the regulator to explore whether telecom firms should be permitted to charge different rates for different uses of internet data.

The Telecom Authority of India (TRAI) is reported to be receiving 10,000 emails a minute in support of the concept of net neutrality.

A further twist has been the launch by the country's largest telco, Bharti Airtel, of Airtel Zero, a platform where companies can let users browse their sites or use their apps for free by paying for consumers' data charges.

Campaigners argued that this would play into the hands of bigger businesses which could afford to carry that cost and restrict the opportunities of startups and innovators so leading to the slowing of the growth of ecommerce.

One major ecommerce business has already pulled out of the platform: Flipkart had been in discussions about joining but, facing a backlash from consumers, announced it was "walking away" from the talks and committing itself to "the larger cause of net neutrality in India".

In a statement, the firm said: "We will be working towards ensuring that the spirit of net neutrality is upheld and applied equally to all companies in India irrespective of the size or the service being offered and there is absolutely no discrimination whatsoever."

In an argument that has become very polarised, some commentators have sought to introduce a more nuanced discussion. Live Mint, for example, pointed out that "India's debate on net neutrality is in danger of confusing anti-competitive practices with legitimate price discrimination".

Thus, there is a difference between charging more for services that use more bandwidth and allowing a business to pay fees to gain an advantage over its rivals.

At the other end of the spectrum from the campaigners bombarding TRAI with emails are those who view a free market as the best way of enabling innovation and ensuring that as many Indians as possible can access the internet.


Data sourced from Business Standard, Live Mint, Forbes; additional content by Warc staff

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Brand integrations key for Subaru

15 April 2015
HOLLYWOOD, FL: Subaru, the automaker, has seen considerable success from integrating its brands into various content on TV and the web – thanks in large part to following a three-point formula in this area.

Brian Cavallucci, national advertising manager for Subaru of America, discussed this subject at the Association of National Advertisers' (ANA) 2015 Media Leadership conference in Hollywood, Florida.

And he reported that a trio of factors largely shape whether a candidate for media integration is ultimately appropriate for the brand.

"First, we look for ways to incorporate [the] Subaru product organically into relevant content," he said. (For more, including how dogs also shape the firm's strategy, read Warc's exclusive report: Subaru's dogged brand integrations boost results.)

Alongside the desire to see its vehicles assume an authentic position in any content they feature in, another goal involves enhancing any existing messages the company has in the market.

"We want to provide natural and interesting extensions into our brand initiatives," Cavallucci told the ANA delegates.

Building on both these points, the third aim is to identify opportunities where Subaru constitutes a uniquely good fit.

"We also want ideas that are authentic, natural, seamless and uniquely Subaru. If you could 'insert any car here', we generally walk away from it," Cavallucci said.

Oftentimes, he revealed, the proposals Subaru is presented with lack a creative edge and instead fall back on an all too familiar trope.

"What we're all looking for is a good idea," Cavallucci continued. "We want something that's creative. It's got to be unique. It's got to be authentic.

"If I see one more media proposal about a road trip … I think I might throw up on my desk. You have to find something that really resonates with the audience – something that's new.

"But it also has to fit with the brand, not only the partner that's creating the content."

Data sourced from Warc

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Singapore women lead dual screening

15 April 2015
SINGAPORE: Women in Singapore are enthusiastic users of their smartphones while watching television and are also significantly influenced by ads on pay TV, new research has shown.

The latest iteration of High Heeled Warriors, an ongoing research study into the media habits of the modern Asian woman conducted by media and entertainment business NBCUniversal, revealed that 75% of Singaporean women use their smartphones while watching TV, the highest level of any nation in Southeast Asia.

Their actions ranged from "liking" a brand to tweeting about a TV show, posting comments on a fan page or simply chatting to a friend. Overall around one third (35%) of Singaporean women were multitasking, simultaneously watching TV and looking for more information about the shows they were viewing.

The research also found that 42% were influenced by ads on pay TV when making purchase decisions.

Their reasons for turning on the TV included entertainment, information and inspiration. Genres and themes on drama (55%), cooking (48%), celebrity news (32%), hair, make-up and make-overs (41%) were found to resonate well with Singaporean women.

They also admired and related to characters and celebrities that embody success, career-mindedness, ambition and independence, while having a strong sense of family and community at the same time.

And with US programming the most watched content in the city state, a fictional female such as Detective Olivia Benson in the crime series Law & Order: SVU proved especially popular.

That particular show appears on the women's channel DIVA, but pop culture channel E! is also widely viewed by women and both dominate major consumer categories for advertisers who want to engage with this group.

"We now know how the Singaporean High Heeled Warrior engages with content, her preferred formats and the various themes that resonate," said Christine Fellowes, managing director, Universal Networks International, Asia-Pacific.

She added that these findings meant "clients can connect more deeply with female consumers and drive even more measurable business outcomes through strategic advertising and sponsorships".

Data sourced from Marketing Interactive; additional content by Warc staff

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Brand brilliance shines through

15 April 2015
NEW YORK: Activision, Divvy, Kind and Always have been named as the winners of the 2015 Brand Brilliance Awards.

The Brand Brilliance Awards, organised by the Brand Activation Association (BAA), itself a division of the Association of National Advertisers (ANA), recognize the most influential and dynamic brand marketers across four categories: Brand Activation, Industry Impact, Legacy and Creativity.

Activision took the top spot in the Brand Activation category for its innovative, multi-year support for its Call of Duty video game.

In the past, particular Activision campaigns have been recognised, with, for example, the one that launched 'Call of Duty: Modern Warfare 3' winning a Grand Effie in 2013. This sought to engage both existing hardcore gamers and an older audience of lighter gamers who wouldn't typically see Call of Duty as a game for them.

The Game Changer Award went to Divvy/Motivate for its bike sharing business model. Divvy is Chicago's bike sharing program owned by the city's Department of Transportation – with 3,000 bikes and 300 stations – and operated by Motivate, a firm with a track record in such schemes across the US.

KIND Snacks picked up the Hero Brand award for its efforts making the world a better place while simultaneously building the legacy of the brand.

Its KIND Movement has been running for some years now, beginning as a way of encouraging individuals to surprise others with unexpected acts of kindness and progressing to a community of like-minded people invited to carry out specific KINDING missions.

The Inspiration Award was taken by Always, the Procter & Gamble feminine hygiene brand, for its Like a Girl programming.

This shifted the traditional approach to such products – featuring scientific demonstrations or idealised imagery – to address the loss in confidence girls often feel when going through puberty. Core messaging, based around the tagline "Like a Girl", aimed to reframe how people used this expression, making it a term of empowerment.


Data sourced from ANA; additional content by Warc staff

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TV decline accelerates

14 April 2015
NEW YORK: Television is falling out of favour, experiencing double-digit declines in usage around the world as consumers increasingly turn to various digital devices to view video content according to a new study.

The world's love affair with the TV may be coming to an end, declared consulting firm Accenture as it unveiled the findings of online research conducted among 24,000 consumers in 24 countries for its Digital Video and the Connected Consumer report.

It said that video consumption – anytime, anywhere – has become mainstream and is accelerating the decline of traditional TV viewing. Specifically, viewership for long-form video content, such as movies and television on a TV screen, declined by 13% globally over the past year and by 11% in the US.

Similarly significant declines were noted for a category thought to be relatively immune from this trend: sports viewership on TV screens declined by 10% globally and by 9% percent in the US.

And this development was evident among all age brackets, although, as one might expect, it was most obvious among the younger ones.

Thus, 14 to 17-year-olds globally were abandoning the TV screen at the rate of 33% for movies and television shows and 26% for sporting events.

This rate of decline slowed among 18-34 year olds to 14% for movies and television shows and 12% for sporting events. And the next age group, 35-54 year olds, showed a similar drop-off, at 11% and 9% respectively.

The over 55s were the slowest to change, with just 6% moving away from the TV to watch movies and shows, and only 1% doing the same for sports.

Gavin Mann, Accenture's global broadcast industry lead, described this as "a definitive pendulum shift away from traditional TV viewing" and pointed to improved streaming and longer battery life as important factors.

"The second screen viewing experience is where the content creators, broadcasters and programmers will succeed or fail," he stated.

But consumers were not enjoying a trouble-free experience on those second screens. Just over half of those watching online video (51%) complained about a poor internet service, while 42% complained about the volume of advertising. In fact, respondents indicated a willingness to pay for their online video service if it included greater content variety, less advertising and better video quality.

The research also found that respondents showed a preference for the dominant TV broadcaster, satellite and cable providers over newer internet providers.

Data sourced from Accenture; additional content by Warc staff

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Britons stick to a few trusted websites

14 April 2015
LONDON: When it comes to content discovery and online shopping, more than half of online Britons rely on a handful of trusted websites or recommendations from friends rather than surfing the internet, according to new research.

Global media agency Carat analysed data from its Consumer Connection System – a proprietary research and insight tool surveying 11,000 British consumers and their media habits – to show that 55% of internet users in the UK only used two or three sites when purchasing or looking for content, a trend that has major implications for publishes and advertisers.

The top five trusted sites for content in the UK, according to Carat, included three belonging to broadcasters – BBC, BBC Online and ITV – as well as retail giant Amazon and search engine Google.  

The study also revealed that 41% of people felt overwhelmed by the wealth of choice on the web, making it harder for them to decide what to buy.

And 26% of respondents felt the volume of information on the net made it hard for them to find what they were looking for when shopping online.

Consequently, many are turning to friends for advice. One third preferred to trust friends' recommendations on social media rather than ads. Further, 44% of users said they looked at content uploaded by friends at least once a week and 29% of people checked posts shared by friends at least once a day.

This was especially true of Millennials, 49% of whom trusted personal recommendations from friends more than ads; 33% indicated they would visit a site if recommended via a social network.

Commenting on the findings, Dan Hagen, Chief Strategy Officer at Carat, said "This opens several interesting opportunities and challenges for brands.

"Smart content, and crucially, distribution strategies combined with innovative approaches to partnership can help advertisers redefine their content strategies, cutting through this noise to deliver the right content to the right person at the right time, driving real business value."

Data sourced from Carat; additional content by Warc staff

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Most retailers lack mobile strategy

14 April 2015
LONDON: Many physical UK retailers regard mobile with suspicion, fearing the impact of showrooming, and two thirds have no clear strategy on how they will invest here, according to new research which predicts consumer spending via mobile will quadruple in the next decade.

A survey for Barclays bank polled 1,500 UK consumers and 221 retailers and found that seven in ten retailers did not yet offer consumers the option of shopping via a mobile website or a mobile app. And just over two thirds (68%) admitted they had not developed a clear plan to invest in this area.

A mere 3% of those retailers surveyed thought their business could be described as being at the cutting-edge of mobile readiness, The Drum reported.

Richard Lowe, managing director and head of retail and wholesale at Barclays, acknowledged that many retailers continued to be wary of mobile but argued that they needed to embrace it.

"Inevitably practices such as 'showrooming' lead to some sales shifting online," he said, "but, with almost three quarters of consumers using their mobile devices whilst out and about, ignoring this trend would be a missed opportunity."

He pointed to the success of hybrids such as click and collect as evidence that the physical high street store still had a fundamental role to play.

"Retailers must cater for the mobile consumer in order to remain relevant," he added.

And what the mobile consumer is looking for from retailers, the research suggested, is primarily wifi: more than half the consumers surveyed (57%) wanted free wifi hotspots, while four in ten (42%) said they were always looking out for such places.

Barclays also forecast that consumer spending via mobile devices would increase from the current figure of £9.7bn a year to £53.6bn over the next ten years, or almost 14% of retail sales.

Add in the impact of related areas, from browsing products to paying at the till, and mobile is expected to play a role in 42% of all retail sales by 2024.


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

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New Asian markets driven by youth

14 April 2015
ASIA: Laos is set to be one of the fastest growing markets in Asia in over the next fifteen years, with consumer spending predicted to triple between 2015 and 2030, driven by a combination of youth and urbanisation.

A report from research firm Euromonitor International – Markets of the Future – pointed to five markets in Asia to watch. As well as Laos, it named Bangladesh, Cambodia, Myanmar and Sri Lanka as the region's next generation of consumer markets.

A number of factors were referenced in addition to the obvious requirements of economic growth and poverty reduction. Modern retail formats, for example, are emerging and leading to a wider range of consumer goods becoming available.

But these countries also shared other characteristics, mostly having younger populations and faster growing urban populations than others in the region.

Bangladesh, for example, is expected to add 1.6m urban inhabitants every year between 2015 and 2030, with a consequent increase in demand for packaged food. Euromonitor highlighted the categories of dairy, baby food and confectionery, all of which are expected to more than double between 2014 and 2018.

Laos, meanwhile, has the youngest demographic profile, with a median age of 21.7 in 2014 and more than one third of the population aged under 14. Despite the high birth rate, relatively little is being spent on baby food ($2.07 per capita) and baby care products ($0.27).

Such low spending levels mean, said Euromonitor, that "companies must understand the trade-off poor consumers make between price and quality".

In addition, there can be "challenges around building brand awareness or even category awareness (with word of mouth a crucial form of communication)".

Standard business models are unlikely to work, even those imported from neighbouring emerging markets, although Euromonitor noted that it was often possible to combine CSR policies with commercial strategies to good effect.

It cited the example of Grameen Uniqlo in Bangladesh, with the fashion retailer sourcing raw materials, production, logistics and sales within the country and ploughing profits back into the business.

"Uniqlo is learning a huge amount of valuable information about the market as well as achieving CSR targets," it observed.

Data sourced from Euromonitor International; additional content by Warc staff

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Luxury brands tap festivals

14 April 2015
NEW YORK: A number of luxury brands are looking to connect with affluent millennials by getting involved with outdoor music festivals.

Luxury Daily highlighted the approaches fashion brands and retailers have been taking, from curating a range of items that will be useful to festival-goers to having an on-site presence.

"Brands are increasing their participation in experiential and grassroots marketing due to the increasing fragmentation of old media," observed Nicole Larrauri, managing partner at the Long Island marketing agency EGC Group.

And she noted "a dramatic increase this year" in the number of music festivals and the attendances.

"Music festivals give brands the change to engage with consumers in new and interactive ways," she explained, including pop-up booths, product sampling and the use of brand ambassadors.

"Brands who aren't participating in events, should be curating," she added.

In that vein, the current theme of Nordstrom's monthly Pop-In shop is helping consumers get "festival-ready" with a range of clothing and accessories.

And Neiman Marcus recently ran its second annual Make Some Noise brand platform activation at this year's SXSW festival in Austin, Texas.

Larrauri advised that "brands should be focusing on the complete path to conversion with a program like this … Starting with the awareness of festival-themed products, to well-executed where-to-buy mobile programs and targeted social media efforts".

In the UK, upmarket label Mulberry has established a branded tent at August's Wilderness Festival, which has been described as a festival for upscale music lovers and which has attracted attendees such as the governor of the Bank of England.

Festival goers can see how one of its handbags is made and even make a personalised bracelet for themselves, so creating a closer bond with the brand.

"Music festivals are attracting a very hard-to-reach audience: the affluent millennial," Larrauri said. "This target audience cares less about brand status and 'stuff' and more about experiences and are harder to reach through advertising.

"They'll spend money on the concerts they want, but need to create a real relationship before buying products from a brand," she went on. "They also want a brand that is aligned to their own passions and interests."

Data sourced from Luxury Daily; additional content by Warc staff

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Mobile boosts Aussie newspapers

14 April 2015
SYDNEY: The number of readers of printed newspapers in Australia continues to decline but online readers are starting to offset print losses according to latest data.

Figures from EMMA (Enhanced Media Metrics Australia) show overall print readership fell 2% in the 12 months to February 2015, to 14.2m readers, but at the same time mobile readers increased 14% to 3m per month. Total newspaper readership rose by 2% to 16m, Marketing reported.

"More than three quarters of our population now own a smartphone, which has doubled in the last four years, according to the Telstra Smartphone and Tablet Index," noted Mark Hollands, CEO of the Newspaper Works.

"People are checking their smartphones up to 150 times a day," he added, "and this is where newspapers play a vital role, with readers turning to trusted sources for breaking news and information on the go, wherever they are."

The Sydney Morning Herald claimed to be Australia's most-read news publication, with total readership across all platforms hitting 5.2m in February 2015, up 9% on the same month in 2014. And increases in online readership more than offset declines in print, as they surged 17% to 3.3m.

In terms of print only, however, the Herald Sun remains the leader, with daily weekday readership averaging 1.384m, almost twice the Sydney Morning Herald's figure of 0.721m. In second spot, the Daily Telegraph is the only other newspaper to command an average daily readership in excess of 1m (1.049m).

The chairman of Newspaper Works argued that print occupies a unique position in an increasingly cluttered media landscape.

"There are now hundreds of TV options both in subscription and free-to-air, there are thousands of news sources on the internet," Michael Miller said.

"But in terms of local [newspaper] media brands, in Melbourne you have got two serving the city. You have got two nationally; it's one of the least cluttered media available for advertisers and that makes it a very seamless transaction and effective medium to both understand and to use."

Data sourced from Marketing, Sydney Morning Herald; additional data by Warc staff

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CrossFit flexes WOM muscle

14 April 2015
AUSTIN, TX: CrossFit, the fitness company, believes that word of mouth has a vastly more important role to play than marketing in maintaining the significant growth it has recorded over the last decade.

Jimi Letchford, the organisation's global brand officer, discussed this subject at South By Southwest (SXSW) in Austin, Texas.

And he reported the firm's rapid expansion – which has seen it attract some 12,000 affiliate gyms, versus a total in the low double digits ten years ago – draws on effective results and a corresponding army of brand advocates.

"We don't purchase ads on broadcast or digital or print like 24 Hour Fitness or Equinox," said Letchford. "We don't need to." (For more, including details of the company's "least rents" business model, read Warc's exclusive report: CrossFit's unique approach to brand-building.)

"Someone who says, 'CrossFit's changed my life, and I want to give that message to somebody else': that person has way more impact on our brand than a logo or a slogan or what time someone opens the doors."

Its customers' devotion to – and proselytising about – the brand's distinct exercise philosophy and "Workout of the Day" is such that CrossFit has been compared to a "craze", a "religion" and even a "cult".

Letchford did suggest that the focus on varied daily workouts, high-intensity regimes and fostering a communal atmosphere at affiliated gyms – which it calls "boxes" – was indeed different from much of the competition.

"The traditional gyms: they count on people being on the books, expect them to pay, and hope they never come," he said.

"Our boxes: they thrive off attendance, participation, results and word of mouth. Word of mouth that's so powerful that we continue to grow on a 30% yearly rate."

While spending "zero dollars" on traditional forms of marketing, CrossFit is highly adept at using owned media on platforms like Facebook and YouTube for spreading the word about its intense approach to fitness.

"We have a small team that runs our social media. They're a little bit more on the aggressive side, so to speak," said Letchford.

"We almost shove it down people's throats. And if they don't like it, that's fine. I see a lot companies and businesses: they do things for the thumbs up … We get interaction on there, and get good conversation."

Data sourced from Warc

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Wearable consumers shun high street

13 April 2015
LONDON: Wearable technology is posing a major problem for high street retailers because current and potential buyers are shunning them in favour of buying online, according to new research.

The latest Wearables Tracker from YouGov, the polling firm, found three times as many wearables owners bought their devices online rather than in a bricks-and-mortar store.

Based on responses from more than 2,000 consumers, almost two-thirds (62%) said they bought their device online, with Amazon the most popular site (31%), compared with 22% who bought in-store.

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It is a similar story for those considering whether to buy a wearable device with 56% saying they think they will purchase online.

YouGov also found that 72% of current owners researched devices, of whom 16% visited a store to check out the wearable device before buying.

However, the report suggested there is still an opportunity for retailers among those considering to buy. Even though 56% said they thought they would buy online, 47% of those who intend to research the product said they would visit a store.

YouGov director Russell Feldman accepted the new technology posed a dilemma for retailers because wearables are an "odd beast" in that they are both high-tech versions of existing goods but also an emerging and distinct category.

This made it difficult for retailers to decide where best to display them – perhaps the jewellery section or maybe consumer electronics? – but Feldman said retailers need to find the answer because otherwise it will lead to shoppers getting confused.

"Although we are likely to see many consumers grazing in-store and then purchasing online, were retailers to be better at showcasing these devices to consumers it is likely they would at least increase their share of this lucrative market before it slips away from them completely," he said.

The warning is timely because the survey coincides with the online launch of the Apple Watch, which is being made available for pre-order to consumers in the UK and eight other major markets.

The first offline sales in the UK will take place at Selfridges and Dover Street Market in London. Elsewhere, it will be sold in luxury stores in cities such as Paris and Tokyo.

Data sourced from YouGov, City A.M.; additional content by Warc staff

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UK privacy concerns still linger

13 April 2015
LONDON: Further evidence that British consumers have deep concerns about the security of their private information online has been underlined in two new surveys that emphasise the need for businesses to build trust.

A survey of more than 2,000 UK adults for CloudMask, a Canadian-owned global security firm, found 72% of Britons are worried about hackers and unauthorised access to their personal information.

This is especially so because consumers find sharing their data online has become unavoidable and 70% have had to share data when signing up for online services.

Public concern has also mounted in recent months following well-publicised cases of the hacking of corporations and celebrities as well as the revelations leaked by Edward Snowden, the fugitive National Security Agency contractor.

Despite their concerns, about half (51%) of those surveyed say they don't want to pay for online protection while 61% think the organisation responsible for an app or website should take the most responsibility.

However, in a surprise finding that suggests a change in consumer behaviour is underway, the research also found that a third (32%) would be willing to pay to protect their data online and 29% firmly believe it is their own responsibility.

Nonetheless, Garreth Cameron, group manager at the Information Commissioner's Office, said that even though consumers may be prepared to pay to protect their personal data, it remains the responsibility of businesses to follow the law.

"Businesses should be doing everything they can to keep information safe by investing in consumer privacy online, both in terms of education, increased protection and good practice," he said.

Separately, a smaller poll of 250 British consumers by Worldpay, the payment processing company, found three-quarters (75%) would consider a website to be more secure if it prominently displays payment authentication logos on its homepage. But only 8% of retail sites in the UK currently do this.

Security concerns also prevent 46% of consumers from storing their payment details with an online retailer, although 60% would consider doing this if the security measures were made clear, Retail Week reported.

"Retailers need to reassure customers that their information is in safe hands, from the second they start browsing a site to the moment they receive an email confirming their purchase," said Maria Prados, global retail vp at Worldpay.

Data sourced from CloudMask, Retail Week; additional content by Warc staff

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Focus on young shoppers 'misplaced'

13 April 2015
CAMBRIDGE, MA: Retailers looking to boost sales have placed too much emphasis on the impact of innovations like social networks on younger consumers and should instead concentrate on older shoppers, new research has contended.

Older consumers have significantly greater purchasing power and, on average, spend considerably more than shoppers aged under 35. Indeed, households over 55 drove 35% of retail spend in 2013 compared with just 21% spent by the under-34s.

In The Future of Shopping report, Forrester Research analyst Sucharita Mulpuru explains there has been massive demographic change over the past four decades.

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Drawing on census data and labour market statistics going back to 1973, she points out that real incomes have declined for younger consumers at the same time as their numbers have fallen as a proportion of the overall population – households under 25 comprised 7% of the population in 2013 compared with 9% in 1973.

Also, technological change is not uniquely for the young because the history of technology innovation – from the introduction of subscription TV in the 1970s to 3D printing in the 2010s – suggests that change has an impact on all generations.

Alongside demographic change over the last four decades, the advent of mobile, ecommerce and the emerging consumer healthcare sector are among six main trends that have transformed retail, Mulpuru says.

To survive, retailers will need to become "truly digital businesses, creating new sources of value through digital customer experiences and digital operational excellence".

Specifically, that means retailers will have to innovate to reduce retail costs and that may even have to include marketing, Mulpuru says.

Ultimately, those retailers that reinvent traditional store experiences, through delivering top digital customer experiences and operational excellence, will grow while others facing greater online price competition will remain stable or decline.

Finally, the research concludes that the long-term outlook will be positive for online retailers, luxury, direct sellers, healthcare, restaurants and away-from-home food, while other sectors struggle, especially furniture stores, toys and sporting goods.

Data sourced from Forrester Research; additional content by Warc staff

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Indian smartphone adoption surges

13 April 2015
BANGALORE: Smartphone adoption in India is expected to record a compounded annual growth rate (CAPGR) of 36% over the next five years, a new report has forecast.

There were about 81m smartphone shipments in 2014, but this should rise massively to 651m by 2019, predicted management consultants Zinnov India.

It said growth is being driven by increasing competition, which is pushing down prices, ease of access to content and language localisation, growth of internet-enabled services as well as government initiatives like the "Make in India" campaign.

Just how important price and competition is influencing the Indian market was reinforced earlier this week when Lenovo India revealed that about three-quarters of its sales come from smartphones priced under Rs 10,000.

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The "unstoppable surge" of smartphones in India continues, the report went on, as it pointed to 29% of the urban population, with a base of 409m users, adding to adoption growth.

Smartphones are already outpacing the growth of feature phones, it said, but warned domestic vendors that they need to adapt to face off stiff competition from Chinese brands.

Xiaomi, for example, recently surpassed all other brands for sales of 4G LTE devices and this week stepped up its expansion plans in India by announcing it will sell its phones through The Mobile Store retail chain as well as online retailers Flipkart and Amazon India.

Arvind Rawat, engagement manager at Zinnov, warned Indian smartphone brands that they will need to differentiate themselves to head off growing competition from overseas.

"With consumers spoilt for choice, domestic smartphone vendors will have to increasingly focus on streamlining operational processes and investing in R&D for differentiation," he said.

Data sourced from Zinnov India, BGR, Reuters; additional content by Warc staff

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Mazda drives ahead on digital

13 April 2015
AUSTIN, TX: Mazda USA, the auto marque, is now directing the majority of its marketing efforts through digital channels, reflecting the rapidly changing habits of consumers.

Russell Wager, the company's vp/marketing, discussed this topic with delegates at MediaPost's OMMA conference held during South By Southwest (SXSW) in Austin, Texas.

"Almost 60% of our efforts now are in the digital world - whether it's in-market, out-of-market, SEM or social," he revealed. (For more, including how Mazda is building its brand from the bottom up, read Warc's exclusive report: Mazda puts digital in the driving seat.)

More specifically, the firm decided to retool its marketing dashboard two years ago, having conducted rigorous analysis of numerous factors. "We used analytics to see where we should put our messages," said Wager.

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"We used over 1,900 variables ... like inventory and incentives and advertising," said Wager. "Alongside these inputs were wider determinants which can shape shopper behaviour, such as the weather."

"And it basically said - to no surprise - [that] we should shift more towards digital. Okay, everyone does that. But we made a dramatic shift."

The impetus behind this decision is not hard to discern given that the purchase funnel has morphed into highly complex "journeys", according to Wager.

"Probably five years ago, if you had gone to purchase a car or truck, you would probably have visited about three or four dealerships," he said.

"On average, most people now visit one-and-a-half [dealers]. Why? Because they've interacted with the brand far before they get to the actual consumer touchpoint of a Mazda dealer."

Mazda's move towards digital as a result has been evidenced by everything from car launches to rating dealerships, plus within Mazda USA and its agencies.

"Two years ago, my digital team - and SEM team and social team - was three people. It's now 15," Wager reported. "You've got to restructure both on the internal as well as on the partner side."

Data sourced from Warc

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Luxury brands 'need China focus'

13 April 2015
SHANGHAI: The luxury market in China is set for solid growth, but brands need to seek to influence Chinese consumers at home before they buy high-end goods abroad, a category expert has said.

Rupert Hoogewerf, chairman of the influential Hurun Report, best known for its China Rich list, said there are about 2.9m people in mainland China who qualify for the luxury consumer category.

Speaking to Luxury Daily, he said there is little sign that any other emerging country will come close, even within ten years, to surpassing Chinese affluents, who he described as the consumers "underpinning the global luxury market".

However, while that may be widely understood by the industry, the key issue is how to recognise what influences them and to understand Chinese marketing tactics.

Hoogewerf said Chinese affluents are knowledgeable and take time to explore price comparison sites, but most importantly, a lot of their research and decision-making is made in China before they travel abroad to spend.

"If you just wait by your store for people to walk in, it will probably happen, but you will be missing a big opportunity. So what everyone should be doing is looking to influence the Chinese back in China," he said.

But some brands are missing an opportunity, he continued, because they have held back from going right into China because it requires energy and resources to reach those consumers.

Those same luxury buyers are now travelling abroad in huge numbers – the total number of travellers outside of China is currently about 45m, he said, which rises to about 110m including Hong Kong and Taiwan.

"There is an impact to be had for sure," he added. "[But] you need to know how to analyse the market so you are not wasting your dollars."

Data sourced from Luxury Daily; additional content by Warc staff

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Online ad icon reassures Canadians

13 April 2015
TORONTO: A third (33%) of Canadians are "comfortable" with interest-based online advertising as long as the advertiser is transparent and there is an opt-out option, a recent nationwide survey has found.

The Canadian Marketing Association (CMA) and research firm BrandSpark International questioned almost 9,500 Canadian consumers between November and December 2014.

As well as revealing that a full 80% are aware that specific online advertising may be sent to them based on their browsing history, the research discovered that consumers aware of the Ad Choices Program icon are more likely to be receptive.

Canada's Ad Choices Program was launched in September 2013 and provides a link for consumers to seek out information and find out ways of opting out of online ads if they want to.

When consumers are aware of the icon, their comfort level about having their browsing history collected increases by 10%, the research found. It also revealed they are more open to personal recommendations and discounts.

When asked if they "appreciate personalised recommendations made by online shopping sites based on my past purchases", just 29% of those who have not seen the icon agree. But this rises to 40% among those who aware of it.

Consumers are much more open to receiving discounts without being aware of the icon (52%), but the proportion does rise slightly to 56% when they are made aware.

Elsewhere, only about a fifth (18%) of consumers would pay for online content in order to avoid viewing ads that appear with free online content. But men (22%) are more likely to be interested in this option than women (14%).

While over half of consumers welcome receiving discounts, younger generations are moderately more enthusiastic (58% of 18-24s versus 47% of those aged 65+).

The CMA said the findings should give advertisers more confidence in the Ad Choices Program and it argues that if more brands get involved then consumer confidence will improve and their openness to interest-based advertising will increase.

Data sourced from CMA; additional content by Warc staff

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