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How brands can seize the shoppable media opportunity

The convergence of commerce and storytelling is driving the creation of a new advertising opportunity: shoppable media. A new WARC Guide outlines how marketers can take advantage of the rise of shoppable ad formats.

The WARC Guide to Shoppable Media*

Media owners are investing in tools to allow brands to catalogue and promote products on their platforms, with the aim of enabling users to complete a purchase without having to leave the app or website. Shoppable content can include static images or livestream videos, often hosted by influencers, and formats are also being trialled in TV and audio.

Six takeaways

1: Online shopping is becoming a form of entertainment. Where e-commerce was previously utilitarian, users are growing accustomed to more immersive and interactive experiences.

2: Social media has offered a digital ‘store front’ during COVID-19. With consumers unable to visit physical retail outlets, social platforms have helped brands to maintain visibility.

3: Livestream video is a key driver of shoppable media growth. Following its rise in popularity in China over the last few years, media owners are introducing in-app shoppable livestream events.

4: Shoppable media requires a new approach to media planning. Social commerce campaigns must blend storytelling with the information likely to trigger an immediate conversion.

5: Influencers are vital to shoppable media success, but their role is becoming more ambiguous. The arrival of influencers’ own branded product ranges may complicate advertiser relationships.

6: Shoppable media works best in categories like fashion and beauty. These benefit from a sweet spot of high levels of buyer engagement and accessible pricing.

* Readers can sign up to a WARC Talks webinar in which contributors from Isobar Commerce advise how shoppable media can be integrated into an omnichannel strategy.

Roku targets addressable TV primacy with Nielsen deal

Roku is buying Nielsen’s Advanced Video Advertising unit in a deal that will turn the US streaming platform into a significant addressable advertising player.

The deal, first reported by Variety, means Roku will acquire Nielsen’s automatic content recognition (ACR) and its dynamic ad insertion technology (DAI), giving advertisers better targeting and measurement capabilities, allowing them to place highly targeted, household-level advertising spots. The capability will allow Roku to work with linear TV programmers and turn regular TV ads into digital ones.

• Nielsen’s Advanced Video Advertising unit had reportedly struck agreements to carry out addressable ad tests with a number of big TV brands, including Disney, CBS, Discovery, Fox, NBCUniversal, WarnerMedia, A+E Networks and AMC Networks. Roku says it will now have “renewed conversations” with these programmers and others about working to enable addressable ads.
• Roku’s big advantage is its scale – it had 51.2 million active accounts by the end of 2020, and its Roku Channel reached some 61.8 people in the US in the fourth quarter. 
• Immediately after the Nielsen deal was announced, Roku revealed it aims to sell as much as $1 billion of its shares as part of a plan to grow its business, using the cash for “working capital and general corporate purposes, including sales and marketing, research and development, repayment of debt, capital expenditures and acquisitions or investments”.

Key takeaway

Spending on addressable TV advertising in the US is still only a tiny part of the total TV ad market, but is forecast to reach $3.6 billion by next year, an increase of 75% from August 2020. This deal puts Roku in a strong position to grab a slice of that market, while delivering streaming advertising to traditional TV networks.

Sourced from Variety

‘Buy Now, Pay Later’ gains traction in the US amid fierce competition

Retailers scrambling for new ways to keep and attract new customers, particularly young ones, are introducing “Buy Now, Pay Later” schemes.

According to the Wall Street Journal, Macy’s, Gap, and Neiman Marcus have all introduced the rather old-fashioned concept of spreading payments to make purchases more widely accessible to the less-affluent customer, ones who may already have maxed out their credit cards, or not have one at all. 

The details

• The plans come at a cost for the stores who lose out on fees from credit cards carrying their name, plus they have to pay hefty fees to fintech companies that offer the buy now, pay later plans, such as Klarna Bank, Affirm Holdings, and Afterpay. In addition, they lose out from income generated by customers who roll over debt on their store cards. 
• It’s hoped that costs will be outweighed by the income from attracting new custom following the devastating economic effects of the pandemic. Macy’s CEO Jeff Gennette says 40% of shoppers using Klarna are new to the store, and 45% are aged under 40 – only slightly more than 25% of Macy’s existing shoppers are below 40.
• Around 20% of millennials used buy now, pay later last year. The payment method is forecast to grow to 4.5% of North American e-commerce payments by 2024, according to Worldpay.

Key Quote

“Customers, particularly younger ones, were asking for a buy now, pay later option. If we didn’t have it, they might have gone elsewhere” – Macy’s CEO Jeff Gennette.

Sourced from the Wall Street Journal

Line doubles down on 'super app' ambitions

The merger of Z Holdings, which operates Yahoo! Japan, with LINE Corp, the company behind popular messaging app LINE, has created one of the largest info-tech companies in the country, one with global ambitions.

Certainly, Takeshi Idezawa, co-CEO of Z Holdings, a SoftBank subsidiary, made the new entity’s strategy clear: the aim is to launch a global smartphone app and expand online services worldwide. SoftBank says it will invest $4.7bn over five years in the new project, as Nikkei Asia reported. 

LINE is similar to messaging apps elsewhere, but differentiates itself with virtual stickers, animated emojis and games with popular characters. It also offers a number of other services, as well as allowing streaming and video calls.

The details

• The deal creates a tech giant with more than 300 million users and offers messaging, online advertising and financial services.
• The key to success will be how well and how fast the merged entity streamlines overlapping services such as news and entertainment, and also incorporates SoftBank financial services. 
• The deal will give Z Holdings an opportunity to expand in three Asian markets where LINE is popular: Taiwan, Thailand and Indonesia. The new entity will have more than 300 million users across messaging, news and financial services in Japan, Taiwan, Thailand and Indonesia. 

Key takeaway

Successful integration of the various services – including financial ones – analysts believe, could pose a challenge to domestic e-commerce giant Rakuten, as well as US tech giants such as Amazon, Facebook and Google.

Sourced from Nikkei Asian Review

Staffing levels see first growth in a year

The number of staff taken on has shown an increase globally for the first time since the coronavirus outbreak began, according to the latest findings from WARC's Global Marketing Index (GMI).

Key trends

Developed by WARC, the GMI is a monthly indicator of the state of the global marketing industry based on current conditions among practitioners. An index value above 50.0 indicates growth while below 50.0 indicates decline.

The global index value for staffing levels reached 53.1 in February 2021, the first instance of growth since February last year. Europe has returned to growth for the first time since COVID-19 while the decline in Asia Pacific eased notably last month.

Additional findings

• The latest GMI report also finds the indices for global marketing budgets and trading conditions are in growth, though the rate of growth in TV budgets is slowing.
• Marketing practitioners who complete the survey receive the full analysis report.

Sourced from WARC's Global Marketing Index

IAB Spain: e-commerce gains amid robust digital investment

The IAB, with the professional services firm PwC, has mapped the shape of digital ad investment in Spain over 2020, a year in which the country became one of the hardest hit in the pandemic, and in which the e-commerce sector gained significant ground.

Why it matters

Hit hard by the pandemic and playing catch up on digital relative to some other European markets, the IAB’s study into online ad spend in Spain points to a healthy market buoyed by strong new brands.

Details

• A total of more than €3 million went to digital media in Spain in 2020, representing a 3.8% drop. When compared to the total -18.4% decline in the total Spanish ad market, its digital scene has proven especially resilient.
• The IAB registers a defined turn toward performance marketing in the investment figures, part of a broader need to bring in short term results in a downturn.
• Programmatic and other automated systems have strengthened their position versus direct, with a 5.9 percentage point increase on 2019.
• The top three digital advertisers were PSA, the French car manufacturer, Amazon, and France Telecom.
• Per Adjinn data in the report, the ‘distribución’, or e-commerce sector saw the largest increase in share of voice (SoV) with 13.6% in 2020 up from 6.1% in 2019.

Double digit growth

A handful of formats saw double digit growth in the pandemic year:

• Influencers up 27.3% versus 2019.
• Affiliate marketing up 20.3% vs. 2019.
• E-Sports up 19.1% versus 2019.

Sourced from IAB Spain, WARC

Consumers praise brave brands on social justice

Brands can successfully connect with consumers through positive coverage of their actions around social causes, according to a recent study by Kantar. 

Why it matters 

From the #metoo movement to Black Lives Matter, it is clear social media has a powerful role to play in galvanizing public opinion in favor of social justice issues. It’s important for brands to understand how this can affect them and what they can do about it.

Kantar’s study selected 17 personal values and 15 actions and then analyzed more than 1.5 million consumer conversations in the US over the last two years to identify disruptive trends related to values.

Key findings

• Consumer demand for values showing momentum include bravery and improvement; actions such as donations, supporting black-owned businesses and anti-racism are likely to disrupt.
• There is strong support for helping black-owned or minority-owned businesses to succeed. Uber Eats, with its initiative to waive delivery fees for black-owned restaurants, resonates with consumers.
• Consumers’ online conversations refer to ‘bravery’ in the context of racism, community and family, and associations are made with companies like Nike, Apple and Facebook.
• Online American consumers also widely applaud Nike’s effort to support Colin Kaepernick, the footballer and civil rights activist.
  
• Consumer interest in diversity is gaining momentum, and brands being talked about in this space include tech giants Google, Apple and Facebook.
• Brands should ensure they develop a deep understanding of cultural trends, using technology to gather data so they have ‘an ear to the ground’.

Key quote

“Now more than ever brands must strive to go deeper and understand the scope and context of how consumers will react to the important social justice issues and act. We know that disruptive values in this space include improvement through diversity and bringing about ‘bravery’ in our organizations” – Mercedes Bender and Cynthia Vega, Kantar.

Sourced from Kantar

Disney+ attracted most new subscribers in 2020

Amazon Prime Video and Disney+ were the subscription video-on-demand (SVOD) services that attracted the most new subscribers in Great Britain last year, according to data from Kantar.

Why it matters

Video-on-demand is becoming a competitive market and Amazon and Disney have achieved success in different ways. Amazon Prime Video has tapped into demand for live sports and used its links with the Prime membership. Disney has been helped by a strategic centralisation of the business into a single unit responsible for Disney+, content distribution and ad sales.

Takeaways

• Since the second quarter of 2020, Amazon Prime Video has consistently accounted for two in five of all new SVOD subscribers and this reached one in two in Q4 (49.1%).
• Disney+ had a strong launch at the start of the year and took a 38.6% share of new subscribers across the whole of 2020.

Sourced from Kantar, WARC Data

Half of over 55s in Southeast Asia are gamers

Half of Southeast Asians who are older than 55 play video or mobile games, according to data from YouGov.

Why it matters

Brands need to remember that it is not just young men who are gamers – the channel can be used to engage a diverse audience. Instead, marketers should focus on tailoring their approach according to the game and audience.

Takeaways

• In the Philippines, 65% of those aged over 55 say they play video or mobile games, around double the level seen in Malaysia and Vietnam.
• Some brands are missing out on the opportunity, though – WARC's survey of over 1,000 marketers finds that 40% of brands don't plan to advertise across gaming formats in 2021.

Sourced from YouGov, WARC Data

How to write a killer case study

Get ready for the WARC Awards for Effectiveness with our LIONS Live session today on how to write killer cases. Join us on Wednesday 3rd March at 15:30 (GMT) to hear from three award-winning strategists about their secrets to writing killer cases.

Featuring: Lucky Generals' Andy Nairn, DDB Group Hong Kong's Andreas Krasser and TBWA\Worldwide's Agathe Guerrier.

Bilibili more than doubles revenue from advertising

Bilibili, the Shanghai-based video-streaming platform, has been trying for some time to diversify its revenue by becoming more mainstream; its efforts seem to have paid off after it announced last week that its Q4 revenues increased 91% to 3.8bn yuan (US$588.3m).

Within that total, ‘e-commerce and others’, a section that includes content licensing, grew 168% to 740.8m yuan over the same period, while advertising revenue increased by 149% to 722m yuan, the South China Morning Post reported.

Future strategy

• Bilibili, which counts large numbers of Chinese Gen Z consumers among its users, has been pushing to expand beyond its original appeal to the niche anime, comics and games (ACG) subculture since it went public on Nasdaq in 2018.
• Analysts now expect its new revenue streams outside of gaming, especially in advertising, will be a long-term growth opportunity for the company.
• Bilibili is aiming to double its monthly active users from 202 million in the fourth quarter to 400 million by the end of 2023.
• However, the company may face challenges in trying to appeal to new users while retaining its core youth support, who helped Bilibili to grow in the first place.

Key quote

“When the platform has expanded with new content [in areas] such as beauty and lifestyle, it smoothed things out for its advertising business, as a broader range of brands will need a platform like Bilibili with a solid user base among the younger generation” – Shawn Yang, managing director of Blue Lotus Capital Advisors.

Sourced from South China Morning Post

Podcast listeners more diverse than US population

Podcast audiences have grown rapidly across the United States in recent years and are now more diverse than the wider US population, according to data from Nielsen.

Why it matters

As well as being major podcast listeners, Nielsen adds that Black and Hispanic listeners are more engaged with podcast advertising. NPR has engaged different podcast audiences through a selection of diverse content and advertisers can use the medium to connect with new audiences.

Takeaways

• Hispanic, Black, Asian American and 'other' listeners collectively account for two in five (41%) of podcast listeners.
• While 8% of all podcast listeners visit a retail location for more info when hearing a retail podcast ad, this rises to 9% among Hispanic listeners and up to 14% among Black listeners.

Sourced from Nielsen, WARC Data

US economy is boosted by 10% jump in personal income

Household income in the US rose by 10% in January, the second largest increase in income on record, according to figures released by the Commerce Department last Friday.

The increase came as federal government stimulus payments to households and consumer spending increased 2.4%, and it is hoped that the extra money will prime the US economy for a burst of growth this year, the Wall Street Journal reported.

Background

The administration of former President Donald Trump agreed a $900bn stimulus program last December and has been sending one-time cash payments of $600 to most households. In addition, the government has been adding $300 a week to the standard benefits claimed by the unemployed. Meanwhile, job growth resumed in January after falling in December.

Next steps

• Analytics firm Oxford Economics forecasts that US output will grow 7% this year, its strongest rate of growth in decades, and that US output will fully recover from the downturn by this summer.
• Income was above pre-pandemic levels in December, the savings rate is high and it is expected that wealthier households will contribute significantly to consumer spending this year.
• Previous government data have revealed that retail sales increased in January by the most since early last summer.

Key quote

“People are going to travel more. They’re going to go back to restaurants and bars, they’ll go back to the gym – all the things they basically were not able to do before the pandemic. This is where you will really see a burst in spending” – Lydia Boussour, senior economist at Oxford Economics.

Sourced from The Wall Street Journal

Consumers want India's brands to take a stand

Brands in India have to pick a position on controversial socio-political issues because consumers want them to, but it is is a high-risk, high-returns strategy.

Why it matters

When it comes to controversial socio-political issues, brands in India generally play it safe and avoid taking a bold stand – unlike their global counterparts. There are many risks for those that want to do so in a polarised nation, but the returns can more than make up for it.

Takeaways

• Indian brands are known for cause marketing but have often shied away from taking a bold stance on socio-political issues.
• Taking a position on an issue requires research on its probable impact, with some fundamental principles to be observed.
• Brands must have the necessary credentials, be consistent and committed, and act and not just talk.