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From temporary adjustment to permanent transformation: the 2022 challenge for marketers

As brands shift their marketing strategies from pandemic-induced temporary adjustment to permanent transformation, WARC’s Marketer’s Toolkit 2022: Global Trends Report, the first in a series of Toolkit reports, aims at helping brands identify, adapt and successfully meet the challenges of the year ahead and turn them into opportunities for growth. 

Key findings from the WARC Marketer’s Toolkit 2022 include:

• Changes in consumer behaviour will impact 2022 marketing strategies
  Fully 97% of marketers responding to a survey for the WARC Marketer’s Toolkit 2022 said they believe changes to consumer behaviour seen during the pandemic will impact strategies in 2022

• The ‘double bottom line’ – valuing profit and the planet – is now a reality
  Forty-six percent of survey respondents said they afford the environment and financial growth equal importance. 

• Market penetration/customer gain is the most important barometer of marketing effectiveness
  More than half (54%) of respondents now view market penetration/customer gain as the most important barometer of marketing effectiveness, up from 44% last year.

• Spending on social commerce will increase
  Three quarters of brands in the WARC survey plan to increase spending, leveraging the power of creators to sell via livestreams and shoppable media.

• Spending on e-commerce will also grow
  Just over three quarters (78%) of respondents expect to spend more on e-commerce and 25% are adopting an integrated approach by merging e-commerce and digital branding teams.

Burger King and Ogilvy top the Creative 100

Fast food chain Burger King has emerged as the top brand in the 2021 WARC Creative 100 rankings, thanks in no small part to its Moldy Whopper campaign, which also helped ag agency Ogilvy leap from fifth to top spot in the network rankings.

The 2021 WARC Rankings – Creative 100, Media 100, Effective 100 – were postponed from Q1 until now because of the disruption to the awards industry caused by COVID-19. Many award shows paused in 2020 and resumed in 2021 to judge two-years of work. 

The top three spots in the different categories within the Creative 100, along with scores and movement from the last ranking, are listed below.

Campaigns

1. Moldy Whopper · Burger King · INGO Stockholm / DAVID Miami / Publicis Bucharest · 800.9 points
2. Stevenage Challenge · Burger King · DAVID Madrid / DAVID Miami · 483.5 points
3. The E.V.A. Initiative · Volvo · Forsman & Bodenfors Gothenburg · 272.1 points

Brands

1. Burger King · 680.3 points · no change from #1 
2. IKEA · 564 points · up from #4
3. Diesel · 359.7 points · up from #9

Advertisers

1. Restaurant Brands International · Canada · 816.9 points · no change from #1
2. Anheuser-Busch InBev · Belgium · 811.3 points · up from #3
3. IKEA · Sweden · 564 points · up from #8

Agencies

1. DAVID Miami · Ogilvy · 483.6 points · up from #23 
2. Impact BBDO Dubai · BBDO Worldwide · 477.9 points · up from #5
3. Publicis Milan · Publicis Worldwide · 386.6 points · up from #7 

Networks

1. Ogilvy · 2186.1 points · up from #5 
2. BBDO Worldwide · 1409 points · down from #1
3. DDB Worldwide · 1128.9 points · down from #2

Holding companies

1. WPP · 3724.3 points · up from #3
2. Omnicom Group · 3680.2 points · down from #1
3. Interpublic Group · 2480.9 points · down from #2

Countries

1. USA · 3603.2 points · no change #1
2. UK · 1111 points · no change #2
3. Brazil · 1083.6 points · no change #3

Commenting on the rankings, Mark Read, CEO, WPP, said: “If our role is to make the best work, connect brands seamlessly with audiences and produce outstanding results for our clients, then there’s no better endorsement than to top the WARC 100 rankings for creative, media and effectiveness. It’s a wonderful tribute to our fantastic people, agencies and clients, and my thanks goes to them all.”

Full rankings are listed here. WARC Rankings subscribers can also view all the ranked creative, credits and case study summaries, in addition to further data by category and region.

These annual league tables are produced by combining the winners’ lists from the industry’s most important global and regional awards shows – as determined by the WARC Rankings Advisory Board and a worldwide industry survey – and by applying a rigorous proprietary three-step methodology. 

Gaming lessons for behaviour change

Games are wildly popular, but techniques that inform them can be a powerful way to adapt users’ habits within the service; new research showing how gamification can encourage active travel holds important lessons for advertising as questions of sustainability come to the core of business.

People need to drive less if the world is to take on climate change, with short trips that could be replaced with a short walk or other forms of active travel at the heart.

Why it matters

It’s not just local authorities – like London’s Hounslow, where the research took place – businesses are expected to take a lead in the fight against climate change. 

Increasingly, businesses don’t just have to look at direct and indirect emissions, but at all the emissions up and down the value chain – these are known as Scope 3 emissions – which include the impact of your customers as they use your brand’s product.

Scope 3 is the area of greatest climate impact, and yet so much of it comes from activities out of your hands. Understanding how to encourage new, sustainable behaviours in both customers and suppliers will become increasingly important to business operations and, critically, to the marketing department.

What to know

Highlighted in Ars Technica, participants in the study could earn points by tapping a card on physical boxes distributed around the borough with prizes for those walking, cycling, or using any other non-motorised form of transport. The researchers also used traffic cameras to measure the impact on traffic.

The results of the Cardiff Metropolitan University study into the effectiveness of a gaming initiative run in the western London borough of Hounslow indicate:

• The proportion of participants who reported being physically inactive (less than 30 mins of physical activity per week) decreased from 25% pre-game to 18%.
• The proportion hitting the World Health Organisation’s optimal target of 150 minutes grew from 62% pre-game to 75%.
• Not only did people move more, but the initiative led to a 53% reduction in both cars and vans in the area studied.

Consider this:

• Loyalty cards have been part of the CRM arsenal, with contactless cards now mainstream are there opportunities to encourage movement.
• Cars are items of great prestige to their owners that become a habit, are there opportunities to encourage the right behaviours and for business to assist its customers to this end, rather than criticising many people’s way of life? Are there opportunities to combine?
• Experience is increasingly important to agencies’ strategic offer, and with Environmental, Social and Governance (ESG) goals now in investors’ sights, there is ample opportunity to take forward these behavioural ideas into new areas.

Sourced from Ars Technica, Deloitte

PX: B2B lays claim to the partner experience

Half of B2B marketers are likely to look at partner ecosystems in a different light in the new year, according to research and advisory company Forrester, and will lay claim to the partner experience (PX). 

Partners as value creators

That’s one of the research firm’s predictions for B2B in 2022, as it notes a surge in non-transactional partners over traditional reseller and dealer partners. Accordingly, it envisages that many B2B marketers will start to regard partner ecosystems as more than just channels to markets – they will be seen as creators of value, necessitating the creation of a PX function.

Three more predictions 

• Always-on digital engagement is fast becoming the norm, but three-quarters of automated efforts will fail to meet their ROI goals because of inadequate buyer insight. 
• Marketing-sourced metrics will be replaced by lift-based performance indicators that can demonstrate what marketing does for business revenue. 
• Fragmented revenue-marketing teams will consolidate in a fifth of B2B firms. At the same time, the pandemic has given rise to the fractional marketing practitioner, which will require CMOs to reassess their operations: the future may entail managing a smaller team of strategic executives, rather than the effective governance of a large team.

Sourced from Forrester

Retail media ad costs rise 21% to new high

The cost of retail media advertising has risen by 21% over the past year to reach a new high of $1.04 per click, according to data from digital advertising company Skai.

Why it matters

This comes as demand from brands to advertise on e-commerce platforms continues to rise rapidly – retail media adspend grew by 45% in Q3 2021, quicker than the growth in social media (26%) and search (32%) advertising.

Retail media costs are also expected to rise further as advertisers broaden their strategy on platforms like Amazon to include more upper-funnel activities.

Takeaways

• All three media have seen costs rise rapidly in Q3 2021 - retail media CPC rose by 21%, social CPM increased by 34%, and search CPC has grown 30%.
• Additional research shows media inflation of 4% is expected worldwide this year, with TV and online formats recording the largest increase.

Sourced from Skai, WARC Data

Environmental sustainability: How APAC organisations fare

Even as climate risks become impossible to ignore and values-based consumers further firms’ awareness of corporate social responsibility (CSR) and sustainability, APAC firms are making inconsistent progress in their sustainability efforts, according to Forrester’s “The State of Environmental Sustainability among large organisations in Asia Pacific” report.

Why it matters

The importance of environmental responsibility and sustainability as a business initiative has increased due to COVID-19 but APAC firms are taking very different approaches in terms of what practices to implement and how aggressively to implement them, with inconsistent government policies giving many firms cover to delay taking desperately needed action.

Key insights

• 42% of purchase influencers in APAC at firms that prioritise CSR practices said that the importance of sustainability as a business initiative has increased due to COVID-19.
• 33% of firms have created a position for a director, vice president or executive to lead the sustainability programme, compared with 58% among the Fortune Global 200.
• There are four types of CSO – activist, influencer, politician and tenured – to set the sustainability vision, drive organisational change and embed strategy into the core business model.
• 33% have named a sustainability lead but 53% have established a target date for the partial or total elimination of greenhouse gas emissions – consistent with the global average of 55%.
• 41% have set a date by which they will attain carbon neutrality, i.e. when they will achieve net zero carbon emissions via a combination of generating less CO₂ and buying carbon offsets.

Quote  

“The good news is that a growing number of APAC firms are making public climate action and environmental sustainability commitments to reduce waste and energy usage and cut greenhouse gas emissions” – Michael Barnes, VP research director, Forrester.

One-third of consumers prefer to shop for groceries online

A third (35%) of consumers say they prefer to shop for groceries remotely, for example via an online order, according to a survey from YouGov.

However, despite e-commerce's growth since the COVID-19 pandemic began, there is still greater preference for going to a physical venue for groceries, reported by 43% of adults.

Why it matters

As a result, it is vital that brands and retailers design online and offline customer experiences suitable for a variety of consumer segments. This will only grow in importance as hybrid buying becomes a more established habit in the grocery market.

Takeaways

• A third (35%) of consumers say they prefer to shop for groceries online, with 43% preferring to go to a physical venue.
• Online groceries are most popular in China (70%) and India (65%) but less popular in Europe and the United States.

Sourced from YouGov, WARC Data

ESG: A growing focus on sustainability demands a response from marketers

The way companies are managed is changing in response to myriad external pressures – climate change, social justice demands, COVID-19, continued tech disruption – and those have implications for marketers.

Environmental, social, and governance (ESG) criteria are a set of standards for a company’s operations used by many investors in the investment decision-making process. 

Context 

For half a century, Anglo-American capitalism has been predicated on the notion, first espoused by Milton Friedman, that the primary, indeed the sole responsibility of a business is to make profits for its shareholders. 

But just over two years ago, the Business Roundtable, a group of chief executive officers of nearly 200 major US corporations, said that investing in employees, delivering value to customers, dealing ethically with suppliers and supporting outside communities are now at the forefront of American business goals.

What it means for marketers

Marketers are having to look beyond just promoting a product or service to customers to embrace goals that affect wider society, and making sure both the public and the investor community are made aware of that. And as diverse board members are incentivised to meet ESG targets, marketing will be critical to telling that story. 

What’s changing?

• The profile of board members is changing in response to the need for strategic guidance on “non-market crises that arguably carry the most enterprise risk for firms today”, says Wharton management professor Mary-Hunter McDonnell.
• There is now a greater focus on ESG goals, which can be promoted by linking progress on these to executive pay.
• A rise in ESG investments may push companies to become greener in order to increase their share price, suggests Luke Taylor, finance professor at Wharton. 
• Taylor also proposes maximising shareholder welfare rather than shareholder value. “There’s a difference there because shareholders may care about more than just profits.”

Sourced from Knowledge@Wharton

E-commerce trends fuel store openings

E-commerce charged ahead in 2020 and 2021, and yet for the first time since 2017 there are more stores opening in the US than are closing, which reflects a shift in how executives understand online retail: less like the Amazon machine, and more like distributed models common across Asia and Latin America.

Why it matters

The US tends to look inwards, but in the trajectory of e-commerce across chain businesses it can learn a lot from other parts of the world such as Magazine Luiza in Brazil, while at a broader level it is the combination of stores with online engagement options that are likely to drive the biggest chunk of growth in the next half decade for retailers.

The trend

Reporting in the Wall Street Journal links the result of researcher IHL Group’s report into 900 US chains – in which mass merchants, food, medicine and convenience retailers are all growing their physical footprint – with changing views about the role of the store.

Not only do they serve a crucial logistical purpose with collection and returns but they also fulfil a marketing purpose.

Effectively, the internet doesn’t work as the evangelists would have you believe; it’s no customer-finding panacea. Standing out has become harder and more expensive as the pandemic pushed most competitors online. And so traditional methods are not only continuing to show effectiveness – signalling your business’s seriousness with a well-fitted, well-designed store in a prominent location still engenders trust – but more flexible landlords mean retailers aren’t tied into potentially ruinous long-term deals. Rents are also around an eighth cheaper.

Key quote

“We get a bump online within a 10-mile radius of each store we open. Stores are like an inexpensive billboard” – Chris Riccobono, founder of online shirt brand Untuckit (which now has 88 stores and has plans for a further 62 in the next three years).

Sourced from the Wall Street Journal, WARC

How APAC brands can unlock the potential of social commerce: Report

Brands have a significant opportunity in social commerce, with three out of four people saying they are likely or highly likely to buy through social media in the future, according to a report by global data and measurement-driven agency Essence that investigates the rapidly growing trend of consumers buying products and services directly on social platforms.

Why it matters

While social media platforms have always provided an environment for buyers and sellers to interact, there is a shift towards organised commerce on platforms, enabling discovery, browsing and purchasing to take place on one platform without the need to interact with any external websites or applications, thus creating a seamless experience with fewer clicks, as well as higher potential revenue and conversion rates.

Key insights

Some useful statistics highlighted in the report include:

• China is the leader in social commerce, forecast to account for 13% of total e-commerce sales in 2021.
• 80% of consumers in China bought items on social media, followed by Singapore (50%), India (49%), and Indonesia (48%). 
• 90% of Chinese who participated in live shopping and conversational commerce enjoyed the shopping experience.
• 88% of Indian respondents (the highest after China) say they are likely to buy via social media.
• In Indonesia, apparel (49%), food delivery and takeaway (33%), and beauty (32%) were the most purchased categories.
• In Singapore, 37% still use credit/debit cards for social media transactions; 25% for both digital wallet and mobile payment.
• 50% of Australians participated in live shopping, conversational commerce; but 80% enjoyed the shopping experience.

Quote

“E-commerce is maturing as a field, with social media giving brands and retailers new ways to reach audiences and new growth opportunities. In this environment, social commerce serves as a key future-proofing method for the next five years and beyond.” – Aniket Basu, senior director, technology and e-commerce, Essence.

Brand in action: How Tailor and Circus makes underwear inclusive

Tailor and Circus is a young Indian underwear brand that makes undergarments for every body type and the brand’s communication conveys the message with regular people modelling their products and not creating false portrayals of the perfect body. 

Abishek Elango, co-founder of Tailor and Circus, speaks to WARC about the idea of not just inclusive advertising but being an inclusive brand.

Key insights

• It is not easy to love your body because of the years of conditioning, stereotyping, self-loathing, unhealthy eating habits and disorders.
• In India, the sari is inherently an inclusive and body positive outfit but when it comes to progressive advertising, there is a gap between modern representation and fashion.
• A brand has to first take an honest and critical look at itself and know that it is inclusive as a company before it can begin advertising in an inclusive way.

Large brands posting twice as many Instagram Stories this year

Brands with more than 100,000 followers post almost 50 Instagram Stories each month, more than twice as many as they did last year, according to an analysis of Instagram business accounts by social analytics company Socialinsider.

Why it matters

While Instagram Stories can offer brands a quick and easy way of engaging with audiences, marketers need to be careful to not neglect the main Instagram Feed – on average Story posts reach only half the people that Feed posts do. This gap has also widened over time, suggesting the Feed has become more important in terms of reaching a broad audience.

Takeaways

• Brands with more than 100,000 followers post almost 50 Instagram Stories each month, more than twice as many as last year.
• Instagram Stories have become more popular for brands of all sizes, though the biggest increase between 2020 and 2021 is among the largest profiles.

Sourced from Socialinsider, WARC Data

Do consumers really care about privacy?

Apple’s anti-tracking update saw a vast majority of users choose privacy; spooked by a vague new policy ultimatum from WhatsApp many customers downloaded encrypted messenger platforms Signal and Telegram, while internet browser DuckDuckGo is fast expanding – given the tools, it appears that privacy is front and centre of the consumer mind.

Why it matters

Or is it? Together, these stories provide a compelling narrative that fits a broader tide towards Web3, a vague term for a blockchain-based internet of “value” that imagines advertising as a kind of irredeemable blight on people’s lives with no purpose other than to slow down browsing experiences.

What these stories have shown, however, is the fundamental power of defaults. Apple made it easy to block tracking, in a similar way to how personal data processing services made it easy to connect to a powerful platform seemingly for free.

The broader view

As venture capital firm Sequoia Capital puts it in a recent essay, consumer interest may be shifting towards privacy, it encourages new entrants to plumb the opportunities offered up by this new idea. New business models can be thought up but they will rest on:

- Distrust of big tech

- Incumbent inertia

Where it is very useful, however, is in a framework for understanding levels of private applications and, more importantly, for understanding the privacy tolerance of certain individuals. Worth a read if this is a conversation in your organisation.

Sourced from Sequoia Capital

Ad mail has a growing role in prompting digital activity

For the first time, the amount of mobile device usage prompted by mail exposure has outstripped the amount used to call advertisers directly, according to new data from JICMAIL, the Joint Industry Committee for Mail.

Why it matters

“The trend towards mail prompting usage of mobile devices is a lead indicator of the deepening relationships between physical and digital channel opportunities with mail priming activity elsewhere,” says Mark Cross, engagement director at JICMAIL.

Key findings 

Diary-based data captured from a panel of 1,000 households every month reveals that, in Q3 2021, ad mail was increasingly effective at driving consumers to digital actions. 

• The effectiveness of mail at driving consumers to use their tablets or smartphones increased by 11% year on year in Q3 2021; the two-year growth trend revealed an increase of 41%.
• Nine percent of mail drives consumers to advertiser websites, 6% to seek out new information about a brand online, while 5% prompts consumers to look up their account details.
• Eleven percent of direct mail containing appointment-related information drives mobile usage; mail containing product notifications and reminders drives a similar level of mobile effectiveness.
  
  

What next? 

JICMAIL has launched a number of new initiatives to help advertisers measure the effectiveness of mail campaigns, including a Test and Learn Toolkit, an experimental methodology that allows advertisers to directly seed the JICMAIL panel with their campaigns, an integration into data consultancy Kantar’s brand measurement and shopper panel measurement solutions, and an integration with research company RAM (Research and Analysis of Media).

Sourced from JICMAIL