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P&G’s Pritchard predicts all ads will involve 'some form of digital'

All advertising will ultimately incorporate “some form of digital” component in the future, Marc Pritchard, Procter & Gamble’s chief brand officer, has predicted.

During a session at the Variety Entertainment Summit, a conference held as part of CES 2021, Pritchard argued: “All advertising and media will become some form of digital, some form of programmatic, data-driven and automated.” 

Why it matters

The growth of channels like digital out of home and connected TV means what was once defined as “traditional” media inventory can now be purchased via systems that enable precise targeting and measurement. Even cinema, a touchpoint that has suffered greatly during the COVID-19 pandemic, has got in on the act, allowing for clearer measurement than in the past.

The payoffs from digital capabilities

As more media channels are infused with digital planning and buying capabilities, Pritchard noted, it will let marketers:

• “define the audiences that we want to reach”;
• “define what kind of programming we want our brands to be associated with”;
• “recognise … there is a huge ocean out there, and there are a lot of fish, and there are just a few that you have to go with.”

Continued Pritchard: “That's the beauty of what we have here with programmatic … and the advent of connected TV: it just opens this vast opportunity to ensure that we can reach people, the people we want, where we want, when we want, in a safe environment. And it will be good for the entire industry.”

Predictions for the next decade of sport streaming

As streaming enters the mainstream of sports viewing, a new paper anticipates that fans will increasingly subscribe to a handful of services, expecting the ability to switch plans on and off as needed.

Why it matters: The magical critical mass for sports streaming success might be 50m active subscribers, as two media veterans predict how the direct-to-consumer streaming giants, with their large international audiences and flexible packages, leave no one dominant player but multiple platforms selling certain sports.

This is according to an exploration of the future of sport broadcasting by the media consultants and former heads of NBA Broadcasting in the 1980s and 90s, Ed Desser and John Kosner, writing in Sportico.

Still got it: “Sports is appointment viewing, an advertising magnet and a means of counter-programming against services with stronger libraries like Netflix.” Sports are both promotion machines and some of the most promotable content out there.

Growth potential: SVOD platforms are approaching saturation in many markets, but the US has its own quirks of distribution. Broadband penetration is higher than traditional cable networks, which makes the exposure an SVOD platform offers arguably superior to cable providers given the headroom in the market.

The really worrying thing: the new guard of video titans – Netflix, Amazon Prime, Apple – “can justify outspending linear TV because of their scale, applications for data, and superior monetization capabilities.” Worse still, they don’t even have to.

One size no longer fits all: Leagues are likely to align with the highest bidder, which means that the all-in-one subscription for all available sports will likely recede. In its place, platforms able to reach out to a younger fanbase will make individual sports more accessible.

Investors call out Omnicom and Home Depot on ads fuelling misinformation

Investors in advertising giant Omnicom and the home improvement retailer Home Depot are calling for investigations into whether the companies may have paid for digital ads that appeared alongside hate speech and misinformation.

Resolutions have been filed by both groups of shareholders calling for independent investigations to look into whether advertising policies “contribute to the spread of hate speech, disinformation, white supremacist activity, or voter suppression efforts”.

The context

• The resolutions make clear investors consider advertisers cannot distance themselves from the context in which they advertise. “Advertisers are not passive bystanders when they inadvertently finance harm,” the resolutions said. “Their spending influences what content appears online.”
• Companies are now believed to spend over half their global advertising dollars on digital platforms, where ads are mostly placed using algorithms with no oversight of the content alongside which they may appear.
• Recent research revealed 1,668 brands had run 8,776 unique ads on 160 sites that published misinformation about the 2020 election.

Takeaway

The Capitol siege, greatly fuelled by misinformation about voter fraud and conspiracy theories, is seen as a game changer. Shareholders’ current action signals that a lack of supervision over where advertising dollars end up is no longer acceptable – plus, it’s a risk to a brand’s, and so investors’, interests.

Famous brands send Premier Foods’ profits soaring

Consumers stuck at home during lengthy lockdowns are turning to familiar brands for consolation, judging by trading results from the UK’s Premier Foods, the maker of Mr Kipling cakes and Bisto gravy.

A strong brand performance

Reporting on the three months to the end of 2020, the company says it’s expecting profits for the full year to March to be up at least 12%.

• Describing “another exceptional quarter of trading”, Premier Foods said sales of its branded products were up 16% for the year to date – seven times the growth rate of non-branded products.
• Comforting, old-favourite brand names performed very strongly – Mr Kipling cakes is on track for a record year; gravy brand Bisto and Batchelors, the market leader in dried soups, both saw double-digit sales growth. Ambrosia custard and rice pudding also saw sales climb.
• Sales of Sharwood’s cooking sauces surged by 40% for the quarter, helped by a new low-sugar version of a stir-fry sauce. This and a number of other products were boosted by TV ad campaigns.

Soundbite

“By spending money on marketing now, all Premier Foods can do is make its products front of mind when consumers shop, so post-lockdown people still recall its brands when they are deciding whether to cook themselves or go for the ready-meal option, which was so popular before COVID-19 struck” – Russ Mould, investment director with AJ Bell, speaking to Proactive.

TikTok leads the social pack as user activity doubles

TikTok's growth in user activity far outpaced major social platforms like Facebook, Instagram, and WhatsApp in 2020, according to an analysis of App Annie data.

Why it matters

The short-form video app is the most direct challenge to more established social platforms like Facebook and can provide audiences and advertisers more creativity and spontaneity.

Brands are already taking notice – over two-fifths (44%) of marketers plan to spend more on TikTok in 2021, making it the fourth most in-demand platform and ahead of Facebook.

Takeaways

• Across 16 countries, TikTok's average monthly consumption per user nearly doubled while the other top five social apps rose just 11.0% on average.
• In eight of the countries analysed, TikTok is now the social app with the highest monthly consumption per user. Last year it replaced the Facebook platform for the top spot in Canada, France, the UK and the United States.

Sourced from App Annie, WARC Data

Why WFH could be here to stay – some people prefer it

Just over half the people who have had to work-from-home (WFH) during the pandemic say it suits them well, finds a major survey in India. For them, WFH leads to good-quality sleep, more exercise, better relations with family members, improved mental health, and many say they’re more productive.

What the research shows

A YouGov-Mint-CPR Millennial survey questioned 10,000 workers on how they feel about a work-from-home (WFH) routine. They were equally divided on the issue, with about half wanting to get back to the office, and the other half wanting to continue to WFH.

• For a slight majority, not having colleagues around makes WFH “unsatisfactory”. Younger people and women were more likely to be working from home.
• The more educated and higher-earning professionals tended to be able to work from home in larger numbers, while those who earn less or are poorly educated tend to work in roles where WFH is more challenging.
• The trend has meant a dramatic fall in commutes, which has saved people money, but it has also added to home costs, such as utility bills and grocery costs. These trade-offs could prove to be important considerations going forward as employees either push to return to the workplace, or to carry on remotely.

Key takeaway

What is clear, the data shows, is that WFH has had a significant and positive impact on the work-life balance for many, and it’s likely to be in demand by a sizeable number of workers post-pandemic.

Oil giants find revenue solace in grocery sales

Major oil companies, suffering weaker demand for fuel during the pandemic, are finding that an uptick in grocery sales at their network of service stations world-wide is helping pick up the revenue slack.

BP and Royal Dutch Shell say the surge in food-and-drink sales means they will expand in the sector, hoping retail can help them offset the falling demand for oil in the longer term, The Wall Street Journal reports.

• Shell says over the next five years it has plans to add 10,000 retail units to its 45,000-strong world-wide network, giving it a larger number of outlets than either Starbucks or McDonald’s. BP says it plans to add 6,700 outlets to its current 19,000.

• The business model is an attractive one, say experts, because margins tend to be higher on retail compared to fuel, and are more stable because they aren’t subject to the same price volatility as the energy market.

• The companies are also expanding into new revenue streams run out of gas stations – Shell, for example, says it plans to speed up its rollout of parcel collection and home delivery services. BP has partnered with home delivery app Glovo in Spain and Deliveroo in the UK.

“COVID-19 was effectively a dress rehearsal. We already knew there were likely some headwinds coming at fuel demand in future, combustion engines are becoming more efficient and electric vehicles are coming” – Frank Beard, convenience retailing consultant.

Facebook and Google accused of striking anti-competitive sweetheart deal

Documents reviewed by The New York Times provide some evidence that Facebook shelved a competitor product in return for preferential terms in a deal to join a Google-led ad auction alliance nicknamed Jedi Blue.

What it means: 

Ultimately, should a deal have been made, it will renew concerns about the closed-door agreements that major players in digital advertising are able to make, especially when a guaranteed win rate is alleged.

Even if, as both Facebook and Google contend, such agreements are commonplace, the lack of transparency will not be gladly received by competitors or legislators.

It all comes down to header bidding, a technique designed to reduce reliance on Google’s ad platforms (given they own both the dominant ad exchange and ad server) so publishers could find better prices. Google needed to navigate past this, especially with the news that Facebook was thinking of throwing its weight behind the new technique, and so created Open Bidding, an alliance of exchanges.

Source: 

Details of the agreement, shared by Texas prosecutors in a federal court, are part of the multistate suit filed by 10 state attorneys general in December alleging that Google overcharged publishers and edged out potential challengers. It comes hot on the heels of a DoJ suit filed in October concerning preferential deals with Apple and other device-makers for search engine defaults.

Comparisons: 

Executives at six of the more than 20 partners told the Times that their own agreements lacked many of the terms included for Facebook, giving the social network an advantage over them. These boil down to information and speed advantages, a guaranteed win rate, and the ability to maintain direct payment relationships with clients, the complaint alleges.

Google’s spokesperson argues that the complaint misrepresents both the agreement and other aspects of the company’s ad-tech business; Facebook says that such deals actually help to increase competition. Neither spoke in detail about the deal.

Sourced from the New York Times, WARC

Five tips for driving effectiveness in 2021

The WARC Guide to new research in marketing outlines several vital considerations for driving effectiveness in 2021. 

Despite (or, perhaps, because) of the turbulence experienced in the past year, the marketing community has been focused on new thinking that can help brands improve their effectiveness in 2021.

Some of the main insights featured in The WARC Guide to new research in marketing are: 

1. A brand’s share of search – or the proportion of search traffic claimed by a specific brand compared to that of its rivals – is a useful proxy for its market share.
2. Google UK and The Behavioural Architects identified the “messy middle”, a phase in the online purchase cycle where consumers are typically engaged in one of two actions: exploring their options (an “expansive” task), or evaluating (a task aimed at reducing their options).
3. Neuroscience research applied to TV spots from brands like Ford, IKEA and Goldfish Crackers found that ads with diverse casting performed more strongly in terms of persuasiveness, attention, connection and encoding metrics with Caucasian audiences in Canada.
4. Marketers should add “digital availability” – that is, making sure brands are available to buy in more places online – to their focus on physical and mental availability.
5. “Creative commitment” – a metric based on campaign duration, budget size and the number of media channels used – has a strong correlation with campaign effectiveness.

The WARC Guide also contains recommendations around outcome-based marketing, the value of measuring attention, and the continuing importance of share of voice.