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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.

McCann Worldgroup and McDonald's top Effective 100

McCann Worldgroup is the top network in the WARC Effective 100 rankings for 2021, with Ingage Istanbul emerging as the leading digital/specialist agency, while McDonald’s is the most effective brand. 

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 Effective 100, along with scores and movement from the last ranking, are listed below.

Campaigns

1. I’m Drinking It For You · DB Export · Colenso BBDO Auckland / Carat Auckland / Red Star Auckland · 51.7 points 
2. Can’t Touch This · Cheetos · Goodby Silverstein & Partners San Francisco · 50 points
3. Michelin Impossible · KFC · Ogilvy Sydney · 47.2 points

Brands

1. McDonald’s · 209.8 points · no change #1
2. KFC · 163.3 points · up from #4
3. Coca-Cola · 135.9 points · down from #2

Advertisers

1. Unilever · Netherlands / UK · 240 points · no change #1
2. McDonald’s · US · 209.8 points · up from #6
3. The Coca Cola Company · 166.3 points · down from #2

Creative agencies

1. FP7 McCann Dubai · McCann Worldgroup · 95.8 points · no change #1
2. Colenso BBDO Auckland · BBDO Worldwide · 92.9 points · new entry
3. BMF Sydney · Enero Group · 92.1 points · new entry

Digital / specialist agencies

1. Ingage Istanbul · Group M · 46.6 points · up from #46
2. AFFINITY Sydney · 39.5 points · new entry
3. Tribal Worldwide Bogotá · DDB Worldwide · 35.7 points · new entry

Media agencies

1. Carat London · Dentsu International · 61.3 points · new entry
2. Mindshare Istanbul · Mindshare Worldwide · 56.8 points · up from #4
3. Carat Auckland · Dentsu International · 51.6 points · up from #35

Networks

1. McCann Worldgroup · Interpublic Group · 694.1 points · no change #1
2. BBDO Worldgroup · Omnicom Group · 683.3 points · no change #2
3. Dentsu International · Dentsu · 569.7 points · up from #5

Holding companies

1. WPP · 1897 points · no change #1
2. Omnicom Group · 1749.7 points · no change #2
3. Interpublic Group · 1358.7 points · no change #3

Countries

1. USA · 1171.1 points · no change #1
2. China · 699.4 points · up from #4
3. India · 629.6 points · down from #2

Suzanne Powers, global president & CSO, McCann Worldgroup, said: “The WARC honour as the #1 most Effective network for 2021 is a testament to our teams’ unwavering dedication to using the power of creativity to drive impact for our clients’ brands across all of our regions.”

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.

Australia's News Media Bargaining Code brings small publisher bargaining ahead of review

A piece of legislation that became notorious thanks to Google and the firm FKA Facebook, now Meta, taking robust opposition to its collective bargaining clause has shown some flaws in action as the biggest publishers have secured big, secretive deals, while – as predicted – smaller publishers have struggled to gain a foothold.

The News Media Bargaining Code, which came into force earlier this year, is a tool that aims to correct power and revenue imbalances between global tech platforms and Australian news publishers whose work is surfaced (and sometimes subtly repackaged) for platform distribution.

A collective bargain

• Eighteen small Australian publishers have joined together as the Public Interest Publishers Alliance – with support from mining billionaire Andrew Forrest’s Minderoo Foundation charity, a representative of which is leading the discussion – the Press Gazette reports. Its efforts to do so are allowed under the law’s waiver of competition law in these circumstances, but require one more important step.
• Now, the problem is that the legislation worked too well until it didn’t. Without the Australian government having to designate who counted as platforms under the legislation, tech giants and publishers got to business sorting out deals on a confidential basis.
• As predicted, this meant that the law never found its bite and the publishers who really could have done with some redistributed income were left out in the cold. The Alliance is now waging a campaign for the government to designate Facebook and Google as platforms in order to force negotiations.
• The question now is whether they can build the requisite political pressure to get that designation in place. Governments, regulators, and indeed platform representatives around the world will be following the news closely.

Under review

As predicted, the law helped the big boys but left out smaller players (there’s a $150,000 revenue threshold to qualify as a publisher that can negotiate). 

Early next year, the Treasury will begin a review of the law’s effectiveness, but as a piece in the Conversation by researchers at the University of Canberra points out, how can it be properly judged if its most important and controversial element – the designation of who is and isn’t covered – hasn’t been put to the test.

Broadly, any review will seek to understand the legislation’s effect on the health of news, notably whether it has impacted the number of journalists employed, how many new journalists are being recruited and trained, and whether outlets have been closed, reduced, or expanded.

Sourced from Press Gazette, WARC, The Conversation

Tesco launches first-party-data media and insight platform

British grocery giant Tesco is launching a media and insights platform to connect brands and their agencies with the retailer’s extensive first-party behavioural dataset from the longstanding Clubcard loyalty scheme.

Why it matters

Snappily titled Tesco Media and Insight, powered by dunnhumby, the platform aims to unite the retailer’s loyalty and in-store data with dunnhumby’s data science chops to create a closed-loop platform. It follows similar efforts by Walmart in the US.

Context: massive reach

Tesco claims its Clubcard is used by more than 20 million households. In dunnhumby’s telling, the new platform will open access to Tesco’s 27.6% share of the UK grocery market and 36% share of the online grocery market. Dunnhumby began its relationship with the retailer at the launch of the Clubcard in 1994 and is now wholly owned by Tesco.

Given the Clubcard scheme remains successful and popular, Tesco will have to be extremely careful with its deployment of ads on the customer side, given they will come through as personalised recommendations.

Effectively, that means it has a very compelling offer of both high reach media and a solid measurement platform, as a buyer should be able to see whether ad spend has led to instore or online spend. According to a trial, the measurement tools have allowed brands “to see the true return on spend, with an average ROAS of £6.60 with Tesco Media, compared to an average of £3.80 on other channels”.

On the media side, the company claimed to reach 58% of the UK population every week, putting it among some of the country’s biggest media owners, Marketing Week reported.

“Our new platform will bring together the wealth of customer knowledge we have, with the insights from dunnhumby, and use it in a way that helps our brands to be more efficient and targeted and ultimately to serve our customers better”, says Alessandra Bellini, Tesco Chief Customer Officer in a statement.

At the launch event, covered in part by MediaTel, Bellini compared the new system to offers from major US retailers like Walmart’s Connect and Target’s Roundel.

The effort fits into a much wider trend of retail media, and further emphasises the value of first-party data to companies well ahead of the decline of third-party cookies.

Sourced from Tesco, Marketing Week, MediaTel, WARC

5G: Fast mobile networks have brought the world online

New data from Ericsson, the Swedish telecoms and networking multinational, shows how 4G helped to bring the world online, how the pandemic accelerated how we all use mobile networks, and how 5G will point further.

Ericsson’s Mobility Report for November 2021 looks back at the last decade of data use, one that saw 5.5 billion smartphone users come online.

Why it matters

5G is rolling out, sometimes controversially, sometimes for reasons that people don’t understand. But networks are becoming more widespread and devices that use the 5G signal are becoming more affordable with 5G connectivity and – with all the possibilities that the additional bandwidth brings – are expected to be dominant by 2027.

The figures

• 5G is expected to account for around 50% of all mobile subscriptions worldwide – covering 75% of the world’s population and carrying 62% of global smartphone traffic by 2027.
• More 5G handsets in circulation earlier in the technology’s lifecycle has spurred incredible mobile traffic growth: mobile network data traffic was up 42% year-on-year in Q3 2021.
• In Q3 alone, mobile data traffic was more than all mobile traffic ever generated up until the end of 2016. Think on that.

Sourced from Ericsson

How to understand the data on the 'perfect job'

A recent survey by office equipment supplier Raja Workplace of 2000 UK workers discovered what people really want from a job, the aspirations they have for their working lives and what that means strategically.

Why it matters

Workers are ordinary people, who would like more money, more routine time off, and to live closer to their workplaces (or would like to work closer to their homes). It’s not only about understanding the pressures people face, but how the deeper trends they speak will likely inform our cities and economies, how they will buy, and how to sell to them.

The findings

Naturally, there’s a business hook – Raja Workplace, who commissioned this research, sells office equipment – but aside from a desire for comfortable seating, clean desks, and good storage, all of which the company sells, there’s plenty to unpack.

At its core, the research breaks down to the following five key desires:

• A 21-30 hour working week
• Salary of £44,355 per year
• 29 days annual holiday per year
• Commute between 16-20 minutes
• A supportive boss

What it means

• People want to work less. It appears that 2020 saw a 3.5 hour drop in average weekly hours worked, according to ONS data, though coming back into 2021 this has increased again. Whether it is immediately adopted or not, and some companies are looking to get ahead of the curve for welfare or environmental reasons, we’re looking at a potentially significant shift in the shape of people’s lives.
• More money. Average weekly pay, also according to the ONS, reflects an average salary lower than the £44,355 that the ‘perfect job’ pays. Effectively, people are short on non-work time and short on money. Both, unsurprisingly, are leading causes of stress.
• Holiday, however, is largely unchanged. Most people have around 28 days holiday in the UK (it’s technically statutory, but firms can fiddle with bank holiday allowance in the contract of employment) and the 29th day desired here is no great change. But it points to the importance not of more irregular time off but the need for more regular time in their typical weeks.
• A minimal commute. Another potential long-term casualty of the shift to home working. Whether for the bosses who commute in from the green belt to the juniors rumbling through town on their hour-long bus journey, it was long and often expensive for everyone. Ideas like the 15-minute city should be interesting here, as they carry the potential to truly reshape work, retail, housing, and transport. That’s if the vision can go beyond the building of luxury apartments with a couple of shops underneath.
• Finally, a supportive boss – who doesn’t want that? 

Sourced from Raja Workplace, ONS, CNBC

The future media agency won’t look like the current one

Data capabilities are what marketers now look for when choosing to work with a particular agency or group, new research shows: 94% of senior marketers say they’re likely to review their media agency relationships due to data and technology’s rise in importance.

Why it matters

As brands continue to in-house technology and talent – and as first-party data capabilities and automated buying platforms become more important to campaign performance – a gap has formed between brands’ needs and media agencies’ abilities and business models. Agencies will need to address perceived failings around expertise and transparency. 

Key findings 

A survey of 150 senior marketers at $1bn+ revenue companies in the US, UK and APAC, conducted by global digital services provider Kepler, found that:

• 85% say data optimisation, rather than media buying clout, is now the most important criterion determining media investment performance;
• 65% say traditional media agencies do not have the technology expertise their organisation requires to maximise media investment;

• 78% of marketers say they will prioritise agencies which have a talent and trading model that can flex around their in-house operations;

• 71% believe their digital media performance is suffering because their media agency partner/s do not have strong enough relationships with the technology giants. 

 Key quote

“The traditional model is becoming stretched. And while price is important, for many clients this is one factor among many. Clients need to focus on finding fair and appropriate incentivisation models and agencies need to set themselves up to adapt to these changes” – Matt Green, Director of Global Media Services, World Federation of Advertisers. 

Sourced from Kepler

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 ad 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