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Advertising in premium digital media is effective: Australian study

Advertising in premium digital media creates superior recall and brand uplift and is more effective than run of the internet and Facebook, according to an Australian study by research lab MediaScience.

Why it matters

Not all digital media is equal and premium digital – with premium content and context – is a better choice for advertisers due to its ability to encode memories and build brands, says a study commissioned by ThinkPremiumDigital that measured key metrics across short- and long-term memory as well as brand lift. 

Four findings

• Premium display and video placements drive 2.4 times better recall and 1.6 times brand lift compared to run of internet, which includes niche and non-premium sites such as TechRadar, The Daily Mail, Mamamia and Buzzfeed.
• Premium placement is even more effective for light buyers – the most important audience for brand growth – with premium display and video placements delivering three times the recall and 2.8 times the brand lift compared to run of internet.
• Premium display equals premium impact, with the former alone generating 3.5 times the brand recall compared to display across run of internet sites.
• Short form video in premium environments offers 1.8 times better recall and 2.8 times the brand lift, while short-form video in premium environments delivers 1.8 times higher recall than Facebook video.

Read more here

How remote working could reshape cities and redefine rush hour

Remote working has now been with us for so long that many believe it has changed working practices forever and for many of us, there will be no going back to packed commuter trains and jammed highways. 

Why it matters

Rush hour and the journey to work is the consideration around which many people are forced to build their lives. With less need to be in an office at a fixed time each day, the way cities function and the patterns of people’s movements around cities could be changed fundamentally. And that, clearly, has big ramifications for media planners, and perhaps for radio and Out Of Home planners especially.

The details

• Economists estimate around one third of workers in the US of jobs that could be carried out remotely. Even if a relatively small number of these people worked from home, even one day a week, or now and again set off for work at different times, starting their working day at home rather than in the office, this could significantly flatten the rush hour peak. 
• Back in 1980, before the internet had even entered people’s vocabulary and “working from home” meant something very different, US census data shows around 2.3% of workers said they usually did it; by 2018, that number had risen to 5.7%. Now researchers forecast that proportion could double and more in very quick order. 
• Researchers at the Instituto Tecnológico Autónomo de México, Stanford and the University of Chicago estimate 20% of post-pandemic working days will be done from home. 
• New patterns are already being observed – around Dallas, LA, Chicago and New York, smartphone data and GPS devices reveals big drops in morning movement peak, and a flattening out of the afternoon peak as remote workers abandon commutes, opting instead for local trips in their neighbourhoods, perhaps to a coffee shop or grocery store.

Key quote

“Transportation historically has changed very slowly. [What we’re talking about now] “is dramatic relative to the pace of change we’ve seen” – Steven Polzin, former senior adviser for research and technology at the federal Department of Transportation.

Sourced from the New York Times, University of Chicago

Fashion and electronics see largest online shopping growth

Fashion, consumer electronics and health & beauty have seen some of the largest rates of online shopping growth, according to a global survey of online shoppers by PwC.

Why it matters

Shopping online has grown rapidly in popularity but this has been felt differently across categories. Around half (53%) of online shoppers say they are shopping more or exclusively online in the fashion category, a rate that is more than double the 22% shopping more or exclusively in store. However, online growth has a narrower lead for other categories like groceries.

Online and offline retail is far from separate, though. Brands should instead play to each channel's strengths.

Takeaways

• Online growth in consumer electronics also leads, with 41% of online shoppers buying more or exclusively online, compared to 21% for in-store shopping.
• This gap is smaller for grocery, though, at 33% for online and 32% for in store.

Sourced from PwC, WARC Data

Sponsors pull out of Brazil’s Copa America on reputation fears

Three major corporate sponsors have pulled their brands from the Copa America soccer tournament in Brazil, where the COVID-19 pandemic is still raging.

It follows news that corporate sponsors of the forthcoming Tokyo Olympics have reportedly called in consultants to advise on brand association with the Games, which many have called into question because of the pandemic.

Copa America in the time of COVID

• Mastercard, Ambev and Diageo have all pulled out of the Brazilian competition, due to kick off on Sunday. While all three said their brands would not be displayed, Mastercard said it will remain a sponsor of the competition.

• Brazil, which has suffered over 480,000 deaths due to the pandemic, offered to host the regional tournament only last month following an announcement that co-hosts Argentina and Colombia were cancelling it. 

In Tokyo, brands hedge

• Meanwhile a number of Japanese companies have asked for research into whether association with the Games – an event that has generated more than $3 billion in sponsorship, could now damage their brands.
• With the Games now almost six weeks away, polling of the Japanese public has consistently shown their opposition to the Games going ahead – although that opposition is falling as the country’s vaccination programme has gathered pace: around 80% were opposed a month ago, with a more recent poll showing opposition had fallen to 62%.
• The decision whether or not to go ahead with sponsorship for many is said to be so finely balanced that some companies created two campaigns, planning which to use at the very last moment.

Key quote

“They are waiting to see if the opposition to the Games begins to fall, because if it doesn’t, they are concerned that these Games could actually hurt their brands. Meanwhile, most of the campaigns have gone full stop when you would expect them to be ramping up” – Advertising executive working with one Olympic sponsor

Sourced from the Financial Times

Brick and mortar vs online: Singapore consumers’ pandemic choices

Despite the government’s advice to stay at home and practise social distancing, it appears the Singaporean consumer prefers in-store to online shopping.

Why it matters

While shopping shifted online during the pandemic, consumer preference for brick and mortar remains high in Singapore, with a report by market research firm YouGov suggesting that after COVID-19 ends, consumers will return to the shopping channel they prefer.

Five findings

• Eight in ten (80%) Singaporeans have shopped online in the past three months, slightly less than the 85% who have shopped in-store.
• Brick and mortar is preferred for everyday essential items, such as household food and drink (55%), personal care items (41%), household cleaning supplies (37%) and medicine (30%).
• Clothing (33%) is the only discretionary item in the top five most purchased items in-store.
• A third (33%) say adhering to social distancing measures is a barrier to shopping at brick-and-mortar stores.
• The main motivation for online shopping is home delivery and it is the preferred channel for discretionary items like clothing (39%), footwear (19%) and furniture/home decor (14%).

Sourced from YouGov

Netflix pivots with retail business

As the phenomenal growth of Netflix shows signs of easing relative to its rivals, the video streaming service is taking to the world of e-commerce with its own online shop.

On sale at Netflix.shop, the world’s biggest streaming service offers Netflix-logoed underpants, hoodies, necklaces and charms. Unlike a number of competitors, like HBO Max and Hulu, Netflix has no ads, its revenue reliant instead on the monthly fees paid by its 200 million-plus global users.

The move comes as the brand has made serious efforts to expand the retail side of its business over the last year, The New York Times points out.

The details

• Netflix’s consumer products team has grown from 20 to 60 people and the company has done deals with Walmart, Sephora, Amazon and Target to sell everything from clothes, and beauty kits, to toys and houseware products.
• The new store, described as a “boutique”, will feature only a limited merchandise related to popular Netflix shows initially, with Lupin, a French crime series being featured later this month. Along with Lupin caps, hoodies and sweaters, the more dedicated fan will also be able to splash out on throw pillows at $60 each, and even a side table for $150. Day one will highlight products related to two anime series, Eden, and Yasuke. A clock incorporating the Yasuke character Haruto will be on sale for $135.
• The shop is no doubt at least partly inspired by the fact that a demand was clearly not being met, at least not by Netflix – thousands of fan-made products linked to the hugely popular show Tiger King are selling on Etsy and other sites. Products include candles, face masks and greetings cards. None of these products are linked to Netflix officially. 
• Netflix has, however, teamed up with various clothing companies for individual products, such as a clothing and accessory line launched with H&M featuring the popular rom-com, To All the Boys I’ve Loved Before. 

Key takeaway 

Official sales of merchandise linked to shows, films and fictional characters were worth an estimated $49 billion in the US in 2019, according to the trade group Licensing International. Globally, that figure was $128 billion. Dwarfing all other players was, of course, Disney.

Sourced from the New York Times

Ferrari seeks lifestyle brand position with fashion line

Already associated the world over with the epitome of style and sophistication, Ferrari is aiming to take its brand into the world of fashion.

Its ready-to-wear collection, which is aimed mainly at the young, will sport plenty of Ferrari logos, including, of course, the brand’s famous Cavallino prancing horse, and the name “Ferrari” worked into knitwear and shirts. The collection will be launched on a real-world catwalk event in the supercar maker’s home of Maranello, the FT reports.

The details

• The launch event, on June 13, will coincide with a “Ferrari Experience”, inviting guests into the brand’s new fashion boutique. Items in the collection, which Ferrari is stressing is made in Europe, range in price from €120 for a T-shirt bearing the Ferrari logo to €3,000 for a coat with a hood. The collection is aimed across the board at men, women and children, but has an emphasis on the younger fashion buyer.
• Moving into fashion is part of a wider plan of Ferrari’s chief brand diversification officer Nicola Boari, to “reach out to a wider audience and create business opportunities that are meaningful”. Boari says the company is entering the fashion sector “as a lifestyle brand [which will be] integrated with the core business”. And it follows Ferrari’s earlier announcement that it aims to increase the non-motorsport side of the business to around 10% of total company profits within seven to 10 years.
• The launch also comes hard on the heels of Ferrari’s controlling shareholder, the Agnelli family’s holding company, Exor, taking a 24% stake in luxury shoemaker Christian Louboutin for €541, along with an €80 million majority stake in the Chinese luxury brand Shang Xia.

Key takeaway

Ferrari is certainly not the first car marque to step into the world of fashion – Mercedes-Benz collaborating with Louis Vuitton designer Virgil Abloh is one example; but Ferrari’s dedicated fashion line with an eight-strong, in-house team of designers is something quite new.

Sourced from the Financial Times

Over one-quarter of Gen Z follow influencers

Gen Z follows influencers on social media almost as much as they do brands, according to a consumer survey of internet users across 47 countries from target audience company GWI.

When comparing brands and influencers following, it emerges that Gen Z is almost as likely to follow brands as they are to follow influencers, with only 5 percentage points of gap (33% who follow brands and 28% who follow influencers). This gap is almost three times as much for all other generations, between 13 and 15 percentage points.

Why it matters

Almost one-third (28%) of tech-savvy Gen Z follow influencers on social media, but they have specific preferences: they don’t respond well to celebrity influencers, but rather prefer raw, unfiltered content that brings real credibility to brand endorsement. Therefore, influencer marketing can be a powerful addition to the marketing mix if used in conjunction with other brand-building efforts.

Leading campaigns that leveraged these elements correctly saw a consistent return on their ad spend – Timberland, for example, witnessed an increase in sale by 258% after leveraging younger consumers’ interest in nature.

Takeaways

• One-third of Gen Z, millennials and Gen X subscribe to social media accounts of brands they purchase from or are interested in, with millennials leading at 36%.
  
• Gen Z is almost as likely to follow brands as they are to follow influencers (33% versus 28%).

Online fashion greenwashing on plastics

Online fast-fashion stores are ‘greenwashing’ their images, a new study says, by highlighting the small sustainable ranges they produce while the bulk of their output is still made from petrochemicals.

What the research found 

The Royal Society for Arts, Manufactures and Commerce (RSA) analysed over 10,000 recently added items from across some of the UK’s leading women’s fast-fashion websites for its report Fast Fashion’s Plastic Problem. 

• On average, 80% of items contained new plastic, while 49% were made entirely of new plastics such as polyester, acrylic and nylon. In some stores just 1% contained recycled fabric.

• Across the four brands analysed (Asos, Boohoo, Missguided and PrettyLittleThing) new products were, on average, 61% plastic.

Why it matters

Most people (76%) want to see fewer plastics and petrochemicals used in the production of clothing, but there is an “awareness gap” when it comes to understanding how much plastic is used in clothing. 

RSA takeaways

• Fashion brands need to do more to promote second hand clothing and explore different business models, while also offering greater transparency around the extent of their plastic use.
• Consumers need to shop more consciously: buying less and buying better and also caring for and repairing current clothing.
• The government should explore a per-item ‘plastics tax’ on clothing imported into or produced in the UK containing virgin plastics.

Sourced from RSA

Amazon ad rates soar on rising demand

If online e-commerce generally was one of 2020’s big winners, then it’s perhaps not entirely surprising that Amazon has had, and is still having, a rather good pandemic - Amazon’s search ad rates reflect this. 

Demand for advertising has rocketed, according to research from MarketPlace Pulse, and this has driven up advertising rates on the e-commerce giant’s platform by over 50% in May, compared to the same month in 2020.

The details

• Advertising on Amazon now costs, on average, $1.20 per click. That’s up 30% from $0.93 at the start of the year and up over 50% year-over-year. The lowest price was $0.70 in May last year, when the pandemic caused disruption to many supply chains, which resulted in a number of brands running out of stock and so cutting advertising. 
• Global shoppers are expected to spend an estimated $578 billion on Amazon. The report says its findings of increasing ad rates are not confined to the US, but consistent across markets globally.
• Amazon has turned most widgets on its site along with those in its app into paid-for advertising inventory. Big brands are increasingly spending more of their advertising budgets with Amazon, researchers found, and the result is they can afford to compete for limited ad space, and this bidding drives up prices further. The report points out the same thing happened with Google and Facebook.

Key quote

“Prices will continue to rise over time. Smaller brands trying to enter the market, it will be increasingly expensive to do it when they are up against established brands who are willing to pay to protect market share.” Juozas Kaziukenas, founder and chief executive officer of Marketplace Pulse, speaking to Bloomberg.

Sourced from Marketplace Plus, Bloomberg

Volkswagen’s self-driving media play

Volkswagen’s autonomous vehicle plans are media plans - here’s why that matters. 

The german car giant estimates that the price of peace of mind is $8.50 for both self-driving and media offers. VW is also planning subscription models for a full set of digital features in its electric cars, including access to video games, allowing drivers to while away the minutes while re-charging their vehicle.

The details

• VW is reported to be exploring an hourly fee once all the features it intends to offer with its autonomous cars are in place; and it’s apparently looking at a range of subscription models for its electric cars, too, including “range or performance” increases that will be available on daily or even hourly packages.
• VW board member Thomas Ulbrich told Die Welt newspaper that initial subscription features will be available in the second quarter of next year, including video games, although VW won’t be producing the games itself. “In the charging breaks, even if they only last 15 minutes, we want to offer customers something,” Ulbrich said.
• As more parts of a car are managed through software, it becomes possible to opt in or out of many – and be charged accordingly. VW’s chief sales officer Klaus Zellmer says the company envisages subscriptions eventually earning hundreds of millions of euros in additional revenue. But it is autonomous-car subscription packages that VW, along with other carmakers, are eyeing as the real money makers. These could include the option, during a journey, to pay in order to go fully autonomous for a limited time, before once again taking control of your car.

Key quote

 “In autonomous driving, we can imagine that we switch it on by the hour. We assume a price of around seven euros per hour. So if you don’t want to drive yourself for three hours, you can do it for 21 euros.” Klaus Zellmer, Volkswagen chief sales officer

Sourced from Ars Technica

E-commerce to account for over 8% of FMCG sales in 2021

More than 8% of global FMCG sales will be from online channels this year, according to research from Kantar, GfK, IRI and Intage. This is double the level in 2018 (4.2%) and up from 6.5% in 2020.

Why it matters

Online is a rapidly growing channel in the FMCG category but its share of sales value varies significantly across markets, with highs in Mainland China and South Korea and lows in much of Latin America.

Kantar adds that the key challenge for online FMCG brands is driving loyalty and winning share among lower spend trips. WARC's latest research into customer retention argues brands should tilt the balance of investment toward acquisition as this can also help with retention.

Takeaways

• Online FMCG sales grew the most in markets where the channel is already well established – its share grew 6.4 percentage points (pp) in Mainland China, rose 3.3pp in South Korea and increased by 3.6pp in Great Britain.
• Rising penetration has helped drive online's growth – 67m more households bought their grocery shopping online at least once in 2020.

Sourced from Kantar, GfK, IRI, Intage, WARC Data

All In census reveals extent of inclusion problem in advertising

Improving representation of black, disabled and working-class people within the advertising sector is a priority, leading figures say, following the results of a major survey into the make-up of the industry’s workforce.

The All In Report, published by the UK industry’s Inclusion Working Group, formed by the Advertising Association, IPA and ISBA, surveyed some 16,000 advertising professionals, representing, it is believed, just under 20% of the UK’s ad industry population.

The details

• Just 1% of black professionals are in C-suite positions in advertising, compared with 3% in the general population. And disabled people are also underrepresented in the industry generally, making up only 9% of the workforce, compared to 20% of the general population. One in five advertising professionals went to fee-paying schools, compared to just 8% of the population outside the industry; and 64% of advertising professionals have parents who were also professionals. Outside advertising, that is true for just 37% of people.

• Mental health appears to be a widespread problem in the industry with 31% of those surveyed saying they felt stressed or anxious. The picture of women in the industry also highlighted areas to improve – over half of women felt that taking maternity leave disadvantaged their career, and there is also a 10% pay gap between the genders at senior manager level and up; 12% of women said they experienced sexual discrimination and only 38% felt able to report discrimination against others – this dropped to 26% when the reporting personal discrimination.

• Despite these failings, the survey also uncovered some positives – 83% of executives believe their company is taking concrete steps towards greater inclusivity; and ethnic minorities are actually overrepresented in advertising, accounting for 16% of the workforce, despite only making up 12% of the UK’s working-age population. And, among 18 to 24 year-olds, minority ethnic staff make up 25% of the industry.

Key quote

“It is now time for action. Our census results have provided the benchmark data we need and the way forward is clear. We urge all companies in our industry to engage with the All In Action Plan to help make rapid progress on these critical areas. Everyone deserves a workplace where they feel included and it is in our power to make that happen now. The benefits, social and economic, will be huge as we build our way out of the pandemic” – Kathryn Jacob, CEO Pearl & Dean and Chair, Inclusion Group

SEA e-commerce dips: Ramadan and another year of COVID-19

For a second year in a row, Muslims in Southeast Asia had to observe Ramadan under the COVID-19 cloud and technology company Criteo has found some shifting e-commerce patterns in the 2021 holy month, from 12 April to 12 May, compared to last year.

Why it matters

Southeast Asian e-commerce underperformed this year compared to last year’s Ramadan period, with a notable dip observed in the final week of the holy month suggesting consumer caution in spending amid the ongoing economic downturn.

Key insights

• Mobile sales saw the largest lift throughout Ramadan in 2021, with a 107% surge at the end of the religious period on 12 May.
• Earlier on 1 May, app sales rose by 60%, while desktop sales saw the smallest spike of 40% during the second week.
• Only two categories posted growth from pre-COVID Ramadan in 2019: fashion/luxury and mass merchant products.
• Fashion/luxury outperformed mass merchant products during Ramadan, up 50% from baseline from 23 April to 5 May.

Sourced from Criteo