MxMIndia

Tag: James McDonald

  • TV market grew ahead of expectations in the second quarter of 2018, with total spend rising 1.9 per cent to £1.2bn

    UK H1 adspend strongest since 2014

    By A Correspondent

     

    UK adspend rose 6.4 per cent year-on-year to reach £5.6bn in Q2 2018 – the 20th consecutive quarter of market growth. Coupled with an overall adspend rise of 7.2 per cent year-on-year during the first half of 2018, to a total of £11.4bn, this was both the strongest second quarter and first half since 2014.

     

    This investment, highlighted in Advertising Association/WARC Expenditure Report data, means full-year outlooks for 2018 and 2019 have been upgraded to +6.3 per cent and +4.9 per cent respectively. This would lead to a projected adspend total of over £23.5bn for 2018.

     

    Overall market growth is being driven by increased spend on online advertising. Internet advertising – inclusive of online revenues for newsbrands, magazine brands, broadcaster video-on-demand and radio station websites – continues to grow at a rapid rate and consequently full-year projection figures have been upgraded by three and a half points to 13.3 per cent growth this year. This would result in over £13bn being spent on online advertising in the UK this year.

     

    Data show that mobile accounted for over half of search spend for the first time in the second quarter. Further, display formats are also growing strongly – online video attracted half a billion pounds during the three months to end-June.

     

    The TV market grew ahead of expectations in the second quarter of 2018, with total spend rising 1.9 per cent to £1.2bn. Spot advertising – 89 per cent of the total – rose for the third consecutive quarter, and the 1.4 per cent growth rate was ahead of forecast.

     

    Said Margot James, Minister for Digital and the Creative Industries: “It’s fantastic to see our world leading advertising sector continuing to flourish. The industry makes a huge contribution to the UK economy, and its international reputation for creative excellence is playing a vital role in helping to bang the drum for Britain abroad.”

     

    Added Stephen Woodford, Chief Executive at the Advertising Association:

    “Spend on advertising is showing real strength and resilience especially at a time of some uncertainty for UK business. We know advertising has a positive effect on the economy, with £1 spent generating £6 for UK GDP, so it is encouraging to see the strongest Q2 and H1 results since 2014. While we welcome these figures, we are also conscious that our upgraded predictions for 2018 and 2019 depend on getting the right deal from Brexit negotiations and clarity on what the future will look like. We must also ensure that the unique features that have made the UK the global hub for our industry, such as access to the best and brightest creative talent from across the world, are prioritised as we leave the EU.”

     

    Said James McDonald, Data Editor at WARC: “Growth in online advertising spend continues to exceed our expectations, resulting in the fifth upgrade to our forecasts in as many quarters. Barring any major shock to the system, this trend should continue to play out over the years ahead, lifting total market value in tow.”

     

    Full-year forecast summary Adspend 2017 (£m) 2017 v 2016 Forecast 2018 Forecast 2019
    % change % change % change
    Internet* 11,553 14.3% 13.3% 9.6%
    of which mobile 5,223 37.3% 27.9% 19.5%
    TV 5,108 -3.2% 1.4% 0.8%
    of which VoD 211 7.1% 10.5% 9.5%
    Direct mail 1,700 -3.1% -4.5% -3.8%
    Out of home 1,144 1.5% 3.3% 3.6%
    National newsbrands 1,033 -5.5% -4.3% -3.3%
    of which digital 275 19.3% 3.5% 6.3%
    Regional newsbrands 887 -13.1% -8.0% -4.1%
    of which digital 212 9.9% 11.4% 9.7%
    Magazine brands 776 -11.5% -8.5% -6.5%
    of which digital 271 -4.0% -1.1% -1.6%
    Radio 679 5.2% 6.8% 5.1%
    of which digital 35 26.3% 25.0% 16.7%
    Cinema 259 2.7% 3.9% 7.0%
    TOTAL UK ADSPEND 22,137 4.3% 6.3% 4.9%
    * Broadcaster VoD, digital revenues for newsbrands and magazine brands, radio station websites and mobile advertising spend are also included within the internet total of £11,553m, so care should be taken to avoid double counting.

    Source: AA/WARC Expenditure Report, November 2018

     

    At-a-glance media summary – Q2/H1 2018 Q2 2018 v Q2 2017 H1 2018 v H1 2017
    % change % change
    Internet* 14.5% 14.8%
    of which mobile 29.2% 30.4%
    TV 1.9% 3.5%
    of which VoD 9.4% 10.8%
    Direct mail -4.1% -5.0%
    Out of home 1.5% 3.3%
    National newsbrands -7.4% -4.2%
    of which digital 3.6% 3.2%
    Regional newsbrands -9.6% -9.3%
    of which digital 9.7% 14.0%
    Magazine brands -9.0% -8.7%
    of which digital 6.2% 1.1%
    Radio 1.9% 7.1%
    of which digital 20.4% 29.2%
    Cinema -2.4% -7.8%
    TOTAL UK ADSPEND 6.4% 7.2%
    * Broadcaster VoD, digital revenues for newsbrands and magazine brands, radio station websites and mobile advertising spend are also included within the internet total, so care should be taken to avoid double counting.
    Source: AA/WARC Expenditure Report, November 2018

     

  • WARC Global Ad Trends has focused on sponsorship in this monthly report

    $66bn in ad sponsorship this year

     

     

    By A Correspondent

     

    Advertisers are expected to spend a combined $66bn on sponsorship this year, though fewer than one in five are confident that they can actually measure the business value return of the sponsorships they undertake.

    These and other key findings are included in the latest monthly Global Ad Trends report focusing on sponsorship compiled by WARC, the international authority on advertising and media effectiveness.

    Sponsorship growth is trending ahead of most paid media, and $66bn is expected to be invested this year – mostly on sports properties

    Brand spend on sponsorship – inclusive of rights but excluding activation – is expected to rise 4.9% to reach $65.8bn worldwide this year. Sponsorship is growing faster than all paid media channels excluding internet formats.

    North America makes up the greatest share of spend (36.8%, or $24.2bn), followed by Europe (26.7% or $17.6bn), Asia-Pacific (25.2% or $16.6bn), Latin America (7.0% or $4.6bn), and then the Middle East & Africa (4.3% or $2.8bn).

    Most of this money is going to sports properties. Among these are the FIFA World Cup in Russia, which is thought to have attracted $1.7bn worth of deals. At a time of fragmentation, sport offers large, engaged, multiscreen audiences: by volume of data, the 2018 FIFA World Cup was the most-streamed sporting event in history. TV is still king for live sporting events, with World Cup matches reaching 44% of the global population via television.

    Sponsorships are principally used to drive brand metrics and reach

    Generating brand awareness is the most important objective for sponsorship campaigns. This mirrors separate WARC research in this year’s WARC 100 that found 61% of successful campaigns counted brand awareness as a core objective. This suggests sponsorship plays the same role as mass-reach media, fitting into the ‘upper-funnel’ of a marketing plan (generating awareness and consideration).

    Sponsors rely on intermediate metrics; true ROI remains a challenge

    Only 19% of sponsorship professionals are confident that they can actually measure the business value return of the sponsorships they undertake. Further, only 37% of practitioners have a standardised process for measuring sponsorship.

    The top two named tools used for evaluation are digital and social media metrics. However, the Association of National Advertisers (ANA) states that social media metrics often provide a “distracting noise” due to their weak relationship to sales.

    Social Media and live events power sponsorship activation

    Social is considered the number one activation channel for sponsorships by 83% of marketers. However, the prevailing sentiment is that authentic engagement of sponsorship, through digital and social activation, remains a challenge.

    Possibly by way of remedy, the share of marketers activating sponsorships through experiential live events has risen to two-thirds (65%) over the last year.

    Summing up, James McDonald, Data Editor, WARC, says: “As brands continue to jostle for a finite amount of consumer attention, the changing way in which media is consumed has led to the fragmentation of audiences. Yet sports generate an engaged, mass audience which sponsors can reach, before amplifying their campaigns via social media and experiential events.

    “Sponsorships facilitate the upper part of the sales funnel – driving brand awareness and consideration – in much the same way as TV. This can present challenges, however, such as the knowledge gap between brand impact and sales impact.”

    Global media analysis: A round-up of sponsorship

    ·  4.9% forecast rise in sponsorship spend this year, outpacing the majority of paid media

    ·  19% of practitioners who say they can confidently measure the ROI of their sponsorship campaigns

    ·  39% of Russia World Cup sponsorship deals originating in Asia

    ·  44% reach of global population for both the FIFA World Cup and Olympic Games

    ·  73% of advertisers stating that brand awareness is the most important objective for sponsorship campaigns

    ·  83% of marketers who use social media to amplify sponsorship campaigns

     

    Other new key media intelligence on WARC Data

    ·  Advertisers to spend over $20bn on consumer data this year

    ·  Blockchain adoption is low, though over half of advertisers intend to use in future

    ·  Word-of-mouth most popular way to discover new video content

    ·  Over a third of UK adults have access to a connected TV

     

  • Nuggets from WARC’s global ad trends on digital and print publishing

    Newsbrands diversify to plug $28bn financial hole

     

    Newsbrands’ combined revenue has dipped globally by $27.8bn between 2012 and 2017, with rising income from print circulation and digital advertising not enough to offset a $40.1bn decline in print ad receipts over the period. Publishers are now looking to diversify business models to balance the deficit.

     

    These and other key findings are included the latest monthly Global Ad Trends report focusing on print and digital publishing compiled by WARC, the international authority on advertising and media effectiveness.

     

    Print still provides over 90% of newsbrands’ revenue and total income is down $28bn since 2012

    Print (print advertising and print circulation) still accounts for over 90% of newsbrands’ revenue worldwide, though the majority now comes from circulation. Print circulation revenue has grown by around 1.6% each year, rising from $80.4bn in 2012 to an estimated $86.8bn in 2017 (57.5% of the total). Once the main source of income, print advertising now contributes 33.2% towards the bottom line.

    Digital (digital advertising and digital circulation)’s share of newsbrands’ ad income is growing, but is not yet enough to offset print’s decline. Income from digital ads ($10.1bn in 2017, of which $4.7bn is transacted in the US) now provides a further 6.7% and digital subscriptions just 2.6%.

     

    Most publishers believe their business will diversify to offset the downturn

    A quarter of respondents to a recent WAN-IFRA survey believe that non-traditional revenue sources (i.e. those beyond circulation, subscriptions and advertising) currently account for less than 10% of total income. By 2022, most (21%) believe non-traditional income will contribute between 31% and 40%. Branded content teams (such as Guardian Labs, WSJ Custom Studios and T Brand Studio) are becoming in-house fixtures, and partnerships with content recommendation companies (such as Outbrain and Taboola) are commonplace.

     

    Facebook offers publishers scale, and risk

    The majority of publishers state that their main business objective when engaging with Facebook is to use the platform as a distributor of content. Targeting new audiences and building brand awareness are also key goals, highlighting the social network’s scale.

    On average, 26.7% of consumers are sharing news stories online, varying from 43.0% in Brazil to 8.0% in Japan last year. But 53% could not remember the name of the newsbrand when referred from social media. Aside from anonymity, publishers have little control over the user’s overall viewing experience, and monetisation of the audience is a significant issue.

    Facebook recently made changes to its news feed algorithm, which de-prioritise video content from third-party media outlets. The move threatens publishers’ “pivot to video”, a strategy which aims to generate more ad income from non-text formats.

     

    UK newsbrands join forces to offer brands context, safety and scale

    As of last week, advertisers and agencies are now able to buy digital inventory and access audiences across UK newsbrands The Times, The Daily Telegraph, The Sun and The Guardian from a single sales point. The publishers each have an equal stake in revenue generated from an audience roughly on a par with Facebook’s reach in the UK of 35.1m users, according to the latest PAMCo data, and could be a potential indication of the future model for other publishers.

    Summing up, James McDonald, Data Editor, WARC, says: “The data underline the scale of the challenge facing publishers – despite robust consumer interest in their products. The response appears to be to club together to build scale, to emphasise the importance of context and brand safety, and to diversify revenue streams, particularly into native and branded content.”

     

    Global media analysis: A round-up of print and digital publishing

    ·  1.6% average growth rate in print circulation revenue

    ·  26.7% readers who share news stories on social media

    ·  31.0% US newsbrand ad revenue coming from digital

    ·  34.3% average growth rate in digital subscription revenue

    ·  57.4% consumers who are willing to see advertising in exchange for free news

    ·  90.7% newsbrand revenue derived from print

     

    Other new key media intelligence on WARC Data

    ·  Short-form TV ads capture 8% to 11% more attention per second than long-form

    ·  YouTube launches ad-free Premium and Music services

    ·  Accounting adjustment results in Amazon’s ad sales doubling to over $2bn

    ·  Aussie VOD revenue to top A$126m this year but linear TV formats decline

     

    Global Ad Trends is part of WARC Data, a dedicated online service featuring current advertising benchmarks, data points, ad trends and user-generated expanded databases. For more information visit https://www.warc.com/data

  • Estimates indicate that mobile overtook desktop internet for the first time in 2017

    Global adspend to accelerate in 2018: WARC

     

    By A Correspondent

     

    WARC, the international marketing intelligence service, has released its latest monthly Global Ad Trends report digesting up-to-date insights and evidenced thinking from the worldwide advertising industry.

     

    Focusing on advertising expenditure in 96 markets, this latest Global Ad Trends report includes key trends in spending patterns by media and geography since 2009, a round-up of 2017, as well as full-year projections for 2018.

     

    Global growth is forecast at 4.7 per cent to a total of US$572bn this year, boosted by the Pyeong Chang Winter Olympics, FIFA World Cup, US mid-term elections and reduced dollar volatility in emerging markets.

     

    Growth in North America (+5.0 per cent), Asia-Pacific (+6.0 per cent) and Western Europe (+2.6 per cent) is expected to hasten in 2018, while Central and Eastern Europe (+8.4 per cent) and Latin America (+7.0 per cent) will continue to expand at a strong rate. Advertising spend across the Middle East and Africa is expected to dip once more (-4.1 per cent), though at a lesser rate than in previous years.

     

    Global advertising spend rose 3.0 per cent to US$546bn in 2017, according to new projections based on data for 96 markets. The growth rate in 2017 represents a slowdown from the 3.8 per cent rise recorded in 2016, partially owing to weaker growth in the United States (which accounts for 34 per cent of the value of advertising worldwide).

     

    The slowdown in the US contributed to an easing in growth across North America as a whole. Adspend in the region rose 3.3 per cent to US$199.6bn in 2017. Growth in the world’s second-largest ad region, Asia-Pacific, also cooled (+4.3 per cent to US$162.8bn in 2017, as growth in Japan (23 per cent of the regional total) was muted by a weaker Yen. The Chinese ad market – which accounts for 41 per cent of Asian and 12 per cent of global advertising spend – expanded by 4.7 per cent to US$66.7bn last year, propelled by rapidly increasing spend on mobile ads.

     

    Mobile increased its share of global advertising expenditure by an estimated 5.9 percentage points (pp) to 20.6 per cent in 2017, equivalent to US$112bn (up 44.5 per cent year-on-year). Approximately 45 per cent of mobile advertising spend is based in the US, where US$156 dollars per capita is spent on mobile ads.

     

    Mobile is thought to have been the only media channel to have gained share year-on-year. Estimates indicate that mobile overtook desktop internet for the first time in 2017, as spend on desktop ads was thought to have taken a share of 18.3 per cent (down 1.9pp year-on-year).

     

    The largest media channel, TV, is estimated to have registered a 1.4pp dip in 2017, taking a share of 36.5 per cent of the global adspend total (US$199.5bn). Print continues to lose share, the channel was down an estimated 2.2pp in 2017 to 12.5 per cent. Since 2009, print has recorded a massive 21.5pp decrease in its share of global adspend, and has lost an average US$11.5bn each year since 2012.

     

    Out of home’s share dipped by 0.1pp to 5.7 per cent in 2017, while cinema’s share held at 0.7 per cent and radio was down by an estimated 0.2pp to 5.7 per cent.

     

    James McDonald, Data Editor, WARC, says: “2018 should be a stellar year for global advertising, with ad investment set to grow at its strongest rate since the post recovery years of 2010 and 2011. All global regions, with the exception of the Middle East, are expected to register growth, supported by key quadrennial events – notably the Winter Olympics in South Korea, the FIFA World Cup in Russia and the US mid-term elections.”

     

    He added, “Mobile is now a key driver of global growth, and was the only channel to gain share of spend in 2017 – it now accounts for one in five ad dollars worldwide. Nevertheless, traditional media still attract 61% of global ad investment, and TV and out of home will be among the main benefactors of increased brand and political campaign spending this year.”