State Of The Net Issue 25


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The results of and the MII\'s annual survey on Irish digital sentiment is the main topic of State of the Net issue 25. Other trends covered include eCommerce growth, digital advertising, cloud computing, smartphone penetration, and more.

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  1. 1. State of the Netessential eBusiness intelligence for Irish managers www.amas.ieA quarterly bulletin on online activity in Ireland     ISSN: 1649 issue 25 Summer 2012More Irish marketers switch budgets online 2011 2012 None at all Less than a quarter 14% A quarter to half 20% 10% 16% More than half 13% © AMAS graphic ( 22% 48% 56% Figures may not add to 100% due to rounding Aileen O’Toole, Managing Director, AMAS Proportion of Irish marketing budgets being spent online © AMAS graphic ( marketing professionals However, the rise of social media 2012 Irish Digital Sentiment Surveyare diverting more of their hasn’t dented the popularityadvertising and promotional of email, a format used by twobudgets online, because out of every three marketers. Methodology: online questionnaireof better opportunities for Sample size: 348customer engagement and The choices such marketersgreater return on investment make have a direct effectthan they experience withtraditional channels. One on the commerciality of Irish media, offline and online, 86% of sample have budget planning responsibilitiesin five marketers currentlyspend 50% or more of their which rely on advertising for much of their revenues. Last 82% have budget spend responsibilitiesbudgets online while 60% year, the Irish advertisinghave invested in mobile market is estimated to have traditional channels. used online marketing, 95%channels, mobile sites, apps been worth slightly more than of the sample said value forand/or QR codes. €1 billion, some €897 million of Desktops, mobiles and money was a key driver, either which was accounted for by increasingly tablets are “very important” or “important”.These are among the main traditional channels. Online transforming users’ mediafindings of the fourth annual or digital advertising, as it is habits and their engagement High rankings were also givenDigital Marketing Sentiment variously called, was the only with commercial messages for customer engagementSurvey conducted by AMAS category to show growth, of and offers. That trend is likely to (97%), optimising reach (93%)in partnership with the the order of 20%, compared accelerate. The dizzy numbers and for online being moreMarketing Institute of Ireland with a 4% average decline from Facebook’s debut stock measurable than other forms of(MII). The survey aims to across other media types, market valuation are as much marketing (89%). Less relevantestablish how the internet is according to research from about the anticipated future were reaching an internationalaffecting the Irish marketing PwC/IAB Ireland and Nielsen. growth in digital advertising market (56%) and sellingprofession, the channels globally, as they are about the directly online (50%). A majoritythey use and the marketing Previous MII/AMAS surveys have phenomonenal reach of the of the sample – 59% – reportedbudgets they control. recorded a gradual shift among social network. a higher return on investment Irish marketers from traditional to from online marketing thanSocial media has gained online channels. But the latest The recessionary environment from traditional popularity, with 70% of survey shows emphatically that presents challenges to IrishIrish marketers maintaining digital is core to the marketing marketers, not least how to Online’s gain has been at thea business Facebook strategies of the Irish marketing ensure that depleted marketing expense of other media. Presspresence and 44% with their profession, and in many cases budgets can deliver tangible appears to be the biggest loser,own YouTube channels. is delivering greater value than results. Asked about why they continued on page 4Compiled by AMAS in association with the Irish Internet Association
  2. 2. 1. Digital advertising Display 38% 20% Classified DigitalDigital advertising is now the third largest category of advertising in Ireland mediabehind press and TV, new data from Nielsen and IAB Ireland reveals, and is mix 2011 Irelandreporting robust double digit growth. The recession is taking a considerabletoll on the advertising marketplace, as budgets are cut and media owners €132mare forced to reduce their rates to earn their place on the advertising schedule.Nielsen data shows that the overall advertising market, excluding digital, fell invalue in 2011, by 4% to €897 million. The most significant category drops were in © AMAS graphic ( 42%outdoor and radio, each down by 9%, followed by cinema (8%) and press (6%). Paid for search Irish adverting market However, new research from 450 PwC for IAB Ireland shows digital 400 426 bucking the trend – showing growth of 20% in 400 2011 and placing a value of €132 million on 350 2010 Irish digital advertising. The beneficiaries of this 300 upswing are multinationals, like Google and€ In millions 2011 Microsoft, a range of overseas sites that are 250 280 286 © AMAS graphic ( visited by Irish audiences as well as a slew of 200 established and relatively new Irish players on the media landscape. 150 100 111 132 Search continues to remain the largest slice of 101 110 89 81 the digital advertising pie but new formats, such 50 23 22 9 as social media, are winning favour. PwC/IAB 8 0 Ireland places a value of €5.8 million on Irish social media advertising in 2011. Source: 2011 IAB Ireland/PwC Adspend Study, Newspapers TV Radio Outdoor Magazines Cinema Online survey of online properties, advertising networks ex cluding and sales houses. UTV & C4 2. eCommerce continue to be modest compared with those of our nearest neighbour The number of Irish consumers buying category, with 34% of Irish consumers where 71% of the population made online continues to grow, with more turning to the internet to book holidays online purchases last year. In the UK, the purchases being recorded across all or business travel. Clothing and sporting online marketplace has been valued major eCommerce categories. Ireland goods showed significant growth, with 17% at £68 billion by industry association is on a par with the EU27 average, with of the Irish population making an online IMRG, making it the second largest 43% of Irish consumers saying that they purchase compared with 13% the previous eCommerce market in the world. The had made an online purchase within year. Irish consumers continue to prefer to largest gaps between Irish and UK the previous 12 months. This represents physically do the weekly shopping, with eCommerce are in groceries and food an increase from 36% in 2010. just 4% of the population saying they had – one in five UK consumers now buy bought food and groceries online. them online – and in household goods, Travel and holiday accommodation where 33% of UK consumers buy online, remain the most popular eCommerce Irish eCommerce adoption levels compared with just 8% in Ireland.
  3. 3. Top Trends 3. Mobile Smartphones in numbers Smartphones and tablets are transforming consumers’ media and buying behaviour, with implications for every business from large corporates to the corner shop. A © AMAS graphic ( series of both local and international studies has tracked the explosive growth of smartphones and tablets and the implications for businesses which are targeting the “always on” consumer. Sample: adoption level, RedC puts Irish household smartphone Irish online consumers.  Other statistics: ownership at 49% of the population in smartphone users only. 2011, but predicts it will accelerate to 71% by the end of the current year. Google- Putting individual smartphone adoption a message that is as relevant to larger commissioned research produces a galaxy at 43%, the Google research charts the companies as it is to SMEs. For the latter, of new Irish statistics on smartphones and growing reliance on smartphones for the Google research shows how vital drills behind the data to provide fascinating email, social media access, reading news smartphones are when consumers are insights into how these devices are and either researching a purchasing searching for local services – 89% seek out changing consumers and businesses. decision or actually making it on a local businesses and 90% take action, such phone. A third of Irish smartphone owners as making contact or transacting business. Smartphone multitasking have bought something through their phone, while four out of five have used Tablets are also transforming consumers’ 59% Watching TV their phones to research a purchasing relationship with business. RedC puts 89 % 54% Listening to music decision. Smartphone owners like tablet ownership in Ireland at 16% at the 35% Using internet to multi-task, with three out of five end of 2011, but anticipates it will be 28% Watching movies watching TV while using their phones. as high as 41% by the end of this year. Use smartphone 21% Reading papers/magazines Meanwhile, Adobe is predicting that while... 14% Playing video games For businesses, the main takeaway is that tablets’ global share of website traffic will 12% Reading book mobile needs to be core to their strategy, exceed smartphone traffic by early 2013. Sources: Our Mobile Planet; Ireland, understanding the mobile consumer, May 2012, commissioned by Google, research by Ipsos MediaCT among 700 Irish online adults in Q1 2012. Connecting the World: World Independent Network of Market Research, Irish research by RedC, late 2011 © AMAS graphic ( Bought or ordered goods online by category % Any goods Travel & holiday Clothes & Books, magazines Household Music Electronic Food / or services accommodation sports goods & e-learning goods & Film equipment Groceries EU 27 43 22 22 16 16 13 11 6 UK 71 38 41 32 33 33 19 19Ireland 43 33 17 15 8 14 13 4 Source: Eurostat 2011, respondents asked if they have bought or ordered goods or services for their own use over the past 12 months. the opportunity to win online
  4. 4. continued from cover Preferred online formatsa trend that was also evident in previous MII/AMAS surveys. 45% of the sample said they had Mobile 29%moved spend from press to online, 39% said thatthey had moved it from direct mail, 39% from PR Audio (e.g. podcasts) 18%and 37% from magazines. Video 44%Social media use has matured among Irish Online display advertising 47%marketers, with a majority maintaining a businesspresence across the prime channels. Asked why Blogs / social networking 63%they used social media, building relationships Online classifieds 15%with customers was the most popular reply(86%), followed by building brand awareness Email campaigns 67%(82%) and listening and monitoring (62%). Games 6%Irish marketers see both the benefits and the Online PR 38%downsides of social media use. The primarybenefits are: Search engine marketing 39%• Understanding customers better (75%)• Building contacts (75%) Search engine optimisation 59%• Delivering cost savings (54%) Website sponsorship 17%But social media can be hard work, with 70% © AMAS graphicof the sample saying that it has added to their Viral marketing 17% ( Reputational risks for their companieswere a concern with 56% of the sample, while Other 4%61% had difficulties keeping up to date withsocial media developments. 0 10 50 20 30 40 50 60 70 The full 2012 Irish Digital Online offers more ROI than traditional marketing 40 Use of mobile channels 42% © AMAS graphic ( Marketing survey is available on AMAS’s SlideShare channel 37% © AMAS graphic 30 – ( 30% Graphs from this and previous 24 25% issues of State of the Net are also available through our % 20 SlideShare channel and can be 59 Yes reused once AMAS is credited. 18 No 10 Don’t know 0 Mobile Mobile QR None websites apps codes Use of social media sites by Irish businesses © AMAS graphic Figures may ( not add to 100% due to rounding 30 44 39 39 61 61 % 70 55 Yes No
  5. 5. Top Trends4. Cloud Cloud computingIrish businesses and organisations are tuning into the cloud computingbuzz, but adoption levels remain relatively low. The cloud, a range 37% adoption in Irelandof hosted services that can be accessed via the internet, has been Have deployeddeployed by 37% of Irish businesses and public sector organisations, cloud solutionsaccording to research commissioned by Microsoft.Adoption levels are highest among larger businesses, defined asthose employing more than 250. At 53%, that contrasts sharplywith the 21% deployment levels recorded among SMEs, © AMAS graphic ( 56% With cloud solutions 77%those employing less than 50. Among public sectorbodies, cloud computing is used by 39% of the sample. experienced cost savingsFor many of those early adoptees, the much-trumpetedbenefits of the cloud are a reality – 56% say they haveseen cost savings and 47% recorded productivity gains. Believe cloud will help Source: Microsoft/Amárach CloudFor all that, the research indicates that Irish businesses economic recovery Index Research, based on onlineand public sector organisation are only at 3.2 on a survey among 151 businesses and10-point scale of cloud adoption. public organisations April 2012 Appy days for Irish Business of an app can also vary to capture marketing and enhances the customer wildly and widely – anything sales opportunities. Mobile experience and brings from €2k to €100k – so you advertising is the fastest anything “extra”? Does its need to know what you’re growing element within shelf-life deliver the required getting into before making online advertising, even if return on investment? that kind of investment. its current share of digital spend is still only a tiny If it’s not going to be a Gartner believes that the proportion in Ireland overall. “much-loved, can’t-live- winning apps of 2012 will Furthermore, while many without” app, would you Joan Mulvihill have unique features that of our favourite apps are get a better return from CEO, Irish Internet Association cater specifically for a free, apps themselves will a mobile campaign with mobile environment, rather generate solid revenue – alternative solutions such as Mobile apps can be a major than simply mobile adapted Gartner predicts $15.9 billion click to video, to Facebook, business opportunity, but versions of their online in end-user spending in 2012. to landing page or to what of their staying power originals. Mobile internet download a voucher? and return on investment? use is set to overtake The Yappy mobile There are over a million desktops by 2014, and this advertising agency The IIA will continue to apps out there, but once mobile environment will estimates that less than10% recognise the importance downloaded many are increasingly define the user of brands have an app. Yet of mobile trends in our – in a fit of app overload – experience of your brand. the fact remains that you annual awards next promptly deleted. Before don’t necessarily need one September, so watch out adding your app to their Advertising spend will to run a successful mobile for announcements of growing number, ask increase in tandem as campaign. Marketing categories and key dates. yourself: “What customer brands increasingly shift directors face interesting The IIA will be running a need will it satisfy?” marketing budgets to challenges in 2012. Do you free mobile event in mobile and experiment invest in your own app while early September – see Quotes for the development with cutting-edge apps being clear about how it for more details.
  6. 6. Social networks – who would want another one?Who would outside Facebook And there are many more.start another to news or discussion Wikipedia lists over 200 currentsocial network sites, very often one social networks, from 43 Thingsin the face of of the simplest ways to Zooppa.Facebook’s to log in to thesedominance? other sites is to use In a survey just before its flotation, their username and half of Americans said FacebookIts flotation in password from... was a passing fad and evenmid-May set Facebook. more said they did not trust itnew stock to protect their private records So who would be General Motors passed a votebut caused optimistic or naive Pinterest: visual of no-confidence in Facebookjitters and enough to try to advertising by pulling its $10doubts about a compete with such Globally, Google+ has gained million ad-spend on the network.possible social Fiachra Ó Marcaigh a dominant player? more traction than its previousmedia bubble. Director, AMAS Well Microsoft for social services and is credited So is Facebook vulnerable? one. Its latest take on with 90 million members. No, but neither is it invulnerableBut for all that, a social service With Google’s popularity and – nothing can guaranteeFacebook is in a commanding was unveiled within days of the strength behind it, it has every long-term dominance inposition. With over 900 million Facebook float. opportunity. LinkedIn has technology or online. Askaccounts worldwide, and carved out a strong identity Novell, WordPerfect, AOL,over two million in Ireland, that Will itself sink or swim? and loyalty as a professionally MySpace or Bebo...position looks unassailable. Time will tell, but it’s very far oriented network. from alone in competing with If you’re a marketer, shouldFor many young people, Facebook. In some markets, Pinterest – the online pinboard you bother about emerging orFacebook is the internet. It is especially non-western ones, to “organise and share the lesser-known social networks?where they socialise, meet, play local social networks are very things you love” – has a visual Yes, if only to protect yourgames and spend the majority strong. China’s most popular interface that has won it a lot brand on such networks and,of the increasing amount of micro-blogging site Sina Weibo of attention (although it has potentially, to develop an earlytheir media time that is spent has a reported 300 million also been called “a solution presence on relevant networksonline. Even when they venture members. in search of a problem”). used by your target audiences. eCommerce core to Dubarry’s growth plans AMAS: what we do We cut through the clutter and the complexity to allow Leading Irish brand Dubarry The work programme varied AMAS is an internet consultancy our clients to capitalise on has upgraded its eCommerce from evaluating its existing with a simple goal – help our the unlimited opportunities facilities and launched digital websites to specifying new clients to exploit the internet. offered by the internet. marketing campaigns, following eCommerce functionality and Large corporates, government an internet strategy project providing content, search bodies and, increasingly, high- Services: completed by AMAS. Dubarry, engine optimisation (SEO), potential businesses retain us to • Strategy whose iconic boots are favoured online marketing, training and develop and help implement • Research by Queen Elizabeth and Bruce other services. internet strategies. • User experience Springsteen among others, is pursuing an international growth The first sites in a series of multi- Contact Us: • Content strategy targeting discerning lingual, multi-country websites Aileen O’Toole, • Training buyers of quality marine and have been launched by Dubarry, Managing Director on • Marketing country clothing and footwear. supported by traditional and +353 1 6610499 or • Project management digital marketing campaigns. The AMAS project was designed Like us on Facebook: to improve the brand’s online visibility, boost eCommerce Follow us: sales and support traditional For digital research and insights, sales and marketing activity. follow AMAS on Twitter @AMASinternet © AMAS Ltd. Published by AMAS Ltd., 38 Lr. Leeson Street, Dublin 2, Ireland. Tel: +353 1 6610499 Email: Web: