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Econsultancy Global Media Budgets Index

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Econsultancy Global Media Budgets Index

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Econsultancy Global Media Budgets Index

  1. 1. Market Data / Supplier Selection / Event Presentations / User Experience Benchmarking / Best Practice / Template Files / Trends & Innovation  Media Budgets Index: Comparing media budget allocation to media consumption In association with Datalicious
  2. 2. Media Budgets Index: Comparing media budget allocation to media consumption In association with Datalicious Econsultancy London 4th Floor, Wells Point 79 Wells Street London W1T 3QN United Kingdom Telephone: +44 207 269 1450 http://econsultancy.com help@econsultancy.com Econsultancy New York 350 7th Avenue, Suite 307 New York, NY 10001 United States Telephone: +1 212 971 0630 Econsultancy Singapore 20 Collyer Quay #23-01 Singapore 049319 Telephone: +65 6653 1911 All rights reserved. No part of this publication may be reproduced or transmitted in any form or by any means, electronic or mechanical, including photocopy, recording or any information storage and retrieval system, without prior permission in writing from the publisher. Copyright © Econsultancy.com Ltd 2016 Published June 2016
  3. 3. Media Budgets Index In association with Datalicious Page 3 All rights reserved. No part of this publication may be reproduced or transmitted in any form or by any means, electronic or mechanical, including photocopy, recording or any information storage and retrieval system, without prior permission in writing from the publisher. Copyright © Econsultancy.com Ltd 2016 Contents 1. Executive Summary................................................... 6 1.1. Methodology ........................................................................ 8 1.2. About Econsultancy............................................................ 11 2. Foreword by Datalicious...........................................12 2.1. About Datalicious ...............................................................13 3. Country Comparison Index......................................14 4. Introduction..............................................................15 5. State of the Nations ..................................................16 5.1. Singapore: Overspending on print.....................................17 5.2. India: Proportion of time spent on TV double the percentage of total spend on the channel ..........................17 5.3. US: Bucking the trend; underspending offline..................18 5.4. Australia and New Zealand: Total online spend ahead of both India and Singapore in the APAC region...................18 5.5. UK: Overinvested in print; broadcast still strong..............19 5.6. Where budgets are currently allocated ..............................19 5.7. How budgets are currently allocated ................................ 24 5.8. Where does the pressure come from?................................27 5.9. Roadblocks to increasing digital spend ............................ 28 6. Customer Behaviour vs. Media Mix ........................ 30 6.1. Where do marketers believe customers are spending their time?................................................................................... 30 6.1.1. A mobile mystery............................................................31 6.2. What are marketers’ budget priorities? ............................ 33 6.2.1. Web is underrated and display is overrated in EMEA ..35 6.2.2. UK and US more accurate in matching assumed customer dwell time with budget allocation..................35 6.2.3. ANZ finding it hard to let go of tradition.......................35 6.2.4. Mobile spend to catch up with attention in Asia ...........35 6.3. The time gap ...................................................................... 36 6.3.1. Sourcing the data ...........................................................37 6.4. Balancing spend across the mix ........................................ 38
  4. 4. Media Budgets Index In association with Datalicious Page 4 All rights reserved. No part of this publication may be reproduced or transmitted in any form or by any means, electronic or mechanical, including photocopy, recording or any information storage and retrieval system, without prior permission in writing from the publisher. Copyright © Econsultancy.com Ltd 2016 6.5. Is there flexibility? ............................................................. 40 6.5.1. Test and learn.................................................................42 6.6. Dialling up or down ........................................................... 43 7. Campaign and Mix Optimisation ............................ 46 7.1. Ideal optimisation capabilities .......................................... 46 7.2. Today’s most effective channels........................................ 49 7.3. Understanding attribution ................................................ 50 7.3.1. India ...............................................................................55 7.3.2. Singapore........................................................................56 7.3.3. Global .............................................................................57 8. Country Focus: Singapore ....................................... 59 8.1. Brand spending and customer time.................................. 59 8.2. Selected trends................................................................... 60 8.3. CMO cheat sheet.................................................................61 8.4. Conclusion...........................................................................61 9. Country Focus: India............................................... 62 9.1. Brand spending and customer time.................................. 62 9.2. Selected trends................................................................... 63 9.3. CMO cheat sheet................................................................ 64 9.4. Conclusion.......................................................................... 64 10. Country Focus: United States.................................. 65 10.1. Brand spending and consumer time ................................. 65 10.2. Selected trends................................................................... 66 10.3. CMO cheat sheet.................................................................67 10.4. Conclusion...........................................................................67 11. Country Focus: Australia and New Zealand ........... 68 11.1. Brand spending and consumer time ................................. 68 11.2. Selected trends................................................................... 69 11.3. CMO cheat sheet................................................................ 70 11.4. Conclusion.......................................................................... 70 12. Country Focus: United Kingdom .............................71 12.1. Brand spending and consumer time..................................71 12.2. Selected trends....................................................................72 12.3. CMO cheat sheet.................................................................73 12.4. Conclusion...........................................................................74
  5. 5. Media Budgets Index In association with Datalicious Page 5 All rights reserved. No part of this publication may be reproduced or transmitted in any form or by any means, electronic or mechanical, including photocopy, recording or any information storage and retrieval system, without prior permission in writing from the publisher. Copyright © Econsultancy.com Ltd 2016 13. Appendix...................................................................75 13.1. Asia......................................................................................75 13.2. Australia and New Zealand ............................................... 89 13.3. EMEA (excl. UK)...............................................................103 13.4. UK...................................................................................... 117 13.5. US...................................................................................... 131
  6. 6. Media Budgets Index In association with Datalicious Page 6 All rights reserved. No part of this publication may be reproduced or transmitted in any form or by any means, electronic or mechanical, including photocopy, recording or any information storage and retrieval system, without prior permission in writing from the publisher. Copyright © Econsultancy.com Ltd 2016 1. Executive Summary Media preference Despite a strong movement towards digital, certain media channels still prevail. The most expected of those is TV, which retains its top spot for a variety of reasons. Predominantly, this is because there is still a significant population that is not digital first. Whether this is due to geographical restriction or habit, few brands wish to isolate these customer segments. On an effectiveness basis, executives note that TV is disproportionately expensive. However, it cannot be denied that it is effective, particularly in a brand advertising or second screening role. Investment is expected to increase in TV in most areas; however, EMEA and Singapore in particular are showing caution. Several traditional media channels are continuing to experience declining investment even though some, including radio and print media, show a reasonable degree of ongoing consumer interest. Digital, however, is where the most consistent growth and investment is being seen, with the UK and EMEA putting in the most effort and in some cases digital taking up to 100% of their budgets. Within digital, despite the volume of column inches devoted to mobile, it is websites that receive the most attention. This is where executives expect to increase their budgets. While most executives also expect to increase their exposure on mobile platforms, the sector is slightly more volatile and 6% voiced an intention to decrease their investment. Email is continuing to enjoy a resurgence, with over 90% of executives stating a commitment to either maintaining the status quo or increasing their investment. Paid social, however, has a tendency to polarise, with executives in all regions divided as to whether to increase or decrease spend in this arena. Clearly, it has yet to establish its value. Budget allocation Budgets are still largely allocated on the basis of historical performance rather than customer behaviour or external insights. However, this is gradually changing. While initially it seems that executives are saying extra budget is allocated to those who press their business case hardest, thought is moving in the direction of assessing media effectiveness through ultimate business success. Campaign-specific objectives are beginning to gain traction and viewed in concert with the rest of the multichannel and overall business goals. This will help organisations make objective decisions about media effectiveness and spend. Ability to measure customer behaviour is good to middling across the board, but even those areas with strong measurement capability aren’t necessarily inclined to use it, as only 31% of executives stated that they based their digital media spend on customer time spent in channel. Executives in Asia were the most confident about their abilities to pinpoint customer media choice. Typically, the CMO or marketing director holds media budget responsibility. However, agencies enjoy a greater level of involvement in Asia where, due to their international networks, they are able to bring experience to a relatively immature market. Measurement is noted as being one of the biggest roadblocks to making progress in digital – either because of the lack of ability to understand outputs or conduct assessments in the first place. This links closely to both the impact of legacy systems which are unable to manage the levels and complexity of data produced by digital channels and siloed departments that find it difficult to interact within a multichannel ecosystem.
  7. 7. Media Budgets Index In association with Datalicious Page 7 All rights reserved. No part of this publication may be reproduced or transmitted in any form or by any means, electronic or mechanical, including photocopy, recording or any information storage and retrieval system, without prior permission in writing from the publisher. Copyright © Econsultancy.com Ltd 2016 Despite the changes in customer behaviour and organisational incompatibility challenges that marketers are facing, most feel they have achieved some balance within their digital marketing mix, more so than in offline media. This could well be down to the growing uncertainty of the role offline media plays in a multichannel media ecosystem. Being able to adapt to the changing multichannel ecosystem is an increasingly important skill and not one many marketers feel they have mastered. The majority of those executives surveyed feel they could be more agile but are generally cautiously optimistic. Many approach the challenge by ring-fencing the majority of their budget (between 70-80%) for longer-term projects and leave the rest for test and learn or spontaneous spend. Measurement The need for ongoing measurement and campaign optimisation is generally understood, however there is a lack of consensus as to what makes the most effective digital measurement tool. The questions include how to translate digital measurement norms back to offline media where expectations have changed and how quickly an organisation should react to insights revealed by measurement. Cross-device campaign management is proving one of the biggest challenges for marketers to measure and optimise, but it is also one of the answers marketers most desire. A large number of executives are still focusing on single channel or device-specific measurement campaigns that help to a degree but are unable to give an insight into the effectiveness of a multichannel campaign. The ability to understand attribution or other measurement metrics is by no means universal yet, with around half of executives finding it either irrelevant, not something they understand or a tactic that they do not yet use. Programmatic remains an area that is frustratingly opaque for marketers and while automation has its temptations, the lack of transparency means it is ranked lowest in terms of companies’ capabilities. Despite the range of sophisticated measurement tools available and survey results suggesting that customers may not spend the majority of their time in these channels, marketers believe that in- store POS, TV and websites are the most effective in terms of delivering on media spend. To ratify their decisions, marketers are coming back to the simplest yet possibly most revelatory of metrics: sales uplift and consumer activity.
  8. 8. Media Budgets Index In association with Datalicious Page 8 All rights reserved. No part of this publication may be reproduced or transmitted in any form or by any means, electronic or mechanical, including photocopy, recording or any information storage and retrieval system, without prior permission in writing from the publisher. Copyright © Econsultancy.com Ltd 2016 1.1. Methodology Research objectives This report was designed to examine the relationship between where marketers are spending their money and where consumers are spending their time. This global study explores media habits and budget allocation across the UK and US, EMEA, Asia and Australia/New Zealand. Combining a global survey, desk research and interviews, this report pulls together a picture of media spend and consumption, in order to better inform media spend across these hugely different regions. This is the first time this report has been done, and offers an insight into an area which so far has not been explored to such an extent: are advertisers wasting their budgets, putting money into channels their consumers ignore? The report is therefore designed to pull together findings from new research, and also provide some updated recommendations on approaches to and opportunities within online and traditional media spend. Research methodology The methodology involved three main phases:  Phase 1: Desk research to identify what information is already available about how budgets are being allocated and where consumers are spending their time.  Phase 2: A series of in-depth interviews with a range of senior digital and non-digital marketers and ecommerce leads across different sectors, markets and regions. This was to provide insight into key themes, challenges and opportunities in allocating media spend.  Phase 3: An online survey (678 respondents) of relevant senior staff across a range of organisations and sectors, across all regions covered, designed to better quantify feedback. Figure 1: What best describes your job role? Respondents: 633
  9. 9. Media Budgets Index In association with Datalicious Page 9 All rights reserved. No part of this publication may be reproduced or transmitted in any form or by any means, electronic or mechanical, including photocopy, recording or any information storage and retrieval system, without prior permission in writing from the publisher. Copyright © Econsultancy.com Ltd 2016 Figure 2: Are you more focused on B2B or B2C marketing? Respondents: 628 Figure 3: In which business sector is your organisation? Respondents: 628
  10. 10. Media Budgets Index In association with Datalicious Page 10 All rights reserved. No part of this publication may be reproduced or transmitted in any form or by any means, electronic or mechanical, including photocopy, recording or any information storage and retrieval system, without prior permission in writing from the publisher. Copyright © Econsultancy.com Ltd 2016 Figure 4: Which channels are included when allocating the media budget? Respondents: 584 Acknowledgements Econsultancy would like to thank the following people for their contributions to this report:  Head of Media, EMEA, FMCG  Deborah Goldingham, Head of Marketing SE Asia, MasterCard  Jana Mollett, Head of Brand Advertising, NOW TV  Mark Evans, Marketing Director, Direct Line  Former Global Procurement Director, FMCG  Alessandra di Lorenzo, Chief Advertising Officer, lastminute.com  Jean Thomas, CMO, Vinomofo  Nick Adams, Director Marketing Enablement, Telstra  Trevor Johnson, Global Agency Development, Facebook  Matt Taylor, CMO, HelloFresh Australia  James Woodbridge, CMO, Antares Restaurant Group (Burger King NZ)  Will Lin, VP Digital Media, HomeAway US  Barnaby Dawe, Global CMO, JustEat
  11. 11. Media Budgets Index In association with Datalicious Page 11 All rights reserved. No part of this publication may be reproduced or transmitted in any form or by any means, electronic or mechanical, including photocopy, recording or any information storage and retrieval system, without prior permission in writing from the publisher. Copyright © Econsultancy.com Ltd 2016 1.2. About Econsultancy Econsultancy’s mission is to help its customers achieve excellence in digital business, marketing and ecommerce through research, training and events. Founded in 1999, Econsultancy has offices in New York, London and Singapore. Econsultancy is used by over 600,000 professionals every month. Subscribers get access to research, market data, best practice guides, case studies and elearning – all focused on helping individuals and enterprises get better at digital. The subscription is supported by digital transformation services including digital capability programmes, training courses, skills assessments and audits. We train and develop thousands of professionals each year as well as running events and networking that bring the Econsultancy community together around the world. Subscribe to Econsultancy today to accelerate your journey to digital excellence. Call us to find out more:  New York: +1 212 971 0630  London: +44 207 269 1450  Singapore: +65 6653 1911
  12. 12. Media Budgets Index In association with Datalicious Page 12 All rights reserved. No part of this publication may be reproduced or transmitted in any form or by any means, electronic or mechanical, including photocopy, recording or any information storage and retrieval system, without prior permission in writing from the publisher. Copyright © Econsultancy.com Ltd 2016 2. Foreword by Datalicious This new research from Econsultancy, commissioned by Datalicious, puts the changing shape of media preferences into perspective. The advertising and marketing industry has talked about being data-driven for many years now. If that’s the case, then why are we still seeing media budget inefficiency and disconnected customer experiences? This report is a unique examination of the spending behaviour and attitudes of major marketers in across the globe. We commissioned this study because we wanted to see an index of the disparity between the channels marketers are allocating their budgets, and the channels where consumers are actually spending time. This has never existed before and it’s a key piece of data in understanding the factors driving marketing decisions by major from brands around the world. Whilst it’s common knowledge that digital media – and mobile in particular - is growing at the expense of traditional media, the rate of change is difficult to determine, especially across regions. By opening itself up to the digital advertising ecosystem, television is proving far more resilient than print media, with a small minority of marketers expecting to decrease spend on the medium this year. For most it remains one of the most effective ways of communicating to prospective customers, particularly those without a digital-first orientation. In this report you will see that many are still experimenting in the digital space. The ability to test and learn means advertisers can see what works and as planners get to grips with what works best, we can expect some volatility in the digital media used. This need for advertisers to find their way in the digital world is clearly reflected in this report. However, it is great to see marketers becoming more confident in their experimentation, as digital provides the kind of data that can produce more accurate performance reporting and projections than traditional offline channel reporting. It’s particularly the case when it comes to attribution. Only a third of survey respondents used attribution to measure marketing effectiveness. Within that amount a majority were still using last-click, the least effective attribution model — the majority recognising the benefits of an effective attribution model. There are still challenges to brands implementing a successful media attribution program although as the subject has become more commonplace, these challenges are becoming more easily met. Online media alone will not achieve the outcomes brands are looking for. The continuing role of television demonstrates this, along with the importance of out of home, particularly in-store displays. Advertisers are likely to use a growing range of channels to achieve optimal results, but it will be difficult to manage this mix without a clear understanding of how each element plays its part in achieving the final outcome. For that, marketers need to embrace a data-driven approach to channel allocation or risk wasting budget on sub-optimal performance. From myself and the team at Datalicious, we hope this report gives you a clear view on the state of data-driven media budgets and how marketers are responding to the opportunities and challenges of aligning online and offline budget allocations. And we hope that this report will help guide your future decision-making as you enthusiastically embrace data-driven insights. Special thanks to Jefrey Gomez, Jim Clark and the Econsultancy research team for helping put this significant research together. Christian Bartens CEO & Founder Datalicious
  13. 13. Media Budgets Index In association with Datalicious Page 13 All rights reserved. No part of this publication may be reproduced or transmitted in any form or by any means, electronic or mechanical, including photocopy, recording or any information storage and retrieval system, without prior permission in writing from the publisher. Copyright © Econsultancy.com Ltd 2016 2.1. About Datalicious Datalicious is a full-service analytics agency and technology firm, providing the tools and insights to help companies achieve more effective marketing outcomes. From its origins as a specialist consultancy based in Sydney, Australia, the company attracted investment from the Veda-Equifax Company and has grown to become an innovative software development company that now helps many blue-chip clients across Europe and South-East Asia to think outside the box and achieve data-driven marketing best practice. Datalicious products include the SuperTag tag manager, DataExchange user ID management tool and OptimaHub cross-channel marketing analytics platform. Datalicious is also one of the biggest Google Analytics Premium resellers in South-East Asia. Datalicious technology drives the attribution capabilities for some of the world’s largest and most innovative brands so please contact us for a selection of case studies on how other market leaders are using Datalicious to supercharge their marketing efforts. For more information visit datalicious.com or email:  sydney@datalicious.com  melbourne@datalicious.com  auckland@datalicious.com  singapore@datalicious.com  bangalore@datalicious.com  london@datalicious.com  hanover@datalicious.com  seoul@datalicious.com
  14. 14. Media Budgets Index In association with Datalicious Page 14 All rights reserved. No part of this publication may be reproduced or transmitted in any form or by any means, electronic or mechanical, including photocopy, recording or any information storage and retrieval system, without prior permission in writing from the publisher. Copyright © Econsultancy.com Ltd 2016 3. Country Comparison Index That marketers are failing to match their media spend to where customers actually spend their time is clear. However, this trend is by no means uniform across territories or even within seemingly aligned regions. Singapore, for example, follows the presumed trend by overspending slightly too much on offline media while underinvesting in online. Its near neighbour India however, greatly overspends on offline while leaving online under-represented. The country could stand to move more than half its media investment from offline to online. Conversely, the US seems to strike almost the right balance (although there are disparities when it comes down to a per channel basis, see Section 5), with only a 3% margin either way which, interestingly, sees the nation spend less than optimal amounts offline. Australia and New Zealand are similarly under-indexing offline and overspending on online but by a slightly larger margin, around 7%. The UK returns to the presumed trend with a more than 10% disparity in spend versus consumer time spent and favours offline media more than it should. Table 1: Media spend vs. consumer time across selected countries Channel Spending % of total Time / role Spend disparity Singapore OFFLINE TOTAL $1,413m 87% 62% +15% ONLINE TOTAL $202.44m 13% 38% -25% TOTAL SPEND $1,615.44m India OFFLINE TOTAL $9,013.8m 89% 79.6% +9.4% ONLINE TOTAL $1,083.2m 11% 20.3% -9.3% TOTAL SPEND $10,097.0m United States OFFLINE TOTAL $171,500m 73% 76% -3% ONLINE TOTAL $64,200m 27% 24% +3% TOTAL SPEND $235,700m Australia & New Zealand OFFLINE TOTAL $6,685m 56.7% 64.2% -6.5% ONLINE TOTAL $4,715m 43.3% 35.8% +7.5% TOTAL SPEND $11,400m United Kingdom OFFLINE TOTAL £11,956 62% 51% +11% ONLINE TOTAL £7,194 38% 49% -11% TOTAL SPEND £19,150
  15. 15. Media Budgets Index In association with Datalicious Page 15 All rights reserved. No part of this publication may be reproduced or transmitted in any form or by any means, electronic or mechanical, including photocopy, recording or any information storage and retrieval system, without prior permission in writing from the publisher. Copyright © Econsultancy.com Ltd 2016 4. Introduction If only marketers could be as confident as John Wanamaker when he claimed that 50% of his marketing budget was wasted1, he just didn’t know which half. The media landscape today is so fragmented and fast-moving that the 50% you wasted yesterday could be money well spent today. And vice versa. Are we still fighting the tension between traditional, offline media and the digital vanguard? Or have we finally found a way for each media element to live together in perfect harmony? This report is the culmination of extensive global research into the media habits of marketing executives in a number of critical markets: the UK and US, EMEA, Asia and Australia/New Zealand. These markets were chosen for the way they reflect the subtle (and not so subtle) differences in media approach as a result of exposure to technology, market maturity and resource availability. Critically, this report debunks a number of myths that, over time, have become accepted wisdom among marketers and media strategists. Yes, mobile is a vital channel that is seeing growth, but it is far from a lone panacea. Several traditional channels that have been all but written off as being too old-school to be cool are seeing a quiet resurgence and in several territories can prove the ‘make or break’ element in campaign success. Finally, we attack the measurement issue which continues to perplex marketers on a number of fronts. What should be measured, how much and how often, and will the results be of any use? If, that is, marketers can find people with the right skills and amount of time to get measurement under way. Editorial note: The charts included in the body of this report refer to the global average, consolidated from the entirety of our survey sample. For detailed geography-specific charts please see the Appendix. 1 Statement credited to both John Wanamaker (1838-1922) and Lord Leverhulme (1851-1925).
  16. 16. Media Budgets Index In association with Datalicious Page 16 All rights reserved. No part of this publication may be reproduced or transmitted in any form or by any means, electronic or mechanical, including photocopy, recording or any information storage and retrieval system, without prior permission in writing from the publisher. Copyright © Econsultancy.com Ltd 2016 5. State of the Nations There is an increasing sense that marketers need to refocus their media budgets to reflect consumer behaviour and the massive consumption drift towards online channels. However, marketers are unsure as to how to prioritise spend, particularly given the fluid nature of consumer interaction. Not all channels remain a high priority while others are often used in conjunction with one or two others. Here we make an exclusive comparison between data that reveals where customers are spending a great deal of their media time versus where marketers are prioritising spend. With regional breakdowns we are also able to see the distinct gaps where marketing strategy is failing to keep time with customer behaviour. Figure 5: Please rank the following channels in order of the amount of time customers spend on the channel. Respondents: 493
  17. 17. Media Budgets Index In association with Datalicious Page 17 All rights reserved. No part of this publication may be reproduced or transmitted in any form or by any means, electronic or mechanical, including photocopy, recording or any information storage and retrieval system, without prior permission in writing from the publisher. Copyright © Econsultancy.com Ltd 2016 The averaged assumptions of nearly 700 survey respondents worldwide is that:  The majority of consumers spend most of their time on websites.  Far fewer consumers are assumed to put TV as their favourite media channel over digital media.  TV is expected to be more of a first choice of media than mobile but overall executives expect consumers to spend more time on mobile than TV.  Traditional, offline media outside TV and print are not assumed to contribute much consumer interest at all. 5.1. Singapore: Overspending on print Table 2: Media spend vs. consumer time in channel – Singapore Channel or platform Spending % of total Time / role Spend disparity Television $425m 26% 29% -3% Radio $140m 9% 23% -14% Print $672m 42% 10% +32% OOH / POS $176m 11% - - OFFLINE TOTAL $1,413m 87% 62% -15% ONLINE TOTAL $202.44m 13% 38% -25% TOTAL SPEND $1,615.44m 5.2. India: Proportion of time spent on TV double the percentage of total spend on the channel Table 3: Media spend vs. consumer time in channel – India Channel or platform Spending % of total Time / role Spend disparity Television $3,413m 33.8% 67% +3.8% Radio $305m 3.0% 6.1% = Print $2,566m 25.4% 6.5% +21.6% Direct mail $2,343.8m 23.0% - - OOH / POS $386m 3.8% - - OFFLINE TOTAL $9,013.8m 89% 79.6% +9.4% ONLINE TOTAL $1,083.2m 11% 20.3% -9.3% TOTAL SPEND $10,097.0m
  18. 18. Media Budgets Index In association with Datalicious Page 18 All rights reserved. No part of this publication may be reproduced or transmitted in any form or by any means, electronic or mechanical, including photocopy, recording or any information storage and retrieval system, without prior permission in writing from the publisher. Copyright © Econsultancy.com Ltd 2016 5.3. US: Bucking the trend; underspending offline Table 4: Media spend vs. consumer time in channel – United States Channel or platform Spending % of total Time / role Spend disparity Television $70,600m 30% 37% -7% Radio $16,200m 7% 21% -14% Print $31,600m 13% 18% -5% Direct mail $45,700m 19% OOH / POS $7,400m 3% OFFLINE TOTAL $171,500m 73% 76% -3% ONLINE TOTAL $64,200m 27% 24% +3% TOTAL SPEND $235,700m 5.4. Australia and New Zealand: Total online spend ahead of both India and Singapore in the APAC region Table 5: Media spend vs. consumer time in channel – Australia and New Zealand Channel or platform Spending % of total Time / role Spend disparity Television $3,554m 31.2% 34.5% -3.3% Radio $960m 8.4% 23.8% -15.4% Print $1,140m 10.0% 5.9% +4.1% Direct mail $480m 4.2% OOH / POS $551m 4.8% OFFLINE TOTAL $6,685m 56.7% 64.2% -6.5% ONLINE TOTAL $4,715m 43.3% 35.8% +7.5% TOTAL SPEND $11,400m
  19. 19. Media Budgets Index In association with Datalicious Page 19 All rights reserved. No part of this publication may be reproduced or transmitted in any form or by any means, electronic or mechanical, including photocopy, recording or any information storage and retrieval system, without prior permission in writing from the publisher. Copyright © Econsultancy.com Ltd 2016 5.5. UK: Overinvested in print; broadcast still strong Table 6: Media spend vs. consumer time in channel – United Kingdom Channel or platform Spending (000) % of total Time / role Spend disparity Television £4,911 26% 33% -7% Radio £575 3% 15% -12% Print £3,616 19% 3% +16% Direct mail £1,835 10% OOH / POS £1,019 5% OFFLINE TOTAL £11,956 62% 51% +11% ONLINE TOTAL £7,194 38% 49% -11% TOTAL SPEND £19,150 5.6. Where budgets are currently allocated Unquestionably, the overarching trend for media spend globally is skewed towards increased digital exposure. Figure 6: What best describes your planned media spend for the following channels in 2016? Respondents: 581
  20. 20. Media Budgets Index In association with Datalicious Page 20 All rights reserved. No part of this publication may be reproduced or transmitted in any form or by any means, electronic or mechanical, including photocopy, recording or any information storage and retrieval system, without prior permission in writing from the publisher. Copyright © Econsultancy.com Ltd 2016 TV still dominant That said, an examination of total spend across online and offline channels in several major advertising markets shows that TV advertising continues to dominate budget allocation. Despite any number of indicators determining that the customers’ time spent online is increasing, TV remains the central pillar of most brands’ advertising strategies. According to research for this report, 50-60% of executives across markets consistently plan to keep their TV commitments the same over the next year. Voice of the marketer “You have to be cognisant of the life stage of the business, local sensitivities and really understand your audience. Customer segmentation is key and measurement with consistent benchmarking across your markets is vital.” Barnaby Dawe, Global CMO, Just Eat “We are heavily dependent on TV but we have an approach that makes us look where the consumer is going to be most receptive to our message. They may be watching TV but they’re also texting. The attention to TV has gone.” Head of Media, EMEA, FMCG A little over a third plan to increase their TV spend over 2016 in the US, the UK and Asia. Combining the number of executives who plan to maintain or increase investment, it makes TV the offline channel least impacted by the growing interest in digital. Voice of the marketer “At Facebook, we recently commissioned custom research conducted by Nielsen that showed that boosting TV campaigns with Facebook video ads drives incremental reach, increases efficiency and improves effectiveness. According to that research, when TV and Facebook were combined, advertisers saw a 19% increase in targeted reach versus TV alone. Secondly, when millennials were the target audience, incremental reach increased to 37%.” Trevor Johnson, Global Agency Development, Facebook There are minor exceptions. In Asia as a whole, outdoor and in-store point of sale (POS) see a couple of percentage points more than TV in terms of executives planning to increase investment. In Australia and New Zealand (ANZ), only around a quarter of executives plan to increase investment in TV. However, the proportion of those planning to decrease investment is on a par with the rest of the world at 19%. EMEA (except the UK) and Singapore buck this trend. There is much less interest in increasing investment in TV (only 8% of executives plan to do so over 2016), but EMEA has the largest proportion of executives who plan on keeping investment levels the same. Overall, however, this leaves the region with the largest proportion of executives who plan to reduce their investment in TV. Only print media, in-store POS and radio are expected to see greater cuts. Country-specific markets can see large differences, with more than twice as many executives in India as in Singapore keen to increase investment in TV. Singapore is also the only territory singled out by this research where TV can be shown to have been significantly impacted by digital and is expected to see the third biggest decline in investment, alongside direct mail and radio.
  21. 21. Media Budgets Index In association with Datalicious Page 21 All rights reserved. No part of this publication may be reproduced or transmitted in any form or by any means, electronic or mechanical, including photocopy, recording or any information storage and retrieval system, without prior permission in writing from the publisher. Copyright © Econsultancy.com Ltd 2016 Voice of the marketer “To a certain extent, there’s still a reliance on certain channels. Traditional TV spend would take up a large portion of above the line (ABL) and that’s still the case. It’s the furthest reaching medium and it’s still the most efficient at getting a broadcast message out to as many prospects as possible. We still spend 60% of our budget on TV. That doesn’t mean there isn’t an appetite to spend more on more efficient channels.” Jana Mollett, Head of Brand Advertising, NOW TV Radio, direct mail and print continue to experience declining fortunes, largely showing the greatest propensity to suffer budget cuts and minimal growth in investment. There are a couple of notable exceptions. Asia, for example, has a much higher regard for outdoor than most other markets. The biggest drop in investment is in EMEA, where nearly half of all executives plan to reduce investment in both printed media and radio. The digital surge There is an undeniable trend towards greater investment in digital media worldwide. The amount varies from territory to territory depending on the digital maturity of the market, but overall the increase in investment is marked and consistent. Figure 7: What proportion of your organisation’s media budget was allocated to digital channels in 2015? Respondents: 539 The shift has been primarily in the number of executives allocating a higher proportion of media budget to digital channels, as the 1-10% and 11-20% brackets saw a drop. The growth was predominantly in the middle of the field, where more executives were allocating between 21% and 60% of their media budget.
  22. 22. Media Budgets Index In association with Datalicious Page 22 All rights reserved. No part of this publication may be reproduced or transmitted in any form or by any means, electronic or mechanical, including photocopy, recording or any information storage and retrieval system, without prior permission in writing from the publisher. Copyright © Econsultancy.com Ltd 2016 Voice of the marketer “Digital spend is the one that is increasing quarter on quarter. Our spend across video on demand (VOD) and display increased 100% between our key summer campaign and our Christmas campaign last year. That reflects an appetite to do more digitally because of scale as well as the targeted reach. Perhaps people are still reliant on TV, it just depends on the campaign objectives. For us, if we are trying to get broad reach there is no better channel, but we will always incorporate digital elements.” Jana Mollett, Head of Brand Advertising, NOW TV Locally, ANZ, the US and Asia are most cautious, with growth being seen largely in the 11-20% to 51-60% brackets, while the UK and EMEA are shifting more towards growth in the 71-80% and 81-90% brackets. These are also the only two regions with significant proportions of executives (26% in EMEA, 13% in the UK) committing 91-100% of their budgets to digital. Figure 8: What proportion of your organisation’s media budget will be allocated to digital channels in 2016? Respondents: 539 Table 7: Average proportion of media budgets allocated to digital channels 2015 2016 UK 50% 56% EMEA (excl. UK) 46% 55% US 36% 40% Asia 33% 39% Australia and New Zealand 40% 46% GLOBAL 38% 43%
  23. 23. Media Budgets Index In association with Datalicious Page 23 All rights reserved. No part of this publication may be reproduced or transmitted in any form or by any means, electronic or mechanical, including photocopy, recording or any information storage and retrieval system, without prior permission in writing from the publisher. Copyright © Econsultancy.com Ltd 2016 Websites and mobile still critical More than half of the executives surveyed in every region plan to increase spending in at least two digital entities over 2016, most commonly on websites and mobile channels. EMEA and ANZ showed no appetite to decrease spend on websites at all, while the proportion of executives planning to do so in the US was negligible (2%). Voice of the marketer “In our shift to digital, we have the largest spend in the country, built up over two to three years in programmatic and content. We’ve divested ourselves quite heavily of magazines and press, while out of home may have been dying at one point and yet now there is a resurgence so we’re riding that wave too.” Nick Adams, Director Marketing Enablement, Telstra “Everyone knows that people have moved to mobile and are consuming more video than ever before. Those stats have been presented at every trade show for the past two years. Marketers are also starting to understand that their audiences are using both mobile and traditional media – like TV – together more than ever before. This means structuring campaign strategies to meet people on both screens.” Trevor Johnson, Global Agency Development, Facebook Mobile and/or apps showed a little more volatility, with up to 9% of executives planning to decrease their investment in the channel. This is countered overall, however, by the large volumes of executives in different markets expecting to increase spend (51%-62%) in the mobile channel. Email continues to perform strongly overall, but varies in value to executives. Around a third to just under a half indicated they would increase spend, but overall no less than 90% of executives stated they were at least maintaining the status quo or increasing their commitment over 2016. Voice of the marketer “We have an in-house Digital Services team which gives us greater agility in the digital space. One reflection of this is that we have moved rapidly into ‘always on’ content and have invested in our social media effectiveness, which was recently endorsed by a Harvard Business Review that named us as the most empathetic brand on Twitter globally.” Mark Evans, Marketing Director, Direct Line “We also know that people respond better to native. On Facebook’s Audience Network alone, which is 83% native, we see native ads perform seven times better compared with banners. These are the places and formats that audiences are adopting. I think marketers understand that, which is why we are starting to see dollars shift. I think you will continue to see marketers explore how to combine mobile, native and video to drive the most value for their businesses and audiences.” Trevor Johnson, Global Agency Development, Facebook Paid social is gaining traction as advertisers see the value in native, programmatic and content marketing. However, compared with the UK, which has the strongest showing in terms of executives planning to increase their spend (66%), paid social has the least support in APAC. The results are somewhat contradictory, with 58% of ANZ executives planning to increase spending but 15% planning to reduce it. Similarly, only 41% plan on increasing spend in Asia while 11% plan to decrease it, rising to 13% of executives in India where only 37% plan to increase spend. Social media is becoming a headline trend in digital marketing and is blurring the boundaries between paid, owned and earned media. The platform is still changing rapidly and brands are continually adjusting strategies in the channel to figure out how best to engage the consumer. As
  24. 24. Media Budgets Index In association with Datalicious Page 24 All rights reserved. No part of this publication may be reproduced or transmitted in any form or by any means, electronic or mechanical, including photocopy, recording or any information storage and retrieval system, without prior permission in writing from the publisher. Copyright © Econsultancy.com Ltd 2016 messaging becomes an important part of the social advertising mix over 2016, we can expect the complexity of paid social to grow. Voice of the marketer “We’ve piloted a number of new techniques with Facebook, putting our toe in the water. Some have worked well and we’ve rolled in other markets where it’s not been so successful. It’s a lot of test and learn whilst we ensure we stay focused on our core campaign objectives.” Deborah Goldingham, Head of Marketing SE Asia, MasterCard Search and display will continue to see increased spending, with around half of executives in most territories planning to increase spend in this area. Only Asia and the US saw lesser commitment when it comes to SEO, with 32% (US) and 42% (Asia) of executives planning to increase spend in this area. 5.7. How budgets are currently allocated Executives have clearly been taking the lessons about measuring and metrics on board, as survey results show that, in one way or another, digital media spend is almost always based on some form of evidence-based reporting. This is not to say that the evidence is accurate, however. Voice of the marketer “Measuring the true business value of advertising happens when you can prove, unequivocally, that an ad played a role in driving a business outcome. That can only happen when ads reach real people and marketers are able to properly measure them. Unfortunately, marketers aren’t having an easy time getting to that point. There are two main reasons why:  Over-reliance on proxies: While clicks and CPMs may be the currency of the last decade, they are only proxies of value and business outcomes. People-based measurement is the crucial foundation for helping marketers accurately understand the role their ads played in the path to purchase.  Rapid shift to mobile: The technology that supports current measurement systems (cookies to track exposure and tie to behaviour, and clicks as a proxy for sales) is not sufficient in a world where people use multiple devices throughout the day and the majority of purchases still happen in a physical store. People are consuming more media than ever across multiple devices and it is impacting the ability of marketers to target and measure their advertising effectively.” Trevor Johnson, Global Agency Development, Facebook The majority of those allocating digital media spend are basing their decisions on incremental change from the previous budget depending on performance. While seeking to improve on past activity is certainly a route to improving overall performance, there is no guarantee previous campaigns have been based on solid insights themselves. Voice of the marketer “One of the challenges is that we have to break the TV-centric mindset and think more agnostically and plan with neutrality.” Nick Adams, Director Marketing Enablement, Telstra
  25. 25. Media Budgets Index In association with Datalicious Page 25 All rights reserved. No part of this publication may be reproduced or transmitted in any form or by any means, electronic or mechanical, including photocopy, recording or any information storage and retrieval system, without prior permission in writing from the publisher. Copyright © Econsultancy.com Ltd 2016 Figure 9: Which factors best describe your organisation’s approach to allocating digital media spend? Respondents: 531 Figure 10: Which factors best describe your organisation’s approach to allocating offline media spend? Respondents: 531
  26. 26. Media Budgets Index In association with Datalicious Page 26 All rights reserved. No part of this publication may be reproduced or transmitted in any form or by any means, electronic or mechanical, including photocopy, recording or any information storage and retrieval system, without prior permission in writing from the publisher. Copyright © Econsultancy.com Ltd 2016 Offline media spend is still largely dependent on campaign-specific objectives. Goal-oriented metrics are important as they help the business make sure it stays on track to deliver projected growth. However, even in the offline environment, in-depth measurement is increasingly possible and companies should be making sure that campaigns don’t just deliver on objectives, but do so efficiently. Only 31% of executives surveyed globally stated that they based their digital media spend decisions on customers’ time spent in channel, with an even smaller proportion basing their decisions on ROI reports from attribution modelling. In the offline sector, these numbers decreased yet further to 25% and 20%, respectively. This should frustrate executives who clearly have the information at hand. In the survey, a third of respondents said they had a good idea of where the customer spent their time and a further 49% stated that they were able to measure to a degree but not across the board. More executives than the average from the UK, EMEA, the US and ANZ agreed with this latter point, with Asian executives having the most confidence in their ability to monitor customer time spent. The UK was the least confident about measuring customer time spent, with a quarter of executives stating that they couldn’t do so. Figure 11: Is your organisation able to measure the time spent on channels where media is purchased? Respondents: 487 EMEA (including the UK) performs particularly poorly when matching consumer time spent in channel with media budget allocation while Asia is the polar opposite. Time spent in channel is a vital metric for Asian digital media spend (52% of executives agree) and only slightly less important for offline media spend (38%).
  27. 27. Media Budgets Index In association with Datalicious Page 27 All rights reserved. No part of this publication may be reproduced or transmitted in any form or by any means, electronic or mechanical, including photocopy, recording or any information storage and retrieval system, without prior permission in writing from the publisher. Copyright © Econsultancy.com Ltd 2016 5.8. Where does the pressure come from? Research for this report suggests that politics can still play as much of a role in media budget allocation as hard facts (see Figure 9 and Figure 10). While at the bottom of the pile overall as a deciding factor for media spend, the option of ‘whoever puts forward the best business case gets the budget’ accounted for a fifth of executives. Voice of the marketer “Pressure comes from all areas of the business. Like any company, there are only finite resources, and I need to justify my budgets continually, otherwise it will be allocated elsewhere.” Matt Taylor, CMO, HelloFresh Australia Responses for this category tended to be marginally higher in the offline media spend category and remained consistently at around the 20% mark, indexing slightly higher for the APAC region (max 27%). There is clearly scope for more rigour in measurement, reporting and campaign analysis. Voice of the marketer “Any budget pressure comes from the CMO and Board. Traditional marketing channels have a defined ROI process but new initiatives quite often don’t. To manage this we have an agreed percentage that is ring-fenced for Fast Fail testing and no ROI is measured until we see success and can scale.” James Woodbridge, CMO, Antares Restaurant Group (Burger King NZ) Figure 12: Who is ultimately responsible for allocating and approving spend across the media mix? Respondents: 519
  28. 28. Media Budgets Index In association with Datalicious Page 28 All rights reserved. No part of this publication may be reproduced or transmitted in any form or by any means, electronic or mechanical, including photocopy, recording or any information storage and retrieval system, without prior permission in writing from the publisher. Copyright © Econsultancy.com Ltd 2016 In the vast majority of cases, media budget responsibility including allocating and approving spend, comes down to either the CMO or head of marketing and is an internally assessed and established strategy – with one notable exception. As is perhaps to be expected of a developing nation only just beginning to build its own marketing culture, India is vastly more reliant on media agencies to allocate media spend across the channel mix (38% compared to Asian average of 29% and global average of 13%). Voice of the marketer “There isn’t a great deal of pressure on spend as long as the ROI is good. If there is a $1m budget but $1.5m is spent and the profit is good, then that’s okay. Generally, our key metric is new customers. As long as that cost isn’t too high then we’re good.” Jean Thomas, CMO, Vinomofo Singapore, on the other hand, favours handing this responsibility to the head of marketing (38%), but survey respondents noted that media buyers also play a strong role (29%), stronger even than for India (20%), although their reliance on media agencies in the region is lower than the global average, at 10%. Agency experience is particularly valuable for local brands who, while enjoying scale at a national level, have not been lucky enough to be influenced by group members or partners from more mature markets. Many agencies, even national ones, tend to be part of global networks and benefit from colleagues’ experience. Voice of the marketer “All agencies working together is where the knowledge comes from. We have created a best practice objective and a knowledge transfer where we’re literally hard coding that knowledge into the scope of work and we as the client are aligned when allocating media spend.” Deborah Goldingham, Head of Marketing SE Asia, MasterCard “The ecosystem is still fragmented. Some advertisers are much more advanced than others. Some are taking programmatic in-house and others are outsourcing everything. It varies widely, even between Northern and Southern Europe for example.” Alessandra di Lorenzo, Chief Advertising Officer, lastminute.com 5.9. Roadblocks to increasing digital spend It is clear that executives are increasing spend in digital. However, while the trend is definitively upwards across all regions there are few large movements. The majority of projected changes are in the order of one, two or three percentage points. In such a rapidly changing environment and with a philosophical acceptance of the effectiveness of digital in every industry sector, why is adoption not increasing more rapidly and penetration deeper? Sheer proliferation and interdependency of channels is making the media landscape hard to navigate. It requires a new way of working internally at client brands and also between clients and agency partners. Often, it brings in other departments within the brand that previously had no involvement in marketing. It is unsurprising that an inability to understand or measure channel performance, legacy systems and siloed departmental structures are the top three challenges executives face (Figure 13). The high proportion of executives citing legacy systems and siloed departments is particular to the Asian market (47% and 45%), with ANZ suffering from silos more than most (50%) while lack of resources to manage the data-driven elements of marketing is strongly impacting the UK (54%) and EMEA (48%).
  29. 29. Media Budgets Index In association with Datalicious Page 29 All rights reserved. No part of this publication may be reproduced or transmitted in any form or by any means, electronic or mechanical, including photocopy, recording or any information storage and retrieval system, without prior permission in writing from the publisher. Copyright © Econsultancy.com Ltd 2016 The scale of the challenge of advertising via the immense and rapidly evolving digital landscape is not concerning executives as much as questions over data and organisational structure. Around a quarter of executives are concerned by the scale of the digital landscape to some extent, but for most, it is near the bottom of the priority list. Understanding data, managing technologies and integrating departments will be key to accelerating digital advertising volumes. Figure 13: Which three factors prevent your organisation from spending more on digital channels? Respondents: 522
  30. 30. Media Budgets Index In association with Datalicious Page 30 All rights reserved. No part of this publication may be reproduced or transmitted in any form or by any means, electronic or mechanical, including photocopy, recording or any information storage and retrieval system, without prior permission in writing from the publisher. Copyright © Econsultancy.com Ltd 2016 6. Customer Behaviour vs. Media Mix Section 4 examined the macro and organisational pressures impacting marketers’ budget allocation across online and offline media. Section 5 includes an up-to-date snapshot of the media landscape as marketers understand it and examines if attitudes towards media are matching the reality. 6.1. Where do marketers believe customers are spending their time? Voice of the marketer “It’s important for us to understand consumers’ media consumption, so that we can be in the right place at the most relevant time. This is particularly pertinent within insurance; given that it has an annual purchase cycle. Working closely with our agency partners ensures that we are on the front foot and as a result, we have seen improved media efficiency in recent years that more than offsets media market inflation.” Mark Evans, Marketing Director, Direct Line In a question covering both online and offline media consumption worldwide, marketers felt that customers spend the majority of their media time in the web channel – 45% stated this was their first choice. Only 12% of marketers believe customers spend the majority of their time in the TV channel. Radio performed poorly in every locality, scoring 3% in ANZ and single digits in the cumulative score of top three preferences for customer dwell time elsewhere. Printed media performed strongly (25%) relative to other offline channels and even some digital, particularly in view of the little investment (and growing cuts) it currently receives from marketers. Direct mail and display also perform poorly, proving to be online and offline equivalents, as programmatic risks reducing display to spam and a history of poor targeting sends direct mail on a direct route from letterbox to recycling box.
  31. 31. Media Budgets Index In association with Datalicious Page 31 All rights reserved. No part of this publication may be reproduced or transmitted in any form or by any means, electronic or mechanical, including photocopy, recording or any information storage and retrieval system, without prior permission in writing from the publisher. Copyright © Econsultancy.com Ltd 2016 Figure 14: Please rank the following channels in order of the amount of time customers spend on the channel. Respondents: 493 6.1.1. A mobile mystery Only 7% of marketers worldwide believe customers spend most of their time on mobile. This runs contrary to the accepted wisdom that mobile is dominating customer attention. Why are marketers giving such low credence to the mobile channel? Cumulatively (in an aggregation of executives who cited mobile as either the first, second or third choice of channel where customers would spend most of their time), 27% of executives agreed customers spent most time on mobile, but this still seems low particularly in view of the column inches devoted to mobile marketing. In the US, 56% of marketers cited the web as their first choice for where customers were spending their media time, again with surprisingly few putting mobile at the top of their lists. Overall, 29% of American executives believed that mobile was one of the top three media destinations for customers, placing it fourth overall behind print media (32%) and email (39%), with web far outstripping other channels at a total of 75% of executives making it their first, second or third choice for customer time spent in channel. In the UK, the situation is even more inexplicable, with only 2% giving the mobile channel the top spot and overall only 12% ranking it as anywhere within the top three choices for customers. Paid
  32. 32. Media Budgets Index In association with Datalicious Page 32 All rights reserved. No part of this publication may be reproduced or transmitted in any form or by any means, electronic or mechanical, including photocopy, recording or any information storage and retrieval system, without prior permission in writing from the publisher. Copyright © Econsultancy.com Ltd 2016 search and email far exceed mobile for customer time spent as anticipated by marketers, at 37% and 47% respectively. Cumulatively however, UK executives believe customers spend less time overall in the web channel than US marketers, at 59%. The story is similarly low for EMEA, where no respondents hold mobile as the first choice for customer time spent and web again dominating at 80%. Email continues to show its strength as customers’ secondary channel of importance, with 5% of executives stating it is their first choice for majority of customer time spent. The mobile picture improves in Australia and New Zealand, still dominated by executives giving top billing to customer dwell time on websites (36% as a first choice, 27% as a second and 12% as a third). Mobile overall is given top-three customer dwell time scores by 24% of executives, only three percentage points behind TV, but trailing email by 28 percentage points. In fact, Asia is leading the field when it comes to recognising the growing influence of customer dwell time in the mobile channel. While still a low proportion (10%) cited mobile as the channel customers spend most time in, overall 32% of executives ranked it in the top three and in this case only marginally behind email (35%), TV (36%) and then web occupying its customary top spot (55%). This makes it clear why China in particular is leading the charge when it comes to moving marketing into the purely mobile channel through messaging and the market-dominating WeChat. While it is often lambasted for being behind the curve in adopting maturing digital strategies, Asia is leading the way in the key future battleground of mobile. Voice of the marketer “The majority of customers in most markets are coming to us from mobile, either mobile web or app but proportionately, mobile marketing is much smaller and further down the conversion funnel. However we are increasing spend in all markets across mobile, primarily in Facebook which is a great app download platform for us. You have to navigate the complexities of mobile in that it offers both a platform and a channel.” Barnaby Dawe, Global CMO, Just Eat “Mobile is fantastic because it gives you the mobility information from customers plus location-based activities. It fits into a broader scope multi-channel campaign that can then itself be the backbone of a wider TV campaign. It’s not about either/or. It’s about being complementary.” Alessandra di Lorenzo, Chief Advertising Officer, lastminute.com
  33. 33. Media Budgets Index In association with Datalicious Page 33 All rights reserved. No part of this publication may be reproduced or transmitted in any form or by any means, electronic or mechanical, including photocopy, recording or any information storage and retrieval system, without prior permission in writing from the publisher. Copyright © Econsultancy.com Ltd 2016 6.2. What are marketers’ budget priorities? As seen in Section 5.1, it is clear that marketers believe the web remains the channel where most customers reside. Email, TV, paid search and paid social are also expected to harbour large audiences. More old-style channels, including display, outdoor, direct mail and radio, have fallen far out of favour. We should expect marketers’ budget allocation preferences to match their assumptions about customer dwell time. Voice of the marketer “We relied on search to do most of the digital marketing but SEO is very reactive. It’s great when the intent to convert is much stronger but you have to go out and reach users too. One of our metrics is new visits to the site. Facebook is very important for learning about new users but we also have TV and brand promotions. It’s very important to market holistically.” Will Lin, VP Digital Media, HomeAway US “No-one gets fired for buying TV? That’s about to change. If you are just moving wallpaper, you won’t sell product. There’s a role for digital and TV to work together but when budgets become really stretched, suddenly there is an ‘aha!’ moment and you start to interrogate every other medium with more attention than anyone ever did with TV.” Head of Media, EMEA, FMCG In the self-reported findings of the survey, by and large these do match up; however, it is possible to see from the global study that marketers continue to overspend in channels that the executives themselves note are declining in customer popularity. When seeking customers, it is possible that marketers have lost sight somewhat of where they should be focusing their energies, according to James Woodbridge, CMO of Antares Restaurant Group (Burger King NZ): “Common sense seems stupid to say, but in many big corporates having plenty of budget to research to the nth degree is inefficient and quite often common sense is just as good. It’s just unfortunate that common sense is not so common these days. Be pragmatic.”
  34. 34. Media Budgets Index In association with Datalicious Page 34 All rights reserved. No part of this publication may be reproduced or transmitted in any form or by any means, electronic or mechanical, including photocopy, recording or any information storage and retrieval system, without prior permission in writing from the publisher. Copyright © Econsultancy.com Ltd 2016 Figure 15: Please rank the following channels in order of proportion of media budget allocated (from most budget to least budget). Respondents: 506 According to the global survey, executives are: Underspending in: Matching time spent with budget for: Overspending in:  Website – 66% (top choice for customer dwell time) vs. 56% (top choice for budget allocation)  Paid search – 23% vs. 26%  Printed media – 25% vs. 31%  Email – 39% vs. 32%  Mobile / app – 27% vs. 21%  Paid social – 19% vs. 14%  In-store POS – 8% vs. 8%  TV – 25% vs. 33%  Display – 14% vs. 20%  Direct mail – 12% vs. 14%  Radio – 5% vs. 7%  Outdoor – 6% vs. 7%  SEO (organic search) – 13% vs. 14%
  35. 35. Media Budgets Index In association with Datalicious Page 35 All rights reserved. No part of this publication may be reproduced or transmitted in any form or by any means, electronic or mechanical, including photocopy, recording or any information storage and retrieval system, without prior permission in writing from the publisher. Copyright © Econsultancy.com Ltd 2016 Voice of the marketer “TV networks have been slow to respond to the shift in consumer behaviour change driven by technology. Unfortunately, we still need to be on TV but we are paying too much for it. TV is a great example of diminishing returns for advertisers.” James Woodbridge, CMO, Antares Restaurant Group (Burger King NZ) 6.2.1. Web is underrated and display is overrated in EMEA Investment in website media is 40% less than what executives themselves estimate customers give their attention to in EMEA (57% vs 80%). However, investment in display is dramatically overrepresented. Only 5% of executives in the region believe that customers spend the majority of their time (and even then it is the second choice for all respondents) on display and yet, cumulatively, it’s in the top three choices for 38% of executives to devote media budget to the channel. Almost across the board, ANZ executives are devoting disproportionate amounts of media spend to channels where they themselves consider customers are not devoting the majority of their time. 6.2.2. UK and US more accurate in matching assumed customer dwell time with budget allocation As a rule, budget allocation in the UK is a few percentage points lower than the numbers marketers suggest are spending the majority of their time in each channel. But there is nowhere near the same discrepancy as seen in the ANZ region. Overall, executives seem to be pitching spend ten percentage points lower than their estimated customer volumes. The US paints a similar picture, although executives ascribe more than double the importance to printed media (11% make it their first spend choice, compared to 5% feeling it is the number one media channel for consumers). 6.2.3. ANZ finding it hard to let go of tradition Unlike the nations above, where spend does not meet the estimated customer dwell time in the majority of cases, ANZ tends to overcompensate across channels, particularly in offline media. Offline, elements such as display are higher up the preference scale (executives’ first choice for investment against customers’ third choice for media dwell), if not exceeding the spend versus volume of customers’ ratio overall. Outdoor bucks the trend for tradition, with only 3% of executives placing it in their third choice for spend (the highest rank it achieves), compared with the same proportion believing it’s a second choice for customer dwell time and a further 6% stating it is a third choice. 6.2.4. Mobile spend to catch up with attention in Asia Despite being the most advanced region in terms of acknowledging customer mobile channel use, marketers’ spend still has to match up. However, the discrepancies between budget allocation and presumed customer time spent is minor across all channels, again with the tendency to underspend relative to time spent.
  36. 36. Media Budgets Index In association with Datalicious Page 36 All rights reserved. No part of this publication may be reproduced or transmitted in any form or by any means, electronic or mechanical, including photocopy, recording or any information storage and retrieval system, without prior permission in writing from the publisher. Copyright © Econsultancy.com Ltd 2016 Voice of the marketer “[In Australia] TV is a blunt instrument used for air cover that drives search. Radio is good for awareness in markets where we have bigger budgets but we always try to get a value add, such as promotions and content in Australia. However, the UK is heavily regulated and as a responsive tool is hard to measure. It’s a tricky one to get right.” Barnaby Dawe, Global CMO, Just Eat “In the US we saw uplift in SEO, PPC and direct referral when we ran TV nationally rather than targeted via demographic.” Will Lin, VP Digital Media, HomeAway US “None of us is getting mobile 100% right. Consumption is far higher than the amount we spend in every single one of our markets. However, there comes that point when the customer is looking at Facebook on a tiny screen without the sound up and you have to ask – are they getting an experience on mobile or not?” Head of Media, EMEA, FMCG 6.3. The time gap From the above assessments, it is easy to understand the importance of integrating customer dwell time per channel into budget allocation calculations. It is only one of many contributing factors and should not be used in isolation. It cannot be denied, however, that understanding where customers spend their time, either online or offline, is vital to landing media campaigns. Figure 16: Which of the following best describes how time spent data is used in your organisation? Respondents: 486 It should be of some concern to advertisers to learn that the majority of UK advertisers (51%) do not use the data around the time customers spend on media channels. Of those that do, a third state that it is one of the variables informing future media spend. The picture darkens further for the rest of EMEA, where 53% of marketers do not count time spent data at all (accounting for the
  37. 37. Media Budgets Index In association with Datalicious Page 37 All rights reserved. No part of this publication may be reproduced or transmitted in any form or by any means, electronic or mechanical, including photocopy, recording or any information storage and retrieval system, without prior permission in writing from the publisher. Copyright © Econsultancy.com Ltd 2016 large anomalies in Section 5.2.1 above, perhaps) and only 18% incorporate it in their suite of variables. In ANZ however, 48% stated time spent was the key variable in determining future spend, although this result is somewhat contradictory considering only 3% of respondents suggested that they actively monitored time spent online to adjust spend mid-campaign (see agility above, Section 5.5). This was an overarching trend across all regions, except Asia, where 14% of executives actively monitored customer media consumption. This is not a uniform APAC behaviour however, as a substantial proportion of executives in India (27%) don’t use time spent data at all, compared with 7% of executives in Singapore who admitted this was also the case. Overall, companies in India relied less on customer time spent data than those in Singapore. However, both nations roughly reflected the area as a whole on other counts. This compares unfavourably to the global trend, where only 25% of executives overall stated that they didn’t use time spent data to inform campaigns and furthermore, that nearly a third (31%) stated it was a key variable for future media spend. The US, in comparison, had a lower-than-average proportion of executives dismissing time spent as a variable and 47% stated it was one of their contributing factors. 6.3.1. Sourcing the data Again, reflecting on the difference between the relative maturity of the markets contributing to this report, more established digital markets such as the UK, EMEA and the US all showed majorities for sourcing customer dwell data from in-house tools. This ensures accuracy and maintains data security across reporting. Figure 17: Where do you get the data around the time spent on your media channels? Respondents: 486
  38. 38. Media Budgets Index In association with Datalicious Page 38 All rights reserved. No part of this publication may be reproduced or transmitted in any form or by any means, electronic or mechanical, including photocopy, recording or any information storage and retrieval system, without prior permission in writing from the publisher. Copyright © Econsultancy.com Ltd 2016 Of secondary importance were third-party data providers and agencies normally came third – except in the case of ANZ and Asia as a whole, where around half of executives (15+ percentage points more than Western nations) relied upon data provided by agencies. Within the Asian region, India was most dependent on agency help, as per Section 4. Neither Singapore nor India felt confident relying on in-house measurements (32% and 20%, respectively), with the majority of Singaporean executives seeking assistance from third parties (68%). 6.4. Balancing spend across the mix As a result of the findings above, it is unsurprising that, globally, the majority of executives (42%) feel that they are very much average when it comes to finding the ideal offline budget balance, stating that they are ‘neither balanced nor imbalanced’. Nearly a quarter (24%) would go as far as to say they are ‘quite balanced’. However, only a tenth consider their budget strategy to be ‘very balanced’. In terms of managing the digital mix (Figure 19), however, global confidence is high, with 33% stating they feel it is ‘quite balanced’ and a further 39% feeling their approach is average. Figure 18: How balanced is your offline media mix/spend? Respondents: 490 The US, which by and large had managed to match its spending patterns to customer time spent, also considers its offline mix to be average, while it is more confident regarding its online mix (36% consider their strategy to be ‘quite balanced’ compared to 24% for offline). Voice of the marketer “Singapore has a huge opportunity in cinema and mobile. Getting any messages across there is very much dependent on print. Whereas with the Philippines it still needs out of home and broadsheet which is ironic when you consider the high penetration of social there. It’s a real challenge and when we’re building our media strategy in the region, we have to be very focused on the consumer audiences.” Deborah Goldingham, Head of Marketing SE Asia, MasterCard
  39. 39. Media Budgets Index In association with Datalicious Page 39 All rights reserved. No part of this publication may be reproduced or transmitted in any form or by any means, electronic or mechanical, including photocopy, recording or any information storage and retrieval system, without prior permission in writing from the publisher. Copyright © Econsultancy.com Ltd 2016 The UK is more pessimistic about its ability to achieve an offline spend balance, despite its similar spend/time patterns to the US. Its confidence in digital spend, however, matches its North American cousins. Executives in EMEA claim to be similarly unbalanced to the UK in terms of offline, but surprisingly given the discrepancy between spend and time spent online in both web and display described above, 30% of EMEA executives consider their digital mix to be well balanced. Considering its attachment to traditional ad spend, it is perhaps unsurprising that executives in Australia and New Zealand feel their approach to the offline mix is ‘quite balanced’ (36%) and are less confident in the digital mix (33%). However, the dominant sentiment across all regions from around half of all executives surveyed is that their budget strategy is ‘neither balanced nor imbalanced’. Figure 19: How balanced is your digital media mix/spend? Respondents: 492 Voice of the marketer “Overall we’re moving more towards digital. We heavily invested in digital last year and this year we’re looking at getting more of a balance between digital, out of home and print.” Deborah Goldingham, Head of Marketing SE Asia, MasterCard “It’s so important to think in an ‘always on’ approach to customers. Particularly in FMCG there are people in the audience who are enormously tech savvy and many who are completely not. You need to be able to talk to all of them.” Head of Media, EMEA, FMCG
  40. 40. Media Budgets Index In association with Datalicious Page 40 All rights reserved. No part of this publication may be reproduced or transmitted in any form or by any means, electronic or mechanical, including photocopy, recording or any information storage and retrieval system, without prior permission in writing from the publisher. Copyright © Econsultancy.com Ltd 2016 6.5. Is there flexibility? Voice of the marketer “While it can be tempting to jump on every new media opportunity that comes along, we must start with what best delivers our business objectives. However, there is also a risk of getting left behind, so we experiment regularly, but sensibly. Specifically, we carve out a reasonable proportion of our budget for media channel agnostic ‘test and learn’.” Mark Evans, Marketing Director, Direct Line Many executives interviewed for this report noted that there was certainly a portion of their budgets set aside for ‘test and learn’. A handful of those also identified that a tranche of the remaining budget was established with flexibility to respond to market trends. Unsurprisingly it would appear that brands inhabiting entrepreneurial or technology spaces tended to be more responsive than blue chip organisations. Voice of the marketer “Our rule has always been to spend it where it is most cost effective. Roughly we attributed 80% to our ongoing efforts and put 20% into testing. When we find something that does well, it becomes part of the ongoing budget and something else gets kicked out. The customer changes a lot and we have to follow.” Jean Thomas, CMO, Vinomofo In the executive survey globally, companies were cautiously optimistic about the relative agility of their media budgets (Figure 20). Nearly half stated they were ‘quite agile’ (48%), while a little under a fifth claimed to be ‘very agile’ (18%). Around a third (28%) were pessimistic about their ability to flex budgets while a relatively small number (6%) claimed to be rigid on spend. Voice of the marketer “More and more we are trying to set aside budget or looking for efficiencies where we can be more reactive. For example, in digital or radio we can buy late in the day and certain channels like programmatic display can be switched on and off quickly. Certain technology such as Sky Ad smart do let television advertisers be more reactive. This could be changing the way TV is bought.” Jana Mollett, Head of Brand Advertising, NOW TV
  41. 41. Media Budgets Index In association with Datalicious Page 41 All rights reserved. No part of this publication may be reproduced or transmitted in any form or by any means, electronic or mechanical, including photocopy, recording or any information storage and retrieval system, without prior permission in writing from the publisher. Copyright © Econsultancy.com Ltd 2016 Figure 20: In a typical campaign, how agile is your organisation with the media budget? Respondents: 519 In local markets, EMEA comes top for budget flexibility, with a trend-busting 44% of executives claiming to have a ‘very agile’ response to media spend and a further 28% claiming to be ‘quite agile’. Asia is the most agile territory overall; however, most of its executives (52%) only consider themselves ‘quite agile’. Voice of the marketer “We have established a digital engine that fuels 50% of our campaigns across the region. It’s very much rooted in digital and social media. Based on what is happening and trending we adapt our media bias to those needs: 80% is baked in, 20% is adjusted.” Deborah Goldingham, Head of Marketing SE Asia, MasterCard India is particularly bullish, with 37% of its executives claiming to be ‘very agile’, compared with Singapore’s 10%. This trend is reversed in the ‘quite agile’ section, however, with 65% of executives in Singapore compared with 46% in India. The UK matches the overall trend most closely, while ANZ and the US are most cautious about their budget flexibility, as the proportion of executives stating they are ‘very agile’ with media spend is in single figures. Voice of the marketer “We track our budget every day and from that we forecast so there are no real surprises. The dashboard will tell us if our forecast is on track and then we can have a quick meeting to see how to improve on it. If you have technology, then flexibility can be normal. Big businesses have too many chiefs with so many layers of management. Digital is not that hard, it’s the complicated structure that makes it difficult.” Jean Thomas, CMO, Vinomofo
  42. 42. Media Budgets Index In association with Datalicious Page 42 All rights reserved. No part of this publication may be reproduced or transmitted in any form or by any means, electronic or mechanical, including photocopy, recording or any information storage and retrieval system, without prior permission in writing from the publisher. Copyright © Econsultancy.com Ltd 2016 There is certainly room for improvement in advertisers’ flexibility and responsiveness, particularly in view of the low numbers of executives using customer time spent data to adapt campaigns in-train (see Section 5.3). As Hello Fresh’s Matt Taylor advises: “All our campaigns are measured every single day, and as soon as something begins to stop performing it is gone. We can’t afford to take the view of, ‘oh we’ve done it before, I guess we’ll just keep going as is’ in such a dynamic business.” 6.5.1. Test and learn The ability to adapt whole campaigns, both online and offline, while the campaigns are active, still proves difficult for many. Traditional channels continue to be run on long lead times with concrete commitments. For some, this is restrictive and they are diverting spend to channels that give them the freedom to experiment. For others, such rigidity saves them from jumping on every unnecessary bandwagon. Figure 21: To what extent does your media budget allow you to test and learn? Respondents: 519 Most executives, regardless of sector, have managed to carve out at least some space in their media plan for a test and learn allocation. Globally, a third of executives identified that an allocation had been set aside for experimentation, regardless of channel. A further quarter (28%) noted that there was no such entrenched budget partition, but if a business case could be made for it, then extra funds could be found. Almost as many executives had parsed out budget per channel for test and learn activity (25%), while only 13% admitted that there was currently no scope for testing in the media budget.
  43. 43. Media Budgets Index In association with Datalicious Page 43 All rights reserved. No part of this publication may be reproduced or transmitted in any form or by any means, electronic or mechanical, including photocopy, recording or any information storage and retrieval system, without prior permission in writing from the publisher. Copyright © Econsultancy.com Ltd 2016 Voice of the marketer “We are encouraged to be innovative and to test and learn. The budget model we operate on is a 70-20-10 split. 70% of digital is allocated to the baseline of tried and tested strategy, then 20% is testing new partners or new technologies. Finally, 10% is for innovation and doing something quite different.” Jana Mollett, Head of Brand Advertising, NOW TV This remains the picture by and large across most regions, with only the UK and US showing a minimal increase in companies with no testing allocation (19% and 17%, respectively). Within Asia however, Singapore – surprisingly perhaps for a nation that has shown itself otherwise to be with or ahead of the curve in technology-led or inspired media trends – also has one of the highest proportions of executives with no testing budget (15%). 6.6. Dialling up or down There are clear gaps between executives’ assumptions about where customers spend their time online and offline and the budget allocated to each of these channels. Before examining these gaps, however, it is pertinent to look at which three channels executives (based on experience, evidence or perhaps gut feel) would increase or decrease their media spend on. Results suggest that, despite some anomalous behaviours noted above, there is at least a general understanding of where future trends are leading. Figure 22: For which three channels would you increase your media spend? Respondents: 489 Globally, most executives would increase spend on websites (53%), followed closely by mobile (40%) and email (32%). Radio (4%) and outdoor (5%), unsurprisingly perhaps, receive the least attention.
  44. 44. Media Budgets Index In association with Datalicious Page 44 All rights reserved. No part of this publication may be reproduced or transmitted in any form or by any means, electronic or mechanical, including photocopy, recording or any information storage and retrieval system, without prior permission in writing from the publisher. Copyright © Econsultancy.com Ltd 2016 Figure 23: For which three channels would you decrease your media spend? Respondents: 489 Conversely, printed media is the first for the axe, with nearly a third (32%) of executives making it their first choice for budget cuts, followed by direct mail and radio. Outdoor finds itself in the middle of the field, despite receiving little support in terms of either customer spend time or media allocation (see Section 5.2). ANZ executives’ choice for increasing or decreasing spend continues to demonstrate the traditionalism shown in Section 5.2. While they would agree to increasing their commitment to the top three digital channels identified by most executives as important (website at 52%; mobile/app at 33% and paid search at 30%), ANZ executives also highlight email as the top candidate for a reduction in spending (39%). TV’s reputation for wastefulness hits home in the EMEA region, where 45% of executives would reduce spend in the channel. The same proportion would like to cut the radio budget, while printed media (40%) and direct mail (30%) also come under scrutiny. Perhaps still seen as sacrosanct (given the vast sums spent on the Super Bowl, starting at $5m for 30 seconds) in the US, TV is only in the middle of the table for reduced spending, while printed media is at the top of the list for cuts. Websites continue to enjoy the lion’s share of the budget increases in North America. Print continues to suffer in the UK, while broadcast media and digital are less likely to suffer reduced investment. The nation goes against the tide only in terms of executives’ desire to increase investment in SEO (organic search). Asia defies expectation, with 37% of executives suggesting that they would increase spend in TV, third only to mobile and website. Paradoxically, a further third would also reduce investment in TV, the top choice for making budget savings. Once again however, the region is not homogenous and executives in Singapore are more reluctant to cut TV budget than
  45. 45. Media Budgets Index In association with Datalicious Page 45 All rights reserved. No part of this publication may be reproduced or transmitted in any form or by any means, electronic or mechanical, including photocopy, recording or any information storage and retrieval system, without prior permission in writing from the publisher. Copyright © Econsultancy.com Ltd 2016 radio, direct mail or paid search, while it is the top choice for executives in India, on a par with email. Radio is the most consistent channel to suffer restrictions across the board. Voice of the marketer “We have a global performance team that drives best practice through all our markets from acquisition to retention. There is a lot of predictability which helps markets understand trends so they can make more sense of the media mix.” Barnaby Dawe, Global CMO, Just Eat
  46. 46. Media Budgets Index In association with Datalicious Page 46 All rights reserved. No part of this publication may be reproduced or transmitted in any form or by any means, electronic or mechanical, including photocopy, recording or any information storage and retrieval system, without prior permission in writing from the publisher. Copyright © Econsultancy.com Ltd 2016 7. Campaign and Mix Optimisation Measurement is frequently a sticking point for organisations looking to maximise their media spend. Philosophies around how and what to measure always seem to be changing; agencies and vendors create proprietary metrics that lack equivalence across the industry. The landscape and consumer behaviours are changing so fast that the option to measure is one a time-poor marketing department doesn’t always have. Voice of the marketer “Just because they’ve been blinded by science, the average marketing manager thinks digital is complicated. Everyone understands return on investment. The first thing people want to know is: is this going to deliver? All media is the same. How much reach is there? Will it engage my audience? You have to drill into it to make sure the metrics aren’t smoke and mirrors as well as monitoring fraud but in the end it’s down to good, old ROI.” Head of Media, EMEA, FMCG 7.1. Ideal optimisation capabilities Learning from and improving on past campaign performance is often the starting point for most organisations’ optimisation journey. As a result, most respondents rated ‘optimising campaign budget based on historical performance data’ either a ‘critical’ or ‘very important’ capability to have (74%), as seen in Figure 24. Voice of the marketer “Marketing has always been a merge of creativity and science. Understanding consumer behaviour with strong analytics and connecting the dots with engaging creative to reflect and inspire their needs. Nothing is untouchable these days and although historical patterns give us some comfort in making decisions, it is not going to help you when predicting where your brand needs to be in two years’ time. We use a Fast Fail & Scale process with new ideas. We are robustly testing several new ideas, learning fast and scaling what works.” James Woodbridge, CMO, Antares Restaurant Group (Burger King NZ) Cross-device behaviour was also identified as an important piece of the puzzle in optimising campaign spend, with executives rating it only marginally lower than historical data. That said, actually delivering device-specific campaigns came in lower still at 64% of executives. This is still a large volume of marketers focusing on device-specific campaigns. However, it also shows that it is more important to understand how consumers are interacting rather than creating specifically for devices themselves. Voice of the marketer “It’s all very well to bring in automation, but you’ve got to know what you’re automating. We’re not running at speed on everyday basics. Singapore, for example, does a lot of learning, but how do you transfer those skills across the organisation. The technology is in every market but how do you scale the skill?” Deborah Goldingham, Head of Marketing SE Asia, MasterCard
  47. 47. Media Budgets Index In association with Datalicious Page 47 All rights reserved. No part of this publication may be reproduced or transmitted in any form or by any means, electronic or mechanical, including photocopy, recording or any information storage and retrieval system, without prior permission in writing from the publisher. Copyright © Econsultancy.com Ltd 2016 Figure 24: How important are your organisation’s capabilities in the following areas to business success? Respondents: 523 Programmatic buying was the only option to be cited by less than half of those surveyed. Marketers realise its importance, particularly in the efficiencies automated buying can deliver. That said, it is at a stage in its maturity where challenges are becoming more apparent – viewability, ad fraud, brand safety – and may explain executives’ lower enthusiasm. With interesting candour, one experienced former global marketing procurement director notes: “Investing in media, we have made decisions now with zero backing them up. Why did we go into the internet? Because everyone else is. There’s not enough talent at the moment to support the understanding of all the activity in the digital space. Mobile and tablet advertising is going to be enormous and we’ve been saying this for five years. But the number of people who really know about it is small and we all want a piece of them.” Voice of the marketer “The programmatic side is driving me nuts. Agencies are so opaque, it feels really cloak and dagger.” Head of Media, EMEA, FMCG Despite noting that delivering campaigns with device-specific media was not as vital as optimisation or understanding cross-device behaviour, it is currently the best-executed capability, with 66% of executives claiming their organisation was either ‘excellent’ or ‘good’ at it (Figure 25).
  48. 48. Media Budgets Index In association with Datalicious Page 48 All rights reserved. No part of this publication may be reproduced or transmitted in any form or by any means, electronic or mechanical, including photocopy, recording or any information storage and retrieval system, without prior permission in writing from the publisher. Copyright © Econsultancy.com Ltd 2016 Figure 25: How would you rate your organisation’s capabilities in the following areas? Respondents: 487 While 52% of executives stated that they were either ‘excellent’ or ‘good’ at identifying customer engagement across devices and even more were ‘excellent’ or ‘good’ at measuring that activity (54%), only half were confident about tracking the purchase path across devices. Double the proportion of executives felt that their organisation was poor at tracking (20%) than were poor at delivering campaigns (10%). It would seem that delivering campaigns is not an issue but measuring their effectiveness might be. From a local perspective, the US and Asia as a whole matched the global trend of being slightly more confident than average that their organisation had identified the critical optimisation tasks and was capable of executing them. Voice of the marketer “Most of the US strategy is also fairly global so we have centralised the teams. There are regional differences and customs but in general our overarching strategy is similar across regions. Even though we call this digital marketing, it’s actually performance marketing. Everything we do, even from a brand standpoint, is looking for ROI and performance.” Will Lin, VP Digital Media, HomeAway US UK and EMEA, on the other hand, were very pessimistic about their ability to deliver on these tasks, with only a third to a half of executives confident about delivering campaigns. In every other task, less than a quarter felt capable, while as many as 40% of executives in EMEA alone stated they were poor at both tracking and measurement. ANZ was not bullish about its capabilities as a whole. Those executives stating their capabilities as ‘excellent’ were in the low teens. However, over half of those surveyed felt they were at least ‘good’, with programmatic buying coming out as their top skill.

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