Social media has significantly changed the media landscape. Consumers now have more media touchpoints that are growing exponentially. Navigating this complex landscape requires considering bought, owned, and earned media. Tools are needed to organize the different types of media and allocate budgets effectively based on objectives. Analyzing social network conversations provides insights into earned media and a feedback loop for bought and owned media. Extensive testing of new media combinations is also needed to fully evaluate opportunities in the current environment.

1. Social Media and ResearchMike HessExecutive Vice-PresidentResearch, Marketing Science, and Consumer InsightsCarat

2. OutlineCurrent Climate: Economic and MediaSocial NetworksRecent AdvancesNavigating the Landscape (BOE)Maintaining Neutrality in Planning: Tools/Cases

3. Current State of Affairs Recession

4. MediaEconomy is Still #1 Issue for US ConsumersEconomy leads as biggest concern, but significant drop compared to prior 3 months Health Care and Federal Budget Deficit show a steady increaseSource: CNN Opinion Research Poll, August 2009

5. Spending Less, Staying at Home MoreMedia Consumption: Points to At-Home

6. Avg 2+ person HH: +26 minutes TV per week; 4 hrs 43 minutes per day

7. Homes are not downgrading from cable / satellite to broadcast.HH Historical Trend: Watching TVAverage daily hours continue to increase, even during recessionsSource: Nielsen

8. However, Stock Market Shows Signs of RecoveryThe S&P 500 closed at a new interim high 52.7% above the March 9th low, which is 34.0% below the peak in October 2007As of Sept 9, 2009Sources: dshort.com (9/09/09)

9. Increasing Complexity inMedia TouchpointsMedia touchpoints are growing exponentially.

10. Media planners need to leverage the data and options to make more effective business decisionsTelevision is Still the 800 lb. Gorilla1st screenAudio2nd screenNewspapers3rd screen Magazines4th screenLandline phone Average Daily Minutes, Core Sample, N=752 observed days, Spring and Fall 2008All participants, including non-users of various media, including concurrent media exposure.Those 65+ spent much less time with audio, and much more time with newspapersBy age groupThose under 25 spent very little time on landline phonesScreen mediaOther major mediaAvg. 353min (48%)Avg.143min (20%)Avg. 20min (3%)Avg: 8min(1%)Radio Avg. 84min(11%)Avg.14min (2%)Avg. 6min (1%)Avg: 25min (3%)Other Audio 80min(11%)

11. Number of Touchpoints Used Driven by Age Using a 10 minute average as a cut offThose 18-24 are exposed to twice as many screen media 10+ mins as those 65+ (10 vs. 5); greater media diversityThe Council for Research Excellence@The Nielsen Company

12. How Social Networks Have Changed the Media LandscapeEvolution / EffectFindings from NeverEndingFriending Study

13. 2.5mm conversations12,500 conversations

14. Online Landscape has EvolvedBROADCASTERSMYCASTERSThe Players: TV Networks, Online Distribution Hubs, Movie Studios, Your next store neighborThe Other Media: TV (sending and receiving)The Big Change: The Internet is not a competitor, or a complementary outlet for niche content; distribution is king, content does not necessarily live on a site The Players: MySpace, Facebook, Gawker, “News Site X,” Your next store neighborThe Other Media: Mobile (sending and receiving)The Big Change: Social networking as a toolkit has gone mainstream (see Obama). Consumers are building and Internet ecosystem around themselves

15. Social Networking is Growing.. (nearly ¾ of online users participate).85%75%75%75%72%72%72%70%68%57%52%Source: Nielsen NetView age2+, * Home only

16. Social Networking: Viable Part of Media MixAgency planned spending is shifting gears“2010 Media Planning Intelligence Study; ”Center of Media Research/Insight Express September 2009

17. Ad Spending Expected to IncreaseIn 2011 ad spending on US social networking sites will increase to $1.4 billionSource: eMarketer, June 2009

18. Self-ExpressionDiscoveryInteractionPersonal Profile, Video, Blogs, Music, PhotosSkin, Badges, Widgets, Wallpapers, Ringtones, Contests, Viral Video, New FeaturesProfiles, Groups, ForumsChannels, Events, Jobs, WikisCustom Communities, Video, Entertainment Content, Events, Cause MarketingIM, Bulletins, Comments, Blogs, Events, FriendingContests, Quizzes, Viral Content, Friending, Polls, Widgets, TwitterThe Social Network PlatformSource: Never Ending Friending April 2007Base: SN 14-20 (n=2605)

19. Social Networking is Preferred Free-time Activity Check out social networking sites17%147 Million US usersvisited a social networking site*17%Talk on your cell phone14%Watch TV10%Surf Web generallyPlay video game9%8%IM7%Listen to MP3 player71 Million (83%)Age 12-341%Listen to radioSource: ComScore Media Metrix, age2+, June 2009 Source: Never Ending Friending April 2007 Base: SN 14-20 (n=2605)

20. Constant EngagementWhen they’re regularly on social network sites… 15% First thing in the morning 16% Before school/work 18% Lunch 25% At school/work 31% After school/work 68% Evening 30% Late night (10pm-4am)Prime TimeExtending into their offline lives 73% Never bored when using it 66% So many things to do 56% Add fun to going out 48% Having more fun in life general 47% More plugged into music scene 46% More on top of trends, what’s new 45% Makes my life more exciting 40% Discovered brands/products really likeSource: Never Ending Friending April 2007Base: SN 14-20 (n=2605)Q: When are you regularly on your favorite social networking site? Base = SN users 14-40; n=2,605 Q: How much do you agree with each of these statements? Top 2 box (Completely Agree, Agree) Top 2 box agreement (3-pt scale) Base = SN users 14-40; n=2,605

21. Social “Networking” Can Crowd Out Traditional BehaviorWeekly hours spent…Q: During the past week, approximately how many hours did you spend doing the following activities?Base = SN users 14-40; n=2,605 non-users 14-34; n=431

22. What’s Hot Now in Social Networking?

23. What’s Changed in the Past Few Years Social media has migrated from the young to mainstream

24. Facebook hits 300 million users September 09, about the size of the US population

25. Their fastest growing segment are people age 35+

26. Social Networks seek ways to turn profitable

27. Facebook turns a profit in 3Q 09, earlier than expectedSource: Universal McCann, "Power to the People: Social Media Tracker Wave 4," July 30, 2009Source: Adage, CNN (9.16.09)

28. Social Networks Provide the Basis for “Earned Media”And Provide New Opportunities for Research: Substitute for Focus Groups?Low Carb Friends… a community where of people from around the world come to discuss all issues related to how to lose body fat and keep it off.Bodybuilding forum…forum dedicated to bodybuilding, supplements, muscle building, nutrition, bodybuilding training, workouts, fat loss, and total fitness. Cheftalk.com…Food and Cooking discussion for the professional and the at home cook.Trek BBS… is the number 1 place to chat about Star Trek and theupcoming movie, with like-minded fans. Chowhound.chow.com…devoted to the pleasure of food and drink.Features information about meals and gear and delivers it in audio, and video. Goodeats.dyns.net…has a lot to offer in educating the masses about cooking, history and science. Anabolicminds… is dedicated to the discussion of bodybuilding,supplements, nutrition, fat loss, weight loss and overall fitness. Yahoo! Answers… is a new way to find and share information. You can ask questions on any topic, get answers from real people, and share insights.Babytalkzone… friendly community support forum for those who are pregnant, trying to conceive, or adopting. BabyCenter community…Groups for Moms and dads to share the experience of pregnancy and parenthood with photos, answers, and blogs on the largest parenting site.Most talk is on diet/weight management websites(April 25 – June 25 09)22

29. Navigating the Complex Media LandscapeBought Owned Earned

30. boughtearnedowned

31. Time Spent ExponentiallyIncreasesearnedboughtownedTime spent with BOE media is proportional to consumer interest (or concern)videoprintaudiosearchexperientialoutdoorin-storePOSpackagingwebsitesapplicationsservicesblogsfan pagesWoMsocial chatterpressorganic searchviralATLANTA BOSTON CHICAGO DALLAS LOS ANGELES NEW YORK SAN FRANCISCO

32. BOE ReflectsConsumer Centricity and Media Fluidity Roles played allow for understanding rapid change and acting promptly

33. Active presence

34. Talking to consumers

35. Hooking attention

36. Right time, place, mindset

37. Opening conversationsPlanEngaging Experiences

38. Talking with consumers

39. Accessible and useful content assets

40. Enabling participation

41. Creating conversations

42. Being talked about by consumers

43. Listening to conversations

44. Feeding conversationsAllocating the Media Budget in the New Environment: Still Focus on the Consumer

45. 28Creating Classic Segments with Digital ImplicationsUsing segmentation techniques, identified two Hispanic segments that are mutually exclusive:Segment 1: “Healthy & Financially Fit”(more digitally savvy) Size of opportunity: 938,000 HispanicsSegment 2:“Sedentary Indulgers”Size of opportunity: 1,662,000 Hispanics (more into TV/audio)

46. Creating the Right Media Mix Allocation Case Studies

47. Qualitative inputQuantitative inputWeight of variablesAnalysisOutputIngredients Include Quali-Quant Inputs

48. Judgments Made at Granular LevelsBridging technology with “human” expertise…Allocating the Media TouchpointsHuman Factors research has shown that the average person can handle only five to nine decision factors at a time.

49. This is where tools such as Allocator come into playPlumbing/Interiors Company Start with Clear ObjectivesIncrease sales by 6% in the USIncrease awareness by 10 points (from 58% to 68%)Link the brand to water conservationDrive intent & conversionFocus activity where consumers are looking for INSPIRATION & GUIDANCEDeliver the BOLD message in areas where we standoutBe BOLDAssociate & build meaningDevelop programs that add value to the consumer & society

50. Plumbing/Interiors Company Utilize Learning from Optimized Media Mix Step 1: Objective settingIdentify & weight media channels by consumer receptivity metricsBrand – 15/20Media Metrics – 13/20Awareness – 16/20Consumer – 15/20Consideration – 17.5/20CY09 Recommended allocationStep 2: Activity modelingMedia investment based on brand strategy TV 52%

51. Print 37%

52. Trade 9%

53. Social Media 3%Home Improvement StoreApplying Media Neutral Tool with New Client….AwarenessRelative Weight: 6/20LoyaltyRelative Weight: 14/20TrafficRelative Weight: 18/20Step 1: Objective settingIdentify & weight media channels by consumer receptivity metrics2010 Recommended allocationVideo 2 screens 18%

54. Inserts/ROP 19%

55. Spot Radio9%

56. Net Radio14%

57. Cable TV 7%

58. Search 7%

59. Digital6%

60. Spot TV 9%

61. Magazine 10%Step 2: Activity modelingMedia investment based on brand strategy

62. Home Improvement Store …. Lead to a Very Different Recommended Mix

63. SummaryWithtouchpoints and complexity exploding, tools requiredto addressCurrent environment especially conducive to SN growthTo organize the complexity, we’ve found that Bought/Owned/Earned (BOE) is a useful nomenclatureScraping conversations beneficial way to monitor/evaluate Earned portion and provide feedback loop for Bought/ OwnedAllocation needs to be based on plan objectivesMany media combinations have never been run, or only rarely….new era of Testing required to fully evaluate