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Digital Landscape Report

Issue 74: March 2015

Key ContributorsThe AOP gratefully acknowledges the help provided by the contributors on this page in compiling

this Digital Landscape Report. Throughout the report all content is sourced and for further details

relating to any content in this report please contact the relevant provider through the links on

this page (in slide show view).

www.hitwise.co.uk

For further information email [email protected]

www.comscore.com

www.emarketer.com

econsultancy.com

www.brandrepublic.com

Key ContributorsThe AOP gratefully acknowledges the help provided by the contributors on this page in compiling

this Digital Landscape Report. Throughout the report all content is sourced and for further details

relating to any content in this report please contact the relevant provider through the links on

this page (in slide show view).

Content

• Forecasts and Ad issues• In this section – Digital marketing budgets

• Online Audience Trends• In this section – UK PC and Multi-Platform (M-P) universe, audience trend, devices access and audience

‘engagement’

• Media Category Analysis• In this section – UK internet visits to key media categories

• Trends in key interest areas• In this section – Programmatic, Video, Data, Content Marketing, Tablet, Mobile, m-Commerce,

Wearables, Ads, IoT

AOP CommentThere is a feeling of déjà vu this month in relation to digital ad spend. In February a Strategy Analysis report predicted UK would be the first market in the world where digital ad spend achieved half of total ad spend, this month eMarketer are joining them and predicting digital will claim half of the £16.26bn that will be spent on advertising in 2015.

To put this milestone in some context eMarketer claim digital ad spend is 29.6% globally and 31% in the US. On why UK has got here ahead of the pack “aggressive embrace of online advertising and its rapid adoption of mobile advertising”- the mobile space is predicted to be the engine room of growth for 2015 with a 45% increase.

eMarketer are also in agreement with Strategy Analysis in claiming the biggest casualty of the shift to online will be traditional print, newspapers and magazines.

February’s comScore multi-platform data supports the traditional print decline claims to some degree, against a total internet average of around 25% of users accessing exclusively from mobile and tablets, audiences in lifestyle categories, a magazine heartland, we see 34% (beauty/fashion/lifestyle) and

43% (home) indicting a switch away from traditional physical magazine is happening.

This isn’t necessarily all bad news however as the multi-platform users, compared to the desktop, delivers double the page/video views and spends the equivalent of 2 days more online. Migrating the audience to online offers the opportunity of increasing their engagement leading to monetisation.

There is also the opportunity to recycle your online audience to deepen that engagement even further as Hitwise data reveals 25% of incoming users to sites in the media sector come from elsewhere in this category. On exit from a site, 35% of them visit another news and media site.

Finally, it really could be the year of mobile!! eMarketer forecast 317m M2M connections will be made in 2015. Tablet penetration will also increase beyond the 50% ownership threshold and Cisco are predicting strong growth in wearables with many paying close attention to the uptake of the Apple watch.

We should also be on the lookout for branding campaigns going programmatic, video becoming increasingly dominant for online traffic and marketers seeking to make attribution data actionable.

Scott Fleming, AOP Digital Research

Follow AOP at @ukaop

Executive Summary (1)UK to become first global ad market to be 50% digital

Adspend

• The UK will reach a major milestone this year, becoming the first country in the world where digital media will take a 50% share of advertising spending (eMarketer, Mar’15)

• Total media spend in the UK is estimated to grow by 6.0% in 2015 to top £16.26 billion (eMarketer, Mar’15)

• In 2015, mobile ad spending in the US will increase 50.0%, reaching $28.72 billion and accounting for 49.0% of all digital ad spending (eMarketer, Mar’15)

• In 2015, US mobile display ad spending will reach $14.67 billion, compared with $12.85 billion for mobile search (eMarketer, Mar’15)

• 77% of companies plan to increase their digital marketing budgets in 2015, an increase of 8% on 2014 (eConsultancy, Mar’15)

• Content marketing at 73% of respondents is the top priority, data management (59%) and video advertising (58%) also make the top 10 (eConsultancy, Mar’15)

• Despite the rise of earned and owned media, paid media still gets the most budget, 61% planning to increase budgets in this area (eConsultancy, Mar’15)

• Companies are also 35% more likely to be increasing their budgets for cross channel / multi-channel campaign management technology – giving some insight into how marketers are viewing future campaigns (eConsultancy, Mar ’15)

Multi-Platform users consume almost double the pages of PC only usersAudience

• 3 million unique users accessed the internet purely from mobile devices (comScore, MMX-MP, Feb’15)

• The multi-platform user delivers 48% more views (includes video), spends the equivalent of 2 days more time online in the month and consumes around 40% more pages (comScore, MMX-MP, Feb’15)

• Lifestyle based content leads the way in exclusive access from mobile and tablet devices (comScore, MMX-MP, Feb’15)

• On average mobile/tablet reach is double that of PC for the selected entities. However PC, at total internet level, still delivers on average twice as many views per visits, although less pronounced on the example entities. In terms of minutes per visitor, mobile greatly exceeds PC (comScore, MMX-MP, Feb’15)

Executive Summary (2)News and Media 10% of web traffic

Media Category Analysis• News and Media sites maintained their 2015 strong performance and their traffic share of just under 10%, a year on year increase of 25% (Experian-Hitwise, Feb’15)

• Online video dropped slightly month on month (2.2% compared to last months 2.5%) and with other categories growing its overall market share has reduced year on year (Experian-Hitwise, Feb’15)

• The recycling nature of audience continues within the Print and Broadcast sectors with the top traffic drivers for these categories being other sites within the same segments (Experian-Hitwise,Feb’15)

This year will be the year of programmatic branding campaigns

Key Trends• Programmatic

– 2015 will be a big year for programmatic branding campaigns - as opposed to response (Adotas, Mar’15)

– Programmatic ad pricing is starting to rise as demand outstrips supply (Business Insider, Mar’15)

• Video - By 2017, video will make up 69 percent of all consumer Internet traffic, according to a recent forecast from Cisco (Content Standard, Mar’15)

• Data - Marketers focus on making attribution data actionable – one in five using a multichannel attribution approach (eMarketer, Mar’15)

• Content Marketing - Lack of content creation resources was the biggest challenge, cited by 53% of marketing professionals worldwide (eMarketer, Mar’15)

• Tablet - The majority of the country’s consumers—50.3% of the population—will use a tablet at least once per month, expected to rise to almost 60%, or 40.2 million tablet users, by 2019 (eMarketer, Mar’15)

• Mobile - Rumour has it that 2015 will finally turn out to be “The Year of Mobile” - estimates released earlier this month forecast that there would be 317 million M2M mobile connections worldwide in 2015 (eMarketer, Mar’15)

• m-Commerce - UK millennials—ages 18 to 34—were likely to start and end their shopping journeys on their smartphones than any other age group (eMarketer, Mar’15)

• Wearables - The wearables explosion is ticking closer - Cisco Systems forecast that global wearable device connections would total 578 million in 2019 (eMarketer, Mar’15)

• Ad formats - What is an Avalanche ad and why are A-list brands such as Land Rover, Charles Schwab, Samsung, Verizon, Canon, Guinness, Porsche and BMW snatching them up? (WSJ, Mar’15)

• Internet of Things - The internet of things (IoT) is expected to become a thing in 2015, and marketers are focusing heavily on the inevitable connected future (eMarketer, Mar’15)

Forecasts & Ad RevenuesIn this section – Digital marketing budgets

Adspend and Forecasts

Key findings• The UK will reach a major milestone this year, as it is set to become the first country in the world where digital media will take a 50% share of

advertising spending (eMarketer, Mar’15)

• Total media spend in the UK is estimated to grow by 6.0% in 2015 to top £16.26 billion (eMarketer, Mar’15)

• In 2015, mobile ad spending in the US will increase 50.0%, reaching $28.72 billion and accounting for 49.0% of all digital ad spending (eMarketer, Mar’15)

• In 2015, US mobile display ad spending will reach $14.67 billion, compared with $12.85 billion for mobile search (eMarketer, Mar’15)

• 77% of companies plan to increase their digital marketing budgets in 2015, an increase of 8% on 2014 (eConsultancy, Mar’15)

• Content marketing at 73% of respondents is the top priority, data management (59%) and video advertising (58%) also make the top 10 (eConsultancy, Mar’15)

• Despite the rise of earned and owned media, paid media still gets the most budget, 61% planning to increase budgets in this area (eConsultancy, Mar’15)

• Companies are also 35% more likely to be increasing their budgets for cross channel / multi-channel campaign management technology – giving some

insight into how marketers are viewing future campaigns (eConsultancy, Mar ’15)

UK ad spendThe UK will reach a major milestone this year, as it is set to become the first country in the world where digital media will take a 50% share

of advertising spending, according to eMarketer’s latest media ad spending forecast. Norway and China will follow close behind, with digital

grabbing a 45.0% and 43.6% share, respectively, of ad spending in each country. However, the UK will retain its lead by this measure until

2018, when digital’s portion of total ad spending in China will become the largest worldwide

Total media spend in the UK is estimated to grow by 6.0% in 2015 to top £16.26 billion ($26.78 billion), with this being split equally between

digital and all other traditional formats combined—TV, print, outdoor and radio. Ad spending on mobile and online devices will attract more

than twice the ad spending that goes to TV, which will account for a 24.9% share this year, eMarketer estimates

“Digital reaching the 50% threshold in the UK is a significant moment for the ad industry, and digital’s

dominance is particularly interesting when compared with the global splits, as well as the splits in some

other notable regions,” said Bill Fisher, analyst at eMarketer. “Digital accounts for a 29.6% share globally

and just over 31% in the US, for example. The UK ad market is notable for its aggressive embrace of

online advertising and its rapid adoption of mobile advertising. Because so much TV and radio

programming appears ad-free in the UK, the comparative spending on digital channels has always been

high. This year, though, we’re set to see digital reach an inflection point.”

In the UK, digital ad growth will be driven mostly by spending on mobile, which is expected to rise 45.0%

this year to over £3.26 billion ($5.37 billion), up from about £1.18 billion ($1.94 billion) in 2013,

eMarketer estimates. This year alone, mobile will account for 20.1% of total media spending in the UK,

compared with 16.6% for print. In 2016, mobile will surpass TV’s total, at 25.6% of all spending vs. 24.1%

Meanwhile, TV is expected to see ad spending rise 3.2% in the UK this year to more than £4.04 billion

($6.66 billion), although its overall share of the market will fall to less than half that of digital media. By

2018, digital’s share of UK total media ad spend will rise to 56.5%, compared with 22.4% for TV,

eMarketer estimates

The biggest casualty of the surge in UK digital advertising has been traditional print media, with

newspapers and magazines struggling to hold on to their market share. This year, print advertising

spending in the country is expected to fall 3.9% to less than £2.7 billion ($4.44 billion)

US ad spendMobile ad spending continues to increase at the expense of desktop, taking more and more share of marketers’ digital ad dollars,

according to new figures from eMarketer. In 2015, mobile ad spending in the US will increase 50.0%, reaching $28.72 billion and

accounting for 49.0% of all digital ad spending. By 2019, mobile ad spending will rise to $65.87 billion, or 72.2% of total digital ad spend

Next year will be the tipping point where mobile ad spending surpasses desktop. And while desktop advertising will remain a significant

portion of marketers’ budgets—approximately $25 billion in each year throughout eMarketer’s forecast period—mobile will continue

growing in the double digits to gain more and more market share while desktop spending remains flat

The shift to mobile ad spending is being driven mainly by consumer demand. In 2014, US adults spent an average of 2 hours, 51 minutes

with mobile devices each day, up from 2 hours, 19 minutes in 2013. Meanwhile, desktop time fell to 2 hours, 12 minutes daily last year,

after being equal with mobile time in 2013

At the format level, mobile display dollars will continue to increase, outpacing mobile search. In 2015, US mobile display ad spending will

reach $14.67 billion, compared with $12.85 billion for mobile search. Through 2019, both display and search will increase at a similar rate,

with display widening the gap slightly by virtue of growing from a higher base. By the end of our forecast, mobile display ad spend will

total $33.90 billion, while mobile search will be $28.41 billion

It’s important to call out the “other” category as well, which includes classifieds, email and

lead generation, among additional formats. US mobile ad spending on those formats will

increase from $962 million this year to $3.32 billion in 2019. Meanwhile, mobile messaging

ad dollars will rise in 2015 and 2016 before going on a slow decline through the remainder

of eMarketer’s forecast period

Our new forecast breaks out mobile app and mobile web spending for the first time. This

year, app spending will outpace mobile web browser ad dollars nearly 3-to-1. Advertisers

will spend $20.79 billion to reach consumers via mobile apps in 2015, compared with $7.93

billion on mobile browsers

Marketing Budgets

Source: eConsultancy, March 2015

Marketing BudgetsAlmost two-thirds of companies are planning to increase their marketing budgets in 2015, according to the results of our

new report

The Marketing Budgets 2015 survey, published in association with Oracle Marketing Cloud, found that 63% of companies

will spend more on marketing this year, while 31% will retain the same level of spending and 7% will decrease their

budgets

The results of the survey could be seen as a further sign that marketers are getting better at securing buy-in and financial

support from the C-suite

Increased connectivity means that consumers are more empowered with information than ever – from researching a

product on their desktop at home to using a mobile device in-store as a virtual sales assistant. For example, a

recent Deloitte report found that digital devices are influencing 33% of in-store retail sales, equivalent to almost £100bn

This has raised the profile of marketing departments, which are increasingly orchestrating consumer relationships - and

CEOs are now looking to CMOs and marketing departments as a key growth drivers

A good example of this is British Airways, which announced in January that it was splitting its marketing department to bring it closer to the airline’s commercial operations

At the same time, keeping customers switched on to brand messages remains a challenge. Connected consumers are dealing with more “clutter” than ever - and there are some fairly

frightening statistics floating out on the web, ranging from 500 to 5,000 advertising messages a day

This has led marketers to rethink their digital strategy, replacing tried and trusted methods with more precise data and analytical insights on customer behaviour

For example, according to the Marketing Budgets Report, 79% of companies are planning to increase their spending on digital marketing technology – an increase of 13% since 2014

Technologies that marketers are particular focused on include A/B and multivariate testing (50% are planning to spend more in this area) as well as CRM (48%) and marketing analytics (42%)

This is clearly an exciting time to work in marketing, where boardroom support and budgets are rising, and the increased ability to attract and retain customers means the influence of the

marketer within businesses will only increase this year

Source: eConsultancy, March 2015

What best describes your plans for your overall marketing budget in 2015?

Online Audience Trends

In this section – UK PC and Multi-Platform (M-P) universe, audience trend, devices access and

audience ‘engagement’

Key findings

• 3 million unique users accessed the internet purely from mobile devices

• The multi-platform user delivers 48% more views (includes video), spends the equivalent of 2 days more time online in the month and consumes around 40% more pages

• Lifestyle based content leads the way in exclusive access from mobile and tablet devices

• On average mobile/tablet reach is double that of PC for the selected entities. However PC, at total internet level, still delivers on average twice as many views per visits, although less pronounced on the example entities. In terms of minutes per visitor, mobile greatly exceeds PC

Source: comScore, MMX Multi-Platform, Feb data, Mar‘15

UK Online UniverseTotal UK PC Internet Audience – February 2015

44.7 million 35.2 million 116 billion 29.3 hours 2,598 pages 67.8 visitsTotal Unique

Visitors

Average Daily

Visitors

Total Pages Viewed Average Hours per

Visitor

Average Pages per

Visitor

Average Visits per

Visitor

47.6 millionTotal Unique

Visitors

Total UK Multi-Platform Internet Audience – February 2015

172 billionTotal Views

Source: comScore MMX Multi-Platform, February 2015, UK, PC 6+ and Mobile 13+*MMX MP includes PC browsing, PC video streams, mobile browsing & apps (on-network only for untagged apps), tablet browsing & apps for tagged sites & apps.

3,607 pagesAverage views per

Visitor

78.7 hoursAverage Hours per

Visitor

Note: January saw a change in methodology for mobile measurement which filters through to Multi-Platform

UK Online Universe

30,000

32,000

34,000

36,000

38,000

40,000

42,000

44,000

46,000

48,000

50,000

Jan-14 Feb-14 Mar-14 Apr-14 May-14 Jun-14 Jul-14 Aug-14 Sep-14 Oct-14 Nov-14 Dec-14 Jan-15 Feb-15

Un

iqu

e v

isit

ors

(0

00

s)

MB/TB Only PC Only Multi-Platform

Non PC traffic adds, on average, around 3m unique users to site audience


Methodology break

(GSMA MMM to MoMX)**

**more information on MoMX can be found at comScore.com in their insights, press release section

Device contribution to audience categoryFebruary MMX Multi-Platform

43.6

50

37.2

6

13.2

15.8

36.4

69.4

43.2

34.2

26.4

24.6

Lifestyle - home

Lifestyle - beauty/fashion/style

Newspapers

Total Internet

PC Only PC/MB/TB MB/TB Only

%


Site audience by engagement (selected sites)

February MMX Multi-Platform

Bubble size represents average minutes per visitorEntities used; mail online (p), mirror online (m), the guardian (p), thetelegraph.co.uk (m), the sun online (m)


48.8

12.4

14.2

11.9

12.4

0.0

5.0

10.0

15.0

20.0

25.0

30.0

35.0

0.0 1.0 2.0 3.0 4.0 5.0 6.0 7.0

rea

ch %

average views per visit

41.5

18.1

13.1

7.8

18.10.0

10.0

20.0

30.0

40.0

50.0

60.0

70.0

0.0 1.0 2.0 3.0 4.0 5.0 6.0 7.0

rea

ch %

average views per visit

Media Category Analysis

In this section – UK internet visits to key media categories

Key findings

• News and Media sites maintained their 2015 strong performance and their traffic share of just under 10%, a year on year increase of 25%

• Online video dropped slightly month on month (2.2% compared to last months 2.5%) and with other categories growing its overall market share has reduced year on year

• The recycling nature of audience continues within the Print and Broadcast sectors with the top traffic drivers for these categories being other sites within the same segments

Source: Hitwise, Feb ‘15

UK internet visits to key media categoriesbased on market share of all UK online visits

UK Internet visits to key media categories

Source: Experian Hitwise UK, February 14 – February 15

Category Feb-15 Jan-15Monthly

changeFeb-14 Yearly Change

News and Media 9.29% 9.59% -3.1% 7.47% 24.3%

Community Directories and Guides 0.27% 0.27% 0.0% 0.24% 13.6%

Online Video 2.18% 2.52% -13.2% 5.31% -58.9%

Social Networking & Forums 9.21% 8.96% 2.8% 14.92% -38.2%

Print 4.05% 4.11% -1.5% 3.07% 31.9%

Blogs and personal websites 1.38% 1.29% 7.5% 1.10% 26.4%

Growth of UK visits to News & Media, Social

Networking and Blog Sites


UK traffic to and from News& Media from Search,

Social Networks and other News & Media sites

Categories delivering traffic to

News and Media

Categories receiving traffic from

News and Media


UK Traffic to Print

websites

UK Traffic to Broadcasters

websites

UK traffic to Print and Broadcaster sites from Search,

Social Networks and News & Media sites


Trends in Key Interest AreasIn this section - Programmatic, Video, Data, Content Marketing, Tablet, Mobile, m-Commerce, Wearables, Ads, Internet of Things

Key findings

• Programmatic– 2015 will be a big year for programmatic branding campaigns - as opposed to response (Adotas, Mar’15)

– Programmatic ad pricing is starting to rise as demand outstrips supply (Business Insider, Mar’15)

• Video– By 2017, video will make up 69 percent of all consumer Internet traffic, according to a recent forecast from Cisco (Content Standard, Mar’15)

• Data– Marketers focus on making attribution data actionable – one in five using a multichannel attribution approach (eMarketer, Mar’15)

• Content Marketing– Lack of content creation resources was the biggest challenge, cited by 53% of marketing professionals worldwide (eMarketer, Mar’15)

• Tablet– The majority of the country’s consumers—50.3% of the population—will use a tablet at least once per month, expected to rise to almost 60%, or 40.2 million tablet users, by

2019 (eMarketer, Mar’15)

• Mobile– Rumour has it that 2015 will finally turn out to be “The Year of Mobile” - estimates released earlier this month forecast that there would be 317 million M2M mobile

connections worldwide in 2015 (eMarketer, Mar’15)

• m-Commerce– UK millennials—ages 18 to 34—were likely to start and end their shopping journeys on their smartphones than any other age group (eMarketer, Mar’15)

• Wearables– The wearables explosion is ticking closer - Cisco Systems forecast that global wearable device connections would total 578 million in 2019 (eMarketer, Mar’15)

• Ad formats– What is an Avalanche ad and why are A-list brands such as Land Rover, Charles Schwab, Samsung, Verizon, Canon, Guinness, Porsche and BMW snatching them up? (WSJ, Mar’15)

• Internet of Things– The internet of things (IoT) is expected to become a thing in 2015, and marketers are focusing heavily on the inevitable connected future (eMarketer, Mar’15)

Programmatic

•In the past, brands often thought of programmatic as a tool designed only for display. Brand advertisers, the argument went, needed video to create the emotional bonds with consumers that are at the heart of great branding campaigns. Well, programmatic video has arrived — and in a very big way. In fact, programmatic video is growing more rapidly than anyone might have predicted only a year ago. A recent report from BI Intelligence found that video will be key in driving the rapid expansion of programmatic in the coming years, with programmatic video spending hitting a remarkable $3.9 billion by 2018

Programmatic video is exploding

•Brand advertisers have also stayed away from programmatic because of fears that they could end up paying for ads that were never viewed. And, in fairness, there was plenty of reason for this concern in the past. The programmatic industry was a little too slow in pushing back against bad actors and creating more trustworthy metrics. But 2014 was a huge year for the industry. The Interactive Advertising Bureau’s new Anti-Fraud Principles are a major step forward. There’s no doubt that some bad actors will always remain, but the new IAB guidelines – built around fraud detection, source identification, and process transparency –are already having an impact. And the IAB’s Anti-Malware Working Group promises to make a big difference as well

The viewability problem is going away

Source: Adotas, Mar’15

When we look back at 2014, we might see it as the turning point, the year that brand advertisers finally woke up to the promise of programmatic. After all, it was in 2014 that Procter & Gamble

made its big announcement: the brand-advertising giant would be devoting 70 percent of its digital media spend to programmatic

But 2014 was just the beginning. This year promises to be a much bigger year for programmatic brand advertising — and not only because other advertisers tend to follow P&G’s lead. Let’s take a

look at four reasons why 2015 will be a big year for programmatic branding campaigns

Programmatic (i)

•More premium inventory is also smoothing the transition into programmatic for brands advertisers. In addition to being able to run programmatic campaigns on Facebook and Twitter, brand advertisers can now choose from a wide-range of top-notch publisher. Condé Nast has been leading the way in programmatic premium for several years now. And in December of 2014, Time Inc., News Corp., American Media, and Wenner Media began to open up premium inventory for programmatic buying as well. Simply put, the days when programmatic was limited to remnant inventory are over

Premium inventory is expanding

• It comes down to this: Brand advertisers will turn to programmatic if they see that it’s working. Granted, it can still be challenging to determine the effectiveness of some branding campaigns, but as our metrics grow more sophisticated each year, the ROI of branding campaigns is becoming easier to pin down. And, thus far, brand advertisers have been blown away by the ROI’s they’re seeing with programmatic

•Programmatic ultimately works for branding campaigns for the very same reason it works for direct-response campaigns. It uses data to make sure ads are delivered to the right people rather than blindly sent into the world with the hope that they’re viewed. Efficiency is efficiency regardless of the campaign you’re running, and more brand advertisers now appreciate this. The tide began to turn in 2014. Expect 2015 to be the year programmatic brand campaigns really take off.

Programmatic just works

Source: Adotas, Mar’15

ProgrammaticProgrammatic ad pricing is starting to rise as demand outstrips supply

Automated ad buying and selling tools are increasingly driving digital ad sales in the U.S. That means less human-mediated,

manual sales, and more opportunities for ad tech specialists to gain a share of ad spend

A new report from BI Intelligence finds that real-time bidding (RTB), a key piece of the programmatic ecosystem, will account for

over 33% of U.S. digital ad sales, or $18.2 billion in 2018, up from just $3.1 billion in 2013

Some of the key takeaways from the report:

o Programmatic and real time bidding (RTB) ad spend is growing fast - RTB will account for over $18.2 billion or 33% of U.S.

digital ad sales in 2018, up from just $3.1 billion in 2013, growing at a compound annual growth rate of 42%. Programmatic will

be 50% in 2018

o Mobile and video ads will be a major driver of this growth – with RTB sales for these formats topping $6.8 billion and $3.9

billion in 2018, respectively

o A number of companies are already cashing in on the growing programmatic market - top programmatic ad companies include

Criteo, Rocket Fuel, the Rubicon Project, and AOL. These four companies pulled in more than $1.5 billion in combined global ad

revenue in 2013, accounting for more than one-tenth of global programmatic ad dollars

o Prices for programmatic ads are increasing for almost all ad types, as demand outpaces supply - the effective cost per

thousand impressions (eCPM) for social ads was up by 64% between January through April 2014, compared to the same time

period one year earlier, according to Turn

o There are still a number of barrier to adoption - top barriers include brand worries that they will lose control over where their

ads will appear, internal resistance at ad agencies, and lack of transparency in the industry over methods and results

Source: Business Insider, Mar’15

Video

Video marketing

Video views are booming

Key audience LIKE video

Video pays off

Video in memorable

Source: Content Standard, Mar’15

Video content is thriving, and its superior ability to reach audiences and convert consumers is undeniable. Evidence

abounds as to the reason: More people are watching videos, and video marketing is incredibly effective

Views are booming

By 2017, video will make up 69 percent of all consumer Internet traffic, according to a recent forecast from Cisco.

Nearly half of Internet users view at least one online video in a month, with the average viewer watching 32.2 videos

per month. In fact, a whopping 100 million Internet users watch an online video each day, according to comScore. For

content marketers, those numbers mean there’s a huge, video-hungry audience eager to devour content. “By a long

shot, video is the quickest way to get your message in front of as many eyes as possible,” says John Huber, COO of Moo

Creative Media

Video is memorable

In a world full of content, video content appears to break through the clutter. The Online Publishers Association

reports 80% of Internet users remember watching a video ad in the past 30 days. Nearly half took some action after

watching the ad, including visiting the website named in the video or purchasing the product featured in the ad

Audiences like video

Like consumers in general, decision-makers tend to like video content, too. Forbes reports 75% of executives watch work-related videos at least once per week, and 65%

have visited a vendor’s website after watching a video. These views tend to produce quality leads, making video marketing among the most effective tactics. 70% of B2B

marketers view video consumption as an effective indicator of lead quality or business opportunity, the Content Standard previously reported

Video pays off – case study, next page

Video (i)

Source: Content Standard, Mar’15

Video pays off – The Wren Example

Women’s clothing company Wren scored a viral hit with an intimate, emotional video showing strangers kissing for the

first time

Directed by Tatia Pilieva on a shoestring budget, “First Kiss” looks more like a mini film or documentary than video

marketing—except that some of the kissing strangers happen to be wearing Wren clothing

As the New York Times tells it, director Pilieva initially sent the video link to 21 people. In the span of the morning, the

video had been viewed 2m times. Eventually, the video would reach over 100m views (and counting)

That massive, viral popularity shows just how many people respond to emotional video content. Creating something

authentic and touching was the brand’s goal, said Melissa Coker, Wren’s founder and creative director, in Business

Insider.

The brand purposefully chose to create a short film instead of a heavy-handed, “buy now” product commercial. “What

we really wanted to do with this video is to generate lasting brand awareness and love, not just a quick hit sale,” she

said

The results speak for themselves. Coker said traffic to the Wren website was up 14,000%, with 96% of those visitors new

to the site. Online sales jumped up 13,600% compared to the week before the video’s release

Indeed, website visitors who have watched a video are 64% more likely to buy an online retail product, comScore reports

But winning with video content depends a lot on quality. As Coker notes, “First Kiss” went viral—and thus drove up sales—because “the content was about the content,

not about the clothes.”

Video marketing

Video views are booming

Key audience LIKE video

Video pays off

Video in memorable

DataMarketers Focus on Making Attribution Data Actionable

No one would argue the importance of cross-platform attribution—defined as a method of assigning credit to a particular marketing-

driven interaction or other brand touchpoint. But when it comes to pursuing and implementing attribution, the majority of marketers still

fall short, according to a new eMarketer report, “Cross-Platform Attribution 2015: Device Identification, Big Data Pose Continued

Challenges.

As marketers increasingly look to attribution to better understand customers, not just build their media plans and justify budgets, figuring

out how to act on cross-platform attribution findings as quickly as possible is on the minds of many

Though blending top-down marketing-mix models with bottom-up path analysis is a popular method of gaining a true holistic view of all

paid, owned and earned advertising efforts across digital and traditional media, most find that real-time optimization of intel gained from

this approach is still mostly limited to those channels and formats belonging to the digital, bottom-up bucket where impression-level

tracking and real-time reporting allows for more real-time optimization

“The more sophisticated attribution solutions from a media-mix modelling perspective are helping with channel allocation and budget planning, but the adjustments and optimizations are

still largely coming from the micro attribution that we’re doing on the digital side,” said Allegra Kadet, managing director at Neo@Ogilvy. “Though we’re making progress on making all

channels actionable, there’s always going to be some outliers where you can’t connect one channel to another chain of events. I think it’s unrealistic to expect that 100% of all channels will

be optimized in real time.”

That’s not to say that some marketers aren’t looking to instil a more real-time optimization approach to some of their traditional media. According to Harpreet Singh, CEO of Kvantum, one

of the biggest trends he is seeing among clients is to make traditional offline media more actionable, particularly television.

Singh said more and more marketers hope to identify the effects of TV ad efforts two or three weeks into the campaign, with backup, alternative media plans on deck to optimize and

adjust efforts as needed. Singh said most of those optimizations are happening through spot buys, whether to dial back on future television investment—in favour of digital channels—or

augment current TV performance with additional coverage. In using attribution to tie actual in-store sales back to TV and other advertising exposures, clients can then determine which

designated market areas (DMAs) are best suited for further TV investment based on the performance of the stores located in the same region

The importance of attributing and optimizing all actions against actual revenue data such as in-store purchase data is notable. Historically, most digital channel optimization is centred on

digital-specific measures such as clicks and conversions, with traditional media modified based on brand-based metrics. Though such metrics might be important indicators of channel-

specific success, by and large, they are not the determinants of cross-platform attribution success

Data – tag managementWhy digital marketers need to care about tag management - tag management helps save time and money

Time- and money-saving are constantly top of mind for marketers, and tag management can help improve both, according to January 2015

polling by Econsultancy in association with Tealium, a tag management system provider. Among digital marketers in North America who

had implemented a tag management service—which enables the placement of a single tag of code, replacing multiple tags on a page—

nearly eight in 10 said it had improved the speed of running marketing campaigns, with the majority of that group saying the process was

“significantly faster.”

This means marketers can spend less time manually entering tags and more time focusing on results. Indeed, respondents cited better

campaign measurement, improved return on investment and increased revenues as the biggest benefits of using tag management

services. Being able to track the progress and metrics of campaigns meant such services allowed for better optimization as well.

Primary websites were the most popular channel for using tags, cited by 62% of digital marketers. However, Econsultancy reported that

marketers were starting to cast a wider net, pointing to mobile as one area seeing growing interest. Three in 10 respondents used tags on

mobile websites, while one-quarter used them on mobile apps. Of course, those percentages are still low compared with No. 1 websites,

but as more marketers see returns from mobile tagging, usage will likely jump.

Those who were using tag management services for mobile marketing had indeed seen success, as more than three-quarters reported

that the effect had been positive. Still, the large majority of this group said the impact had only been “somewhat positive,” indicating

room for improvement during these early days

Earlier polling by Econsultancy in association with Teradata found that tag management was set to see an increase in spending, though

not too rapidly. According to the August 2014 study, just under three-quarters of marketers worldwide intended to invest in tag

management systems over the next two years. However, only 19% said they would evaluate these in less than 12 months, while the

remaining 54% planned to check out tag management systems in 12 to 24 months. In all, 53% ranked the technology as a top (20%) or

high (33%) priority.

Marketers looking to save time and money—so, pretty much all of them—should consider jumping on the bandwagon and investing in

tag management.

Content MarketingLack of resources, strategy and budget the biggest content issues

We’ve all heard it—and probably said it: Content is king. Marketers are using the channel to boost customer engagement, lead generation

and brand awareness. However, recent research suggests that there are plenty of boundaries preventing content marketers from reaching

the ultimate level of success.

Polling conducted earlier this month by Ascend2 found a wide variety of obstacles to content marketing success. Lack of content creation

resources was the biggest challenge, cited by the majority of marketing professionals worldwide. More than four in 10 respondents said

lack of an effective strategy—and likely creation and distribution of content as a result—was an issue, and budget constraints were the

third-biggest challenge, cited by 40% of marketers

Findings from January 2015 research by Curata highlight several trends that could help marketers overcome content challenges. For one,

the study found that it was becoming more common for companies to have an executive who was directly responsible for an overall

content marketing strategy. Fully 49% of the nearly 600 US marketers studied said their firms had one, up from 43% in 2014, and 60%

believed this would be the case next year. Having a leader in place will likely drive the creation of a strategy and help better manage

resources

Knowing what content exists and what can be reused and repurposed can help marketers stretch their budgets—and avoid wasting precious

resource time. However, many marketers polled by Curata weren’t too focused on such efforts. Nearly four in 10 said they never audited

their companies’ content, and an additional 8% only did so biannually. Fewer than one-third of respondents conducted a full content audit

quarterly (18%) or semiannually (14%), and one-quarter did so once a year

As noted, reusing content can help marketers make the most of their money and resources. Unfortunately, this also proved to be a pain

point. Just over one-fifth of respondents said they had a specific process in place to ensure optimal content reuse and repurpose—not far

above the percentage who didn’t do this at all. Marketers were most likely to reuse and repurpose content sporadically, which doesn’t help

when trying to form a long-term plan

In order to overcome resource, strategy and budget issues, marketers should consider having someone directly responsible for an overall

content marketing strategy, as well as auditing, reusing and repurposing content

Tablets

According to new forecasts from eMarketer, the UK tablet market will reach a significant milestone in usage this year when, for the first

time ever, the majority of the country’s consumers—50.3% of the population—will use a tablet at least once per month. This figure is

expected to rise to almost 60%, or 40.2 million tablet users, by 2019

However, the dramatic growth the UK tablet audience has experienced in recent years will drop significantly in 2015 as adoption nears

saturation

The number of UK tablet users grew 35.2% in 2014, but the growth rate will fall to single digits this year and stay there until the end of our

forecast period. Despite this decline, annual gains will remain steady, and eMarketer expects there to be 7.4 million new tablet users in the

country between 2015 and 2019

“The country’s tablet market is reaching a point in its maturity curve that signals a slowdown in user growth. Such a slowdown in the rate

of penetration suggests that most of those who want a tablet likely already have one, with more sales than ever likely to be replacements

The tablet boom in the UK is over, but now the replacement cycle looks to have begun in earnest. And with almost three-quarters of the

internet population set to be tablet users by 2019, it’s still a market worth being in,” said Bill Fisher, analyst at eMarketer

iPad users still comprise the majority of the UK tablet audience, though Apple’s slice of the pie is getting smaller every year as

consumers purchase devices such as the Samsung Galaxy Note, Google Nexus 7 and Amazon Kindle Fire

Apple’s iPad will account for less than half of the UK tablet market for the first time in 2016, and its tablet audience share will

decline by 6.1 percentage points between 2015 and 2019

Mobile

What's on the Horizon for Mobile? M2M connections, wearable devices set for big surges in 2015

Rumour has it that 2015 will finally turn out to be “The Year of Mobile.” No matter what happens, the huge estimates for rising trends

can’t

be ignored. For one, due to marketers increasing focus on the internet of things, the machine-to-machine (M2M) market is set to continue

its rapid growth

GSMA Intelligence estimates released earlier this month forecast that there would be 317 million M2M mobile connections worldwide in

2015—up from 243 million last year. By 2020, this was expected to more than triple and near 1 billion, coming in at 980 million

Surging data traffic from M2M devices will coincide with such growth. In February 2015, Cisco Systems forecast that global average

monthly mobile data traffic via M2M modules would more than quintuple, from 70 MB to 366 MB

Despite strong gains, GSMA expected M2M connections to maintain a small share of total mobile connections throughout its forecast

period, hitting only 10% by 2020.

Wearables, too, have been a common theme in mobile-focused conversations this year, and figures released earlier this month by GfK

indicate there’s good reason for this. The firm forecast that wearable device sales worldwide would rise from around 18 million in 2014 to

more than 51 million this year—and this only includes smart watch and health and fitness tracker sales. Even more, while health and fitness

tracker sales were more than three times those of smart watches, the latter was expected to surge this year to pass the former

Developed regions—specifically, North America and Western Europe—were expected to lead global wearables growth. The total number of

smart watches sold in North America, Western Europe and developed Asia-Pacific markets was forecast to be 18.1 million this year, vs. 2.8

million in 2014, and health and fitness tracker sales were expected to nearly double. Still, growth will be impressive in emerging regions, with

smart watches rising from 1.2 million to 8.0 million in sales this year and health and fitness trackers set to more than double

It appears as though the next generation of smart devices is set to explode—and “The Year of Mobile” debate may finally be put to rest

M-Commerce

Path to purchase starts and ends on smartphones for UK millennials

Mcommerce was a hot topic in the UK over the holiday season, with more retail traffic and sales than ever before heading to the mobile

medium. Among millennials, in particular, shopping via smartphone is becoming increasingly common

According to December 2014 research conducted by Global Market Insite (GMI) for the Mobile Marketing Association (MMA), more UK

millennials—ages 18 to 34—were likely to start and end their shopping journeys on their smartphones than any other age group. A

comparatively healthy proportion of millennial mobile users (18%) said they began their path to purchase on a smartphone, more than

double the proportion of 35- to 54-year-olds (7%) and streets ahead of the nominal 1% of 55- to 64-year-olds who said they did so

When it came to completing the purchase cycle via smartphone, UK millennials were also well ahead of the curve—13% displayed this

behaviour, vs. just 1% of 35- to 64-year-olds

This path-to-purchase behaviour is indicative of the wider uptake of smartphones among millennials in the UK. eMarketer estimates that

the 18-to-24 and 25-to-34 age cohorts will have the highest smartphone penetration level out of all age groups in 2015, at 93.0% and

92.0%, respectively

It should be noted, though, that although this smartphone shopping behaviour is more pronounced among millennials, the percentages

are

still somewhat low. Indeed, the MMA study found that laptops/desktops remained most popular for both starting and ending the path to

purchase among UK consumers generally, and likely even for millennials

Wearables – the next payment device?

Wearable devices preferred over mobile phones for in-store payments

The wearables explosion is ticking closer, particularly as the release of the Apple Watch, and estimates for the market are

huge. In February 2015, Cisco Systems forecast that global wearable device connections would total 578 million in 2019,

compared with 109 million in 2014 and 170 million in 2015. And Tractica estimated that the number of wearable devices

shipped worldwide in 2020 would reach 187.2 million—up from 17.0 million in 2013

Mobile payments aren’t a new concept, but most chatter has focused on the usage of mobile phones to purchase items

However, based on December 2014 polling by Stratos, wearables can’t be left out of the conversation. Among US smartphone

owners, more than two-thirds said they would prefer to use a wearable device over a mobile phone to make in-store

payments

Mobile payments could also increase the frequency of wearables usage, as half of respondents said they would a wearable

device more if it could make in-store payments. Overall, more than four in 10 respondents said they would make in-store

payments via wearables

However, other Stratos results suggest brands shouldn’t bank on selling wearables based on their mobile payment options

Just 12.2% of smartphone owners cited making payments and tracking payment history as the primary way they used or would

be interested in using wearable devices. Instead, wearables owners and potential users were most interested in tracking

fitness and health

Clearly, mobile payment options are a nice-to-have wearables feature, not a must-have

Ad formatsWatch Out for the Rise of Avalanche Ads

What is an Avalanche ad and why are A-list brands such as Land Rover, Charles Schwab, Samsung, Verizon, Canon, Guinness, Porsche and BMW snatching them up?

The Avalanche product weaves an ad into a content carousel on a publisher’s website. Think of a squared-off section of a site highlighting several editorial stories with images—and

one of these images is an ad. If a reader mouses over an Avalanche ad, the advertiser’s image expands.

The ads can fetch a higher price tag because they are tucked in among the publisher’s own content and more likely to catch a reader’s eye than an easily overlooked standard display

ad. It comes a bit closer to mixing advertising with editorial without being intentionally deceptive.

Avalanche is the brainchild of Velocity Made Good founder Chris Batty, who formerly worked in digital sales at Gawker Media and CNET. During those tenures, Mr. Batty said he saw

how the display ad market was becoming commoditized. Publishers were on the lookout for better, more visual ad products but didn’t want to constantly produce brand new custom

treatments.

“There’s all this investment in ad tech, but nobody is thinking about these systems for brands,” he said. “So we thought we can help publishers take control of user experience and

their own destiny.”

Mr. Batty said that 230 Avalanche campaigns have been run to date, and the company worked with 30 publishers last year.

“[The Avalanche] delineates between editorial and ads, but puts them in a package that is less jarring. That is important for sites with limited real estate,” said Andrew Creighton,

president at Vice, which liked the ads so much that it made a small investment in VMG.

VMG doesn’t sell directly to advertisers. It licenses publishers of the technology to sell the ads on their own, typically as part of larger, more premium deals.

A site like CarandDriver.com may bring in a few hundred thousand dollars for a campaign, for instance, while VMG gets paid a small fee each time one of these ads appears on the

publisher’s site, which can add up to $4,000 or $5,000 per campaign, said a person familiar with the matter. VMG’s revenue is trending toward a few million dollars this year, the

person said.

Source: WSJ, Mar’15

Internet of thingsAre Marketers Taking the Internet of Things Seriously?

The internet of things (IoT) is expected to become a thing in 2015, and marketers are focusing heavily on the inevitable connected future

In a December 2014 study by Millward Brown for Kentico Software, the IoT ranked as the second most important priority area in 2015

among US digital marketers polled, cited by nearly six in 10. Big data and cloud software, both related to the IoT, were also among the top

five priorities, at 54% and 49% of respondents, respectively

The IoT has a place in many marketing strategies, too, based on December 2014 research by PricewaterhouseCoopers. Among CEOs

worldwide, 65% cited the IoT as a digital technology that was strategically important

Marketers’ focus on the IoT will only get more intense. Looking further out, November 2014 research by the

Economist Intelligence Unit found that CMOs and senior marketing executives worldwide believed the IoT would have the

biggest effect on marketers by 2020, beating hot-right-now real-time mobile personalization by 1 percentage point

Wearables and virtual/augmented reality were less popular, but given their part in the IoT, their effects will likely be tied into

the space as a whole

Estimates released by Gartner in November 2014 put the potential of the IoT into perspective. The research firm forecast that

the installed base of IoT devices worldwide would rise from 4.88 billion to nearly 25.01 billion between 2015 and 2020

Gartner defines the IoT as “the network of dedicated physical objects (things) that contain embedded technology to sense or

interact with their internal state or external environment. The IoT comprises an ecosystem that includes things, communication,

applications and data analysis.”

Indeed, the IoT boom is coming, and marketers who haven’t jumped on board better do so quickly—or risk being left in the dust by their prepared peers

digital landscape report - aop · 2019. 2. 12. · forecasts & ad revenues in this section...

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