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EuroMedia Trends 2005
Marketers’ Perspective from 14 European Countries
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Study background
• The media landscape is changing fast and becoming highly fragmented
• Consumers’ media consumption habits have entered a new era with the introduction of new communication technologies leading to more connection opportunities
BACKGROUNDBACKGROUND
QUESTIONSQUESTIONS• Does the allocation of marketers’ media
budgets reflect these new media and message consumption patterns?
• Which media do marketers perceive as being the most effective at meeting different marketing objectives?
• What is the role of different media in integrated marketing campaigns?
3
‘
EuroMedia Trends 2005 - European study of marketers conducted by Millward Brown on:
TRENDSTRENDS
PERCEPTIONPERCEPTION
FORECASTINGFORECASTING
• Marketing and media decision-making
• Media and marketing spending
• Marketing and media effectiveness
• Marketing/media trends in Europe (with a focus on Western Europe)
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EuropeWestern Central EasternGermany, France, Croatia, Czech Rep., Italy, Spain, Portugal, Hungary, Greece, UK Poland, Romania,
Russia, Turkey
A robust multi country and cross industry study on trends, and perceived media effectiveness
COUNTRIESCOUNTRIES
SAMPLESAMPLE
INDUSTRIESINDUSTRIES
704 interviews with marketing decision makers in key industries
Automotive, Beauty/Toiletries, Entertainment, Financial Services, Food/Beverage, Media, Pharmaceutical, Retail, Travel/Transportation, Telecom, Technology
7
'
• In Europe, marketers favor traditional media channels to achieve diverse marketing objectives, while in the US “trial and repeat” has already switched to online
• European marketers seem to focus more on short term sales building, risking sacrificing longer term brand equity building
• Online marketing in Europe is becoming more popular (mostly in new customer acquisition and by offering measurable ROI) but is still at a level below the US (c.f. penetration issues)
Main findings
• Biggest budget cuts are expected in leading W countries. Many big spenders are cautious, while CE marketers are more optimistic about their budget growth expectations
BUDGETBUDGET
MEDIAMEDIA
IMCIMC• In W integrated marketing campaigns are less
widespread than in CE
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About Those Budgets…
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Only around 1/3 of the Italian decision makers are optimistic about growing their budgets in
2005, in line with the rest of W. CE marketers are most optimistic.
Increase expected for 2005
40% 40%
37% 37%
58% 58%
From other studies conducted in the US we know that there, optimism amongst marketers is above the European average.
From other studies conducted in the US we know that there, optimism amongst marketers is above the European average.
ITALY: 30%
QE3. How does your total 2005 marketing/media budget compare to the budget for 2004?
EU
W
CE
Biggest spenders in Western Europe are comparatively the least optimistic – the picture
is more consistent in CE
Biggest spenders in Western Europe are comparatively the least optimistic – the picture
is more consistent in CE
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‘Most positive’ markets going into 2005: RO and RU. ‘Least optimistic’: DE and FR
80
70
58
57
57
54
52
50
46
46
43
40
39
37
32
32
30
Romania
Russia
CE Average
Czech
Croatia
Greece
Hungary
Turkey
Poland
Spain
UK
EU Average
Portugal
W Average
Germany
France
Italy
QE3. How does your total 2005 marketing/media budget compare to the budget for 2004?
% marketers plan increase
0
2
4
6
7
9
12
13
14
14
14
14
14
16
18
18
6
Russia
Spain
Romania
Poland
Turkey
CE Average
Italy
Greece
EU Average
W Average
Croatia
Hungary
Portugal
UK
Czech
France
Germany
% marketers plan decrease
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Marketers grow spending on media linked to short term sales building
Of all media that increased in 2004, Magazines are getting the biggest increase in Europe,
driven also by Italy
QF2. How does your 2004 marketing/media budget compare to your 2003 marketing/media budget for the following media? QF3. How does your 2005 marketing/media budget compare to your 2004 marketing/media budget for the following media?
EU US
2004 vs.
2003
2005 vs.
2004
2004 vs.
2003
2005 vs.
2004
Online 28 26 57 54
Magazines 25 22 34 30
Direct Mail 20 21 38 34
Newspaper 19 15 28 28
Outdoor 15 15 23 19
Radio 13 11 27 25
TV 12 10 37 33
Online, Magazines, Direct Mail – perceived to offer better targeting and ROI
% of Marketers said they would grow their particular media budget
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Growth expected for the next 5 years for Web Advertising:
60-70% Croatia, Russia, Romania
50-59% Turkey
40-49% Germany, Portugal, Greece, Czech Republic
30-39% Hungary
20-29% Italy, France, UK, Poland
19% or less Spain
Q.F7 What is the one area within your company’s online marketing budget that you feel will grow most over the next five years?
Amongst on-line users, web advertising will grow most over the next 5 years in EU
There are growth expectations also for E-Mail Marketing in Italy
(in %) Europe Italy
Online Promotions
25 20
E-Mail Marketing
25 32
Web Advertising
35 28
% of Marketers naming the one online application that will grow the most over the next 5 years.
Growth expectations for Web Advertising highest for CE countries
Base: Usage of online marketing
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European computer and online penetration is growing fast
June 2002: 9,57 %
January 1996: 0,73 %
2001 to 2003US: 62.44 65.98 Europe: 19.08 22.43
Growth rates (2000-2005):European Union 131,6% Rest of Europe 341,9%Italy 116,7%US 110,7%
CE countries grow at double digit rates since 2000. The highest: Romania from 6% (2002) to 23% (2003)
Global internet penetration
Global internet penetration
of world population
PC’s per 100 inhabitantsPC’s per 100 inhabitants
Internet penetrationInternet penetration
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Internet usage growth rates (2000-2005) go through the roof. Particularly in the CE countries,
where base internet penetration is still behind WInternet penetration (% Population)User Growth (2000-2005)
US Internet penetration 2005: 67% (of the population)User Growth (2000-2005): 110%
200%
619%
400%
279%327%
44%
171%
280% 253%192%
117%
1059%
93%128%8%
16%19%
28%30%
34% 34% 34% 35%
41%
49%52%
56%59%
0%
200%
400%
600%
800%
1000%
1200%
Turk
ey
Russia
Roman
ia
Poland
Hunga
ry
Portu
gal
Spain
Greec
e
Czech
Fran
ceI ta
ly
Croat
ia
Germ
any
UK
0%
10%
20%
30%
40%
50%
60%
70%
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Marketers' Opinions AboutMedia Effectiveness
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Media Effectiveness Evaluation
6 ATTRIBUTES EVALUATED
Building Brand Equity
New Customer Acquisition
Providing Measurable ROI
Ability to Retain Customers
Ability to Reach Target Audience
Offering Efficiency
We asked marketers to give their opinions on media effectiveness for selected media.
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6 ATTRIBUTES EVALUATED
Building Brand Equity
New Customer Acquisition
Providing Measurable ROI
Ability to Retain Customers
Ability to Reach Target Audience
Offering Efficiency
TV leads in building brand equity…
But based on those companies which use TV within their media mix
TV RADIO
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6 ATTRIBUTES EVALUATED
Building Brand Equity
New Customer Acquisition
Providing Measurable ROI
Ability to Retain Customers
Ability to Reach Target Audience
Offering Efficiency
Media that deliver short term ROI are rated highest in reaching diverse marketing objectives
Promotion
Direct mailMagazines
Direct mail
Promotion
PromotionDirect mail Magazines
Direct mail Magazines Promotion
Direct mail Promotion Magazines
Online is becoming recognized across attributes…
Online
25
Continued Importance of Online Media..
26
Compared to
Q.D2: Do you have a centralized online marketing group at your company?
Online is becoming a specialism within European marketing departments, particularly among the biggest spenders…
Europe
US
In Western Europe 44% of respondents said they have centralised online marketing groups (54% among the biggest spenders) while in CE this ratio was 28%
42 % 73 %
Having a centralized online marketing group at the company
The US data represent learning from different studies conducted by Millward Brown
ITALY: 37%
27Q.D4: Does your company work with a separate agency for your online marketing/media efforts?
Working with separate agency for online support
…Leading to half of European marketers using a specialist external agency for online supportOnly 1/3 of the Italian Companies works with an external agency
EuropeUS
64%46%
W CE
61 %44 %
Base: total
The US data represent learning from different studies conducted by Millward Brown ITALY: 33%
Biggest spenders: 51%
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How Media is Being Usedto Meet Marketing Objectives
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Awareness
Consideration
Trial & Repeat
Purchases
What objectives are brand marketers trying to meet: definitions.
AwarenessCreating awareness of new product
AwarenessKeeping established product top of mind
ConsiderationExpanding the brand'sconsideration
ConsiderationCommunicating thebrand's position
Trial & RepeatRetaining customersand increasingloyalty
Trial & RepeatEncouraging trial
Trial & RepeatAcquiring newcustomers
30
TV and Magazines were named most effective for “creating awareness” and keeping established products “top of mind”
Awareness
AwarenessCreating awareness of new product
AwarenessKeeping established product top of mind
OutdoorMagazines
Magazines
TV
TV Outdoor
31
Consideration
ConsiderationExpanding the brand'sconsideration
ConsiderationCommunicating thebrand's position
Traditional media still have highest confidence of European marketers in boosting consideration
TV NewspapersMagazines
32
Trial & Repeat
Purchases
Trial & RepeatRetaining customersand increasingloyalty
Trial & RepeatEncouraging trial
Trial & RepeatAcquiring new customers
While in Europe marketers vote for traditional media channels to increase trial and loyalty, in the US Online channels excel on response-based efforts
Magazines
Direct mail
Direct mail Magazines TV
TV
TV
Newspapers
Newspapers
36
Integrated Marketing Campaigns
37
59% of European marketers claim that they develop Integrated Marketing Campaigns Italian marketers seem to use quite less Integrated Marketing Campaigns in comparison to the W average level
Europe US
QD5. Does your company execute integrated marketing campaigns?
89 %59 %
78 %56 %
W CE
ITALY: 43%
But there is no universal definition!
All marketers use different words to describe integrated marketing campaigns…The US data represent learning from different studies conducted by Millward Brown
No strong differences in W on the basis of the companies' media budget availability
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Integrated Marketing Campaigns are becoming more widespread.The majority of the Companies has been using IMC for more than 3 years
QD5a. When did your company start doing integrated marketing campaigns?QD5b. For this year, out of all the marketing campaigns that you are aware of, how many are integrated marketing campaigns?
Base: using Integrated Marketing Campaigns
% of Integrated Campaigns in total
22
38
34All
Most
Some
6% DK/ no answer
IT: 10% IT: 30%
IT: 55%
40
Opportunities and Conclusions
BUDGETBUDGET• In W there is a cautious optimism about marketing
budget increases far below the US or CE expectations.
• Marketers with medium size budget are the most optimistic about their budget growth, while big spenders stay very conservative
MEDIAMEDIA
IMCIMC
• European marketers still apply traditional approach to planning media budgets giving preference to media channels supporting short term sales
• Online marketing/web advertising is starting to become more important in the marketing mix in both Western European and CE countries.
• Almost half of W marketers are not yet converted to integrated marketing campaigns that take advantage of the strengths of each medium in a holistic way
• From the other research we do, we know that consumers are using multiple media in multiple ways and are available to be reached beyond traditional communication channels