PRESENTATION HIGHLIGHTS from CARF Seminars

NEW!
• Questioning Media Advertising: Six Media Respond (Oct. 2009)
Radio, Out-of-Home, Magazines, Interactive, Newspapers and Television weigh in on the state of the media.

• Vancouver 2010: What Impact Did the Winter Olympic Games Have On the Way the World Views Canada? (Mar. 2010)
Who followed the Games, the media they used, their impressions of the event and the country, and what their impressions mean for Canada.

More seminar presentations:
• The Power of Advertising (Advertising Week 2009)
• Advertising in a Recession >>
• Effectiveness of High-Tech In-Store Media >>
• Market Research Surveys: Online Versus Traditional >>

Questioning Media Advertising: Six Media Respond October 21, 2009

The economic downturn of 2009 made the complicated and fragmented media market even more of a challenge for advertisers wanting to ensure that their strained media budgets are spent in the most effective ways.

This seminar looked at the key usage statistics for each medium; its share of market; and the principle benefits of using each medium in a multi-media plan as well as new research breakthroughs and initiatives that will affect each medium in 2010 and beyond.

Radio – Connect. Engage. Deliver.

Gary Belgrave, President, Radio Marketing Bureau (RMB)

Radio’s continued relevance to consumers is demonstrated by the fact that even with competition from traditional and new media as well as portable media devices, Radio still captures a sizeable chunk of daily media time. For example, Radio accounts for 32% of the daily media time spent by adults and second only to TV, which garners 35%. The Internet pulls 20%, newspaper 9%, and magazines 4%.

One of the reasons Radio remains relevant is its ubiquity. Radio follows Canadians throughout the day, connecting with them at home, at work, at play, in the car, and through portable listening devices. Radio has expanded beyond on-air to include online and in-market touchpoints to serve communities of listeners by geography as well as communities of interest and entertainment preferences.

Radio has become an interactive social medium that reinforces community, strengthens radio station brands, and increases listener loyalty through blogs, email, twitter, contests, events, listeners clubs and rewards, requests, phone-ins and talk shows.

The appeal of Radio spans generations. More than half of Canadians aged 18 to 34 show a strong interest in the interactive features of the Nano’s new FM tuner. At Calgary’s new rock station X-FM, which launched in Fall 2006, average weekly reach for listeners 18 to 34 to date is 20% higher than in Fall 2007.

Although TV and newspapers are losing share of advertising expenditure to the Internet, Radio’s share has remained consistent. Average annual revenue growth for Radio since 2001 is 5.6% compared to 4.7% for all major media and 1.3% for U.S. radio. The majority of Radio revenue is generated by local advertising although national advertisers have increased annual radio spending by an average of 7.1% each year since 2001.

Radio enables advertisers to reach the right person at the right time. Consumers can be targeted by market or by consumer behaviour, lifestyle and preferences to increase campaign efficiency and complement other media activities. Nestle Canada increased frozen entrée sales by 16% by targeting busy adults during their drive home.

Out-of-Home In The Marketing Mix

Rosanne Caron, President, Outdoor Marketing Association of Canada (OMAC)

Out-of-Home reaches active and mobile Canadian consumers: more than 50% of time is spent outside of the home. There are 13.5 million Canadians who commute daily. The average commuting time is more then 5 hours per week.

OOH has enjoyed a steady increase in its share of advertising dollars, increasing from 5.3% in 2006 to 7% in 2008.

The impact of 2009 has resulted in shorter lead times, and a greater focus on accountability and measurable results. Advertisers want to deliver more impact with fewer dollars with campaigns that are integrated, creative and innovative.

Technological advancements are changing the face of the OOH industry. Digital OOH is engaging and motivates Canadian to respond. The mobile market continues to grow and consumers are increasingly likely to scan coupons with their mobile devices.

There are many benefits to OOH in the marketing mix, one being that it can quickly generate mass reach. OOH also delivers highly targeted market segments. It extends the reach and impact of other media by providing touchpoints throughout the day where consumers live, work, play and shop. OOH provides 24/7 visibility and cannot be time-shifted or turned-off.

OOH delivers ROI and studies have shown that it has a positive impact on brands and sales. It reaches consumers in environments where they are most receptive to advertising, such as in sports and entertainment venues. It also influences shopping decisions at point of purchase. It helps create brand experiences as part of promotions, at promotional and sampling events, and drives traffic to retailers. Digital technology has enabled OOH to be interactive to engage consumers and motivate them to action.

Where Are Magazines Today?

Gary Garland, Executive Director, Advertising Services, Magazines Canada

Although advertisers have cut back on spending and the selection of consumer titles grows each year, reader metrics are strong. Average issue circulation is steadily increasing while US spill circulation is in long-term decline. Readership is stable across all age groups and strongest in the 18 through 49 segments.

Qualitative readership scores remain stable despite the growth of online. Time spent reading remains stable as does "average degree of interest" scores across all measured magazines. Magazine ad effectiveness is also building with ad recall increasing nearly 6% between 2005 and 2008 and action as a result of those ads jumping almost 10% during that same time period.

The market share for consumer magazines between 1998 and 2008 has been stable while television and newspapers have declined against the growth of Internet, radio and OOH. In 2009, revenues are down across many national titles, driven largely by U.S.-based advertiser budget cuts. Regional and vertical titles are generally fairing better. Newsstand sales have dropped because of fewer shopper trips and purchase opportunities. New title launches are slowing and some publishers are restructuring for increased efficiency.

The magazine industry expects a slow rebound through 2010 (barring unforeseen news from the US) and PriceWaterhouseCoopers is predicting a more robust performance in 2011 through 2013 – putting magazines number three in advertising growth behind the Internet and video games.The key reasons to include magazines in the media mix are because they engage consumers, generate action and drive success. Consumers pay attention to magazine ads and find them less annoying than other paid media ads.

Consumers are receptive to magazine advertising. Starcom research found that when consumers were asked to pull out 10 pages that best exhibit the essence of their magazine, three out of 10 pages were advertisements. Of all media, consumers said that magazine ads were most relevant to their interests and that magazines were best at providing important information.

When consumers were asked which media provides them with ideas that influence how to get information about products and services on the Internet, 57% said magazines, followed by cable TV (54%), network TV (53% and radio (51%).

Magazines have been shown to help optimize media mix ROI and to drive brand favourability, purchase intent, brand and ad awareness. Total brand awareness jumps by 25% when magazines are added to a TV campaign and by 44% when combined with TV and online. Purchase intent increases by 44% with TV and magazines compared to TV only, and by 50% with a mix of TV, online and magazines.

What’s New In Interactive Advertising?

Paula Gignac, President, Internet Advertising Bureau (IAB)

Canada has the highest Internet penetration at 72%, well above other countries including the US (63%) and the UK (60%). Canadians also spend the most time online and view the most content.

Canadians across all age segments consume traditional media online – music, TV, newspapers, and radio. Canada also leads in online video reach (86.1%), videos viewed (190.2 per viewer) and time spent (882.8 minutes per viewer).

Social networking attracts a worldwide audience of over 734.2 million unique visitors and continues to be a growing trend. Canada again leads the world in this trend at 89%, when compared to Latin America 81%, UK 80%, US 75%, and Mexico 72%.

Is anybody buying this? Actual online ad spending in 2008 was $1.66 billion, with 2009 budgeted at $1.75 billion.

Online research has developed far beyond number of hits to help advertisers choose the ad styles and the sites best for meeting their goals. We now know and can show that online display ads are best for reach and awareness while video pre-roll delivers brand awareness and positive predisposition towards the brand or product. The results of an online campaign can be tracked back up to 35 days, even for a DR campaign.

While rich banner ads are more effective than on-site banners, consumers are apt to interact and spend more time with ads with video. Creative can now be optimized using technology that tests multiple executive, for multiple targets and markets, all at the same time.

The next frontier for interactive advertising is mobile. It’s huge reach is just one of the potentials of mobile but over the last three years, it has been shown to generate greater ad awareness than online display advertising. Canadians are early adopters of smartphones, and that is expected to continue to build and offer even more opportunities for advertisers with new apps and technologies such as QR codes and image recognition.

Gaming as a vehicle for interactive advertising is another proven way for advertisers to target messages to males aged 12 to 44. Gamers and Xbox 360 owners watch fewer minutes of broadcast TV than other Canadians. In-game advertising has delivered results for big brands in the automotive, fast food, technology and consumer packaged goods categories. Those results include 69% increase in purchase consideration among likely car buyers; a 55% jump in brand familiarity for the CPG brand; 70% increase in positive brand rating for the tech brand; and 39% positive ad rating of in-game ad creative for the fast food brand.

The State of Newspapers Today

Suzanne Raitt, VP Marketing and Innovation, Canadian Newspaper Association (CNA)

Newspaper owners are far more endangered than the medium itself. Daily newspapers and their online sites continue to deliver strong stable readership : 48% of adults read a daily newspaper on an average weekday; and 73% of adults read a daily newspaper in the past week. With over 1,000 titles across Canada, community newspaper readership is also solid – 74% of adults read a community newspaper, weekday or weekend.

Advertising cutbacks in the automotive and retail sectors have had an impact but the top media, in terms of advertising spending, in Canada continue to be newspapers, both dailies and community, with 24.4%, followed by TV with 23.1%.

Newspapers have successfully carved out a place in the digital world with both online and print editions, but haven’t stopped there. They are also making use of new platforms, formats and unique offerings such as mobile, iPOD, Twitter, video, blogs and e-newsletters.

NADbank 2008 reported that 73% of Canadians said they read a newspaper in the past week and 19% of Canadians had read a newspaper online in the past week. Just 5% of respondents only read newspapers online, 20% are dual online/print readers, and 75% read the print edition only. The study found that while the amount of online readership and dual readership has grown since 2005, Canadian are staying with print editions and adding online rather than replacing print with online.

Canadians visit newspaper websites more than twice as often as TV, radio, or magazine websites. They trust newspaper advertising (63%) slightly less than word of mouth recommendations (78%) but more than ads on TV (56%), radio (56%), or magazines (54%). (Source: eMarketer / The Nielsen Company, “Online Global Consumer Study”) During challenging economic times, 28% more Canadians, particularly those 18 to 34s and women, use newspapers and inserts to find sales and bargains. (Source: IPSOS (commissioned by CNA), June 2009).

Newspaper has shorter lead times than other media and is ideal for targeting by local market and specific date to enable timely delivery of messages about sales or special events and to reach consumers before purchase occasions. Advertisers can easily provide consumers with more detail about products and services with newspaper, or drive them online to interact with brands. Newspapers have shorter lead times than other media



Why Television Is A Must!

Theresa Treutler, President and CEO, Television Bureau (TVB)

On average 5.1 million Canadians are watching television every minute of every day. Television provides tremendous reach: 81.6% of Canadians daily, 99% weekly, and 100% monthly.

Canadians spend a lot of time watching TV: Canadians aged 2+ watched 26.2 hours a week and adults 18+ watched 28.4 hours. Adults 25 to 54 watch 23.1 hours a week of television, but spend 19.0 hours with radio, 17.0 hours online, and 1.8 hours with newspaper. (Source: BBM RTS Spring 2009)

More advertising dollars are invested annually in TV compared to other media, however share has declined for most media due to online growth. Consumer surveys conducted for TVB by BBM Analytics and Angus Reid Strategies report that compared to other media, Canadians in all key demos report television advertising to be the most impactful. Most often favourite ads and ads that create an emotional response are TV ads.

Television works synergistically and plays a key role along with other media in driving consumers along the purchase funnel. 42.9% of adults aged 18 to 49 have watched TV and used the Internet at the same time and 49.1% of respondents have gone online and searched for information or a website based on something they saw in a TV commercial. (Source: BBM Analytics omniVU July 2008)

In the U.K. being online while watching TV is now second only to eating while in front of the television. 47% of people between the ages of 16 and 54 report concurrent usage at least once a day; 61% at least once a week; 57% that a TV ad prompted an online search; and 21% report that a TV ad lead to an online purchase.

Perceived role of TV: awareness, interest and action/response

• TV raises awareness of brands never heard of before

• TV sparks interest

• TV provides new information about established brands

• TV persuades you to try a brand/product

• TV generates word of mouth

• TV makes you like a brand

Perceived role of Online: detailed information

• Online helps you to decide which brands are relevant to you

• Online helps you evaluate a brand

• Online gives the extra information you need to make a purchase decision

(Source: thinkbox; TV & Online: Better Together)

The Power of Advertising

Advertising Week – January 28, 2009

History and research have proven that brands that cut their advertising and marketing budgets during economic downturns will likely lose market share to competitors that opt for business-as-usual strategies. It will also be much more costly for them to regain share when the economy improves. This seminar examined the power of continuing to support marketing initiatives during a recession.

Marketing in a Recession: To spend or not to spend
Keynote speaker: Nigel Hollis – Executive Vice-President and
Chief Global Analyst, Millward Brown

There’s plenty of evidence, going back to the Great Depression, that increased spending on marketing during a recession can result in long-term gains for a brand. But is it still true in today’s environment of new media and media fragmentation? The effect is even more striking now, according to Nigel Hollis, EVP and Chief Global Analyst at Millward Brown, citing new evidence from the Profit Impact of Marketing Strategies (PIMS) 2008 database.

The PIMS analysis compared the profits and share of market achieved by companies that increased, maintained, and reduced marketing spend during a recession. Companies that cut marketing spend enjoyed a better Return on Capital (ROCA) in the short-term, but inferior results after the recession ended. On the other hand, those companies that increased their spending achieved significantly higher ROCA and gained an additional market share during the recovery.

Speaking at CARF’s January 2009 seminar, The Power of Advertising (a featured event during the ICA’s inaugural Advertising Week), Nigel Hollis noted that price sensitivity, brand equity, attitudinal underpinnings and market share all have an impact on the results achieved by individual brands.

There isn’t a one-size-fits-all solution. A number of factors should be taken into account by advertisers: the nature and size of the category; the relative strength of the brand; the motivation of customers; and the competitive response. He suggested advertisers support their strong brands, hold prices relative to the competition, take advantage of lower media costs, and use advertising aimed at supporting the price by demonstrating value. He also said that to emerge from the recession as victors, healthy brands need spirit and the will to win.

How Advertising Built Diageo Brands
Dhan Kashyap – Director of Business Strategy, Diageo Canada

“ Regrettable decisions are made through ignorance.”

So goes the proverb quoted by Dhan Kashyap, Director of Business Strategy, Diageo Canada, at the beginning of his presentation at the CARF seminar. Diageo Canada, marketers of premium alcohol beverages such as Smirnoff, Bailey’s and Guinness, demonstrates the will to win and the knowledge to do it.

At Diageo, research is a form of insurance and an essential tool for building and supporting brands. Dahn Kashyap shared several examples, including how Diageo used research to identify the brand’s key benefit and develop advertising that stretched consumer perceptions about where and when to consume Bailey’s. Diageo successfully increased Bailey's share of market by repositioning it from a special occasions drink to a beverage that can be enjoyed among friends in more casual, but still special, situations.

The key, according to Kashyap, is to create brand communications from a deep understanding of the brand’s benefits and the consumer’s relationship with the brand. In a recession, it is all the more important to make the right decisions. He suggested advertisers apply brand communications carefully, go back to the basics and do it right, but also to experiment and course correct as needed.

In response to the current economic conditions, Diageo is setting the bar high, looking for breakthrough advertising that creates above-the-norm awareness. They will continue to focus their efforts in experiential marketing, the digital realm and TV.

Advertising in a Recession
Presentations from the CARF Workshop - Advertising In a Recession – April 6, 2008

The “R” Word
Benjamin Tal – Senior Economist, CIBC World Markets

In these days of economic uncertainty, Benjamin Tal concludes that while there certainly has been a slow-down in the Canadian economy, especially in the manufacturing sector, there currently is no recession in Canada nor is there likely to be one in the near future. This optimistic view is based on a strong housing market in Canada and in rising commodity pricing, especially for oil.
Read more >>

Lessons for Effective Advertising in Uncertain Times
Summer Vallillee – Account Executive, AC Nielsen Analytic Consulting
Jessica Avery – Account Director, Client Consulting, Nielsen BASES

With the increased cost of commodities and the rising value of the Canadian dollar putting the squeeze on Canadian manufacturing, it’s not a big surprise that advertisers will be forced to cut their advertising budgets to maintain product profitability.
It has been the Nielsen experience that continuing to advertise, especially on television for a FMCG, yields a higher long-term (3+ years) return on investment than other types of marketing efforts, including trade deals. According to Nielsen, advertising ROI also improves when TV advertising is combined with other marketing tools such as trade deals. While trade dealing may yield the highest ROI in the short term, the combination of the two marketing tactics can yield 18% greater profitability over the longer term. To cut TV advertising just to reduce short-term marketing expenses can have negative results in the long run.
Read more >>

Making the Strategic Argument for Advertising During Difficult Economic Times
Dr. Jay Handelman – Associate Professor of Marketing, Queen’s University

In uncertain economic times, advertising budgets are sometimes cut to help companies weather any difficulties ahead. Dr. Jay Handelman suggests that rather than automatically making cuts, in an unsettled economy the place of advertising in the marketing mix should be reviewed from a strategic perspective. When considered in this light, advertising is not an expense but an investment and a source of innovation. He advises that advertising continue to be used to help build the value of the product to the consumer.
Read more >>

Effectiveness of High-Tech In-Store Media
Presentations from the CARF Seminar – Effectiveness of High-Tech In-Store Media – May 21, 2008

In-Store Media – Some Thoughts On How It Works
Gwen Morrison, CEO, The Americas and Australasia, The Store

Traditional advertising media have become fragmented to the point where it is difficult, if not impossible, for a brand to generate awareness and brand preference. At the same time, owner consolidation in the retail industry has reduced the number of retailers – but not the retail outlets – and in-store media has gone through a major evolution. With the advent of digital technology, in-store media has become better, cheaper, more compelling and more pervasive while traditional shelf talkers and product signage have all but disappeared at the point of purchase. In-store media now reaches customers in numbers that compare to broadcast media, and retail has become the new media frontier.
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Retail Trends in Canada, 2008
John Torella, Senior Partner, J.C. Williams Group

John Torella says that the retail industry in Canada is currently in a state of unprecedented uncertainty. While retail sales in January 2008 were 8.9% higher than a year ago, consumer confidence is at a two-year low. This is indicative of a harsher retail climate to come. In spite of the January figures, sales in February, March and April have not been good. At this point in time (May 2008), not all retailers are in the same growth mode. Sales of food and beverages, furniture, electronics and appliances all are up – but housing, interest rates, inflation, and savings rates all are down. As a result, Torella warns, the retail industry must maintain its flexibility and be able to adjust quickly to changing conditions.
Read more >>

Digital Signage at Retail: Developments in an Expanding Universe
Terry Debono, President, MxN Media Group

According to Terry Debono, digital signage is an evolution of traditional broadcast, speciality channels and private networks. The advantage of digital signage over other types of media is its ability to focus a message down to a specific location, for a specific product, for a specific length of time. For the retailer, this has enabled an integration of POS advertising with inventory management – for example when an individual store puts on sale a product with excess inventory using digital signage as the advertising medium.
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Market Research Surveys: Online Versus Traditional
Presentations from the CARF Seminar – Market Research Surveys: Online Versus Traditional, January 18, 2008

Online Data Collection: Are We There Yet?
Anne Crassweller, President, NADbank, Toronto

For many years, NADbank has been using RDD telephone-based methodology to collect data on newspaper readership and consumer behaviour of adults 1*+ in urban markets across Canada. However, the decline in response rates (45% in 2006) and the increase in cell phone only households (5% in 2006) have motivated NADbank to explore alternatives to its traditional methodology.
Parallel with its 2006 fieldwork, NADbank conducted an online survey using the same questionnaire as their telephone research. The purpose of the test was to obtain top-line estimates of similarities and differences between online and traditional telephone survey methodology. The test compared the results using the TNS/Canadian Facts online panel (Toronto only members) with the NADbank telephone research in the Toronto market. Observations from the test are reported below.
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Telephone, Online and the Big Picture
Doug Church, Founding Partner, Phase 5 Consulting, Ottawa

Doug Church summarizes the current debate over online versus telephone-based research by saying that, while online research offers definite advantages in terms of lower cost and quicker turn-around time, there remains a question of whether online can replace telephone for broadly-based surveys where probability-based sampling has traditionally been a requirement. He points out that penetration rates for online are generally lower than for telephone and online panels have been convened largely through self-selection because there is no Internet equivalent of the phone book to allow RDD-like sample recruitment. In an attempt to overcome some of the biases against Internet-based research, some suppliers are developing approaches such as propensity scores, non-response weighting, and bad responder controls in an effort to improve the quality of the output.
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Online Research. Why? Why Not?
Debbie Davis, Director of Market Research, BMO, Toronto

Debbie Davis reminded the seminar that online is only one possible methodology in the researcher’s toolbox. She said that while online research is not the Holy Grail, neither is more traditional research. Which methodology is best depends upon the product being researched and the target audience.
Davis said that the reality is that online research is no longer a fad but is here to stay. She points out that in some cases the use of online research is almost a given – the evaluation of a website, customer satisfaction studies where e-mail address are available and subjects have given permission to be contacted, or where the evaluation of visual material is under study.
Read more >>