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Culture of Effectiveness

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One of the flagship reports released as part of the EffWorks Conference was the IPA’s Culture Monitor – a wide sweeping survey of marketing professionals to assess the state of the effectiveness nation. 

Though the report found effectiveness culture to be in good health, there is likely to be significant selection bias in the results. Those with strong effectiveness cultures are more likely to respond to a survey assessing the same. Despite this, there may be some lessons to be learned from those brands and agencies operating at the top of the effectiveness game. 

The Value of Roadmaps 

One standout recommendation was for organisations to create effectiveness roadmaps to further improve their cultures. Effectiveness rarely has a single point of accountability in any organisation, so a centralisedmulti-year plan is a major accelerant of effectiveness culture. 

Start with an Audit 

 Introspective questioning is the logical starting point when creating an effectiveness roadmap. The Report recommends structuring this around 4 pillars. 

  • Focus

What does marketing effectiveness mean to the organisation/agency and what are the expectations from an effectiveness approach? 

  • Process

Is there a clearly defined process and what does it look like? 

  • Data, Tools, Measurement 

Do you have the data to support the meaningful measurement of marketing activity and, if not, how are you going to get it? How do you intend to show the value created from marketing investment and increase the impact on marketing decision-making with this evidence? 

  • People

Is there a focus on continuous learning and development – and do you learn both from success and failure? ​​

It’s a shared journey 

As an agency we believe that in the volatile post-pandemic environment, where distribution networks and advertising consumption have been disrupted significantly, it is crucial for advertisers and agencies to take this journey together.

Will the NFT Bubble Burst?​

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Back in May, What’s Hot reported on the ridiculous rise of non-fungible tokens, or NFTs, the digital, blockchain-based technology which had continually hit the headlines for a series of eye-popping sales. From a token of the Nyan Cat meme selling for nearly $600,000, to a copy of the first tweet going for $2.9m, the world appeared to have completely lost its marbles; such that, by the time a .JPG file sold for the earth-shattering amount of $69.3m, it almost felt like old news. 

Since then, NFT mania has shown few signs of subsiding. In Q3, NFT sales soared to more than $10bn, an eightfold increase on Q2 2021. Thus, it is little surprise that a plethora of brands have been investing in the technology, from Asics to Team GB. So, how have brands utilised the space? 

An NFT – just like limited edition trainers or mint-condition comics – derives its value from scarcity; the fact that the buyer can own something few others possess. This proved tantalising to legacy brands, including Coca-Cola, who utilised the market to re-issue iconic memorabilia from its past. 

And it’s not just memorabilia. As the Metaverse grows – the virtual environments often lauded as the future of the internet, having succeeded NFTs as 2021’s latest un-understandable craze – the prospects for digital goods have risen, with a host of fashion brands racing to produce digital counterparts to their clothing. Before long, gamers could be sporting a virtual Versace in Fortnite. 

NFTs have also been suggested as solutions to a host of other issues. After Kings of Leon made more than $2m in sales of their latest album through a special NFT release, NFTs were mentioned as a counter to years of falling artist revenues due to streaming services. Industries like air travel have also been floated as services which could benefit from a switch to NFT-based ticketing. 

Critics will point out that, as it stands, no such benefits exist, and that brands who have thus far entered the NFT space have taken a rather clichéd, how-do-you-do-fellow-kids approach to engaging with consumers. But while that argument does have merit, the fact that brands haven’t quite yet figured out how best to work with NFTs doesn’t mean the industry is doomed to fail: one only has to think back to early-era brand Twitter to know that clunky comms can rapidly evolve. 

What should cause concern is the vast environmental impact of NFTs. The Ethereum platform it uses for trade requires 48.14 kilowatt hours of energy for every transaction, enough to power the average UK home for five days. In an era where Gen Z increasingly seeks sustainable alternatives when purchasing goods, the carbon footprint of NFTs seems incredibly at odds with that ideal. 

Eventually innovators will find ways to reduce these environmental costs, just as creatives will get better at finding original ways to use the fledgling technology. Until then, brands must tread carefully when first foraging into the NFT market. Despite promises to offset carbon emissions, a number of NFT projects have been scrapped following a backlash from concerned consumers. 

Despite this, NFTs are not going away anytime soon, as the lines between real and virtual blur. The question is no longer whether brands will join the market, but what they plan to do with it. As for whether NFTs will stick around for good, or join the graveyard of obsolete technologies, only time will tell. Put on your Google Glasses and fire up that HD DVD Player, it’ll be a bumpy ride. 

4 The Future

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On the evening of Tuesday 14 September, the consultation period on the future of Channel 4 came to an end. A consultation designed to test the government’s belief “that a new ownership model for Channel 4 would be the best means of ensuring its future success.”

Channel 4 is currently publicly owned but commercially funded. Which means the taxpayer doesn’t fund it, but it’s not required to turn a profit or focus on shareholder dividends in the way private companies are. So, profits are re-invested into programming, allowing the creation of content other channels might view as risky or unprofitable. This in turn allows Channel 4 to deliver against its public service remit of serving diverse and under-represented communities, along with supporting independent British programme makers.

A central concern to those against privatisation is that this element of Channel 4’s offering may be lost. Ampere Analysis found that Channel 4 uses 200 different UK based production companies, 140 of them reliant on Channel 4 for more than half of their TV production work. Each one of these companies brings a new perspective and develops talent which benefits the entire industry. A private owner tasked with maximising profits is likely to reduce the breadth of production companies and the level of risk taking within programming.

Proponents of privatisation argue that new investors with deeper pockets could mean bigger budget programming being brought to British screens. Shortly before losing his job, the culture secretary Oliver Dowden said this meant Channel 4 would be in a better position to take on the streaming giants and to bring in more event programming such as Emma Raducanu’s US Open final. Which perhaps overlooks the fact that Channel 4 were able to do just that under their current model, despite making no return on the ad-free feed from Amazon.

Any change in ownership for Channel 4 as an advertising environment could mean bigger shows, more event programming, and could well pull in larger viewing numbers, providing new opportunities to drive cost effective reach. But the danger is that Channel 4 starts to look a bit more like other channels, which might mean the relatively unique TV audience it currently attracts is diluted. Another consideration for media opportunities is that ITV is currently being mooted as a potential buyer for Channel 4. This reduction in TV sales houses, and the market dominance granted to the new entity, has already been highlighted by ISBA as a concern for advertisers.

Santa Is Back From Furlough, But Xmas 2021 Will Still Be Different 

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Whichever way you spent it, it’s safe to say Christmas in 2020 was a lot different to previous years. With the nation having spent most of the year apart from friends and family, and with coronavirus cases on the rise again, an initial plan to relax lockdown restrictions over the festive period was drastically scaled back – and, for those living in tier four areas, scrapped entirely.

It was little surprise, then, that last year’s Christmas didn’t feel the same. There were no office parties; no long lines for Boxing Day sales. Far from the usual festive feast, food sales declined by 3.4% in the month to December. A staggering eight million Brits spent Christmas Day alone.

After the trauma of last year, one question on most brands’ minds: is Christmas back in 2021?

By delving into a wealth of research and proprietary learning, the7stars has sought to answer that question in our Christmas Trends 2021 whitepaper. The team have identified three over-arching themes which are set to define this year’s festivities, for a Christmas like no other:

Anticipation: After celebrating from a distance last year, consumers are hoping to make the most of this Christmas, with plenty of family reunions and splurging of lockdown savings to celebrate.

Meaning: Over lockdown, Brits found themselves craving closeness and felt more in touch with their sentimental side. This is likely to continue, with a focus on personalised gifts and the relationships that matter most this Christmas.

Impact: The pandemic led many to reappraise what’s important in life, with environmental and social ramifications more apparent than ever before. This year’s festivities are likely to play out in the same context, with Brits dreaming of a greener, cleaner and fairer Christmas in 2021.

Of course, there remain some things which will never change. Christmas crackers will still be pulled; carrots will continue to be crunched. But the impact of lockdown will likely still be felt.

One year on from ditching their usual shopping habits, online orders are poised to rule the roost again this year, with half of Brits intending to shop online at the same levels as during lockdown. However, shoppers could face difficulties getting their presents delivered in time, should global supply chain issues – exacerbated by the UK’s HGV driver shortage – continue into Christmas.

And while those who built up savings over lockdown expressed a willingness to splurge, families with lower disposable income may opt for a smaller, more considered Christmas again this year.

Gen Z, in particular, dream of a Green Christmas, with 56% intending to celebrate in an eco-friendly way, compared to 1 in 4 of those aged 55+. By shifting towards more plant-based and sustainable materials, this group are looking for innovative products to define their experience.

While some Christmas rituals will return, not everything will go back to the way it was. Brits still crave a holly, jolly Christmas, sure – but one that leaves a lasting, positive impact on their world. 

The Contribution Of Context To Digital Advertising

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Once upon a time, adverts had a pretty good idea of the company they might keep. An ad for a watch might sit in the business section of the newspaper. The car advert was placed on a roadside billboard.

But digital changed things. It allowed us to place ads according not only to the content they would sit alongside, but also to who was reading that content. Being able to track behaviour online meant knowing a lot more about the people landing on any given page at any given time. So, ads could be placed against people rather than places. The big advantage of this being that ads could then be bought against the right person, but on lower cost websites and sections of sites.

There has always been great debate about how effective this approach is. It was often cited that products advertised in higher priced media contexts were themselves perceived as being of higher value. This debate has now entered a new phase as Google plans to phase out 3rd party cookies by the end of the year – a move likely to inhibit some forms (and providers) of behavioural targeting.

The release this month of a study looking at the importance of context could hardly be more perfect. Integral Ad Science analysed the impact content surrounding a banner ad has on the effectiveness of the advert itself. Participants were asked to browse pre-selected articles on eight different sites. They were shown one article and one ad per site. Four ads were shown alongside unmatched content, the other four across content which matched either the article theme or message.

Results showed that 73% of people found an ad more appealing when it was related to the content of an article. They also found a 25% uplift in memorability when an ad matched the theme of the content it sat alongside.

Diving a little deeper into the numbers, the study uncovered that adverts which contain a great deal of information benefit most from sitting alongside content that matches on an endemic level (meaning the ad solves a problem the article creates – e.g. an ad for a film on a film listings page). Whereas ads that appeal on a more emotive level see greater benefits from sitting alongside content sharing the same theme.

It’s another piece of evidence to suggest that context, where your ad is sitting and what appears beside it, all impact performance. Moreover, it will serve as a guide for how to navigate targeting choices when online behavioural tracking becomes more limited.

AV’s September Surprise

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After 18 months of uncertainty and upset across the advertising marketplace, we still managed to be surprised by the never-seen-before inflation levels that September brought to AV.

Understandably, advertisers have emerged from the slumps of 2020 to thankfully spend again and revive the marketing industry. Year-on-year figures have looked buoyant throughout recent months but in September, the huge revenue hikes sent everything off balance.

All three big players in AV saw excessive inflation, ITV and Sky with circa 20% year-on-year and C4 at circa 40% year-on-year which, having caught the industry off guard meant the need for the implementation of diverse solutions.

There are many reasons behind the unprecedented inflation, but three factors were key. The first being the relaxing of Advance Booking Deadlines across the industry, something which the7stars has always benefited from, but with large network agencies permitted this short-term perk, late money had entered the market at no penalty, skewing forecasted revenue figures.

Secondly, the number of brands advertising on TV was significantly higher than in 2019. Many advertisers had held back on spending until post lockdown, as well as choosing to avoid months when the Olympics and the Euros were on air, aiming to benefit from the more regular TV schedule (with programming such as Bake Off), and ultimately hoping for pricing to stabilise. Unfortunately, conversely, the additional market revenue together with impacts falling year on year, as more people are back at work and going on holiday, resulted in price inflation.

Thirdly, one of the main drivers behind the excessive Channel 4 inflation was the result of over-investment on ITV for Euros coverage and the return of the summer series of Love Island UK.

To alleviate these market pressures on campaigns, we identified solutions through our ability to be highly agile and flexible in the market; moving marketing spends into more lucrative environments, within sales houses for example, from linear into BVOD where pricing fluctuations do not occur and moving budgets from AV into other media channels where pricing is not impact and revenue adjusted.

Looking forward to Q4, we will no doubt see a bountiful period for advertising and may need to think fast with solutions for continuing year-on-year inflation, but we should view this in a positive light as brands have the overdue revival they have so desperately needed, after such punishing times.

Linear TV channels have an optimistic Autumn/Winter ahead with Channel 4 in particular showcasing an exciting programming slate, so we are anticipating favourable viewing figures which can hopefully stabilise any future revenue spikes.

With AV consumption and advertiser spending surely levelling out from here on in, we should see a more balanced 2022 with market changes based on trends from 2019.

The Battle For Our Screen Time

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At the end of July, Scarlett Johansson began the process of suing Disney after her superhero film Black Widow was released on streaming services at the same time as its cinema release.

Although it set a box office record for a film released during the current pandemic, grossing $218m in its first weekend, receipts then fell sharply and Johansson argued this was because people were able to watch it on Disney+, therefore depriving her of potential earnings and breaking contractual promises which had been made to her.

While Disney defended itself and claimed it had not violated Johansson’s contract, the saga is just the latest example of how powerful streaming services have become, and how traditional film outlets may have more than COVID-19 keeping them up at night.

The streaming industry was one which benefited hugely from the pandemic, with millions of people being forced to stay in their homes. Netflix reported that in Q2 2020, at the height of the first wave of the pandemic, it gained 10 million new subscribers in just three months. Similarly, Disney+ launched in the UK in March 2020, perfectly in time to swallow up droves of viewers in search of new content.

Signs that streaming platforms could garner significant returns on films bypassing theatrical were already there. In spring 2019, a whole year before the pandemic, Murder Mystery, a Netflix original starring Adam Sandler and Jennifer Aniston, was viewed in over 30 million Netflix accounts in its first three days of release – a phenomenal figure by any stretch but even more so if converted into equivalent box office numbers.The enforced closure of cinemas during lockdown gave the major studios a golden opportunity to experiment with straight to streaming themselves, which Disney did with Mulan (Liu Yifei) and Soul (Jamie Foxx & Tina Fey), and then with the simultaneous release on streaming and theatrical (“Day and Date”) of Black Widow itself. If Day & Date can be made to work for the studios, this would seriously weaken the leverage cinema chains leverage over their share of the box-office.

However, there are clear signs that Day & Date is not necessarily working for the studios resulting in a weaker overall return – there is no incremental revenue from the streaming views – whilst the earlier appearance on TV screens is also ushering in an increase in piracy. The financial model has definitely changed but theatrical releases and cinema itself look set to still be with us for the foreseeable future.

Podcast Measurement Is Gaining Traction

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Despite the impact of the pandemic on media consumption, podcasts have been somewhat ‘pandemic-proof’. Following an initial dip in podcast consumption in early 2020 – reflective of a shake-up of consumers’ regular routines, where they no longer needed to fill the silence of their daily commutes – loyal listeners soon found the time in their new routines to re-engage.

Whilst radio still tops the ranks for most popular audio source, there are 14.6m podcast listeners in the UK and growing, with 25% considering themselves ‘regular’ listeners. And with the majority having only listened for 1-2 years, that tally is only set to grow – to an estimated 16.8m by 2024.

Self-reported surveys show podcasts to be a highly effective media channel. In one such Nielsen study, 62% of listeners correctly recalled a podcast ad, with the same proportion considering the product as a result. Thus, podcasts attract an audience which is highly engaged, attentive and curious – all while maintaining a relatively low cost of entry both for publishers and advertisers.

In the UK and globally, podcast audiences skew male, 16-44, and with an above-average income. They are highly engaged and loyal to their favourite podcasters, but also diverse in their consumption, with 40% admitting they consume more podcasts than they did when they first started listening. Podcasts are also successful in driving time spent, with the average listener completing 80% of an episode – substantially higher than YouTube’s 50% viewer completion rate.

Taking this into consideration, podcasts appear to be a no-brainer for brands. However, until recently, the ability to target specific and often complex audiences has been a difficult task.

Whilst we know that podcasts garner a loyal following, gaining a more granular audience understanding with effective channel measurement has proven complicated. Recognising this challenge, leaders in the digital audio market have long searched for ways to make buying and measurement more seamless. Tech giants Apple and Spotify are pioneers in this space, looking to create a programmatic inventory that would enable the buying of audiences in aggregate.

In a bid to become the world’s largest audio platform, Spotify are investing heavily. By leveraging data and analytics in order to grow the monetisation of their ad ecosystem, Spotify have recently acquired Gimlet Media, Anchor and – critically – Megaphone. Through a partnership with Nielsen, Megaphone has unprecedented access to that golden nugget of audience data. This will allow Megaphone and, in turn, Spotify to use Nielsen data to target podcast audiences.

For the first time, podcast measurement can move away from monitoring downloads only, and towards a more platform-agnositc, real-time view of listener behaviour and interests. This offers not only a lucrative prospect for brands, but a more personalised and engaging experience for the listener. As they become easier to buy and measure and more embedded into consumer lives, podcasts are becoming one of the most effective media channels for agencies and brands alike.