Ad-ology 2011 Marketing Forecast

2011 MARKETING FORECASTC. Lee Smith

Ad-ology Research, Westerville, Ohio

WHO IS AD-OLOGY?

• Ad-ology provides research to more than 2,000 agencies, marketers and media properties.

• We study the impact of advertising+marketing on purchase, forecast future marketing, and study ways for clients to “advertise smarter.”

• Launched in 2005. Parent company founded in 1989 in Columbus, Ohio.

• One of five Research Partners for 2010 AAF National Student Ad Competition.

2011 MARKETING FORECASTFROM THE PERSPECTIVE OF…

CMO SMB CONSUMER

2011 MARKETING FORECAST

What the Chief Marketing

Officer Says

In January 2011, Duke University asked 421 Chief Marketing Officers for their thoughts.

Respondents must meet two (2) criteria:

1. Title: CMO, Director level or above

2. Companies in Forbes Top 1000, CMO Club or AMA Members

ABOUT 2011 MARKETING

WHAT THE CMO SAYS


Optimistic, but now more cautiously so.

WHAT THE CMO SAYS

CMO Survey, February 2011, Duke University/AMA (n=421 CMOs)


WHAT THE CMO SAYS

CMO Survey, February 2011, Duke University/AMA (n=421 CMOs)

In January 2010, we asked 363 agency clients for their thoughts.

Respondents must meet four (4) criteria:

1. Title: CMO, VP/Director of Marketing, CEO

2. Companies over $2 million in sales

3. Must employ at least 1 outside agency

4. Must be primary decision maker or one of the primary decision makers

Results featured in ADWEEK several other national trade publications

ABOUT AD AGENCIES

WHAT THE CMO SAYS

Other than budget, what are your company's top five factors for selecting a new agency?

(out of a list of 15 factors)

1. Quality of previous work (54%)

2. Creative capabilities (54%)

3. Industry experience (46%)

4. Responsiveness (44%)

5. Do they understand our customers? (43%)

Attitudes on Advertising Agencies, January 2010, Ad-ology Research (n=363 CMOs)

ABOUT AD AGENCIES

WHAT THE CMO SAYS

What are the biggest sources of frustration or aggravation with your agency/agencies?(out of a list of 15 factors)

The top four by far are:

1. Poor communication (38%)

2. More reactive than proactive (37%)

3. Lack of understanding of our company's business or industry (37%)

4. Lack of strategic thinking (31%)

Attitudes on Advertising Agencies, January 2010, Ad-ology Research (n=363 CMOs)

ABOUT AD AGENCIES

WHAT THE CMO SAYS


What the Small-to-Midsize Business

Owner Says

In November 2010, we asked 752 SMB owners in the United States for their thoughts.

Respondents must meet three (3) criteria:

•Title: CEO, Owner, VP of Marketing/Sales

•Companies less than 100 employees

•Must be primary decision maker or one of the primary decision makers

ABOUT MARKETING IN 2011

Results featured in USA TODAY, Inc. Magazine, Others

WHAT THE SMB SAYS

Biggest budget gainers...

1. Direct Response (24.9% will spend more)

2. Newspapers: Daily/Sunday (19.2%)

3. Newspapers: Weekly/Suburban (18.7%)

4. Local Television (17.0%)

5. Trade Publications (16.5%)

Not in the Top 5 Gainers: Cable TV, Yellow Pages, Radio, City/State Magazines, Out-of-Home, Coupon Books, Cinema Advertising.

Source: 2011 Small Business Marketing Forecast, Ad-ology Research (n=752 SMB Owners)

ABOUT TRADITIONAL MEDIA SPENDING IN 2011

WHAT THE SMB SAYS

Top 5 frustrations SMBs have about the process of buying advertising from media companies...

1. Rate increases without justification or audience increases (54.0%, up from 51% in 2010)

2. Not having enough budget to buy what works best (45.4%)

3. Getting ad proposals that are not relevant to your business (44.5%, up from 37%)

4. Being able to justify cost/measure success (41.6%, up from 35% in 2010)

5. Ratings/Research that is confusing, outdated or misleading (39.4%, up from 31%)

2011 Small Business Marketing Forecast, Ad-ology Research (n=752 SMB Owners)

ABOUT BUYING ADVERTISING IN 2011

WHAT THE SMB SAYS

Biggest budget gainers...

1. Social Media (39.4% will spend more in 2011)

2. Email Marketing (33.8%)

3. Online Display Advertising (27.3%)

4. Search Engine Advertising (24.6%)

5. Daily Deals (20.9%)

Mobile Apps or Advertising (20.9%)

Not in the Top 5 Gainers: Blogging, Ecommerce, Online Video, Podcasting


ABOUT DIGITAL MEDIA SPENDING IN 2011

WHAT THE SMB SAYS

ABOUT SOCIAL NETWORKING IN 2011


WHAT THE SMB SAYS

• 51.0% believe social media is over-hyped

• 51.1% believe “advertising doesn’t seem to work as well as it used to”

• 37.8% DISAGREE that daily deals are a good way to develop new, long-term customers

• 83.4% believe their “company must be one of the first 2-3 that come in mind…”

• 88.6% believe “targeting customers by what they think, feel and value is more effective than by demographic”


ABOUT MARKETING IN 2011

WHAT THE SMB SAYS

• Less than a third of SMBs budget a % of sales revenue for advertising

• 87.5% say “salespeople talk too much about how great their products are instead of what they can do for me.”

• 76.5% answer business email or use the Internet “late at night for business purposes”

• 39.9% attended a networking event outside the office in past 12 months

• Lunch is still the best meal to conduct business over (69.3%, second is breakfast at 12.0%)


ABOUT WORKING WITH YOU IN 2011

WHAT THE SMB SAYS

The best time of the day to meet with advertising/marketing people or take their calls is…



WHAT THE SMB SAYS

The best day of the week to meet with advertising/marketing people is…



WHAT THE SMB SAYS


What the Consumer

Says

In January 2011, we asked U.S. consumers about their purchase intent, lifestyles, and attitudes on advertising.

•Sample size was 2,226 US Adults

•Nationally representative

•Margin of error: +/- 2.2%

•Results reported by 500+ different advertising/media audiences

Here are a few of the highlights from this study for the general US population...

ABOUT THEIR PLANS FOR 2011

WHAT THE CONSUMER SAYS

•New car/truck (18.6%, up from 16.7% in 2010)*

•New home (8.9%, up from 5.7%)

•New bed or mattress (19.0%, up from 14.8%)

•Diet/Weight Loss Program (9.7%, up from 6.3%)

•LASIK procedure (4.8%, up from 2.6%)*

•Vacation inside the US (52.8%, down from 54.7%)*

•New jewelry or a watch (19.1%, down from 23.8%)

*within margin of error +/- 2.2%.

2011 Audience Interests+Attitudes, Ad-ology Research (N=2,226 US adults)

Here are a few of the intended purchase plans for the general US population...



1. Comfortable (62.3%) 2. Healthy (55.5%) 3. Relaxed (44.6%) 4. Safe and Secure (36.6%) 5. Productive (33.3%) 6. Fun (31.6%) 7. Successful (30.9%) 8. Attractive (30.3%) 9. Intelligent (28.3%) 10. In control (27.4%)

Chosen from a list of 30 emotions.2011 Audience Interests+Attitudes, Ad-ology Research (N=2,226 US adults)

In the next 12 months, I want to buy products/services that make me feel…



ABOUT ADVERTISING

Statement Agree Disagree

Whenever I see/hear a local business advertising frequently, they must be doing well

58.6% 41.4%

Whenever a local business that used to advertise heavily suddenly stops, they must be hurting

50.0% 50.0%

Stores that advertise are typically better than those who do not advertise

38.2% 61.8%

I am willing to sacrifice some privacy to get ads that are relevant to me

32.6% 67.4%

Advertising only drives up the cost of prescription drugs

63.2% 36.8%

Advertising is not as creative as it used to be 47.6% 52.4%

2011 Audience Interests+Attitudes, Ad-ology Research (N=2,226 US adults)


Audience Interests+Attitudes, Ad-ology Research, 2010 (n=2111)

US ADULTS WHO HAVE TAKEN ACTION AFTER SEEING/HEARING AN AD (ALL-TIME) 2010


Audience Interests+Attitudes, Ad-ology Research, 2011 (n=2,226)

US ADULTS WHO HAVE TAKEN ACTION AFTER SEEING/HEARING AN AD (ALL-TIME) 2011


Audience Interests+Attitudes, Ad-ology Research, 2010 (n=2111)

What the Consumer SaysUS ADULTS WHO HAVE TAKEN ACTION AFTER SEEING/HEARING AN AD (PAST 30 DAYS) 2010

Audience Interests+Attitudes, Ad-ology Research, 2011 (n=2,226)

What the Consumer SaysUS ADULTS WHO HAVE TAKEN ACTION AFTER SEEING/HEARING AN AD (PAST 30 DAYS) 2011

Today’s Take-aways

✓ Many B2C Product Marketers plan to get aggressive. Others may not be totally sold on economic recovery.

✓ Traditional advertising budgets should be increased for the first time in years.

✓ Digital marketing budgets continue double-digit growth.

✓ Interest in social media is growing steadily.

✓ Brand building is back!

✓ Agency clients say they’re frustrated with reactivity, lack of insight and strategic thinking.

WHAT THE CMO SAYS…


✓ We’re optimistic despite having limited budgets.

✓ You can’t know what best for our business until you KNOW our business and our customers.

✓ We want to be better at targeting our best prospects – including psychographics.

✓ We’re ready to try new things like mobile, video, social, check-ins, and daily deals.

✓ We dislike outdated, biased or misleading research from media companies.

✓ Don’t ease into the week or quit at 5. Email at night, call on Mondays (maybe even the weekends).

WHAT THE SMB SAYS…


✓ We’re spending again, just not extravagantly.

✓ Automotive and Residential Real Estate are poised to pick up in 2011.

✓ Advertising can still be very effective in leading people to call, click, search, visit a business or influencing purchase.

✓ Cutting back on advertising is bad as it sends a message of uncertainty.

✓ Noticeably increasing advertising is good as it sends a message of strength.

✓ Internet Display, Email now causes customers to take action more than some traditional media.

WHAT THE CONSUMER SAYS…

FREE from Ad-ology

• Ad-ology Marketing Forecast reports on future outlooks from Ad-ology, other providers

• Advertising Smarter focuses on tips, advice for local advertisers

• Available on iTunes, YouTube, Ad-ology.com

Our Monthly video briefings

FREE from Ad-ology

• Compilation of forecasts for marketing, media, and advertising

• Current industry news, tweets

• Latest from our blog MarketingForecast.com

• Available for iPhone, Android, BlackBerry

Marketing Forecast smartphone app

ADVERTISE SMARTER!Ad-ology ResearchWesterville, Ohio

Ad-ology 2011 Marketing Forecast

Business

Transcript of Ad-ology 2011 Marketing Forecast