MOBILE ACTION CODES IN MAGAZINE ADVERTISING 2011

MOBILE ACTION CODES IN MAGAZINE ADVERTISING 2011 INCLUDING QR CODES, MICROSOFT TAGS AND DIGITAL WATERMARKS

To understand how action codes are be-ing used in magazine advertising, we surveyed the top 100 U.S. maga-zines.

A record 4468 mobile action codes, which we broadly define to include all 2D barcodes, QR codes, Microsoft Tags, and watermarks, were printed in the top 100 U.S. magazines in 2011. These codes offer publishers and advertisers a compelling way to launch print-to-mobile and print-to-social campaigns that engage readers, build brand loyalty and capture new business.

To understand how QR codes are being used in magazine advertising, we surveyed the top 100 U.S. magazines by circulation. Our study included all the issues dated during 2011.

The study is limited to national titles readily available on newsstands. This eliminated publications that require a membership, such as AARP

By Roger Matus, Executive Vice President, Ann Carver, Analyst, and Maria Tricca, Marketing Manager, Nellymoser, Inc.

Nellymoser, Inc. | 11 Water Street, Arlington, MA 02476 | t: 1-781-645-1515 | [email protected]

P1

™

Codes Increased 439% From Q1 to Q4

Q1 Q2 Q4Q3

2000

1500

1000

500

0

Ac

tio

n C

od

es

Top 100 Magazines (Jan-Dec 2011)

352

1899

Source: Nellymoser

1062 1155


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magazine, as well as regional titles. For the purposes of this study, we refer to this list as the Top 100 magazines.

To compile the data, Nellymoser counted and analyzed every page within the Top 100 magazines. For 2011, we analyzed 164,255 pages. In Q4, we found:

• 47,788 total magazine pages, up from 40,300 in Q3.

• 21,790 total advertising pages, up from 18,407 in Q3.

We also scanned every QR Code, Microsoft Tag, Spyderlynk SnapTag, BEE Tag, JagTag, Digimarc watermark and other codes with an iPhone or Android device. We activated every campaign, ran every video and visited every web page.

Action Code Growth

There were 4468 codes in the top 100 magazines during 2011. The year started off with 352 codes in Q1. It grew to 1899 in Q4, which is 439% growth.

The chart below shows the month-to-month change. From January to December

From January to December 2011, the number of magazine action codes grew a dra-matic 617%.

All Action Codes In Magazines By Month

2011, the number of magazine action codes grew a dramatic 617%, from just 88 in January to 631 in December. The dips reflect seasonality. For example, many publications skip an issue during the summer and the winter holiday seasons.

Advertisers drove the growth (4011 codes), as the chart on the next page illustrates. In January, there were seven advertising codes for each editorial code. By December, the ratio was nearly 25:1.

The nature of the editorial codes also changed during the year. In the beginning of the year, editorial codes were dominated by videos related to features in the magazine. By the end of the year, many of the editorial codes were for sweepstakes run in the editorial section.

For example, there was a noticeable spike of 124 editorial codes that appeared in November. Of the 124 codes, 91 were for sweepstakes run by the marketing teams at just three magazines: Self (59 editorial codes), Shape (16), and Woman’s Day (18).

To really understand action code adoption in advertising, the most relevant statistic

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50

Ac

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es

394

295

170

9488

373

278

370

507

587

681

631

Top 100 Magazines (Jan-Dec 2011) Source: Nellymoser

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


may be the percentage of advertising pages that include an action code. This statistic is not affected by seasonality or skipped issues.

The chart below shows a steady and dramatic increase in action code adoption. From March to December, the ratio grew from 1 out of 28 pages (3.55%) to 1 out of 12 magazine ad pages (8.36%).

Another revealing trend is the quarter-to-quarter growth in action codes by the average, median and maximum number of action codes per issue. In Q1, the average was 2.33. By Q4, it grew to 6.5 per issue. (See chart on the next page.)

The number of magazine titles containing at least one action code exceeded 90% for the first time in May. It rose to 96% in July

Advertising Accounts For Most Code Growth

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In December, 1 out of every 12 magazine ad pages contained a QR code or other action code.

Percentage of Ad Pages With A QR Or Action Code

600550500450400350300250200150100

500

Ac

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5349

182911 21

Jul

14

63

25

77 65

152

246

341352

264307

482

Adver tising

Editorial 562 557

606

25

124

25

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

Top 100 Magazines (Jan-Dec 2011) Source: Nellymoser

8

7

6

5

4

3

% A

d P

ag

es

3.55%

4.02%

5.02% 5.16%4.96%

6.48%

5.76%

7.42%7.96%

8.36%

Mar Apr May Jun Jul Aug Sep Oct Nov Dec

Source: NellymoserTop 100 Magazines (March-Dec 2011)


Overall, QR codes were the most widely used codes, accounting for 72% of all action codes. Microsoft Tag was in second place with 25%.

Microsoft Tag was the code of choice for editorial and publisher use for the entire year: • Q1: 57 of 58 editorial codes were Tag• Q2: 115 of 123 editorial codes were Tag• Q3: 90 of 102 editorial codes were Tag• Q4: 163 of 174 editorial codes were Tag

Digital watermarks first entered the Top 100 list in December. Nellymoser believes this is the beginning of a trend.

and remained at that level for the rest of the year.

QR Codes and MS Tags Lead Market

Almost all of the action codes printed in the Top 100 magazines during Q4 were either QR Codes or Microsoft Tags (97%). At the beginning of the year, the market was closely split between QR codes and Microsoft Tags and they grew in parallel. However, in the middle of the year, the number of QR codes continued an upward trend, while Microsoft Tags remained within a relatively flat range. (See below.)

P4

Number of Action Codes Per Issue Jumped In 2011Q1 2011 Q2 2011 Q3 2011 Q4 2011

Average number of codes per issue

2.33 4.23 4.83 6.50

Median number of codes per issue

2 3 4 5

Greatest number of codes in an issue

12 29 54 70

Number of action codes per issue for issues that contained at least one action code. Each weekly issue of a weekly magazine counted as a separate issue.Almost all of

the action codes printed in the Top 100 magazines during Q4 were either QR Codes or Microsoft Tags (97%).

Action Code Market Share By Month500

450

400

350

300

250

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150

100

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Source: Nellymoser, Inc.

Microsof t TagQR CodeO ther

Jan Feb Mar Apr May Jun Jul Aug SepBEE

Digimarc

JagTag

MSFT Tag

QR

SpyderLynk

WIMO

AR

Type of Code

1

29

58

46

48

63

107

1

1

136

157

1

176

217

94

279

7

88

175

7

1

14

152

202

1

1

10

109

343

40

2

3

Oct Nov Dec

5

3

105

502

14

2

9

145

433

10

226

440

5


How Action Codes Were Used

In contrast to last year, it is now rare for a magazine reader to be sent to a desktop-style web site after scanning a code. Advertisers and editors are creating mobile experiences designed to engage the reader while they are reading the magazine.

Most action codes were used for one or more of the following four purposes:

• Branding and Demonstrations: By far, the largest usage for action codes was to showcase a video (54%). These videos are often created specifically for mobile use. Examples include:• A behind-the-scenes look• A product demonstration• A how-to video• An entertaining video

• Data Capture and List Building (Opt-ins / Subscriptions / Sweepstakes): Action codes are effective for building databases (30%) because readers can

QR Codes and Microsoft Tags Lead Action Code UseQ4 2011 Q3 2011 Q2 2011 Q1 2011

QR Codes 72% 62% 61% 61%Microsoft Tag 25% 30% 38% 39%SpyderLynk SnapTag 1% 4%

JagTag 1% 3%

All Others 1% 1% 1%

respond immediately and wherever they are reading the magazine.

Sweepstakes were, by far, the largest contributor in this category. While sweeps can be run with one action code, there is a growing trend towards sweepstakes that span an entire publication with multiple advertisers and editorial sections participating, each with its own code.

“Smart Sweepstakes” are increasing scan rates for advertisers. After a user scans and enters information, the smart sweepstakes remembers the user’s entry data from one scan to the next, enabling instant entry and reducing the obstacles to form submission.

• Commerce (On-line Store, Brick-and-Mortar Store Locator / Coupon): Readers can immediately scan and act on a desire to purchase. Links to a corporate e-commerce store led the category (19%) followed by in-app

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It is now rare for a magazine reader to be sent to a desktop-style web site after scanning a code.

Mobile Engagements After The Scan

Engagement 2011 Q4 2011

Video 54% 44%

Opt-in / Sweeps

30% 23%

Social Media 23% 16%

E-commerce 19% 19%

Store Locator 13% 11%

Coupon 11% 9%

Photo Gallery 11% 8%

Downloads 6% 5%

Recipes 5% 4%

Voting 1% 0%

NOTE: Columns total more than 100% because each action code may lead to more than one engagement. For example, it may show a video and then offer to allow to share the video.

23%Social Media

Source: Nellymoser, Inc.In Top 100 Magazines 2011

54%

Video

11%Coupon

13%Store

Locator

win

30%Opt-in/ Subscribe/

Sweeps

19%

BuyOnline

4%Recipe

6%Download

11%Photo

Gallery


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More than a third of all codes (1619) come from companies in just three industries: beauty, home and fashion

store locators (13%). Some store locators used the phone’s built-in GPS to find the nearest location.

• Social Media: Action codes were also used to enable Facebook, Twitter and email sharing. In 2011, 23% of codes enabled readers to share a video link or product information via social media. (NOTE: Only social sharing that was part of the mobile campaign was included. Some video campaigns led to a YouTube Channel, which in turn has a social sharing feature. These were not counted.)

Top Industries and Brands

Nearly 40% of the action codes used in advertising (1619) came from companies in three indus-tries: beauty, home and fash-ion. We also found in our Retail Study that companies in these industries led the action code use in stores. In the Retail Study, we found that stores targeting shoppers aged from 14 to 30 with moderately priced merchandise were more likely to use QR codes. Retailers using codes included aerie, American Eagle, BCBG Max Azria, Express, Forever 21, Gap, Madewell, PacSun, Pottery Barn Teen and Sephora. These retailers like to be seen as being on trend.

Similarly, fashionable brands like John Frieda, L’Oreal, Cuisinart, Garnier and Revlon use QR codes. They are a way to demonstrate trendiness and an edgy way for the consumer to connect with the brand, while receiving some benefits.

2011

Electronics

Health

Fashion

HomeJewlery

Source: nellymoser, Inc.

1. 2. 3. 4. 5. 6. 7. 8. 9. 10.

571

268 250

165136 135

715

Beau

ty

Hom

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Fash

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Au

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Hea

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Food

/Bev

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Jew

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Tele

visi

on

Elec

tron

ics

Alc

ohol

243203

333

Television

Alcohol

Beauty

AutoFood/

Beverage

0

400

800

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200

700

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500

100

Top 10 BrandsC uisinar t

Joh

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ried

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44 43 41 41

1. 2. 3. 4. 5. 6. 7. 8. 9. 9.

Revlon


John Frieda

Delta

S amsung

G arnierL’O real

50

80

90

70

60

40

30

20

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Bose Hear tson Fire

Tag Heuer

Top 10 Industries

Top Magazine Titles

SELF Lucky


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126 123 121 121 120 118 113

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1. 2. 3. 4. 5. 6. 7. 8. 9. 10. 11.

112

REAL SIMPLE


Top 10 Industries

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Ninety-six percent of the Top 100 magazine titles contained at least one action code in 2011.

Financial

Health

Home

Fashion

Food/

Beverage


1. 2. 3. 4. 5. 6. 7. 8. 9. 10.

219

145124

75 7357

272

Alcohol

Beauty

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Fin

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Electronics

10985

161

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150

200

100

50

250

300

Jewlery

Auto

Top 10 Brands

Q4 2011

C uisinar t

L'O

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Bose

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Trol

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Inte

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1. 2. 3. 4. 5. 6. 7. 8. 9. 9.

Revlon


Trollbeads

S amsung

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20

35

40

30

25

15

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Bulova

Bose

Z apposIntel J.C. Penney

In Q4, several brands made the Top 10 list that had not made it in previous quarters. This indicates that the market for action codes is broadening. New to the Top 10 list are the following:

• Electronics companies Bose and Intel

• Retailers J.C. Penny and Zappos

Top 10 Magazine Titles

Ninety-six percent of the Top 100 magazine titles contained at least one action code in 2011. Therefore, a broad range of readers spanning demographic categories were exposed to action codes in 2011.

The Top 10 magazine titles included 28% of all codes (1255), which emphasizes the broad reach of codes.

Most of the codes within the Top 10 magazines were in women’s magazine titles, which focus on fashion, family, and homemaking. This is probably because, as mentioned earlier, 40% of the action codes used in advertising (1619) come from companies in three industries: beauty, home and fashion.They tend to advertise more often in these titles.

Half of the magazine titles on the Q4 Top 10 list were not on the Top 10 list in Q3. These titles were ESPN, People, Self, Sports Illustrated, and Time.

Top 10 Magazine Titles

SELF REAL SIMPLE


7768

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Self

Shap

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LuckySports

IllustratedW I R E D TIME

49 47 45 42


were accompanied with an icon showing a smartphone scanning the code. By Q4, that had dropped to 5%.Hardly any codes were accompanied by an SMS campaign for people who did not have action code readers.

There was very little change in these statistics during the course of the year.

Action Code Page Location

More than 90% of action codes are placed on the bottom half of the page, the traditional location for a call to action. The diagram to the left divides the a magazine page into quadrants and shows by percentage where the action codes appeared. Numbers that overlap quadrants indicate that a code crossed quadrant boundaries.

Conclusion and Key Findings

During 2011, Nellymoser reached these key conclusions based on this study:

• Mobile action codes, including QR codes and Microsoft Tags, continue to grow. From January to December, the number of codes grew 617%.

• QR codes are becoming much more common in magazine advertising. In December, more than 8% of magazine

Action Code Text

By Q4, more than two-thirds of all action codes (1327 or 70%) were accompanied by information that described what happens after the scan. This is considered by many to be a best practice and follows the pattern of many other calls to action.

Beyond that, there is a clear trend moving away from embellishments. Few codes were customized or have an icon adjacent to it.

For example, in Q2, 48% of all action codes contained an instruction regarding how to download a code reader. That dropped to 23% in Q4. In Q2, 17% of action codes

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Half of the magazine titles on the Q4 Top 10 list were not on the Top 10 list in Q3.

How Action Codes Appear In Print, Q4

2.7%

46.1%2.1%

39.7%

0.7%7.7%

0.6%0.5%

0 %

Top 100 Magazines (Q4 2011)


Source: nellymoser, Inc.

Scan to ShopGet the Free AppFrom Nellymoser Go To: ScanNow.mobi

31%use color

are c ustomized16%

5%have icon

describes destination70%

Or text SCAN to 800-555-1234

have instruc tions to get app23%

have choice to use SMS3%

In Top 100 Magazines (Q4 2011)

Page Location In Q4


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Copyright 2012 by Nellymoser, Inc. All Rights Reserved.Not responsible for errors and all information is subject to change without notice. Nellymoser and the Nellymoser logo are

trademarks of Nellymoser, Inc. All other marks are the property of their respective owners.

About Nellymoser

Nellymoser, a mobile marketing and technology company, creates instant, interactive consumer “engagements” and rich media apps on mobile devices, such as tablets and smartphones.

These engagements and apps range from contests and product videos to interactive multimedia engagements that can be shared on social media (e.g., Facebook, and Twitter) and include e-commerce for instant product purchases. Many of Nellymoser’s clients use us for responding to action codes, such as 2D barcodes, QR codes, Microsoft Tags, Digimarc

ad pages contained any type of code. This is up significantly from 3.6% in January.

• Microsoft Tags remain widely used by editors and integrated marketers at magazines. Many of the multi-code campaigns in a single issue, such as sweepstakes, use Tag.

• Almost all action code experiences have been mobile-optimized.

• Four types of campaigns dominate the use of action codes:

• Video demonstrations and branding (e.g., a look behind the scenes)

• Data capture and list building, with sweepstakes being an important use.

• Links to e-commerce sites and store locators for brick-and-mortar locations.

• Social media sharing with links to Facebook and Twitter.

• The brands that most commonly use codes are in the fashion, beauty and home industries. In Q4, electronics vendors are retailers entered the Top 10 list for the first time.

• Two-thirds of action codes follow the best practice of describing what happens after the code is scanned. Other embellishments, such as the use of icons, are less common.

Nellymoser intends to update this report on a regular basis to identify trends.

Get notifications of future updates by following Nellymoser on Facebook at http://www.facebook.com/nellymoser.

watermarks and NFC. Nellymoser’s customers include leading publishers, advertisers, retailers and consumer packaged goods companies.

Nellymoser was founded in 2000 and is headquartered in Arlington, MA.

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MOBILE ACTION CODES IN MAGAZINE ADVERTISING 2011

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