NEW STUDY (UK): CONSUMERS MORE LIKELY TO PURCHASE FROM A BRAND WHOSE VIDEO AD APPEARS NEXT TO CONTENT THEY TRUST

From Twitter, MAGNA & IPG Media Lab, the study looks at the importance of context in advertising

 

LONDON – December 9, 2020 – “The Influence of Context” – a new study unveiled by Twitter, MAGNA & IPG Media Lab today – measures how the context in which video ads are viewed affects how consumers perceive them and how they perform. The U.K study looks at context through the lens of content adjacency – the type of content an ad appears next to – and video experience – the way an ad is consumed (i.e. in-feed, non-feed, etc.).

The study was set-up to test pre-roll video ads before various types of content across in-feed and non-feed environments. Content types included premium publisher content, user generated content (UGC) from established creators and UGC from everyday people. Participants were exposed to different combinations of content and ads across three different environments: in-feed on Twitter, non-feed on a video aggregator and non-feed on publisher sites.

Here are the key findings on how different content types and environments drove different results:

  • Content adjacency is a powerful driver for brand KPIs. The importance of the environment in which ads appear extends far beyond brand safety alone. Even within brand safe content, content adjacency proves key in driving traditional metrics, such as brand favorability and purchase intent. The study revealed that when pre-roll is placed beside content that is perceived as high quality and highly trustworthy, we see a +15% increase in purchase intent based on trust and a +8% increase in purchase intent based on quality.
  • There’s a halo of premium. Consumers have an overall more positive opinion of premium content compared to UGC. Brands whose ads appear in front of premium benefit from higher research intent and purchase intent.
  • All UGC is not created equally. There are benefits to appearing next to UGC created by verified content creators such as the brand being perceived as more innovative; and more preferred by the consumer. However, there is a big difference between content created by established creators and the average user. UGC created by the average user can actually stifle ad impact compared to high production UGC.
  • The power of choice. In-feed and non-feed environments offer different consumer experiences and therefore, different brand benefits. People felt less forced to watch pre-roll ads that appeared in a feed versus pre-roll in a non-feed environment. Also, in-feed pre-roll ads feel more relevant and have a greater impact on brand favorability (+6% for in-feed and +3% for non-feed) and purchase intent (+7% for in-feed vs. +3% for non-feed) versus the control.

 

Stephanie Prager, Twitter’s Head of Global Business Partners, said, “As digital video ad spend continues to rise, leading to a projected cost of $24.9 Billion by 2025, it is crucial for marketers to understand how to enable deeper connections between people and the things that they love and care about. We hope this study shines a light on the areas of opportunity and the range of video ad experiences marketers can explore to build high impact, performance driving strategies.”

Richard Oliver, Managing Director, MAGNA UK & Ireland said, “As the growth in the volume and diversity of video content continues, it’s increasingly difficult for advertisers to understand which of the many options are the most valuable. This important study reinforces the point that marketers have always known to be true – context matters – and helps advertisers make more informed choices in today’s video landscape.”

Harrison Boys, Director, Standards & Investment Product, MAGNA EMEA added, “Content is powerful when it comes to advertising strategies, and this study highlights that the context in which that content is delivered can be extremely impactful for brands, and not just an issue of brand safety.”

Download the full report

 

About Twitter

Twitter, Inc. (NYSE: TWTR) is what’s happening in the world and what people are talking about right now. On Twitter, live comes to life as conversations unfold, showing you all sides of the story. From breaking news and entertainment to sports, politics and everyday interests, when things happen in the world, they happen first on Twitter. Twitter is available in more than 40 languages around the world. The service can be accessed at twitter.com, on a variety of mobile devices and via SMS. For more information, visit about.twitter.com or follow @twitter. For information on how to download the Twitter and Periscope apps, visit twitter.com/download and periscope.tv.

 

About MAGNA

MAGNA is the centralized IPG Mediabrands resource that provides strategic investment and media intelligence for agency teams and clients. We utilize our insights, forecasts and strategic relationships to provide clients with a competitive marketplace advantage.

MAGNA harnesses the aggregate power of all IPG media investments to develop go-to-market strategies, designing unique partnerships to drive maximum value for our clients. MAGNA has set the industry standard for more than 60 years by predicting the future of media value. We publish more than 40 annual reports on audience trends, media spend and market demand as well as ad effectiveness.

MAGNA infuses the organization with knowledge that empowers better decision-making. We are a team of experts across five key competencies who support IPG cross-functional teams through: Partnership, Enablement, Accountability and Connectivity. Follow us on Twitter @MAGNAGLOBAL.

 

 

About IPG Media Lab

Part of the Interpublic network, the IPG Media Lab identifies and researches innovations and trends that will change the media landscape and how brands engage with their audiences. Since 2006, the Lab has worked with our clients and with industry partners who can help them best adapt to disruptive change. Its expertise, resources and consulting services also help to inform the learnings, strategies and business outcomes of all Interpublic agencies. For more information, please visit www.ipglab.com or follow @ipglab.

 

# # #

 

Media Contact:

Nicky Higgs

Mediabrands

Senior Comms Manager

[email protected]

 

 

 

 

MAGNA ADVERTISING FORECASTS – DECEMBER 2020

DIGITAL ADVERTISING THRIVES IN COVID ECONOMY

 

MAGNA reveals that the global advertising market place shrank by -4.2% to $569 billion amidst the COVID-induced recession, but some markets (US, China) proved more resilient than initially feared, thanks to the scale and resilience of digital media formats (+8%).

TEN KEY FINDINGS

  1. According to MAGNA’s latest report, media owners’ linear advertising revenues (linear TV, linear radio, print, OOH) decreased by an estimated -18% in 2020, down to $233 billion globally, due to the global economic recession, in line with MAGNA’s spring forecasts (-16%).
  2. Digital advertising sales slowed down but continued to grow through the COVID crisis: +8% to reach $336 billion (59% of total advertising transactions).
  3. Total global advertising revenues (linear + digital) shrank by $25 billion (-4.2%), down to $569 billion – a milder decline than expected in June (-7.2%).
  4. Travel, automotive and restaurants made the heaviest advertising budget cuts while CPG/FMCG, finance and technology remained stable overall.
  5. Sixty-six of the 70 markets analyzed by MAGNA shrank this year. The world’s two largest markets, US (-1.3%) and China (+0.2%), were among the most resilient, while other top markets (Japan, UK, Germany, Canada, Australia, Brazil) declined between -4% and -8%.
  6. The Latin America region suffered the most (-11.3%), followed by EMEA (-6.4%) and APAC (-4.9%).
  7. Looking at 2021, COVID vaccination, economic recovery and delayed cyclical events will fuel a global rebound for marketing and advertising activity: +7.6% to $612 billion (linear: +3.5%, digital +10.4%, US +4.1%).
  8. Despite economic recovery, global linear advertising spend will remain $42 billion smaller (15% smaller) than the pre-COVID level of 2019.
  9. The US market resilience (-1.3% to $227 billion), despite one of the most severe COVID toll, was caused by the scale and organic growth of digital ad formats (+10%), while linear ad spend fell on par with global average (-16%).
  10. Record levels of political advertising spending brought $6.1 billion in incremental advertising sales and generated two percentage points of extra market growth that benefitted local TV ($3.6 billion) and, for the first time, digital media ($1.5 billion).

 

Vincent Létang, EVP Global Market Intelligence at MAGNA, and author of the report, said:

“Back in the spring, MAGNA predicted that digital media organic growth factors would drive digital to grow despite the COVID recession (+1% globally, +3% in the US). It turns out digital media resilience was even stronger than expected (+8% globally, +10% in the US) and possibly because of the changes brought by COVID. The pandemic triggered a tremendous acceleration in both supply (digital media usage and audiences, ecommerce) and demand: small businesses embracing digital media to keep their business alive during lockdowns, big brands pivoting towards lower-funnel marketing channels as they typically do in recession times. MAGNA believes the return of consumer mobility, major events and economic recovery will prompt most industry verticals to grow their linear advertising budgets in 2021, but the long-term trajectory has shifted even further towards a digital-centric marketing environment for years to come. 

 

GLOBAL MARKET 2020: ALL-MEDIA ADVERTISING DECREASE BY -4%

The latest MAGNA study of global advertising market trends, reveals that media owners’ advertising revenues decreased by approximately $25 billion in 2020 (-4.2%), from $594 billion in 2019 to $569 billion. Most industry verticals reduced marketing and advertising spending due to the severe economic recession triggered by the COVID pandemic, as global GDP shrank by -4.4% according to the IMF. The global advertising market will, however, recover by +7.6% in 2021, to reach $612 billion, as a gradual return to normal business conditions will fuel robust economic recovery (real GDP growth +5.2%, IMF).

Brand advertising budgets and therefore linear ad formats (linear TV, linear radio, print, out-of-home and cinema) suffered the most from the economic recession and the restrictions to consumer mobility. Global linear ad spend shrank by -17.8% to $232.5 billion, marginally worse than expected by MAGNA in the spring (-16%).

Television remains the largest linear advertising channel with $149 billion in advertising revenues in 2020. Ad sales shrank by -12% in 2020, in line with expectations, due to the cancellation of many TV campaigns in key verticals (e.g. automotive) and the postponement of major sports events. Print, radio and OOH ad sales declined more heavily: -24% to -25%. Out-of-home, the most dynamic linear media channel pre-COVID was hurt by the decline in consumer mobility, traffic and audience, in addition to the fall in demand from local and national advertisers. Finally, theater closures caused cinema advertising to decline by -66% this year.

Digital formats advertising sales (search, video, social, banners) grew by +8% to $336 billion, to reach a market share of 59% globally. Back in June, MAGNA was expecting digital media spend to grow slightly (+1%) despite the COVID recession; in fact, digital media spending grew way beyond expectations partly because the COVID impact accelerated the organic transition towards a digital-centric marketing ecosystem. Digital media consumption (social and video in particular) accelerated since lockdown; e-commerce exploded as large brands and small business ramped up their digital business in addition to “Direct-to-consumer” brands and ecommerce specialists; many local stores or restaurants started to use search and social marketing to advertise delivery, or “click-and-collect” to keep their business alive while stores were closed. Finally, consumer brand marketers showed a preference for lower-funnel marketing tools, at the expense of branding campaigns, that is classic in any recession time. In the last five years, the share of digital media had grown by three to four percent per year to reach 52% in 2019; in 2020 it jumped by seven percent to 59%. The COVID impact on lifestyles and business model will accelerate the digital transition in a lasting way: one year ago MAGNA was forecast the share of digital formats to reach 64% by 2024; now MAGNA expects that market share to reach 68% in 2024 and 70% in 2025.

Search remains the largest digital advertising formats (+7% to $164 billion, 49% of total digital advertising) as product search from ecommerce giants (Alibaba, Amazon) offset the slowdown of classic search engines (Baidu, Google). Social media benefitted from an acceleration in penetration and time spent during and since lockdown, and with an explosion in the volume of ad insertions compensating for a lower revenue per insertion, social ad formats advertising grew by +17% to $87 billion. Digital video ad spend increased by +15% to reach $45 billion, as strong growth from short-form platforms (YouTube) offset the slowdown of full episode players and outstream video.

As the pandemic and economic crisis was global, so was the impact on advertising spending and revenues across markets. Latin America experienced the worst downturn (-11.3%) and EMEA performed below average (-6.4%). Asia Pacific markets shrank by an average -4.9% while North America was the most resilient region (-1.5%) helped by the scale of digital advertising and record levels of political spending. Sixty six of the 70 markets analyzed by MAGNA shrank this year, with two markets growing nominally due to hyper-inflation (Argentina and Ukraine) and two markets showing real albeit moderate advertising growth: China (+0.2%) and Taiwan (+2.0%). Among top ad markets, the two largest, US (-1.3%) and China (+0.2%) were also the most resilient this year, while other top markets (Japan, UK, Germany, Canada, Australia, Brazil) all declined between -4% and -8%.

Where total ad spend was almost stable, it was almost entirely caused by a large and resilient digital media segment, while linear media was down double-digit like everywhere else. In the US and China typically, the share of digital media was already beyond 60% at the beginning of the year, and digital media spend grew by +10% in both markets; US linear media declined on par with the global average (-16%) while the decline of linear ad sales in China was even worse than average (-26%). Conversely the worst performances came from emerging markets where digital media market shares were too small to offset the heavy cuts in linear ad spend (even if digital spending grew too in those markets), e.g. Chile (all-media -17%), Colombia (-20%), Malaysia (-22%).

2021: LINEAR STABILIZES, DIGITAL ACCELERATES

If, as expected, large scale COVID vaccination takes place in the first half of the year, restrictions to business and mobility are gradually lifted, global economic activity should recover strongly. In its October forecast, the IMF predicted +5.2% for global GDP growth. Major events, if they can finally take place (Summer Olympics in Tokyo, UEFA Football Championship in Europe, and the Dubai World Expo) will also fuel the stabilization and recovery in marketing budgets and advertising spending.

In that scenario, MAGNA predicts global ad spend to grow by +7.6% to $612 billion. MAGNA raises its previous forecast (June: +6.1%) by 1.5 percentage point. All regions will recover to some degree: APAC: +11%, LATAM: +9%, EMEA: +8%, North America: +4%. Linear media will stabilize (+3.5%) while digital media will re-accelerate to double-digit growth (+10.4%).

US AD MARKET: +4% IN 2021

The US economy contracted by an estimated -3.5% in 2020 (source Philadelphia Fed Nov. 2020), a worse contraction than the last recession of 2009 (-2.5%), but a less precipitous decline than the -5.5% expected back in May by US economists as consumption and employment recovered faster than expected in the second half.

Despite the severity of the recession, MAGNA’s analysis of media owner’s financials suggests total advertising revenues (linear + digital) fell by just -1% to $221 billion in 2020, a much milder decrease than initially anticipated. This was caused by stronger-than-expected digital media spend (+10% vs 2019) and a huge influx of political spending that partly offset the budget cuts of other verticals in linear media. Excluding the $6.1 billion of incremental advertising revenues from political spenders, non-political advertising revenues would have dropped by -3% vs 2019, which is still a better performance than the advertising market globally (-4.4%).

Linear advertising sales (linear TV, linear radio, print, OOH) have suffered the most in 2020, with full-year sales declining by an estimated -16%, to $81 billion. Excluding linear political ad revenues (approx. $4 billion), the actual decline of linear ad sales would have been closer to -19%. The economic shutdown not only cut down marketing activity from national brands and local businesses, but also affected media consumption for print, radio and out of home. Coupled with a lack of demand from many top local advertisers and industries that remain on the sidelines, linear media formats outside of national television have still not rebounded and continue to suffer in the second half. On a full year basis, MAGNA believes that national television ad sales shrank by -11%, local television by -3% (it would have been -20% excluding political spending), out-of-home by -24%, radio by -28%, print by -30%, and cinema by -80%.

Direct mail had a tough year, like all traditional media formats, as advertising spending declined by -16% despite robust political spend ($600m). The biggest tailwind for direct mail going into 2021 is the reliance of the financial industry, which spends big on the credit card, mortgage and insurance segments and has been less impacted by the crisis than most other industries.

Conversely, digital media advertising sales have quickly rebounded from their second quarter lows (flat vs 2Q19) and ultimately grew by +10% over 2019, to $140bn. Digital media growth was driven by two factors. The first was the sudden acceleration of the long-term shift in retail consumption and other services from brick & mortar shopping to e-commerce, delivery, click & collect, etc. Combined with the classic shift towards lower-funnel marketing channels in recession times, this fueled advertising activity in search (+8%) and social media (+18%). A second factor was the acceleration of digital video consumption, as both SVOD and advertising-funded video platforms benefitted from the new home-centric lifestyles, boosting total digital video growth (long-form, short-form, outstream, OTT) by +19%.

In the third quarter of 2020, following the reopening of many businesses and the return of sports, total advertising revenues grew by +2% vs 3Q19. The market benefitted from record political spending, a strong rebound in digital media spending (+14%) and the stabilization of national television ad sales (-2%) as postponed 2Q campaigns were rescheduled alongside returning sports events. MAGNA expects advertising sales will continue to recover in the fourth quarter of 2020: +6% including political spending, or +2% excluding political. Digital media ad spend will grow by +14% in 4Q as social, video and search are boosted by stronger-than-usual political spending, and ecommerce holiday season shopping. National television ad sales may remain below 2019 levels (-5%) due to poor ratings and a deficit in sports events compared to last year (delayed starts for NBA, NHL and college football).

The 2020 election cycle generated an all-time of $6.1bn in net incremental advertising sales, smashing previous records with +60% growth over 2016. This surge in political spending mitigated the decrease of US advertising revenues in 2020 by two percentage points from -3% for non-political advertising sales, to just -1% overall. Record fund-raising and a great number of competitive races and states, prompted political strategists to increase ad spend on all traditional media, and primarily local TV as usual, while also using digital media on a huge scale for the first time: $1.5bn was spent on political advertising on digital media in 2020, three times more than in 2018. $700m was spent on each of digital video formats and social media. Local television remains the most popular media format and saw +30% growth over 2016 to an estimated $3.6bn in incremental ad revenues. National television, which historically does not see much political spend, also saw an influx of political dollars in 2020, and grew +32% to nearly $300 million.

In 2021, MAGNA expects eight of the ten key industry verticals to improve and increase spend over 2020. As the COVID restrictions are gradually relaxed during the year, Entertainment (e.g. movie releases) and Restaurant will benefit from a gradual reopening, and Food & Drinks brands will benefit from a return to normal sports schedules and social interactions. The Automotive and Travel industries, however, will remain financially fragile. High unemployment rate leads to fewer people making large purchase decisions, such as buying a car, and the lingering effects of the COVID-19 pandemic leads to fewer people traveling. Even if travel and auto consumption recover (and they might be considering the low comps), MAGNA anticipates these sectors to remain cautious with marketing costs and start with direct media rather than linear media.

Assuming COVID vaccination enables semi-normal business conditions for most of the year, cyclical sports events (Olympics) finally happen, and the economic recovery predicted by economists does take place (e.g. IMF GDP +3.9%), MAGNA forecasts US advertising sales to grow by +4.0% (+6% excluding cyclical events) to reach $230 billion, surpassing the 2019 high. Linear advertising sales will stabilize (+1%). National television will grow +5% thanks in part to the Tokyo Summer Olympic games ($800 million of incremental ad sales), and out of home will gain +11% as consumer mobility recovers. Digital ad sales will continue to grow close to double-digits (+8% overall) driven by search (+8%), social (+10%) and video (+12%).

 

NEXT MAGNA FORECAST UPDATE: March 2021 (US), June 2021 (Global)

 

————–

 

KEY MAGNA FORECASTS (DEC. 2020)

KEY REGIONS 2019 2020 2021
WORLD (INCL. CE) 5.5% -4.2% 7.6%
WORLD (EXCL. CE) 6.5% -5.1% 8.1%
NORTH AMERICA 5.9% -1.5% 4.2%
LATIN AMERICA 3.8% -11.3% 8.3%
WESTERN EUROPE 4.6% -6.3% 9.1%
CENTRAL & EASTERN EUROPE 6.9% -4.7% 9.5%
EMEA 5.1% -6.4% 8.9%
APAC 5.4% -4.9% 11.1%
EMERGING MARKETS 7.1% -4.7% 11.2%
DEVELOPED MARKETS 4.9% -4.0% 6.4%
AUSTRALIA 1.0% -6.2% 11.3%
BRAZIL 7.9% -7.4% 8.4%
CANADA 5.5% -6.2% 5.8%
CHINA 8.4% 0.2% 10.9%
FRANCE 4.9% -7.2% 9.5%
GERMANY 1.8% -4.6% 7.9%
INDIA 10.6% -15.8% 26.9%
ITALY 0.4% -10.2% 10.6%
JAPAN 1.9% -7.8% 9.4%
RUSSIA 5.6% -3.4% 10.1%
SPAIN 2.0% -12.5% 11.2%
UNITED KINGDOM 10.5% -4.9% 11.9%
USA (EXCL. CE) 7.8% -3.3% 6.0%
USA (INCL. CE) 5.9% -1.3% 4.1%

 

 

 

 

TABLE 2: ADVERTISING GROWTH FORECAST – KEY MEDIA (GLOBAL)

 

 YOY GROWTH % 2019 2020 2021
DIGITAL AD SALES 15.3% 8.2% 10.4%
  Search 14.6% 7.2% 10.1%
  Online Video 24.1% 14.9% 14.8%
  Social Media 25.3% 16.9% 13.2%
  Mobile 26.4% 15.5% 14.9%
LINEAR AD SALES -3.6% -17.8% 3.5%
  Television -3.7% -12.2% 2.6%
  Print -10.2% -25.1% 0.2%
  Radio -0.8% -24.1% 4.0%
  Out-of-home 5.2% -25.3% 12.1%
  Cinema 5.3% -66.3% 45.0%
TOTAL (LINEAR+DIGITAL) 5.5% -4.2% 7.6%

 

TABLE 3: ADVERTISING GROWTH FORECASTS – US MARKET
 YOY GROWTH % 2019 2020 2021
TOTAL DIGITAL 16.7% 10.0% 8.0%
Search 17.2% 8.4% 8.4%
Online Video 25.4% 19.4% 11.8%
Social Media 26.3% 17.7% 9.6%
Mobile 26.2% 17.1% 12.0%
TOTAL LINEAR -5.7% -15.8% -2.8%
National TV (incl. CE) -2.0% -11.1% 4.6%
National TV (excl. CE) -0.5% -11.5% 3.3%
Local TV (incl. CE) -15.6% -3.4% -20.4%
Local TV (excl. CE) -2.9% -20.6% -3.7%
Print -13.5% -30.4% -13.0%
Radio -0.2% -28.2% 1.4%
Out-of-home 7.5% -24.2% 11.3%
Cinema -0.1% -80.0% 123.1%
Direct Mail -3.6% -13.9% -4.8%
GRAND TOTAL (incl. CE) 5.9% -1.3% 4.1%
GRAND TOTAL (excl. CE) 7.8% -3.3% 6.0%

CE= cyclical events (US election, Olympics)

 

TABLE 4: FORECAST REVISIONS (VS MAGNA’S JUNE FORECAST)

 

2020 2021
YOY GROWTH % June 20 Dec.  20 Change June 20 Dec.  20 Change
World -7.2% -4.2% +3.0 6.1% 7.6% +1.5
North America -4.4% -1.5% +2.8 4.0% 4.2% +0.2
Latin America -9.9% -11.3% -1.4 6.7% 8.3% +1.6
Western Europe -10.3% -6.3% +3.9 7.2% 9.1% +1.9
Central and Eastern Europe -7.7% -4.7% +3.0 7.6% 9.5% +1.9
Emerging -6.8% -4.8% +2.0 7.2% 11.2% +4.0
Developed -7.4% -4.0% +3.4 5.7% 6.4% +0.7
Europe, Middle East, Africa -9.8% -6.4% +3.4 7.1% 8.9% +1.7
Asia Pacific -8.5% -4.9% +3.6 8.1% 11.1% +3.0
Total TV -11.9% -12.2% -0.3 1.3% 2.6% +1.3
Total Internet 0.9% 8.2% +7.3 9.5% 10.4% +0.9

 

ABOUT MAGNA

MAGNA is the centralized IPG Mediabrands resource that provides strategic investment and media intelligence for agency teams and clients. We utilize our insights, forecasts and strategic relationships to provide clients with a competitive marketplace advantage.

MAGNA harnesses the aggregate power of all IPG media investments to develop go-to-market strategies, designing unique partnerships to drive maximum value for our clients. MAGNA has set the industry standard for more than 60 years by predicting the future of media value. We publish more than 40 annual reports on audience trends, media spend and market demand as well as ad effectiveness.

MAGNA infuses the organization with knowledge that empowers better decision-making. We are a team of experts across five key competencies who support IPG cross-functional teams through: Partnership, Enablement, Accountability and Connectivity. Follow us on Twitter @MAGNAGlobal.

To access full reports and databases or to learn more about our subscription-based research services, contact [email protected].

 

PERSONALIZATION IS KEY FOR MARKETERS TO DRIVE CONSUMER CONNECTIONS: STUDY

By Jeanine Poggi. Published by Ad Age on 13 October 2020.

Brands should think more about personalizing ads based on major life events in an effort to drive better consumer connections, according to a new study from Magna and IPG Media Lab.

Personalized brand messages are increasingly important for marketers trying to reach consumers in a cluttered landscape, and those that are based on major life events strike an emotional chord with people. Those who saw an ad with these types of personalized messages were 16% more likely to want to hear more from a brand and 12% more likely to purchase the brands when compared to the same video ad without a personalized message, according to the study.

Similarly, personalizing ads based on search terms drove an 8% preference for the advertised brand over competitors.

The same pre-roll video ad can drive a 5% higher purchase intent when it is used with more relevant and personalized messaging, according to the study.

The study included responses from over 6,600 participants from the auto, retail and finance industries. Testing was conducted using each brand’s demographic target, as well as high-value audiences, which use people-based IDs for brand-identified targeting personas created by Kinesso.

“Relevance is a critical part of brand marketing strategy because people today are inundated with content on a daily basis and it can be overwhelming,” said Kara Manatt, senior VP, group director, Intelligence Solutions at Magna Global, in a statement. “Personalized messaging can not only help create more relevant ads, but also help amplify brand stories, forging stronger, more solid personal connections.”

While utilizing precision targeting of high-value audiences is effective, these consumers are typically critical of mass-market messages, and are much more open to personalized ads.

Of course, personalization doesn’t guarantee branding. The performance of a personalized ad is amplified when branding is incorporated into the messaging, making them 8% more memorable than standard ads. The same best creative practices should be applied when planning for personalization.

Read the article on Ad Age
Read the Press Release
Download the full study

NEW STUDY FROM MAGNA AND IPG MEDIA LAB REVEALS AD PERSONALIZATION OFFERS A KEY TO FORMING STRONGER PERSONAL CONNECTIONS

“Pursuit of Relevance” Finds Higher Levels of Personalization May Be Needed to Drive More Difficult-To-Shift Metrics

 

NEW YORK – October 13, 2020 – As the world has continued to innovate, we have found that ad personalization is one of the more effective tools out there to help brands deliver more relevant ad experiences. In a new robust study by MAGNA and IPG Media Lab, “Pursuit of Relevance: All About Ad Personalization,” the effectiveness of personalized ads on brand KPIs was quantified and revealed brands can forge stronger connections with people through relevance in the form of personalized messaging. Ultimately, the same pre-roll video ad can drive +5% higher purchase intent with the use of more relevant, personalized messaging.

The study found that most forms of ad personalization had value, but generally higher levels of personalization were often needed to shift more difficult-to-move metrics. For example, personalizing ads based on major life events struck an emotional chord with people, leaving them interested in hearing more from the brand (+16%) and more likely to purchase the brand (+12%) compared to the same video ad without a personalized message. Similarly, personalizing ads based on search terms, which are also deemed more sensitive than other forms of data such as age, drove brand preference (+8%).

The scope of the research included responses from over 6,600 participants and spanned three industry verticals (auto, retailer and finance). Testing was conducted among two audience types – each brand’s demographic target and High Value Audiences (HVAs), which are based on people-based IDs for brand-identified targeting personas created by Kinesso. Ultimately, six types of data sources for personalization were tested: demos, past purchases, location, life events, search terms, and persona-based messages (HVAs only).

“This is an important study that reinforces our belief that personalized messaging, when coupled with precision targeting is a key to driving the results that brands demand today of their advertising,” said Brendan Gaul, Global Chief Content Officer, Head of UM Studios. It also uncovers the importance of maintaining best practices and creative excellence in the development of the work. A good ad that is personalized works very hard. A bad ad that is personalized is still a bad ad.”

“Relevance is a critical part of brand marketing strategy because people today are inundated with content on a daily basis and it can be overwhelming,” said Kara Manatt, SVP, Group Director, Intelligence Solutions at MAGNA Global. “Personalized messaging can not only help create more relevant ads, but also help amplify brand stories, forging stronger more solid personal connections.”

 

Additional key findings the study found on the effectiveness of personalized messaging include:

  • Personalization doesn’t guarantee branding. Performance of personalized ads is amplified when branding is incorporated into the messaging. With branding in the message, personalized ads are +8% more memorable than standards ads. Creative best practices still apply, so the process of planning for personalization shouldn’t distract from the need to have strong branding.
  • Higher levels of personalization may be needed for more difficult-to-shift metrics. Personalizing ads based on life events and search terms were more likely to shift metrics such as brand preference and purchase intent. People were particularly open to the information in ads that were personalized based on their search terms and drove preference for the advertised brand over competitors (+8%). Ads personalized based on life events struck an emotional chord and drove intent to purchase (+12%).
  • Couple personalization with precision targeting. Using people-based IDs for targeting HVAs is effective, but these audiences are often critical of mass market messaging. In response to personalized ads, however, HVAs are much more open (+5%, “something I’m open to right now”). Brands should also consider crafting persona-based messaging for even greater impact (+20% on brand preference vs. +8% with standard personalization).

 

Download the full report

 

This study comes on the heels of another study MAGNA and IPG Media Lab conducted with Verizon Media, “Know Everything About Me: The Consumer Take on Data + Ad Personalization,” which delved into the intricacies of ad personalization and data privacy.

 

About MAGNA

MAGNA is the centralized IPG Mediabrands resource that provides strategic investment and media intelligence for agency teams and clients. We utilize our insights, forecasts and strategic relationships to provide clients with a competitive marketplace advantage.

MAGNA harnesses the aggregate power of all IPG media investments to develop go-to-market strategies, designing unique partnerships to drive maximum value for our clients. MAGNA has set the industry standard for more than 60 years by predicting the future of media value. We publish more than 40 annual reports on audience trends, media spend and market demand as well as ad effectiveness.

MAGNA infuses the organization with knowledge that empowers better decision-making. We are a team of experts across five key competencies who support IPG cross-functional teams through: Partnership, Enablement, Accountability and Connectivity. Follow us on Twitter @MAGNAGLOBAL.

 

About IPG Media Lab

Part of the Interpublic network, the IPG Media Lab identifies and researches innovations and trends that will change the media landscape and how brands engage with their audiences. Since 2006, the Lab has worked with our clients and with industry partners who can help them best adapt to disruptive change. Its expertise, resources and consulting services also help to inform the learnings, strategies and business outcomes of all Interpublic agencies. For more information, please visit www.ipglab.com or follow @ipglab.

 

Media Contact:

Zinnia Gill

Mediabrands

Director, Global Corporate Communications

(646) 965-4271

[email protected]

 

 

 

U.S. ad market to stabilize due to growth in political ads – report

By Sheila Dang. Published by Reuters on 16 Sept. 2020.

Sept 16 (Reuters) – The U.S. advertising market will begin to stabilize in the second half of this year as political ad spending piles up in an election year, and brands continue to pour money into digital advertising, according to a forecast on Wednesday from media research firm MAGNA Global, a unit of Interpublic Group of Companies.

Advertising spending, which often follows the health of the economy, plummeted beginning in March when the coronavirus pandemic hit the United States, and many businesses were forced to shut their stores.

Ad spending in the second half of this year is expected to decline 2% compared to the same period in 2019, after declining 7.2% in the first half of 2020.

That will mean a decline of 4.6% for the full year 2020 to $213 billion, which MAGNA said is in line with its previous forecasts.

Political ad spending is expected to reach a new all-time high this year at $5.1 billion, as fundraising and ad spending during the first half of the year was stronger than expected, MAGNA said.

“It’s surprising because we thought it would slow down due to COVID. But before March, so much money had been raised already,” said Vincent Letang, executive vice president of global market intelligence at MAGNA.

About two-thirds of political ad dollars will be spent on local TV, but digital ad platforms will be the second-biggest winner, earning $1 billion.

Digital ad platforms, which include Alphabet’s Google and Facebook, were “remarkably resilient” during the second quarter, when pandemic lockdowns were at their peak, Letang said, and the sector managed to grow 5.7% in the first half of this year.

That was partly due to a massive increase in consumption of digital media as people stayed home, and small businesses that jumped into digital marketing to keep their businesses alive, he added.

The total U.S. ad market is expected to rebound next year and post 4% growth, according to MAGNA.

Read the article on Reuters
Read the press release