Planning effective communications in times of rapid change Sheila Byfield MindShare Worldwide

1. Planning effective communications in times of rapid change Sheila ByfieldMindShare Worldwide

2. Our agenda for today • Factors that are shaping the future of communications: • Economy • Demography • Social change • Media and technology • The implications for planning • A new communications model? • Measuring it all • A few final thoughts

3. In other words: what is happening in people’s lives and what are the effects on planning?

4. Factors that are shaping communications ECONOMIC Shaping Factors SOCIAL DEMOGRAPHIC MEDIA & TECHNOLOGY

5. Increase in affluence over the coming century Euros 539K Source: nVision

6. Which resource is most valuable in your life? 37 Time 32 Energy Money 14 Space 12 Information 6 Source: Planning for Consumer Change The Henley Centre

7. ‘…consumers are no longer satisfied with the ‘manufactured’ status enhancements that branding had produced. Instead, they seek experiences…where status is not so easily created’ Peter Martin, Chief Business Columnist, Financial Times

8. More spent on experiences in Europe Source: nVision Europe

9. 70 60 Germany 50 Russia 40 Hong Kong China 30 Global average 20 10 0 You can judge a person by their clothes Status items are more important in developing countries 70 60 China 50 Hong Kong 40 Vietnam Malaysia 30 Global average 20 10 0 Designer clothes project a better Image Source : 3D

10. Developing countries are more open to global brands 95% Japan Philippines Thailand China France Taiwan Likely to happen Germany Russia UK Singapore Spain Malaysia US Hong Kong 65% More global brands is a good thing 35% 95%

11. But are less likely to be brand loyal ‘I tend to stick to the same brands’ % Source : 3D

12. Main drivers of brand loyalty • From analysis of over 5,000 brands worldwide • FAME : know about the brand + some experience • AFFINITY : the strength of brand relationship • CHALLENGE : the brand is making waves, setting trends or challenges thinking • PRICE : by far the least important if the other factors are strong Source: MindShare

13. Factors that are shaping communications ECONOMIC Shaping Factors SOCIAL DEMOGRAPHY MEDIA & TECHNOLOGY

14. Children are getting older - younger Older generations are younger for longer Demographics are less reliable

15. Demographics are only the tip ofthe iceberg Work Family Society Experiences Politics Life events Economic status Technology Communications Brands Life stage

16. Factors that are shaping communications ECONOMIC Shaping Factors SOCIAL MEDIA & TECHNOLOGY

17. Family size 10 8 6 4 Own family Live with parents 2 Children leave Partner dies 0 10 20 30 40 50 60 70 80 Life used to be straightforward Source: HenleyWorld 2003

18. Family size Second marriage 10 extended family Have children Student 8 Start Live with Get parents work partner married 6 Buy own Separate Divorce home with third partner leave home 4 Own Partner family dies Live with parents 2 Partner dies home 0 Age 0 10 20 30 40 50 60 70 80 Now it is more complicated (for some) Source: HenleyWorld 2003

19. One person – many lives Source: HenleyWorld 2003

20. Complex lives • Time pressure: so much to do, not enough time time, more time spent out of the home, more to do in the home • Explosion of choice: appreciated by most but people welcome ways to navigate through the jungle • Instant gratification: what you want, wherever and whenever you want it • Individualism (anyone can be famous / small indulgences / pampering / desire for nostalgia)

21. Factors that are shaping communications ECONOMIC Shaping Factors

22. What does the future hold? • Use of television will decline dramatically by the year 2000 • The television will disappear in less than ten years • The Internet will be the leading mass medium • Gilder 1994; Negroponte 1995

23. Soon you will be able to watch any movie and substitute your own face for one of the actors Bill Gates 1996

24. The future will be about screens Bill Gates

25. More people have technology than don’t Source: Roper Reports

26. Moving to an ‘always on’ mode More time on-line Always on Time blocks Time spots 0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 Less time on-line Source: Iris/the future foundation

27. More control over the media…

28. Time and attention are scarce resources… 2006 1950s

29. Activities while the television in on (UK adults aged 15 to 34) TV Primary Activity

30. Some people see a lot of advertising TV Commercials seen each week < 200 Above 900 750 - 899 400 - 749 200 - 399 Source: MindShare 2003

31. Clutter has an impact on awareness • Direct correlation between number of ads. seen and the loss in ad. impact 150 Impact 100 50 100 500 1000 Number of TV ads viewed per week Source : MillwardBrown

32. Advertising has less appeal these days Turned off by the ads % agreeing Source: TGI (Oct-Sep)

33. Media technologies = opportunities to avoid advertising Predicted growth in PVRs over the coming years source: Jupiter Research

34. How do we define media today?

35. What are the implicationsof all of this for planning?

36. So what? • As behaviour continues to fragment further with more and more ways to spend and save time, attention becomes an increasingly scarce and valuable resource for advertisers • Increasing demand for personalised content – what you want, whenever and wherever you want it • More and more ways to easily avoid advertising • Scepticism about advertising and marketing techniques

37. Implications of all of this • Increasing time pressure is making people far more selective over what they use – especially regarding media choices • Greater choice is creating a demand for products and services that can help navigate • People are increasingly looking for experiences to enrich their lives : brands and the media can provide these • Demand for personally designed content and the increasing ease at which people can avoid advertising are probably the greatest communications challenges

38. A new communications model?

39. Could lead to a potential (though gradual) change in the communications model High Risk Channel Ownership Advertiser funded programming Sponsorship Potential ROI Product Placement Content-rich Ads Advertising

40. And a need to talk differently

41. How does Engagement work? Action? Open, Beneficial, Enhance INVOLVEMENT Like, Accept, Believe AFFINITY Interest, Consider RELEVANCE NOTICEABILITY Note, Pay attention

42. But engagement is complex … Substance Comfortable Impressiveness Worthiness Novelty Inherent value Attributes Modernity Invited Presentation Status Trust Entertainment Stimulation Associated value My World Quality Friendly Reputation Enjoyable Variables Fit to Location Time Given Appropriateness Context Relate to Contact & Manipulation Factors Affinity Involvement Proximity Relevance Enter Dialogue Mode & Mission Interaction ENGAGEMENT Need state Talkability Purchase cycle Mood & Mindset Noticability Interest Receptivity Openness Brand Affinity Stand Out Impact Accessibility Disruptiveness +/- Relaxed Environment Dominance Ease of viewing Size/Scale Originality Low Clutter Unexpected Time spent Break routines Line of sight Draws senses Boldness

43. Variables have different levels of importance for different channels Print –national, some regional/local, magazines Outdoor, especially larger sizes, spectaculars and transport Radio PR Attributes Major sponsorships On-line websites Word of mouth Cinema Ambient e.g. gyms, phone boxes Magazines, Weekend newspapers and supplements Quality Friendly Reputation Enjoyability Variables Promotions, coupons, offers Appropriateness Relate to Factors Affinity Involvement Interactive channels, on-line, TV, Radio, Print Relevance In or near a point of sale Mode & Mission Interaction ENGAGEMENT Word of Mouth Commuter contacts, outdoor transport, print Noticability Receptivity Interest Newspapers and Magazines Stand Out Impact Word of Mouth Accessibility Disruptiveness +/- Outdoor, incl. 6 sheets, directionals Regional/ local newspaper Spectaculars/48 sheet Cinema TV Word Of Mouth Sponsored Events One-offs /specials/unusual sites Sampling Out-of Home Packaging

44. So how can we measure it all?

45. Why this is a tricky issue • Think about your own buying decisions: • Sometimes you spend a lot of time deciding what to buy (e.g. a car, or high-price technology), sometimes you spend very little (e.g. a washing powder, or a coffee) • Your levels of consideration, involvement and risk will all play a part in how you respond to brand messages

46. Why this is a tricky issue • Now think about the communications you see or hear … • Can you explain WHICH channels influence your brand choices? • Can you even remember what you have seen or heard? This morning? Yesterday? Last week?

47. Why this is a tricky issue • You will quickly recognise that different channels play different roles at different times depending on where you are, how you feel and the brand decision you are making • Both the media and your mind can be active or passive at different times and in different situations • We need to understand HOW people use channels as well as HOW MANY use them

48. Connections – a new approach • A proprietary study for each brand because each buying decision is different • Developed in a partnership with Millward Brown • Based on the hypothesis that purchase decisions are different for each category and that affects the role and the impact of each channel

49. Purchase journeys are different by category FunctionalTrigger EmotionalTrigger Channels will play different roles and be either actively or passively consumed depending on the stage in the purchase journey Intention Explore Locate Evaluate Convert If not satisfied with own rationale – go back to explore phase

50. Connections - a new approach • Covers all communications : established and new media, advertising and non-advertising channels e.g. WOM, retail, experience etc • Qualitative research (depth discussions, accompanied shopping trips, spy glasses, cameras) • Plus quantitative research to validate results • Identifies how channels work at building brand consideration / brand equity (DEMAND) and at closing the sale (ACTIVATION)