Insider Insights #2: The power of paid media during the pandemic
In the second instalment of our Insider Insights series we are joined by Emma Nicholls from WPR to discuss the power of paid media during the pandemic.
[00:00:05] So just for as I mentioned, I’m not sure of the audience kind of watching live, but for anybody who’s kind of coming in and watching this off the website, or who is interested in media. Essentially what I wanted to go through today was the power of media during this pandemic and answer a couple of questions. The first of which is, you know, whether we should or shouldn’t be advertising. So, there’s definitely a lot of concerns at the moment in terms of our marketing budgets, it’s a really tough time because of the unknown, and kind of due to this level of uncertainty in media budgets – or at least the paid in advertising budget – is being really stretched a moment. They’re often the first to be depleted. And so I wanted to go through a couple of things. First, in terms of the evidence behind why you should or shouldn’t be advertising. But I always say this isn’t like, you know, any usual situation we’ve been in. And the consumer is really, really at the heart of this at the moment because they’re going to be the ones paying attention to the advertising in what is essentially considered an extremely sensitive period of time. So I want to look at that first and then what’s required to establish whether your brand is right to be advertising or not, I wanted to take you through some of the media consumption habits that we’ve seen as part of the pandemic, some of which we’ve seen kind of accelerate, which were already on the on the way up and then some of which have come out to this and that we can leverage. I’ll just summarise the obvious thing to a few handy tips that you can kind of take away and think about when you were looking at our marketing strategy, and obviously our paid strategy.
[00:01:52] So first of all, in terms of “should you be advertising?”
[00:01:57] Well, there’s no point in going much further until we’ve kind of established whether, you know, if there is grounds for a paid strategy for your brand. So just to set the scene really is, you know, I’m using this term “the new normal”, which, you know, has been highly popularised in the last few weeks. And it’s a term we’ve used, I think, before. But it’s got a new meaning, really. Essentially, the definition of that is a current prevailing situation when it has merged recently, that is dramatically from the previous one and is expected to remain. I think that’s a really important thing to note here, is that quite a lot of what we see now is likely to be taken forward into the next kind of phase of advertising after this, and therefore, we need to be paying close attention to what the world is telling us at the moment. I think there is a bit of a question mark as to whether we’re actually embedded into these new normal yet because things are changing so rapidly. But definitely, you know, without a doubt, we’re in something now that has led to change that is probably going to continue past this. And to highlight not a bit more detail, a YouGov poll has suggested that fewer than 1 in 10 actually won’t return to normal after the corona virus.
[00:03:20] And that’s a really interesting stat because, you know, what is clear is that over the past few weeks, well, months really now, I think we’re in two weeks, eight or nine of the lockdown, and we’ve learned this this new way of life really, really quickly. You know, we’ve learned timesaving techniques in terms in terms of communication from a work perspective, we’ve got a new understanding of how we interact with our friends and family and the things that are important to us, and kind of even these positive impacts on climate change as well is definitely leading people to consider those changes staying for good really. We’re also fact finding that Gen Z in particular – but this is across the board as well – this increased level of media consumption is likely to stay, and then likely to continue those changes to media consumption…or not necessarily changes…but at least increases for the Gen-Zers, as some of those strong figures in terms of media consumption come from the likes of social media, messaging service videos and streaming, and around fifty percent of those saying that they’re spending more time on them, and then around a quarter more saying that they actually expect it to continue in.
[00:04:42] And lastly, we’ve got here that about fifty – sixty percent of people think the corona virus outbreak will last more than six months in the UK, and I think this is really interesting because, you know, I think when these first started, we were all under the impression that we would be at home for three weeks, a few staff will be furloughed and then we might be able to get back to normal. But that definitely isn’t the case as it stands at the moment. And as a result, we’re going to have to adjust staffing, adjust our strategies, to really make sure that we don’t lose traction and our brands don’t lose traction. And so what’s that look like on our industry? Well, clearly, there’s been some huge impacts on ads spend. Twenty four percent of brands have paused all ad spend for Q2. And brands have delayed ad spending decisions as well. So it’s quite stark related to the amount of marketers who are pulling ad spend at the moment, or at least delaying some of those big brand decisions that they were looking to make before this all happened. Because certainly when we first saw when we first put into lockdown and that all paid and organic activity was was paused during this assessment period where we will work out what to do. So we do expect some changes to these figures, but certainly a huge drop off in ad spend.
[00:06:02] And that ad spends come off all channels really, with it being down 38 percent on traditional channels that get out on digital ad spend and 43 percent down on traditional channels and social media and paid search have taken a really big hit in terms of ad spend. So advertisers are absolutely unclear as to whether they should or should not be advertising. And hopefully some of the thinking that I’ll share with you now will give us a good reason as to why we should ad spend. So kind of what is the impact of pause in that ad spend? And for that I’ve essentially looked at this paper Advertising in a downturn. And so the you know, the landscape is absolutely rich with insights, with papers, with learnings we could look to. But I think this one is particularly interesting because it takes a look at an extremely similar situation, which was the recession in 2008 and 2009. And essentially the evidence is for us what actually happened to those brands when they went dark or paused or kind of reduced their marketing and ad spend during that period. So I think this is something we should be paying absolutely close attention to.
[00:07:23] The learnings from that I included, the impacts of going dark in terms of the penalties that that could have on your brand.
[00:07:31] So, you know, what we don’t want to do is be reducing our favourability, be reducing our salience, reducing our share of voice at this time, because it essentially gives a platform for competitors to just jump straight on, trump you and steal your share of voice. It also showed that cutting budgets will only defend profits in the long term. And that’s, again, really, really important because over the last 20 years, what we’ve seen is a decrease in effectiveness from my advertising campaigns and which has led to this shift in short-termism. Two of the major things that led to that include the rise of big data and tight targeting, which obviously meant that advertisers sort of forgot about the bigger picture. And then the second is, obviously this recession with a lot of brands changing their strategies to promotional strategies and relying very heavily on promotion. And whilst that may have worked from a short term point of view, what we found is that that then led to brands emerging much less weaker and much less profitable. And also, there was a reliance on promotional strategies as they came out of that. So obviously, with this in mind, we should be really focusing on maintaining our share of voice. Do not be tempted by short termism unless obviously your, your short term success depends on it. You know, for example, some of the airlines, you know, there is no way that they can be doing this level of advertising at present with how that is. But there are lots of brands out there that can still advertise.
[00:09:14] But it’s just in terms of changing our thinking and not thinking that these kind of short term promotional strategy is what’s going to save us,nand what’s going to save budget. And it’s this kind of thinking and these long term thinking that essentially will be the savior of our brands in the long run. So that’s kind of a little bit in terms of the evidence behind the numbers and what we know from the recession as it was in 2008, 2009, and how we can use as a guide. But obviously there are clear differences between a normal recession, and where we are now. And the consumer is absolutely the heart of faced with such heartbreaking news at the moment. So we want to look at what the consumer is telling us about their attitudes to advertising. And what they are telling us is that they are open to seeing advertising and advertising that isn’t related to coronavirus. Cantor suggests that 92 percent of consumers believe that brands you need to keep advertising. And if only for a sense of kind of distraction and of normality, really. And this was kind of supported by the study of global web index as well. Which said that over half of consumers still support normal advertising. And I’ll go into a little bit about what they expect to see over, you know, from advertising as it stands at the moment. But they’re definitely open to it. But we do need to make sure that, you know, we are thinking about the consumer because those consumers are taking note of what brands are advertising.
[00:10:57] Sixty four percent of adults in the UK stated that how well a brand responds to this crisis will have a huge impact on their likelihood to buy the brand in the future. So it’s really important that while some consumers are saying they are happy to see advertising, you know, any, any brand that is putting their profits before the people in this crisis, are kind of likely to lose their trust. So whilst it’s going to look very different for every brand and a brand can approach this in very different ways. Humanity, commitment and passion are essentially the key components of getting the formula right in terms of how we can approach advertising. So, I mean, the crux of it is let’s be careful with how we advertise, but we want to obviously give the relief and to the consumer and bring that sense of normality back to them. And just before I go into what the consumer is looking to see, I just wanted to point out a couple of points that might be really interesting for retail brands. The purchase journey is actually delayed for many of our consumers, or that’s what they’re telling us, with over 76 percent of people in the UK report in that they’re delaying their purchase, as opposed to cancelling it, and 33 percent planning on actually buying once the outbreak decreases or at least is over. So it’s really clear to us here that they’re are identifying themselves as still in market.
[00:12:30] And usually, their purchase maybe, you know, two to two or three weeks or whatever that might be, we might now be looking at two to three months. So it’s really important that we stay engaged with our consumers through our brand advertising. So kind of topping the list, really, in terms of the information that they are looking for is practical information and tips, which helps them deal with the situation. We can see that consumers want entertainment from this list as well. Sorry, that might be a little small, but I’ll share the slides with you after, they want to see entertainment – funny and light hearted content. For different brands this could be anything from recipes to work out routines and quizzes. It doesn’t necessarily need to be specifically referencing coronavirus. You know, we’re all too aware of that situation, but at the same time, we just need to be careful not to exploit it. So it’s just about looking at what resources we have and how that can be utilised to benefit all whilst, you know, we’re all in this together really, and, you know, this isn’t our purpose isn’t solely brand health. But if a brand can figure out, you know, where you know, where they can be quick to respond and adapt to these new tailored strategy or marketing. It essentially opens up doors to connect with existing and new customers in the long term. And that’s really important.
[00:14:05] So I’m just admitting people at the same time.
[00:14:10] There’s a couple of brands I just wanted to pull out that change their marketing strategies. We had a beer brand who we’re talking having. We’re looking at end users who would use news apps quite a lot, but they want to give them some relief and therefore target them in less in less stressful environments and reach them when they’re looking at entertainment and use apps. So that’s a placement strategy that has been on board with them. Then this energy company, they wanted to raise awareness of that new app where consumers can speak to their speak to staff via the app rather than by the phone lines, because they realise that they’re going to be extremely busy at the moment. This sports brand, who were changing their creative to an indoor focus and targeting users who were using those kind of increased apps like yoga and fitness apps. I have definitely seen an increase in this. And a coffee brand who targeted users who are who are using high street coffee shops. You know, the likes of Starbucks, etc., looking at users who have those apps on their phone and then using that as a strategy to target a more affluent consumer who has the expendable income to then purchase that high premium coffee. And I think we’ll all agree that, you know, there are very simple ways in which we can change our strategies and thinking to reach the consumer. I think that means that it opens up the window of opportunity for quite a lot of brands. And indeed, there are very, very strong benefits as to why we can be advertising now. So what we know that is actually likely to maintain our share of voice for even cheaper than ever.
[00:16:04] Competitors are likely dropping their ad spends to the market space is less competitive. And on the tools actually reported that they have seen a 57 percent increase in the cost for life and a 44 percent decrease in CPM. So your advertising, essentially, budgets are still there, is you know, to get higher rates will be more scalable even with the same level of spend. And it’s not really a plea for additional budget. The cost of growth is likely to be lower than normal as well. So obviously taking it as being sensitive, but take advantage of this benefit as well. And we’ve also got an opportunity to stand out amongst competitors, you know, possibly because they’ve just disabled all comms, but also because we’ve got an opportunity to create really, really great content. And lastly, maintaining ad spend will mean that we’re absolutely will be more prepared to exit this coronavirus crisis as a stronger brand, and above your competitors. And so it’s about get into the mindset at this point that your advertising is actually for the recovery and not for the recession. So essentially to tie that all together, especially in this climate, now is not really the time to forget the basic principles of a good advertising strategy. A great way, you know, something got always refer to this, is this Binet & Fields survey on effectiveness, which is back in 2013 now. And I’ve included the title of that, if anybody wants to read it, it is the 60 40 rule in terms of brand awareness. Brand building and sales activation, as we know, will work over different periods of time. But given the position that we’re in now, it’s kind of on the slide is even more important to really engage in that big orange line and creeping up your brand awareness to make sure that that that that profitability doesn’t go.
[00:18:06] It’s really really easy to kind of get into that mindset of the promotional strategies and this direct response of sales activation activity to defend those short term profits. But we will end up emerging weaker and kind of the reason for that. You know, the big data and the promotion strategy takes, etc.. That has led to this rise in short termism. And just here’s another quick graph, really, in terms of, you know, what short termism can do from a profit growth point of view. And it’s clear that essentially, if we if we want to build our brands in the long term, we need to be sticking to those kind of very large branding campaigns that are going to help us boost activation for the next year from a short term point of view. And I really like this quote from Peter Field, who I think has become my guru. And he said, ‘stop thinking that every pound you spend on advertising can only be sense being measured on sales right now. It’s nonsense’. And he’s straight to the point. It is nonsense to think like that because the evidence is telling us that, you know, brand building is as important as sales activation. And by no means is he saying that sales activation should be ignored if there is still an absolute case for it. But without the brand activation and keeping our brands front of mind, there really is no strength and no way in which we can build our brands to become profitable.
[00:19:45] So to wrap up, should you be advertising? Well, essentially, if you can then do. You know, all of the evidence is suggesting that consumers are telling us that’s what they want.
[00:19:58] And therefore, we should make sure that that that keeps on going. And so really quickly, just to give you a quick idea of some of the media consumption habits that are going on at the moment and that we can tap into from a paid perspective, first of all, is increased media consumption.
[00:20:20] Increased social media consumption. No surprises, really.
[00:20:25] You know, we’ve all been turning to our phones and turning to our social media channels for entertainment in moments of boredom with tips and inspiration, in moments of proactivity and of course, keeping up to date with our friends and family you know, when we’re not able to see them. So from a social point of view. We all like you know, we’ve all seen Joe Wick’s and the amount of traction he’s driving at the moment is absolutely huge. And it definitely gives us some idea of what kind of content our users want to say. And we’ve seen this huge acceleration in TikTok. It was already on its way up. But it’s absolutely accelerated beyond belief and is starting to plateau out now, but if we can get on TikTok then I’d absolutely encourage those to do so if they can. And these rising social communities as well, the likes of On the Tools and Joe.co.uk really opens up a window of opportunity for us from a paid perspective. As social loses trust, really from a news perspective we can leverage the engaged audiences and the trust that these audiences have got from a community that’s built up over years and start to look at branded content with those to ensure that we’re kind of bringing that level of trust to the brand and using that opportunity to partner with them to its fullest potential. So in terms of the opportunities there, we’ve got, the content-rich adds: our consumers are naturally telling us what they want to see by, you know, all those millions of people, for example, on Joe Wicks. Leverage those branded content partnerships if we can, as well as the emerging channels. And then also consider where YouTube fits into our social activity. I’ll just talk about that more a little bit on the on the next opportunity that we see.
[00:22:27] I am wizzing through this quite quickly, but if anybody wants any more information on these, obviously just do let me know. We’ve also seen increased TV and streaming viewing habits. And a couple of examples I wanted to show you was, I haven’t played it on this play very well through Zoom, but this thinking takes you through Tesco food love stories, which was an app, actually appeared on TV and but was used in portrait mode and you shot through an iPhone. So it’s just an example of really showing you that users aren’t expecting high content or, you know, extreme production values on TV. They are expecting to see something a little bit more UGC led. And this is another great example from Budweiser who reused that classic Whassup ad, but didn’t do the actual voice then…it might be a bit too embarrassing, but you can go on and have a look at that yourself. But they essentially changed, they updated it so that instead of “staying at home, having a Bud”, they said “in quarantine, having a Bud”. And it was it was really, really simple. And it was actually let inside because, you know, you those YouGov data showing us that essentially lots of people are at home on their own during this lockdown. So it’s a campaign to get people talking to them. Right. I thought it was a really nice one. Great reuse of assets and tapped into the TV by viewing habits as well as obviously having sentiment behind it. But in terms of opportunities, we you know, TV budgets aren’t there for everybody.
[00:24:12] So there’s lots of new solutions now that we could look at using, too. Which is a lot cheaper and has cost efficient entry points. One of those is Sky AdSmart. And I won’t go into the technology of right now, but essentially it is a much more cost efficient way to buy in TV, and you can also overlay targeting data as well. So demographics, parents, if they’re having a baby, if they’ve just moved house. And entry points there are you know, three grand plus on short regional campaigns. So absolutely an opportunity there for andy brands who have a bit of a lower budget and can’t afford to go on the big screen. We’ve also got YouTube as well. I think it was two hundred and fifty million hours of YouTube is watched on TV screens daily. And I know I did this the other day after a few drinks with my dad and we went on to try and find Peter Kay dunking biscuits sketch. And, you know, we’ve got premium apps, premium inventory that, you know, shown on the big screen. And we’re looking at that, you know, really cost efficient cost. Very, very low cost per views using YouTube. And then also we’ve got TV sink and ways in which we can actually leverage the viewing habits. So not necessarily advertising on TV, but using tactics that can actually leverage what we’ve seen from a viewing point of view and then retarget those people in other environments, such as mobile, etc..
[00:25:51] Increased music and audio streaming. So, again, we can’t all afford to be on TV and audio is a great way of getting our message out there with a relatively quick solution.
[00:26:04] And it’s quite easy to record audio. And there’s lots of audio partners now that can actually still record in isolation. So it’s absolutely a great trend to tap into. Our opportunities that are led by radio. It’s still an extremely premium environment and we are seeing that radio is getting more and more listened to, especially in the current climate. And podcast as well. So they’re often overlooked because I think a lot of brands think that are any opportunities to partner with a podcast. But we can actually buy podcasting inventory now, which is pretty similar to the way in which we buy radio, buying impressions before podcast or in the middle. So another great opportunity there. And lastly, we have Spotify. So again, a really low entry point in terms as possible, quick turnaround and we can talk it I and perhaps a podcast as well. So, you know, if someone’s looking at a running podcast, we can then reach them and with healthy, healthy eating campaigns or whatever that might be. So lots of opportunity there.
[00:27:19] We’ve also seen, you know, increased mobile consumption across a variety of apps.
[00:27:25] And, you know, some of which to name a few: we’ve got like a house party, huge social media increase and also kind of the likes of yoga apps, fitness apps, and then we can really tap into this trend as well. Firstly by placement, you know, there’s lots of inventory available now so we can use those. That just conscious of times as we’ve got three minutes remaining. And there’s lots of opportunities as well to leverage that in-app data as well. And similar to the way you would have done with the TV, it’s not necessarily to be served enough but to leverage those habits and make sure that we’re targeting users, you know, on different platforms. And then finally, we’ve got increased home comfort purchases. So, as I’ve mentioned, there definitely is still room for activation, particularly some retail clients, homebound retailers, for example, have kind of got an opportunity to thrive. And we are still seeing people within this purchasing intent funnel. Some are converting as usual, some are converting over a bit of a longer period. But we can then start looking at finding those users who are showing us what level of intent that they got based on the key words that they’re searching. So we can look at using Google Search and GDN on the Google Display Network to look at what keywords they’re searching and then reach them on either the search results from a text app point of view with Google Search or GDN display ads, and then we can take that into Bing as well. Bing Search – there is still a huge population using Bing. And then also Amazon search. And it will probably be best if anyone has any questions on this for me to get in touch, because I can make sure that I can get more information over to you. But particularly if you’re a retailer who has products on Amazon search. Then absolutely, we should be considering this as a platform to engage with our audience on.
[00:29:35] So that’s it really, so just quickly, in terms of a summary, we want to be listening and guided by share of voice.
[00:29:42] Let’s not lose that. But ensure our content does have that humanity at heart. Don’t fall into the trap of short-termism. It can be really easy to do that given the current climate, but we can tap into those media trends, choose the channels that complement our content. Just remember, it’s about contribution and not conversion at this point.
[00:30:07] So that’s kind of everything. I’m not sure if we’re going to end in a minute cause we’ve got less than a minute to go.
[00:30:13] But on the basis of other reading as well, I can send the slides through to you. But of course, if you’ve got any questions or are interested in any paid media opportunities and then obviously talk to Grace and she got sent all my contact details and get in touch or Maddi.
[00:30:30] Thank you so much, Emma. That was really great. No problem. Thank you, guys. Thank you very much. Thanks for joining.