January saw a great start for the digital marketing, media and retail
Consumer spending was even greater at Christmas than most
e-retailers had forecast with a leap of around 50%, online advertising
looks set to overtake television spend in the near future as budgets are
pulled from classic channels, and the switch to digital marketing is
accelerating in Germany and across Central and Eastern Europe younger
Our first international projects of the year confirmed the enthusiasm of
marketers in New York to boost their integrated strategies with more
online activities, and next month we are back in Sweden and Eastern
Europe to see if the same trends are strong in those markets.
For details of new digital training and strategy programmes in your
country e-mail me back, and in the meanwhile we all hope you enjoy this
edition of Digital Intelligence. If you'd like to give a colleague
access this year, then simply e-mail us back and copy them in, and we'll
do the rest.
Founder and Chief Executive
Digital Strategy Consulting
Digital ad revenues to overtake TV by next year
GroupM predicts that UK digital
advertising revenues will eclipse TV ad revenues by next year, writes
The Guardian. The firm expects online adspend to grow over 30%
during the next year, reaching £3.4bn. TV advertising will grow less
than 1% during the same period. Alternative figures published by the
World Advertising Research Centre (WARC) conclude that online adspend
could grow as much as 37.9% in the coming year.
While Group M expects the UK to become the first major economy with
higher adspend online than on TV, the firm forecasts that Sweden will
achieve this during 2008 with 19.5% of adspend going online against
19.2% going on TV ads.
Radio facing 2% fall in revenues in US
Radio advertising could fall up to 2% this year as the local advertising sector slows, writes Mediaweek.
Revenues could drop below $20bn for the first time since 2002 as the industry faces its eighth year of slow-to-no-growth. Radio is said to be facing its worst crisis since the 1950s when it struggled through recession, the Korean War and the advent of television.
Print publishing sector: ad revenues sliding for another decade
Another depressing report for
the print publishing industry as the latest WARC figures point to an
acceleration in the contraction of the newspaper ad industry. The
World Advertising Research Centre - the group behind the official
Advertising Association stats for the UK market - sees newspaper
advertising shrink by more than £1.6bn between now and 2019 (a move
from £6.7bn to £5.096bn over 12 years). That contraction is in spite
of bullish growth in the overall ad market, although with the
concentration being on digital channels. With the profitability of the
print sector already under extraordinary pressure, this will wound
investor confidence even further. Our take: among the firms without
strong digital strategies, watch out for the spiral of cost cutting,
weaker products, lower engagement, and even weaker drivers for
advertisers; among those with the master plan the big question remains
- does the collapse of print revenue get properly offset by the growth
of digital channels.
Online sales grow 50% at Christmas
The latest IMRG Capgemini
e-Retail Sales Index has found that Q4 online sales grew from
£9.61bn in 2006 to £15.2bn in 2007, writes Netimperative. Online shopping peaked in the first week of December with sales up 9%
year-on-year. Firms with both online and high
street outlets such as John Lewis did best.
Further figures estimate that 15% of all UK retail spending during
2007 was online. Total internet spending reached a new high of £46.6bn
during 2007, up 54% on 2006's figure of £30.2bn. For each £1 spent on
goods in 2007, 15p was spent online - in 2006 online represented 10p
of every pound.
Google to bring Print Ads to UK
Google is planning to launch its Print Ads service in the UK, writes
The Sunday Times. The service launched last year in the US and lets advertisers bid on print inventory in the same way as Google AdWords.
Google Print Ads now supplies over 600 titles in the US.
In the UK, Google's advertising revenues grew 40% during 2007 to reach £1.25bn.
From The Sunday Times:
Google Print Ads:
Digital's update on the latest ad products from Google
European telcos head for new markets
Broadband connections in
Central and Eastern Europe rose 44% during 2007 and three of Europe's
five biggest telcos are moving in to take advantage. Research from
Screen Digest shows that France Telecom, Deutsche Telekom and Spain's
Telefonica all now have stakes in the region. Broadband penetration
across France, Germany, Spain, Italy and the UK reached 44% at the end
of 2007. In comparison penetration in Central and Eastern Europe stood
at only 13%. Russia has fewer than 7% of homes connected to broadband
Latin America is another growth market and consumer broadband access
is expected to reach 30% of homes in the next five years. Connections
grew 41% during 2007 compared to 23% across the "Big Five" West
European countries. Telefonica is the leading European operator
working in Latin America with stakes in Argentina, Brazil, Chile, Peru
Telegraph to launch seven new online programmes
The Telegraph website is planning to launch seven new online TV-style programmes covering subjects such as food and drink, culture, technology, finance, motoring,
fashion and travel, writes The Guardian. The new line-up includes "Right On" a weekly politics talk show featuring Ann Widdecombe and described as "politically right, not politically
T-Mobile gives free Wi-Fi to customers
Subscribers to T-Mobile's Web
'n' Walk 3G service are going to be offered free Wi-Fi access writes
Netimperative. Users will be given free use of T-Mobile's network of
1200 UK Wi-Fi HotSpots (39,000 worldwide). Web 'n' Walk costs £12.50
per month in addition to any Flext price plan.
Sony brings Skype to PSP
Sony has confirmed that it is
adding Skype VoIP functionality to its PlayStation Portable (PSP)
gaming device, writes Telecoms.com. Sony are releasing a firmware
update at the end of January for the PSP-2000 series which will allow
users to make VoIP calls when they are connected to a wireless
network. Sony are also releasing a range of additional peripherals
such as microphones to take advantage of the new features.
Netscape to be shelved
AOL is to discontinue its Netscape browser from the 1st of February, writes StrategyEye. The firm is to encourage users to switch to Firefox. Before the launch of Microsoft's Internet Explorer Netscape had over 90% of the browser market but has now been reduced to only 0.6%. Internet Explorer currently has 77% with Firefox on 16%.
Chinese internet population passes 200m mark
China's online population grew
53% to reach 210m at the end of 2007 from 137m the year before,
reports PC World. The figures, from the China Internet Network
Information Centre, put China only 5m users away from becoming the
world's largest internet population. 40% of new users (or 29m people)
came from rural areas.
86.6% of those surveyed use online music services making music the
most popular web application ahead of instant messaging (81%). E-mail
is the fifth most popular application with 56.5% using it.
UK web users get older
New data from Nielsen Online has found that British web users are getting older, writes StrategyEye. In October 2007 the average age was 37.9, up from 35.7 at the same time the year before. During the same period the proportion of under 25s online fell from 29% to 25%. In contrast the number of over 55s using the internet in the UK grew 22% during the 12-month period to 19%. Neilsen Online's Alex Burmaster commented: "New online offerings and technology are usually targeted at the young, but it's possible brands could be missing a trick if they continue down this path in the future."
Blogging for news
The rise of blogs to the
heights of official news sources was confirmed this month when a
survey by Brodeur and MarketWire reported by Marketing Pilgrim showed 75% of journalists using blogs
as a place for story ideas and research. 30% of journalists surveyed
said they had their own blog and 21% said they spent over an hour a
day on blogs. Big implications for PR agencies and brands everywhere.
New Media Journalist Survey (PDF):
Digital Insight Report for newcomers to blogging
makes perfect match for online dating in the UK
Staggering to reflect on, but
half of the UK's single population are now logging-on to dating sites.
That's the latest finding from web dating specialists Parship who
reckon almost eight million Brits tried online dating last year, an
increase of around 50% on 2005. The gender balance is pretty even (52
per cent of men vs 48 per cent of women use online dating). Parship's
UK and Ireland director Tony Blin Stoyle sees higher rates among older
people: "UK singles, particularly those aged 30 to 40, recognise that
as they get older and their social networks become smaller, they need
to maximise their opportunities in order to meet a partner. if you
rely on traditional routes and wait for a chance encounter with
someone special, you could end up waiting a very long time."
Parship: http://www.parship.co.uk, 21/01/2008
Industry focus: Online Music
European Commission makes iTunes lower costs in UK
The European Commission has
ruled that it is unlawful for Apple to charge more for iTunes
downloads in the UK than in the rest of Europe. Costs for single
downloads in the UK are 79p - nearly 10% higher than the continental
rate of €0.99. Costs are expected to come down in the next six months
and the EC is now ending its anti-trust action against Apple.
From Brand Republic:
Digital music sales double
Music retailers are reporting a
sudden leap in sales of online music here in the UK, and a 100% growth
in sales in the week after Christmas (based on year on year
comparisons) - reports The Financial Times. This is more than
just lots of iTune downloads and iPhone Christmas presents: the music
sector is heading towards another crossing point where digital sales
will replace physical CDs, probably in the UK and Scandinavia first,
but then in the US and Western Europe.
From The Financial Times:
Radiohead profit from In Rainbows experiment
Radiohead have made more money from digital
sales of In Rainbows than from all their other EMI albums combined,
writes StrategyEye. The band's contract with EMI included no provision
for digital rights, leaving them with nothing from official online
sales of their music. Rumours of 1.2m digital sales of In Rainbows
have been rejected by the band, though official figures are yet to be
released. A CD version of the album went straight to number one when
it was released at the start of January.
Mobile marketing set to take off
The Mobile Marketing Association (MMA) has
released its inaugural Mobile Attitude and Usage Study covering five
markets in Western Europe, writes Mobile Europe. The study polled
1,535 mobile users in the UK, Germany, France, Italy and Spain and
suggests that conditions are right for strong mobile marketing growth.
Key findings include:
1 in 10 mobile users is highly interested in
mobile marketing with 3 in 10 showing moderate interest.
Half of all Italian and Spanish mobile users
are at least moderately interested in mobile marketing.
2-way text messaging is the most important
functionality across all age groups. 7 in 10 consumers have used
text messaging with Italy and Spain the most experienced markets.
15% of all consumers have experienced mobile
Interactive voting, advertising and product or
service information are the most common forms of mobile marketing.
Users are most attracted to mobile coupons,
special sales and alerts about accounts and purchases.
Mobile Marketing Association press release:
Viewers watch 3.5m BBC programmes with iPlayer in two weeks
Online viewers watched 3.5m programmes using the BBC's iPlayer service in the first two weeks following its relaunch on Christmas Day, writes Brand Republic. The iPlayer site attracted over 1m visitors during the period with an average of 250,000 programmes being downloaded or streamed each day. Figures from Hitwise show that traffic to the iPlayer site grew 14-fold between the beginning of December and the beginning of January. The site also entered the ranks of 100 most visited websites in the UK, peaking at number 62.
According to The Telegraph the BBC is also in negotiation with ISPs to cache copies of the most popular programmes directly at local exchanges. ISPs have voiced concerns about the amount of bandwidth iPlayer traffic could consume. "Project Cheetah" will see the BBC place around 200 servers at various points on the BT network, reducing the amount of traffic from the BBC's central servers.
From Brand Republic:
BBC iPlayer: http://www.bbc.co.uk/iplayer
Monthly internet usage statistics for the UK, December 2007
Source: Nielsen/NetRatings Home/Work Panel monthly statistics
Monthly top ten UK parent companies for December 2007
Source: Nielsen/NetRatings Home/Work Panel monthly statistics
Top 10 popular websites in the UK, December 2007
This list features the most popular websites based on
UK Internet usage for December 2007, ranked by market share of visits
across all Hitwise industries.
Source: Hitwise Datacentre, December 2007, based on market share of visits
Top 10 Search Terms in 10 Categories, December 2007
The terms which were searched for most often on the web in December
|Top 10 Search Terms by
Category, Four Weeks Ending December 29, 2007 (%)
|IT and Internet
||Net Communities and Chat
|i am legend
|Food and Beverage Brands and
||Pharmaceutical and Medical
|harry and david
|honey baked ham
|Blogs and Personal Web Sites
|Shopping Rewards and
||Travel Destinations and
||walt disney world