Suparshv Chopra | Director – Digital Media

Very recently, Google discovered that it is not just YouTube that is facing a threat from popular social media apps like Instagram or TikTok but it’s also their core services such as Google Search & Google Maps that are losing their popularity amongst Gen Z . Based on a recent study conducted by Google, as much as 40% of Gen Z are using these social media platforms as a search engine. 

I have penned down my two cents on why this is becoming a growing trend amongst the most sought-after target group and how brands/advertisers can adapt to this changing audience behaviour:

First the why:

As quoted by Prabhakar Raghavan (VP, Google Knowledge & Information Organisation) at Fortune’s Brainstorm Tech conference, “New internet users do not have the expectation and the mindset that we have become accustomed to. The queries they ask are completely different.”  

This generation is thriftier than millennials, chooses practicality over customer experience &, most importantly, prefers visual content over plain text.

According to Think with Google, 85% of teenagers within Gen Z use YouTube to regularly find content, while 80% of Gen Z says YouTube videos are very useful in learning new things. This re-emphasises how aggressively Gen Z seeks visual content. Video is becoming their first stop on the path of discovery. Google’s research also highlights that this new generation is turning to social video apps when looking for new places or experiences instead of finding their next destination through Google Maps or Google Search. 

Social media platforms not only provide the content Gen Z seeks in their preferred format, but also supports that content with proof points in the form of reviews and feedback from the community they trust in comments or chat sections. In their eyes, this makes it easier and more efficient to make the correct decisions.

Next steps for brands/advertisers:

The rising popularity of short-form videos made Tiktok the most downloaded app in the world (Q1’22). It has forced big tech giants such as Facebook, Google, Snapchat, etc. to follow suit and create their own short-form video offering. It is becoming imperative for brands to respond to this demand for short-form videos by adding it to their content strategy. As per our learnings, here are some of the best practices to follow when creating short-form video content:

  1. Tailor your video content to each platform
  2. Leverage User Generated Content wherever possible
  3. Use content creators or influencers to drive higher engagement
  4. Ride on the current trends quickly and thoughtfully 
  5. Go beyond the marketing messages and produce educational content related to the brand
  6. Focus on the first few seconds and make them a thumb-stopper
  7. Have a clear call to action in the end

Brands should also understand other ways they can take advantage of these new trends. Creating and publishing a rich depository of short-form video content should not be restricted to social media platforms. It should also be made available on the brand’s website. This will boost the brand’s SEO efforts as Google announced that they will leverage AI to analyse videos on the web and show users a more rich and visual heavy search results to their queries.  

Your target group’s behaviour is changing, are you up for the challenge?  

Connecting the real and virtual worlds, the metaverse is set to be the next big challenge for marketers. Gaming and e-sports are the drivers of a whole new entertainment industry.

When Facebook founder Mark Zuckerberg announced that the new name of his company was Meta, it was a huge clue to the internet’s next stage of evolution: the metaverse as the next iteration of the World Wide Web as we knew it. After all, virtual and physical worlds are increasingly converging and constantly creating new digital spaces. And one of the main drivers of this are games and the digital world of sports . So, it was only logical that the latest “International Roadshow” by the Serviceplan Group was dedicated to “Mythbusting the Metaverse” – with a particular focus on e-sports and gaming.

People are spending more and more time online, as Eva Simone Lihotzky, Director Group Corporate Strategy Serviceplan Group, is observing. While it was just 7 percent of their day in 2010, it is now around 38 percent – and will soon be 50 percent. “The pandemic has certainly fueled this development, but the third web is already very present.  Virtual worlds are becoming mainstream.”

Virtual spaces are now more creative and social

Online gaming platforms like Roblox, where the users invent their own computer games and can play them with others, are proving a huge hit. Like the team-based strategy game League of Legends, which is played by hundreds of millions of players every month and is constantly being developed. “Virtual worlds are becoming more creative and spatial,” Lihotzky says. “And they are also adapting themselves to users’ needs. This consistency is what makes them lasting companions and therefore also so interesting for the brand economy.”

We are currently “in the early stages of a new technology that has outgrown its hype status,” says Stefanie Kuhnhen, Chief Strategy Officer at the Serviceplan Group. In her view, a “learning community” is currently emerging and it is important to now get a foot in the door. “We shouldn’t just be thinking in single platforms anymore. There are lots of different metaverses that are emerging: open and decentralised, no longer just accessible with AR glasses, but more and more browser-based and mobile.” And the focus is not so much on creating 3D-rooms per se, but on creating exiting experiences and hence time that consumers want to spend with a brand. The “15 minutes that a user is spending in branded spaces or new communities can be worth more than the six seconds that they spend looking at an Instagram ad.”

Marketing is reinventing itself in the metaverse

Marketers need to face up to the metaverse in all its complexity. It is a gigantic space for playing, creating things, connecting with others and working, but also for processing transactions, consuming and even earning money. Online gamers and e-sports players are icons of youth culture and influencers in one. Something that hardly seemed conceivable to older generations is now becoming a reality: while the whole family used to sit down to watch TV together for an evening, young people are now tuning into Twitch to watch other online gamers play.

“In the USA, more kids play Fortnite than football and basketball combined,” says Christian Waitzinger, Chief Experience Officer Plan.Net Group, giving us a good idea of the dimensions. In his point of view, the convergence of the digital and physical lifestyle is already fully underway. Brands like Liverpool F.C. have a shop on Roblox, Chipotle has launched the Burrito Builder there and fashion brands like Gucci are also gradually making a foray into the worlds where young people can be found today. It all comes down to being in the place where your future customers spend the most time. And for Waitzinger, it is extremely exciting to see how more and more new business models are emerging from this and brands are rethinking their understanding of consumers.

Gaming is taking over from TV

Gaming has become more unifying across national borders than almost anything else. “Gaming is a sympathy multiplier,” says Alexander Turtschan, Director Digital Accelerator the Mediaplus Group. “E-sports arenas are the new movie theatres.” A way to lose yourself in stories, compete with others and keep on improving. “We see ecosystems emerging here. You can even become a superstar yourself and earn a lot of money. That’s why, e-sports are a serious contender for traditional sports in terms of marketing or sponsorship.” Here you can find everything that the marketer’s heart desires: attractive target groups, influencers, strong communities and, last but not least, the perfect gateway into youth culture.

The advertising industry is merging more and more into these new worlds and its focus now is to create meaningful engagement of lasting value. Nevertheless, “brands should still stick to their values,” believes Helmi Abdalhadi, Manager of House of Gaming at the House of Communication Dubai. He sees gamers as being very critical and professional and, as a result, the only way to reach them is with authenticity. “So, brands that engage with this target group always need to give something back, really embrace the culture and build up something from scratch. We definitely see a new media genre emerging here.

Brands are leading the way in brandification

More and more brands are recognising the momentum of this global movement and are aligning their gaming and e-sports strategies accordingly. “We realised that there are overlaps with our own fundamental brand strategy,” says Pia Schörner, Head of Gaming and Sponsoring at BMW Group. “Joy” or “thrills” are the perfect fit for what the BMW world refers to as its core. So, two and a half years ago, the Munich-based company began making their brand “future-proof for the younger target groups.”

Above all, it was about generating the maximum impact in what Schörner calls “the fastest growing segment of the entertainment industry”. They achieved this with partnerships with the six best e-sports teams in the world, as well as the development of unique formats such as ‘Brawls’, where well-known e-sports players compete against each other. Schörner believes that it’s very important to not just stubbornly throw in product placements, as so many brands do. “For us, it’s about being relevant.” Brandification is the magic word here.

Authentic advertising instead of mere selling

Markus Weiß, Director of Corporate Affairs & Company Spokesperson at McDonald’s Germany, is taking a similar approach. He admits that “McDonald’s isn’t the first brand that springs to mind when talking about something like e-sports”, but they have developed an approach for the new virtual worlds that is valuable and beneficial and goes beyond merely wanting to sell. “As a brand, we want to be an everyday companion that also gives something back and who is as just as passionate as our target group.”

Entering into a partnership with tournament organisers ESL, the world’s leading e-sports company, was not just a first step but is an important pillar of its gaming engagement until today. McDonald’s is meanwhile active at Gamescom, the world’s biggest trade show for video games, and is launching attention-grabbing promotions like the Twitch Sub Bombs (one-off subscription gifts): in this format, which saw them team up with well-known player collective PietSmiet, the burger giant surprised small content creators (micro-streamers) with a ‘gift’. Those watching the PietSmiet broadcast were encouraged to visit the micro-streamers’ pages – sending their total viewing numbers from the low double-digits into the thousands and therefore supporting the micro-streamers financially. “Whenever possible, we rather integrate the brand in a playful way, combined with our messages, instead of playing classic commercials”, explains Weiß. “Our ethos is: brand love meets brand trust.”

Missed the IRS22? If you’d like to watch one of the sessions, the videos are available on our website

How do you empower a premium brand for the post-COVID world? And what are the challenges that lie ahead with regard to changing consumer behaviour and preferences? De’Longhi Global CMO Fabrizio Campanella on the right combination of short-term activity and long-term aspects, the art of successful international campaign coordination and the power of emotions.

MATTHIAS BRÜLL: How did De’Longhi manage to navigate through 2020?

FABRIZIO CAMPANELLA: At the beginning it was very important to keep calm. Of course the COVID-19 pandemic required us to take action and change some of the ways we operate, but not to change everything. We always try to keep a long-term perspective, so we decided not to change certain things like our media or marketing investments. Yes, the short-term environment was very challenging, very unpredictable, but we thought both investments were important in the long term. That was our approach in 2020 and it still is in 2021 – to find the right combination of short-term activity and long-term outlook.

Has the fact that people were forced to stay at home had a positive impact on your business?

FC: For many of the categories we are in, the pandemic has had a positive impact because of people spending a lot more time at home. However, this merely accelerated trends that had already emerged prior to COVID. The coffee market was booming before; the coronavirus only accelerated that. We have benefited from the fact that many consumers are used to drinking certain types of coffee specialities that are probably more espresso-oriented when they are out of their homes – but that is not the coffee they drink in their own four walls. At home they might be okay with a simpler, more traditional way of preparing coffee. People not being able to enjoy the out-of-home coffee experience during lockdown is what accelerated the trend for the same kind of coffee at home.

You even increased your marketing investments in 2021. What are the main aspects of this and why?

FC: It’s true that we are increasing our media investment, especially in the second half of the year, but this is a longterm commitment. There are still a lot of countries where we don’t yet have top-of-mind awareness. Not in Germany, of course, but our products are still niche in other countries, so we need to build categories and a loyal consumer base. And it takes time to do that.

You have been working with a global ambassador since the summer. Why is Brad Pitt the right fit for your brand?

FC: If you look at Brad’s awareness, he is the number one across regions from the US to Asia and also across consumer segments. And we were looking for an ambassador who was also strong in terms of their values. I think Brad is a perfect fit for our brand DNA because, like us, he sets great store by quality. He is also very focused on design, which will also become even more important for us in the future.

The campaign with Brad Pitt is your first real global campaign. Why did you wait until 2021?

FC: I think the conditions are right now. We have strong products and the right level of investments and have expanded all markets above a certain threshold, which really allows us to bring them all together on the same communication platform.

Are the markets happy with the campaign and will you stick to that consistency in your communication?

FC: It was relatively easy once the markets were on board. They saw the opportunity with the global ambassador and understood that it wasn’t possible to run this thing independently and that to maximise your opportunity you had to have a coordinated approach. I prefer to talk about coordination rather than centralisation because there’s always a balance. There are things that need to be done and executed locally and decided locally, but in a coordinated framework. We decided to go live on 2 September. That was coordinated. The format of the launch events was somehow consistent, but local markets had the freedom to organise a specific format according to their market reality and business reality. So it’s always a combination of the two. And that’s why I think it’s also the path to take in the future.

Are retail supply chains having an impact for you? Is that posing a problem?

FC: The retail environment has been disrupted in the last few months. So of course there are big swings between one chain or another, online and offline. This was one of the most challenging factors for us: managing the business and adapting to the changing environment. There are some distribution channels that were very relevant in the past but are less relevant today. We have an online explosion in countries like the UK, where 90% of our business is now online. This is a fundamental change to our supply chain because it’s a completely different way of working.

De’Longhi’s brand positioning has been driven by a strong focus on design and technological leadership, the objective of matching people’s needs at home. So people-centricity seems to be a crucial driver of your business. How is that reflected in your organisation and daily work?

FC: Design is important for us, as is technological innovation. We are a company that is very focused on technical improvement, technical innovation and technical excellence in our products. But it is also important – and this is something I am personally pushing – to consider the emotional aspect, which is about consumer-centricity. Yes, consumers need better products from a technology standpoint, but they also need to have a good emotional experience. This is something that now features prominently in our conversations on the marketing side, and the evolution of the product portfolio will also go in that direction.

Is the physical point of sale still the place where you provide your consumer with the full brand experience or have most of them already switched to the digital experience?

FC: Of course the digital experience is becoming fundamental. But I also think that the physical touchpoints will remain important. They will change and the reason for their importance will change too. So these days it is probably less about distribution and more about the experience. But at the end of the day, if you really want to buy a fully automatic coffee or espresso machine for the first time, you need to taste the espresso. That is something you cannot do digitally. Just imagine countries like China: as a market, China is further ahead in terms of digital channels. Everything is digital in China, but if you need to convince the Chinese consumer to buy an espresso machine for the first time, I assume they will need to taste the espresso in the stores first. The whole experience aspect is something that will remain fundamental.

What is your strategy for providing your target audience with the best brand experience?

FC: There are probably three things that are key for me. One is consistency. Be consistent and true to yourself throughout the brand experience. Being relevant is also important – talking to your customers based on what they really need and focusing on the emotional benefits of your brand and your product. So if you’re consistent, if you’re relevant and if you’re warm, you will have all the elements in place to offer the best brand experience.

This article first appeared in TWELVE, Serviceplan Group’s magazine for brands, media and communication. You can read more exciting articles, essays and interviews by and with prominent guest authors and renowned experts in the eighth issue under the central theme “A Human-driven Future: How People Shape the Digital Tomorrow. Click here to access the e-paper.

luxury-market

Following a sharp drop in sales in 2020 due to the pandemic, the personal luxury goods segment experienced a V shaped recovery in 2021 and is now set on a historic growth trajectory – forecasted at 29% YOY for 2022 (Bain & Company). The recovery has been driven primarily by domestic spending in the US and China as Covid-19 continues to curtail international travel, as well as increased adoption of online channels – a trend that was well underway pre-pandemic. The following trends outline the forces shaping the luxury market in 2022.  

E-Commerce is fueling the recovery.  

In a category that previously relied almost exclusively on brick-and-mortar sales for high-price items, consumer behavior is increasingly shifting online. According to Bain & Company, online sales jumped 50% between 2019 and 2020 and were up an additional 27% in 2021 thanks to increased adoption during Covid-19. Important for marketers to note, brand-controlled websites experienced the lions’ share of growth and now account for 40% of the online segment (up from 33% from in 2019). From an investment perspective, the top Luxury retail brands have shifted media dollars in mass from traditional to digital and social channels apart from Hermès – who keeps tight distribution and exclusivity at the core of their brand strategy (Kantar).  

Brands are investing in personalization of both product and experience. 

Covid-19 has massively disrupted consumer purchasing behavior, leading them rethink how they shop and the value they expect to receive – specifically as it comes to personalization and ease. Luxury companies are now using data analytics to measure and predict what consumers want and are developing automated production capabilities to provide it. This trend towards “mass-customization” extends to the overall shopping experience, with brands providing personalized product recommendations to shoppers in-store, as well as unique customer journeys online. AI-powered chatbots are another burgeoning trend that allow for immediate, one-to-one customer service (Bain & Company). This shift is providing marketers an opportunity to rethink their approach and provide a more effective consumer strategy.  

Metaverse mindset – luxury brands are playing in the virtual world.  

In the frontier of the metaverse, a network of shared virtual worlds that users can access through a variety of platforms and devices, a new marketplace for digital luxury goods has emerged. Luxury brands are quickly capitalizing on the opportunity to sell virtual product to outfit users’ avatars, along with exclusive and collectable NFTs (non-fungible tokens). Gucci, Burberry, Balenciaga, and Dolce & Gabbana are just a few of the luxury players already extending promotional activity into the virtual world. As the metaverse becomes more mainstream, now is the time for brands to begin thinking about taking steps into this new arena that align with their brand offering.  

It’s time to walk to the walk when it comes to sustainability. 

Consumers expect more from brands than ever before, and now actively seek out those that align with their personal values. According to YouGov data, nearly a third of luxury consumers prefer to shop brands that put sustainability first. To meet expectations, luxury brands must develop an authentic voice on social issues and begin investing in sustainability across their supply chains that allow for real accountability and transparency.  

Social shopping must be seamless. 

With consumer dollars shifting online in mass, having a frictionless social shopping experience is non-negotiable. According to Forbes, the average online shopping cart abandonment rate is 70%, with 49% of consumers citing extra costs at checkout as the main reason for abandonment. 87% of online shoppers will abandon their carts if checkout is complex, and 55% will abandon the retailer completely. Brands must invest heavily in a seamless social shopping experience and one-click checkout options, or risk losing sales to retail brands that get the experience right. 

Brands leaning into these trends are a driving force as the personal luxury goods category as it has experienced a huge resurgence following pandemic lows. The surge is being driven by young, digital savvy consumers that have an appetite for immediate, seamless, and personalized experiences. They want to shop when, and where it’s convenient for them – and that is increasingly in growing online channels. While the demand on brands to be flexible and fast-moving has never been greater, neither has the opportunity.  

When it comes to video advertising for our clients, no detail is left to chance.

In our new round of Jobtitles Bingo Bernadette Pa, Unit Director Video Consultant for Mediaplus, tells us why her job is so exciting and various, she talks about the challenges she faces in her day-to-day job and how she brings successfully together family and career.

By Pooja Suvarna, Digital Marketing Manager at Serviceplan Group Middle

The growth in e-commerce in the recent two years has been exponential, we have seen the Pandemic as a wake-up call for many brands to speed up their e-commerce plans and activate their digital stores to ensure that they do not miss out on the opportunity of selling their products when the world went into lockdown. This is clear with double digit growth in e-commerce volume in our region according to multiple sources and expected to become a $50bn market by 2025 in GCC ($17.7bn in 2019. Stated in a report by Kearney Middle East notes).

Following this growth, many have started speculating about the role of Brick & Mortar stores, and even considering setting a date as to when the digital stores will completely take over. The online sales in e-commerce business are expected to increase by 14.8% every year whereas the offline stores will only increase by 1.9%. So, does this mean that physical stores are going to disappear?

There is no straight answer to this question, and with our experience in the digital sphere we can say that brick and mortar will continue to play a major role in the foreseeable future. However, the changes on the consumer behaviour imposed by the Pandemic will continue to impact the means of communicating with our consumer and their requirements in terms of store experience.

It is clear that in our region, digital penetration and usage is amongst the highest globally, and although many marketers focus their efforts on conversions when looking at digital channels, they should still consider the top of the funnel as a major role of such channels to help drive awareness about brick-and-mortar stores and eventually drive footfall. Though, with a channel that has been always understood to be highly targeted and very minimal wastage, we will have to rethink how we approach awareness when our objective is driving footfall. We can still use the traditional channels with hyper location targeting to ensure the messages are geo-fenced to the specific stores and this applies whether the retailer is a small or large one.

 On the other hand, brands must ensure that they create in-store experience that can compete with the online experience and eventually retain the footfall to the stores. These experiences can start with the human element with staff engaging the shoppers all the way to unique moments in the stores that will enhance the overall experience. Give-aways gift/vouchers with purchases can be another way of attracting the customers to visit the store and shop in stores. Direct checkout without long queue can be an option too to enhance the user experience further.

 Many retailers have started using in-store technology to attract users by introducing things like Augmented Reality overlay to see product reviews, discounts, features etc. which will entice and empower the shoppers to make a purchase decision. Shop and collect options can also be one way to bringing the user to the store which might also lead to additional shopping in the stores, this way the e-commerce business can also play a vital role in supporting the retail business.

Brick and Mortar stores will continue to be an important channel of sales, but innovation and technology will play a vital role for it to continue to excite people and engage them more while shopping in stores. Any retailer either big or small will have to embrace the change and start looking for ways to keep the engagement with their customers.

Understanding the customer – wouldn’t we all like that? Nico Blößl has a few tips to share. As Unit Director Client Consulting & Planning at Mediaplus, he not only manages the communication issues of our clients, but also helps them get their messages to the right people in the right way, at the right time.

So, have fun with a new round of Jobtitles Bingo!

Our colleague Alicia Fricke gives us some exiting insights into the world of the Digital Media Consultant, the job profile combines curiosity, analytical thinking, creativity and sociability.

Job profiles at Serviceplan Group

Who does new client acquisition for Mediaplus? And what exactly do our colleagues when it comes to acquiring new clients? Susanne Kiefl and Larissa Staadtlich provide us with interesting insights into their jobs as New Business & Marketing Managers and tell us how their day-to-day work resembles a barraquito.

Check out our new episode of Jobtitles Bingo and learn more about the exciting day-to-day life as a New Business & Marketing Manager at Mediaplus.

Media insights on the launch of Facebook gaming

BY MODCO MEDIAPLUS

In a move to take on Amazon’s Twitch and Google’s YouTube, Facebook launched their own dedicated mobile app “Facebook Gaming” where users can create and stream live gameplay. The app is already available on Android and will soon be available on iOS. We consulted our gaming team for some insights on how this will play out for brands on the platform. 

Facebook lowers the entry barrier with significantly cheaper CPMs

For advertisers, the app will have appeal thanks to Facebook’s integrated audience data, dynamic optimizations, and ease of delivery through their self-managed ad platform. Where Twitch provides premium content against a highly-qualified audience, Facebook lowers the entry barrier with significantly cheaper CPMs. Facebook’s strong performance metrics for video content will also help drive higher view times and completion rates compared to standard in-feed placements. Because Facebook Gaming is app only, Facebook can guarantee 100 percent share of attention on that device and higher ad viewability, whereas Twitch and YouTube have to contend with divided attention and free browsing on desktop.

Advertising opportunities

Gaming is huge, and it’s only getting bigger. It certainly makes sense for the tech giant to double down on gaming-related efforts and move up this launch to take advantage of increased time spent at home. With a captive audience, now is the perfect time for advertisers to test and learn on a new platform.

Article BY MADISON RHYNER AND KEVIN RENWICK