Minds Eye
The Marketing Minds Newsletter

Market Data

US$60 Billion spent on US TV Adverts

Approximately US$60 billion was spent on advertising on US broadcast and cable TV networks in 2006. (New York Times, April 2007)

UK Advertising Expenditure flat at £19.1 billion in 2006

In 2006 a total of £19.1m was spent on display and classified advertising across all media, just 0.7% higher than in 2005. There was a drop in advertising in all forms of media except cinema (which was unchanged at £188m) and the internet (which grew 47.5% to £2.016 million).

Despite a decline of 2.7% the press still accounted for by far the largest share of total advertising expenditure (43.7%) with a total of £8.346 bn, followed by television at 24.1%(£4.6 bn, down 4.7%). Direct mail represented 12.2% of advertising spend, at £2,322 bn (down 2.1%). (The Advertising Association (UK), May 2007)

US Newspaper circulation keeps dropping

The average circulation of US newspapers has dropped for the 5th consecutive quarter. The average daily circulation for 745 US newspapers fell by 2.1% between October 2006 and March 2007. Small gains were made by some major titles: USA Today increased its circulation 0.2% to 2.28m per day and the Wall Street Journal grew by 0.6% to 2.06m.

The New York Times lost 1.9 per cent of its daily circulation, to 1.12m per day. Generally speaking, the decline has been worst amongst titles focused on large cities: The circulation of the Dallas Morning News fell by 14%, for example, and other notable declines were at The San Diego Union-Tribune (down 6.5%), the Miami Herald (down 5.5%) and the LA Times which lost 4.2% of its weekday circulation. (Audit Bureau of Circulations, April 2007)

Double the number of internet users in three years time

The number of global internet users is expected to nearly double to 1.8bn by 2010. Drivers of this include: the world's 2bn mobile phone users buying internet-enabled phones, rapid growth in the connection of domestic TVs and other entertainment devices, and connection of household phones to the internet (via VoIP). In countries like India and China, the mobile phone may be the primary way to access the internet. (The Financial Times, UK)

There's currently 15.5 million ACTIVE blogs

While the all-time count of blogs on the internet is just over 75 million, just 15.5 million of these are active (have been updated in the last 90 days). (Business Week Online and Technorati, 25 April 07)

Confident, Easy-Going Australians

The annual Eye on Australia from Grey Worldwide report finds a very high levels of consumer confidence (84% say they live in prosperous times). Australians report that being "easy going" and "multicultural" as the most important "True Blue" attributes, with the importance of "sophistication" and being "world leaders" ranking near the bottom of the scale.
(Grey Worldwide, March 2007)

Non-Japan Asia Pacific Advert Spend Exceeded $78 Billion in 2006

Expenditure on television, newspaper and magazine advertising exceeded US$78.6 billion across Asia Pacific (excluding Japan) in 2006. Biggest spend (by far) was in China, where media advertising spend grew 22% to $47.8 billion. The next highest spend was in Australia ($5.7 bn), South Korea ($5.6 bn), Hong kong ($5.2 bn) and India ($3.3 bn, up 23%). Advertising spending in Japan, which has the world's 2nd highest advertising spend (after the USA) reached approximately $52 billion in 2006. (Nielsen Media Research, April 07)

US Advertising Agency Revenue Reached US$28 billion in 2006

Booming digital marketing revenues helped advertising agencies in the USA increase their combined revenues 8.8% to $28.2 billion in 2006. Revenue (as distinct from media bookings) from marketing services increased 13% to $15.1 billion, while traditional advertising revenues increased just 4.2% to $13.1 billion. The marketing services revenue growth included digital marketing revenue from online, mobile, and other digital marketing work increased 23%. For the first time a digital marketing firm ranked among the 10 biggest ad agencies in the USA: Avenue A|Razorfish (part of aQuantive which is being bought by Microsoft). Avenue A|Razorfish was the 9th largest US agency in 2006. (2006 Agency Report, Advertising Age)

Japan's Dentsu is the Largest Global Advertising Agency (Again)

With revenues of US$2.487 billion (up 2.2%), Dentsu remained both the biggest individual agency brand and the biggest agency network in the world in 2006. BBDO Worldwide ranked second on the list of individual agencies, and McCann-Erickson ranked second among global agency networks with revenues of 2.127 billion (up 2.0%). (2006 Agency Report, Advertising Age)

Worldwide Sales of PCs reached 228 million units in 2006

Unit sales of PCs grew 9.5% to 227.7 million units in 2006, making an estimated 1 billion PCs in use, world-wide. Almost all the growth was in portable computers (notebooks), which grew by 26%, compared with just 2% growth in desktop PCs. Sales are forecast to grow by 11% in 2007.
(IDC May 07)

iPod Sales Reach 100 Million Units

Apple has announced that it has sold a total of 100 million iPods since the first model was introduced in November 2001. The company also announced that its iTunes online store has sold more than 2.5 billion songs, 50 million TV shows, and 1.3 million movies since iTunes launched in 2003.

Growth of iPod sales continues to increase almost exponentially, with over 21 million units sold just in the first 3 months of 2007 (50% more than a year earlier).

Those with long memories will recall how Apple CEO Steve Jobs responded to questions about the potential of the iPod when it was first launched: Jobs simply observed that Sony had sold a total of about 650 million Walkman cassette players during that product's life. iPod still has some way to go...

What Happened..
(Marketing News in recent weeks)

NBC Universal and News Corp Video Venture

NBC Universal and News Corporation have announced a joint venture to syndicate their video content to established web sites, with the intention of also creating their own video-focused site later in 2007. The content will be mainly current and past TV shows supported by advertising, with some paid downloads and user-generated videos.

Australian Telemarketing "Do Not Call Register"

Over 1 million fixed line and mobile phone numbers have been registered with Australia's new "do not call" register (there are about 10 million fixed line phones and 18 million mobiles in Australia, population 21 million).

Regulated by the Australian Communications and Media Authority, the telemarketing "do not call" register came into effect at the end of May 2007.

Telemarketing companies must send their databases to Service Stream, who will run the register. Service Stream will then wash companies databases against the do not call register and send the telemarketing company a list of people who cannot be called. Fees will apply if more than 500 do-not-call names a year are returned to a telemarketing company. These are still being finalised, but will be in the order of $24,000 a year initially (for up to 10 million names a year).

Yahoo! Advertising for Cable TV Viewers

Yahoo! has signed an agreement with Comcast, the USA's leading cable TV company, in which Yahoo! online display and video advertising will be featured on Comcast's consumer website. Comcast.net has 15 million monthly visitors, who view 80 million videos each month.

News Corporation takeover bid for Dow Jones

Two of the world's biggest media organisations may merge if Rupert Murdoch's News Corporation succeeds in its bid to take over Dow Jones. Dow Jones is publisher of The Wall Street Journal (second-largest US paper with 2.1m subscribers in print and online) and owns MarketWatch, a financial news website with 7m unique users; and Factiva, a financial data, news publishing and research service which focuses on professionally published sources and the deep web. The Wall Street Journal attracts more than 8m visitors per month and boasts over 800,000 paying subscribers at a time when most papers give their content away for free. News Corporation currently owns MySpace and a wide range of newspapers, and TV operations including The Times of London, The Australian, The Sun (UK), BSkyB, Sky News, Fox News and other FOX TV and movie properties.

Google bid US$3.1 Billion for DoubleClick

Google is attempting to make its biggest ever acquisition, bidding $3.1 billion dollars for internet advertising giant DoubleClick. The take-over is being reviewed for anti-monopoly considerations by US authorities. If it goes ahead, DoubleClick and Google would combine into a huge online marketing company. DoubleClick is a market leader in internet display advertising such as online video adverts and banner advertising. Google, of course, is the leader in search advertising.

aQuantive, Microsoft’s biggest acquisition, for $6 Billion

Microsoft is spending $6 billion to acquire aQuantive Inc., a Seattle digital marketing company. The bid represents an 85% premium on aQuantive’s share price, and will use a notable chunk of Microsoft’s cash reserves ($28 billion at the end of March 07).

aQuantive is forecasting revenues of about $600m for 2007, about 57% of which come from Digital Marketing Services. Other revenues come from Digital Marketing Technologies (about 28% of revenues) and Digital Performance Media (advertising broking, which represents about 15% of revenues).

Microsoft's bid for aQuantive is the latest in a rapid series of consolidation moves in the digital marketing industry. In addition to the Google, News Corp, and Microsoft moves, earlier in May WPP Group agreed to buy 24/7 Real Media, and in April Yahoo! agreed to buy the 80% of Right Media it did not already own.

Random Thoughts

Press Announcements in the Digital Age

Are the days of companies making announcements via the press release coming to a close? As we have observed before, more companies are making announcements through blogs and via online communities such as Second Life. Recently, Google announced its amazing "Street View" feature of Google Maps though a YouTube video which soared to the top of YouTube's "most frequently viewed" list.

Should Blogs Replace the Corporate Press Release?

A growing phenomenon, certainly among digital media companies, is the use of blogs to make announcements to the world. Such corporate blogs are serving a purpose which Press Releases used to have: communicating with customers.

For quite a few years now PR departments in listed companies have seemingly had investors as their primary audience: Take a look at the "News" sections of the websites of such companies and you will see a high proportion of press releases which seem to be aimed at boosting the share price much more than communicating to customers and non-financial journalists.

This move to customer announcements via blogs is both welcome and useful: journalists and consumers alike can choose to monitor or subscribe to the blogs of companies and brands they are interested in. Since blogs are usually designed to make comment and discussion easy, they are less vulnerable to the financial motivations of investor relations departments.

Interesting New Links

The State of the Live Web

This report by Technorati, the world's leading blog tracking company, profiles blog activity and is a very useful source of data on blogging and the blogosphere. Published April 2007 on the personal blog of Technorati's CEO, David Sifry. The report, and some additional data, is also discussed in an excellent article on blogging and the blogosphere. Business Week suggests that blogging growth seems to be peaking. http://www.businessweek.com/the_thread/
blogspotting/archives/2007/04/blogging_growth.html#trackback

www.sifry.com/stateoftheliveweb/

Australia's Do-Not-Call Register

Australia's new telemarketing do-not-call legislation came into effect on 31 May 2007. While there are quite a lot of exceptions (eg market research calls, charities, and political parties) it is now illegal for telemarketers to call phone numbers which are mainly for personal or domestic use and whose owners have put them on the do-not-not call register.

Consumers can register their phone numbers at: www.donotcall.gov.au

Telemarketers can access the service at: www.donotcall.gov.au/dncrtelem/index.cfm

Details for industry have been published at: www.acma.gov.au/WEB/STANDARD//pc=PC_300340

Digital Marketing Blog

Quite an interesting new blog about digital marketing topics.
www.digitalmarketing.us/blog

Just for Fun

Our New Word
(non-essential Marketing vocabulary)

Web 2.2: Engagement Marketing

Engagement marketing can mean conversation, self-service, communities, or even market-of-one incarnate.

Paul Marsden, co-editor of ‘Connected Marketing: The Viral, Buzz and Word of Mouth Revolution’, thinks the biggest danger of simply transplanting conventional advertising thinking into the online space is when advertisers fail to build an interactive element into their communications. “Any online advertising without any interactive dimension – for example, a link to an online shop – is a waste of time. Web 2.2 is all about interacting and engaging with people.” He believes the term viral marketing is already passé. “Web 2.2 is all about interacting and engaging with people; we should really be talking about engagement marketing.”

Well, yes, we agree about engagement; but Web 2.2 ?!?

Jokes
(essential marketing mind-flexing exercises!)

The 98 year-old Mother Superior from Ireland was dying. The nuns gathered around her bed trying to make her comfortable.

They gave her warm milk to taste but she refused to drink it. Then one nun remembered the bottle of Irish whiskey in the kitchen and generously poured an amount into the warm milk.

The Mother Superior tasted it then drank a little more and before long the entire glass was gone. In a whispery voice her last words were, "Don't sell that cow."
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Why do husbands forget their mistakes? Well, there's no use in two people remembering the same thing.
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What does it mean when a man in your bed is moaning and calling your name?
You didn't hold the pillow down long enough.
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A city guy is speeding down a winding country road in his sports car. Approaching him from around a curve, a woman rolls down her window and yells, "PIG!". The man yells back, "B*#%^!", flies around the curve and promptly slams into a 300 pound hog.