International Marketer’s Blog

Reports of better-than-expected consumer spending, jobs markets and retail sales last week allowed the marketing world to breathe a sigh of relief.

The not-so-good news, according to AdAge.com yesterday (06.09.10), is that despite a slight uplift in US gross domestic product late last year, marketers are now bracing themselves for a bleak period moving forwards.

Brands such as Procter and Gamble and Target Corp are steeling themselves for an extended period of low growth, high unemployment and careful spending for years to come.

John Gerzema, chief insights officer at Y&R, sees a permanent move towards more conservative spending patterns. ”We’re going back to a more practical way of spending, where we don’t have access to the same amount of credit,” he said.

In response, many retailers are adjusting their marketing processes to serve consumers spending less or using cash to buy goods.

Furthermore, growth in the big emerging markets such as China, India and Brazil, which was strong through the recession, may now be starting to slump. (more…)

The UK self-regulatory body, the Advertising Standards Authority yesterday announced ambitious plans to extend its remit to policing online marketing content.

The new rules will apply to all marketing messages on corporate websites, and include online marketing tools such as social media platforms Facebook and Twitter as well as mobile apps.

Until now, the ASA’s online remit and CAP’s codes have covered only paid-for marketing communications, such as banner and paid search ads. The extension of the ASA’s remit will close a loophole in the existing CAP Code, which designates companies’ sites as editorial and therefore exempt from regulations put in place to protect consumers.

Sanctions for breaking the code could cause great damage to a brand’s reputation. Google, Microsoft and Yahoo have agreed to remove ads judged by the ASA to be breaking its rules; they will also allow the ASA to place online ads to warn consumers about a company’s non-compliance with the code.

Although the measures are regarded as necessary if online advertising self-regulation is to remain effective, the announcement has generated much comment in the UK media from industry figures. (more…)

Marketers have good reason to be cheerful, according to positive reports from the world’s largest advertising company and other global marketing service companies.

An analysis in Marketing Week (marketingweek.co.uk, 31.8.10) reported a statement from WPP, the world’s largest advertising agency, which spoke of a rapid rebound in US and UK advertising spend.

WPP, owner of JWT, Grey and Ogilvy Advertising, attributed a 2.5% increase in first-half revenue to marketers’ increased spending on advertising.

The UK and US economies have both grown in the last quarter, by 1.2% and 1.6% respectively, and better than many analysts had predicted.

Advertising Age yesterday also reported higher than average first-half growth for Havas Group and Aegis. Paris-based Havas described North America as the “powerhouse” of its growth, along with new business wins in the UK.

Aegis, which reported a 7.8% rise in pre-tax profit to $48.3m (£39.6m) in its first half, says that it is optimistic about the short-term outlook after seeing signs of a “rebound” in the advertising and market research sectors. (more…)

Mobile telecoms companies in India are predicted to spend highly on advertising this year to achieve their global brand ambitions.

The roll out of 3G technology, global objectives and new brand communications mean that the telecoms sector will be spending heavily, with advertising and marketing agencies in hot pursuit.

As the telecoms sector enters a new phase of expansion, brands have to be refreshed and tailored to meet new market conditions.

In a year that has seen some aggressive 3G spectrum bids, industry giants Reliance Communications and Airtel have sought new agencies as part of rethinking their marketing processes.

Airtel, India’s biggest mobile services provider, has had to reposition for global brand consistency in the wake of international acquisitions. While advertising had previously been inspirational and patriotic, Airtel must now craft new campaigns to build its global brand image. (more…)

Advertising spend in China has grown by 17% to US$41bn in the first half of the year. The figures recorded by CTR Market Research, show the highest increase in four years, indicating potential opportunities for international marketing and business.

The cosmetics and toiletry industries have spent most on advertising (US$6.4bn), a healthy 26% increase. Business and services totalled US$5.12 bn followed by beverages (US$4.96bn), foodstuffs (US$4.07bn) and pharmaceutical (US$3.74bn).

Chinese household appliances, transportation and home goods sectors are the so-called “emerging advertisers”, growing the most significantly at 71%, 48% and 43% respectively.

Spending on television shows the smallest growth (15%) compared to other media. While TV spend still comprises 78% of the media share at US$33bn, this is a 13% decrease from the same period last year. This is partly due to the policy adjustment of State Administration of Radio, Film and Television (SARFT), according the report on campaignasia.com. (more…)

Automotive companies are using messages of national pride to appeal to recession-battered American consumers.

Current campaigns for Dodge Challenger, Jeep Grand Cherokee and Chevrolet are among those pushing the patriotic message.

The former, by Wieden and Kennedy, reimagines the revolutionary colonists charging British Troops. The tagline is “Here are a couple of things America got right: cars and freedom”.

The Jeep Grand Cherokee spot, ‘Manifesto’, uses images of skyscrapers, locomotives and welders to remind US consumers “the things we make, make us”.

“The campaign is [our] way of making it clear … that we have that personal pride back and we’re creating quality products,” said Olivier Francois, lead marketing executive, Chrysler Group, when the ad broke.

Chevrolet, meanwhile, has juxtaposed images of rocket scientists with shots of GM workers building a Corvette. “While time has marched on and priorities have changed,” says the voiceover, “it’s nice to know America still builds rockets.” (more…)

Ad spend in Brazil is predicted to soar in the lead up to two major international sporting events according to research company Forrester.

The 2014 Soccer World Cup and 2016 Olympics are proving major incentives for marketing services companies to strengthen their presence in Brazil, with a number of agency acquisitions already completed.

Roxana Strohmenger, a Forrester analyst following the marketing space in the Latin American market, predicted that global advertisers are likely to plan international marketing activities to integrate their brands with both events.

“With preparations and ramp up to [the events]… the amount of ad spend in the Brazilian market will increase significantly,”

Strohmenger was quoted in a report on Clickz.com She added that Brazil’s relatively limited exposure to the economic crisis in the US and Europe last year makes the region a safer bet for investments than other markets. (more…)

South Africa is to build on the success of the World Cup with a multi-million dollar international marketing campaign, aiming to attract tourists and returning football fans in particular.

According to the report in South Africa’s Business Day, the World Cup has shifted international perceptions of the country, which has a reputation for violent crime.

“We have always had to focus our campaigns as being a welcoming destination in a global market that regarded Thailand and India as more friendly. However, the tournament has finally changed that perception,” said Roshene Singh, chief marketing officer of South African Tourism.

The 188 million rand (around $US26m) international marketing activity will feature ads on major television networks in which Indian, Nigerian and American visitors will relate their World Cup experiences. SA Tourism will also use social networking sites, such as travel website wayn.com, to communicate the positive World Cup story. (more…)

An article in the Financial Times this week describes the approach taken by a number of global brands seeking to develop business opportunities in emerging markets. The report’s author Emma Jacobs looks at international marketing strategies employed by established global players such as HSBC, McDonald’s and Starbucks.

HSBC, which has for many years been branding itself as ‘The World’s Local Bank’ is pursuing a strategy promoting the understanding of different cultures as key to developing successful business relations. The company has sponsored this summer’s ‘Festival Brazil’, a programme of cultural activities at London’s South Bank Centre. Running alongside the cultural event is a series of business seminars and conferences about operating in Brazil designed to help people, including foreign journalists and trade representatives to engage with the festival.

Key to successful expansion in new markets for companies such as Starbucks and McDonald’s has been research and investment in products adapted to local tastes.

Starbucks has until recently pursued a strategy trading on its all American image. However, the company is now subtly adapting products to local tastes at the same time as tailoring some outlets more closely to the local environment. The company hope to reconnect with local communities whilst maintaining its core American image. (more…)

The global marketing industry is likely to benefit from a new set of standards on the back of an alliance between two professional bodies.

The American Marketing Association (North America’s largest marketing association) and the Global Marketing Network (the marketing professionals worldwide membership group) have joined forces to co-develop a range of measures. The idea is to create a new set of global standards for the marketing profession.

The report, on utalkmarketing.com, says it’s hoped that the partnership will boost the profession with ‘the most comprehensive and widespread support’ for the international marketing community.

The measures include jointly developed branded membership offerings, new globally-accredited certification programmes, and the AMA being appointed as a GMV Professional Development Centre and distributor for GMN’s Global Marketer Programme in North America. (more…)