JUNE 17, 2013

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Industry Viewpoints
Digital Drives Growth in Entertainment and Media Industry
PwC’s annual Global Entertainment and Media (E&M) Outlook 2013-2017 projects that while traditional, non-digital media will continue to dominate overall E&M spending globally in the next five years, the growth will come from digital. PwC is forecasting digital revenues to increase by an average of 12% a year during that period. Consumer spending on E&M content will continue shifting from physical to digital. In 2008, spending on digital content constituted 12% of total spending, which has grown to 27% today and is projected to account for 47% of spend in 2017. PwC dedicated a chapter in the report to the consumer magazine market, and noted that it has proved resilient and its value globally will experience a modest rise in value from $81.9B in 2012 to $83.3B in 2017. Digital revenue from both circulation and advertising will account for 16% of total magazine industry revenues by 2017, up from just under 9% in 2013. The US dominates the magazine market with 30% share of 2013 revenue, but that is predicted to shrink by 1.3% a year through 2017. The notable growth markets include China, Brazil, South Africa, Nigeria and Kenya.
So what? PwC’s report provides a positive outlook for media's near-term future. However, the report also serves as a reminder that companies in the media space, and magazine companies in particular, must fully engage in digital strategies in order to prosper.
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The Changing State of Men
In last week's newsletter, the changing perceptions of women’s roles in the workplace were detailed. And while traditional female behavior is being redefined, so too are attitudes about traditional male behavior. A new study released by JWT focuses on how masculinity is evolving and how men are adapting to changing gender roles at home and in the office. In regards to personal appearance, younger American and British men are further embracing grooming/beauty regimens traditionally associated with women. On average, 54% agree that skincare (moisturizer, eye cream) is acceptable for men. One out of three feel the same way about waxing/hair removal and a quarter of men feel manicures and facials are acceptable for men.
So what? In the past, masculinity was more blunt and defined, but men’s identities have become more nuanced -- the personal care example above is just one example of that. Condé Nast's male-focused magazines often start the conversation around men's style, grooming, and other interests. Because sophisticated brands like Details, GQ, and Wired have been at the forefront of some of the trends listed by JWT, they are in a very unique position to serve advertisers looking to reap the financial rewards of these emerging male consumption categories.
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What Links Do Search Engine Users Click On?
When users search keywords at search engines, they are presented with both organic and sponsored links directing them to websites relevant for their search. A group of researchers from Carnegie Mellon and Cornell analyzed over 1.5 million user searches to understand how users search for information and what links they choose to click on. The researchers found that consumers’ click activity after a search is limited – on average, users click on 1.2 links, with 30% clicking on no links at all. Organic links account for 95% of the clicks, but there is large variation across keywords. Their analysis suggests that click behavior depends on their level of involvement with the topic or product they are searching for. Users who are already knowledgeable about a topic and are looking for specific information about it generate more clicks per search and are more likely to click on sponsored links than users who are gathering initial information about a topic. They also search for less popular keywords. Based on these findings, the researchers recommend that brands focus their sponsored search advertising efforts on high-involvement consumers by targeting less-popular words. To reach low-involvement consumers, they should focus their search engine optimization efforts on more popular keywords.
So what? Condé Nast’s digital properties pay careful attention to SEO and the efficient use of paid search budgets. The study’s findings help optimize these efforts and guide our brands as they identify which keywords they should focus on.
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Models/Celebrities and Scent Strips Help Drive Interest in Fragrance Ads
GfK MRI recently published a report on the most effective ways to advertise fragrances in print based on a study of Starch results of fragrance ads run between the start of 2011 and August of 2012. The research supplier's analysis found that the top measured fragrance creatives most often appear in more than one ad design -- such as a single-page or a spread. The analysis also found that ads with scent strips consistently outperformed single-page units, illustrating an engagement payoff for advertisers that include a scent. Advertisers that chose to include models or celebrities in their ads were also more successful -- GfK MRI found that ads with models or celebrity images earned higher scores than those without.
So what? This analysis helps fragrance advertisers add some focus to their ad creative process. Advertisers that have achieved success in attracting eye balls and driving action are more likely to have made a greater investment in their ad, by the way of models or celebrities and scent strips. Advertisers struggling to make a mark with consumers might want to consider ads with a higher production value that dial up the human element and the scent, and dial down the copy.
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Quick Takes
The Travel Industry Will Spend $3.35 Billion on Digital Ads this Year; Will Spend Nearly $4 Billion Next Year
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Anheuser-Busch Owns Nearly Half of U.S. Beer Market Share
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Netflix Still Owns the Lion's Share of the Subscription TV Streaming Business
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NCIS, The Big Bang Theory and Sunday Night Football were Primetime's Most Viewed Programs this Year
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Condé Nast
Feedback, questions, ideas for future issues? Please contact:

Phil Paparella
Condé Nast Research & Insights | Associate Director
1166 6th Avenue, 14th fl. | NY, NY 10036 | office 212.790.6044 | philip_paparella@condenast.com

Tamar Rimmon | Senior Manager, Digital Analytics
Robyn Hightower | Manager, Research & Insights