MAY 12, 2014

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Affluents
Affluents' Summer Travel Plans: Domestic and Digital-Free

Reflective of their improving economic outlook and confidence, the number of affluents (HHI: $100K+) planning to spend more on summer vacation this year versus last year outnumbers those planning to spend less by two-to-one.  According to Ipsos’ April Affluent Barometer, 36% of affluents plan to spend more on summer vacation this year.  There is a renewed interest in domestic travel: 80% of travelers plan to travel within the continental United States this summer (70% last summer).  While beaches remain a top vacation type, family vacations and driving vacations are showing growth over 2013.  Affluents also plan to unplug while on vacation this summer.   Compared to two years ago, 17% fewer plan to check email.  That leaves more time for traditional media -- 43% will read print magazines and 34% will read print newspapers.  One in four affluents surveyed said they will read magazines that they do not usually read at home.

So what?

Affluents are planning to spend their summer vacations with family and less tethered to their digital devices. While consumers are unplugged this summer, print magazines have an opportunity to form, rekindle or strengthen relationships with affluent consumers while in a relaxed environment. 

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Advertising
Non-Skippable Mobile Video Ads Have Very High Completion Rates

More than 75% of all mobile video ad impressions occur in-app, mostly on phones, says the Mobile Marketing Association (MMA) in its first-ever benchmarking study for mobile video ads. Analyzing mobile advertising data from six leading publishers, including Hulu and Brightcove, the MMA found that completion rates for mobile video ads were flat across ad lengths, with big differences between skippable ads (ranging between 9-14% completion) and non-skippable ads (ranging between 92-96% completion). However, click-through rates dropped for ads greater than 30 seconds. The performance of mobile video ads, like other forms of advertising, declines with excessive frequency, and there is a significant downward trend in click-throughs when ad frequency is greater than 10. Time of day also has meaningful impact on exposure and performance. For both phones and tablets, impressions climb gradually during the course of the day and peak during prime-time, and then drop sharply. Completion rates, on the other hand, are relatively flat throughout the day, and then climb up during the wee hours of the night.

Completion_rates

So what?

Based on these results it seems that mobile video viewers are willing participants in the value exchange model for many digital video publishers: ad exposure in exchange content.  As Condé Nast’s footprint in digital video continues to expand and the audience is increasingly accessing our content via mobile devices, mobile video monetization will become more important than ever. The MMA’s benchmarks can help us assess our own performance and optimize accordingly.

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Industry Viewpoints
MSI: Both Survey and Behavioral Data Needed to Predict Sales

Research conducted in the Netherlands and published by the Marketing Science Institute set to uncover if online behavior metrics (often called passive metrics) or traditional surveys were better at predicting sales. After developing models to analyze the relationship between both behavioral and survey metrics, and sales for 36 brands in 15 categories, the researchers concluded that both forms of data analysis matter in forecasting sales.  Curiously, the analysis found that online behavior metrics are strong at providing an explanation of a sale, but survey metrics are actually better at predicting the sale.  The authors explain this by suggesting that surveys do a better job of capturing brand consideration which leads to a site visit which then leads to a sale.  

So what?

This analysis suggests that traditional survey research should be used to answer big-picture strategic questions like determining market size or how to best create demand.   Online behavior measurement is better for tactical planning such as how to most effectively drive conversions.  While the consumer decision journey now consists of more starts and stops (both online and off) than ever before, survey responses still act as a better barometer of the brand awareness, consideration and likeability that will ultimately lead to sales.

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Retail/Shopping/Commerce
In Search of Savings, U.S. Shoppers Leave Brand Loyalty at the Door

According to a new study by Deloitte, the long recession has left its mark on American consumers, 80% of which say that the U.S. economy has fundamentally changed. The 2014 American Pantry Study found that when it comes to their brand preferences for groceries, beverages and household products, consumers are now more frugal and their brand loyalty is decreasing as they look for savings. More than four in five consumers report that they are looking closely for savings in every spending category, and 94% expect to remain cautious even if the economy improves. While some are feeling resentful about the compromises they have had to make, most are not – 71% of consumers say that even though they are spending less on household products now, they don’t feel like they are sacrificing much. Nearly nine of 10 consumers find store brands to be just as good as national brands, and many national brands that were considered “must-haves” in the past are now being abandoned by customers due to competition from other brands, which are cheaper or on sale.

So what?

While Deloitte's study focuses on categories that comprise a smaller portion of Condé Nast's advertiser base, it still provides a useful capture of consumer temperature.  Well-known household brands are pressured by these new shopping trends and need to work harder to convince consumers that they are worth the price.

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Quick Takes
Led By GM, Toyota and Chrysler, New Car Sales Were Up 8% in April
Cars_april_2014

Source: Motorintelligence.com
Mobile Advertising Now Accounts for Half of Facebook's Revenue
Chartoftheday_1837_facebooks_revenue_growth_n

Source: Statista, Facebook
Consumer Confidence in the U.S. Hits its Highest Mark Since 2007
1399044497553

Source: Nielsen Global Survey of Consumer Confidence
Half of Verizon, AT&T and Sprint iPhone Customers are Using an iPhone 4S Model or Older
Chart-of-the-day-iphone-upgrades

Source: Business Insider, AlphaWise Survey, Morgan Stanley Research
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

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