SEPTEMBER 29, 2014

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Affluents
Ipsos: Affluent Population Grows in Size and Spending Power

The market research company Ipsos defines American "Affluents" as adults aged 18+ living in a household with a household income of $100,000 or more. According to that definition, the affluent population has grown 8% over last year to now encompass 67.5 million adults. The affluent population in aggregate spends $2 trillion per year (an all-time high) in the 158 categories measured by Ipsos. Key average affluence metrics are nearly unchanged versus last year; average household income dropped by 1% to $197,400, but average net worth rose 1% to $1.02 million. Both income and net worth levels are well ahead of their 2011 and 2012 levels. Affluents continue to be persistent magazine readers as 78% of affluents read at least one title and on average, they read seven. Magazine readership becomes even heavier as you move up the affluence ladder -- 84% of "Ultra Affluent" adults (HHI: $250K+) and 85% of the "Wealthy" (HHI: $500K+) read magazines; both groups are also more likely to read more titles per person.

Affluent_magazines_ipsos_2014

So what?

The affluent population, by Ipsos' definition, continues to grow in aggregate and that means the aggregate dollars being spent by affluents follow suit. While some brands might use a narrower scope to define affluence than those with a household income of $100K+, there is no debate that magazines remain an enduring part of affluents' lives as evidenced by the even higher consumption among the country's wealthiest 1-2%. For many high-end advertisers, few advertising tactics can match the audience efficiency of magazines.

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Mobile/Tablets
Adobe: Mobile Users Still Hesitant to Click Ads

In a recent white paper covering mobile (smartphones and tablets), Adobe reports on a survey of global users' (U.S., Canada, France, Germany and U.K.) behaviors and outlines tactics brands can use to connect with mobile audiences. Though click-through for the average mobile ad is well below 1%, survey takers report clicking on some ads in the past three months; 31% of respondents report clicking on at least one ad on mobile websites and 21% report clicking on an ad in apps. Among users in the countries surveyed, U.S. mobile users are the most active ad clickers and Germans are least likely to click. Users are reluctant to clutter their device's notification center; just 16% of users have opted in for push notifications. They are more likely to opt-in to user-initiated communications as evidenced by their usage of QR codes (27%) and location check-ins (30%).

So what?

While dollars are quickly moving to mobile advertising, this research indicates that advertisers and publishers still have a ways to go to reach peak effectiveness. Although not a completely fair comparison, mobile's ad interaction scores lag behind effectiveness metrics reported for print and other media. Consumers seem more willing to answer impulsive queries for information than be interrupted on their devices by ads and push messages. Offline strategies that encourage mobile engagement might be a better way than push notifications to get users to engage on their devices.

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Advertising
Digital Fuels 5.3% Growth in Global Ad Spend

As the end of 2014 approaches, ZenithOptimedia forecasts that global ad expenditure will grow 5.3% this year, up from the 3.9% growth reported in 2013. Growth is forecasted to remain strong during the next few years – 5.3% in 2015 and 5.9% in 2016. In North America, ad spend will grow by 4.6% this year, followed by 4.0-4.1% in the following two years. The growth is being fueled by digital, which is projected to grow by 16% on average every year between 2014 and 2016. The fastest growing digital categories are display advertising (due to the rapid rise in social media advertising) and online video. While mobile devices still comprise less than 3% of advertising expenditures, mobile advertising is growing at an impressive rate of 51% annually, versus only 8% on desktops. Print magazines, on the other hand, will see 2-3% less spend each year, and by the end of 2016 will account for 6.4% of global ad spend. Growth is happening at the fastest rate in parts of Asia and Latin America.

Ad_spend

So what?

The growth in ad spend is a positive sign that the global economy – as well as U.S. markets – are recovering and advertisers are regaining their confidence. As advertisers keep shifting budgets to online and mobile, it is important to continue innovating and finding ad formats that resonate with consumers.

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Reader Response
Reader Submission: People Who Consume Local News Are More Engaged on Social Media

Lindsay Mullen, Research & Insights Director at Advance Local, has shared the results of a recent digital news readers study commissioned by Advance Digital Media Group. The survey of 2,396 U.S. digital news readers finds significant similarities in the consumption habits of those that consume local and national digital news. More than half find news via online websites at least once a day. The study also found that two in five are using social media for news and one-third are using news apps on their mobile devices. Both local and national news consumers believe it is important to stay informed, and enjoy sharing their knowledge with others. The difference between the two groups is in their social interactions. Readers of digital local news are more likely than those reading national news online to talk about articles with their friends, leave comments on articles and share links on social networks.

ADMG's report was also picked up by Adweek in an item linked below.

So what?

While both local and national news audiences are valuable to advertisers, this study suggests that high social engagement by local news readers stems from their physical involvement in their communities. This means that national media websites might be able to drive similar patterns of engagement and social sharing by fostering a sense of community.

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Quick Takes
Condé Nast Digital Reached 65 Million U.S. Unique Visitors Last Month; Ranks 29th in Multi-Platform Audience Size
Comscore_august_2014_top_50

Source: comScore
Apple's First Weekend of iPhone 6/6 Plus Sales Eclipse Previous Launches
Firstweekendiphonesales

Source: Apple, Business Insider
Marking the End of a Six Year Decline, U.S. Median Household Income Rose Slightly in 2013
Na-cc759a_incom_g_20140916184208

Source: Census Bureau, Wall Street Journal
Gallup's 'Trust in Mass Media' Measure Hits Its Lowest Mark in 17 Years of Tracking
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Source: Gallup
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