AKQA is arriving in Australia, New Zealand and Singapore through a partnership with creative technology company DT. Experiencing double-digit growth in 2016, DT has just celebrated its most successful year since its founding in 1996. Clients include Bunnings, Optus, Bupa and Tourism Australia.

DT’s brand will remain but transition to the AKQA brand in the future. The partnership is the latest move in AKQA’s strategy to meet client demand across service-lines and regions. AKQA has added more than 300 new employees during the last 18 months by opening locations in many of the world’s cultural capitals including Italy, Brazil, Sweden and UK. Combining DT’s additional 220 employees from Sydney, Melbourne, Auckland and Singapore, AKQA will now have 2,000 employees in 21 studios across the USA, Europe, Asia and Australasia.

Ajaz Ahmed, AKQA’s CEO said: “In a world where digital is everywhere, AKQA’s passion is a thoughtful, considered and intelligent brand experience at every connection. DT’s talent and track record will strengthen the AKQA community and enhance our combined purpose to partner with progressive clients to define and deliver a better future together.”

Brian Vella, CEO of DT will continue to lead the company and join the AKQA Executive Team. He said: “We take pride that DT’s most recent year broke all previous records. As we look ahead to the next chapter in our journey we will now provide our clients and team with access to the global stage alongside AKQA, a globally admired partner that shares our vision. AKQA has always been an inspiration to so many, redefining the industry through influential work time and time again."

WPP Australia and New Zealand CEO Michael Connaghan, who oversees over 80 agencies in the region, sums up the potential of the new partnership:

“Combining the cultural influence, core values and global caliber of AKQA with the capability and coverage of DT represents an extraordinary platform to create the world-leading brand experience agency.”

Recent AKQA launches include the highly acclaimed BBC Earth Story of Life, and the world’s first voice animated story The Snow Fox. AKQA won more than 100 honours in 2016 including seven Cannes Lions; IAB Agency of The Year and PromaxBDA’s Gaming Agency of the Year. DT launched Australia.com, while architecting and creating brand experience activity for Bunnings in Australia.

Joline McGoldrick, vice president at Kantar Millward Brown, shares the agencies’ recent research to help marketers understand Gen Z

In 1989, writer Felicity Barringer wrote that older generations perceived upcoming Gen Xers as ‘a lost generation, an army of aging Bart Simpsons, possibly armed and dangerous.’ 

Some of the old-timer cynicism expressed in that New York Times article is clearly being revived in the way popular media has begun referring to Generation Z. This group of under 19s has been widely labelled as “screenagers” – ambling into adulthood phubbing (snubbing someone in favour of your mobile phone). 

We’ve spent the better part of a year studying Gen Z across 39 countries for AdReaction: Engaging Gen X, Y and Z and we think such cynicism is misplaced. True, Gen Z are spending a lot of time looking at screens but they are also a creative, self-aware and resilient generation deserving of not only the attention of brands but also their best efforts. 

Generations aren’t set in stone at birth nor are generational characteristics just a function of life stage. Instead, we all play a role in co-creating generations by shaping and making sense of the big moments we’re exposed to. We all have a part to play in driving and creating the secular trends (media, entertainment, popular culture, the products we buy and sell) that define this and every generation. 

And so, as with previous generations, Gen Z will unfold and reveal itself as it emerges into adulthood but marketers can be more in synch with and connected to them with some understanding of who they are and what they want.

So what do marketers need to know to relate to Gen Z and create better media, advertising and products to connect with them?

Demographics: Gen Z is estimated to number about 2 billion worldwide. In the US, they represent about a quarter of the population and by 2020, it is estimated they will make up 40% of all consumers. 

Formative influences: Many Gen Z-ers are the children of Gen X-ers (the smaller, less thought of, more realistic Breakfast Club generation), they’re more racially and ethnically diverse and more willing to blur lines and labels than previous generations. Older members of Gen Z were shaped by the financial crisis and the younger ones (let’s be honest) will be shaped by our ability (or inability) to get our political act together in the immediate future.

Media Behaviours: Gen Z quickly find the content they want. They’re accustomed to having information at their fingertips (58% will turn to Google for any query) and the music they want in their ears (43% are accustomed to always available digital music). Conversely, they also quickly move away from what they don’t want (instead of installing ad blockers, 69% of them physically shift away (look at another screen) from ads that they don’t want to see. 

Expectations: Gen Z want advertising that feeds their right brain – advertising that is funny (72% say that humour gives them a positive opinion of ads), with good music (58%) and a good story line (56%). When advertising delivers on this they’ll stay and pay attention. They’re less enamoured with some of the classic youth marketing techniques of celebrity (20%) or special effects (only 26% say this shapes their opinion). 

With all this in mind, what must brands do differently to connect with them?

First, brands must create campaigns that allow Gen Z consumers to co-create a shared brand experience. This group is hands on – they want to try it, take it apart and re-create it. Unlike millennials, Gen Z find hyper personalisation intrusive. Brands that let them vote for something to happen get a more positive reception (31% compared to 25% for Gen Y,) choose an option (28% compared to 25%) or take decisions (27% compared to 22%).

Second, brands need to let their target consumers look deeper inside the brand than ever before. Such openness will allow Gen Z to determine if they want a brand to be part of their lives. Although Gen Z place a great emphasis on personal privacy, they expect brands to be fully transparent. Such a strategy requires brands to share their story, their purpose and details about their production processes. This might involve owned messages but also strategic sponsored content opportunities. 

Finally, brands need to tell their stories in new ways. Traditional digital communication is too left brain, linear and factually based for this group. Gen Z seeks a digital experience that is more right brain with a focus on imagination through technologies such as Augmented Reality and Virtual Reality, non-verbal immersive formats, music and stronger visual imagery.

Data sourced from MillwardBrown

Consumers around the world with some wiggle room in their budgets are getting a taste of the finer things in life. In fact, the growth of the premium sector in many markets is outpacing total growth for many fast-moving consumer goods (FMCG) categories. And as it turns out, it isn’t ritzy categories like diamonds and champagne, as everyday consumables are rising to the top of the list of categories for which global respondents most often say they are willing to trade up.

While electronics and clothing/shoes top the list (cited by 37% and 36%, respectively), respondents in most regions are also willing to consider trading up for better meat or seafood. In fact, this category is cited most often in developed markets, and it’s among the top five categories for which respondents will consider trading up in Southeast Asia, Latin America and Africa/Middle East. In addition, 30% of global respondents say they’ll consider paying more for dairy products. An analysis of sales data in the U.S. shows consumers are backing up this sentiment with their wallets. Between 2014 and 2016, premium milk sales grew 52%, driven by the sale of milk alternatives, such as almond milk. In fact, sales of almond milk grew 250% between 2010 and 2015, while the total milk market shrank by more than $1 billion.

“In many cases, successful innovation results from reimagining traditional category definitions,” said Liana Lubel, senior vice president, Nielsen Innovation Practice. “For example, the dairy category in the U.S. was stagnant but, by redefining the category to include dairy alternatives such as almond milk, brands were able to offer more premium products, and therefore bring new consumers into the category and reengage lapsed consumers.”

Personal care and beauty categories also have strong upgrade potential, and innovation can play an important part in fulfilling unsatisfied needs. More than a quarter of global respondents say they’ll consider buying premium hair-care (27%), body-care (26%) and oral-care (26%) products, and an analysis of sales data in several markets affirms the potential. Indeed, the premium segment accounts for roughly a quarter of dollar sales in the personal category in the U.S. and Southeast Asia (26% and 23%, respectively), and its share is even higher in some subcategories. In the U.S., for the year ended April 2, 2016, more than half of dollar sales in the shaving-needs category (52%) and nearly one-third in toothpaste (32%) were from premium. In Southeast Asia, premium accounted for 55% of face moisturizer, 39% of face cleanser and 36% of toothpaste sales, and sales in all of these categories grew by more than double digits (24%, 24% and 18%, respectively) between 2012 and 2014. Shampoo is another bright spot for premium products. The premium segment accounted for 31% of shampoo sales in Southeast Asia; 13% in the U.K., Germany, France and Italy combined; and 10% in the U.S. And the premium shampoo segment grew by double digits in the U.S. (42% over the year ended April 2016) and Southeast Asia (14% from 2012 to 2014). In the four European markets combined, premium shampoo sales grew 9% from 2014 to 2015.

Outside these categories, however, willingness to consider a premium offering varies widely by market, due to cultural tastes and preferences. For instance, in China, cosmetics are second on the list of categories for which respondents are most likely to consider a premium product. In India, fruit juice and rice or grains are second and third, respectively, on the list of categories for which consumers will consider trading up. In Southeast Asia, vitamins are among the top three premium-potential categories; this is the only region in which vitamins are among the top five categories. Meanwhile, just over one-fifth of North American respondents say they’ll consider buying premium coffee or tea (21%), and an analysis of sales data in the U.S. shows premium liquid coffee and tea are growing at a tremendous rate. Sales of liquid coffee grew 203%, while refrigerated and non-refrigerated liquid tea grew 129% and 116%, respectively, between 2014 and 2016.

“It’s not just big-ticket items for which consumers are trading up,” said Lubel. “Many are looking for everyday items that perform better or fulfill their emotional needs or social aspirations at a price that doesn’t break the bank. This is a ripe opportunity space for mainstream brands to provide premium products that are still affordable compared to higher-tier premium services and offerings.”

Other findings from Nielsen’s Global Premiumization Surveyinclude:

Global respondents see premium products as having exceptional quality (cited by 54%) and superior performance 46%).

Forty-two percent of global respondents say they’re willing to pay a premium for products made with organic or all-natural ingredients.

Self-esteem drivers resonate with respondents who say that buying premium products makes them feel good (52%) and/or makes them feel confident (50%).

Fifty-five percent of Millennials say they’re highly willing to pay a premium for products that come with high quality standards, compared to 35% of Boomers.

It is a truism that media fragmentation has created a headache for those buying and selling media, and for those companies like us who are responsible for measuring it. Twenty years ago, the world was a far simpler place for brand advertisers: TV was king and digital advertising was a merely a ‘fad’. Fast forward 20 years and we know that digital advertising wasn’t a fad, but TV is still king and although some budgets have migrated, its resilience is broadly steadfast.

TV advertising remains strong because it’s underpinned by reliable third-party measurement and can be trusted for predicting and delivering audience reach at scale. In short, we trust TV because it’s mature, solid and reliable, and while it may not be as dynamic as digital, it consistently delivers.

In an evolving digital era, it’s another truism that tried and tested channels are being challenged and brands are finding entirely new ways to reach consumers. Accurate, comparable measurement across TV and digital is key to fully recognising how these platforms can interplay. Understanding the total audience of your advertising - and more specifically how to increase it - is one of the ways in which brands can unlock their growth potential.

Nielsen Digital Ad Ratings and Nielsen Total Ad Ratings identify the relationship between digital and TV advertising (Total Ad Ratings leverages Digital Ad Ratings as well as BARB TV data) by measuring the unique and combined reach of each platform. Since their launch in the UK (in 2012 and 2013 respectively) these solutions have helped numerous advertisers unlock their campaigns’ potential through a better understanding of how reach is delivered across devices.

Now that we have several years’ experience and scaled adoption, it’s a good a time to re-state some of the key reasons why we should care about measuring reach in the first place and share some insights from our ever expanding data set.

REACH: WHY SHOULD WE CARE ABOUT IT IN THE FIRST PLACE?

One of the fundamental laws of brand size is that big brands have larger customer bases. Nielsen’s consumer panel data backs this up, showing that brands with the highest market shares have much higher penetration and get purchased more often by their buyers. Smaller brands tend to be purchased less frequently and suffer from a pattern described in Byron Sharp’s ‘How Brands Grow’, as double jeopardy: getting hit twice with fewer buyers who buy the brand, less often.

The double jeopardy law, as described by Sharp, tells us that market share increase depends on growing the size of your customer base. Rule #1 of his seven rules for marketing is to “continuously reach all buyers of the brand’s service/product category with both physical distribution and marketing communications”. On this basis, mass marketing plans which maximise reach should provide the greatest growth potential.

Mass marketing techniques such as TV are effective at reaching large audiences rapidly but what about digital? Can it build reach as rapidly and as cost effectively as TV? Can digital add significant incremental reach, meaning reaching more potential buyers of your brand? Or can digital replace the reach provided by TV at a lesser expense?

The reality is that all of these scenarios are possible. We can only maximise reach across devices once we understand how the relationship works across devices. Only then can we start pulling the levers that will help unlock greater potential reach, and the potential for more prospective buyers to be exposed.

GREAT EXPECTATIONS: WHAT REACH SHOULD WE EXPECT FROM TV AND DIGITAL COMBINED?

Based on our findings through three years of measuring cross media campaigns with Nielsen Total Ad Ratings we’ve seen an average of 4.4% digital incremental reach against TV. But in reality, a headline figure for incremental reach is largely meaningless.

Forecasting the incremental reach (of digital over TV) is complex as it depends entirely on the relative media weight of each platform. The chart below depicts a view of expected incremental reach figures based on our Nielsen Total Ad Ratings findings. In this example, a TV campaign accounted for 75% of the overall media weight and reached 90% of its target demographic. Once the TV weight is adjusted to 67.5%, the expected incremental reach is 2.5%.

This chart illustrates is that at its broadest level, the greatest determiner of incremental reach is the size of TV campaign. What is deemed as ‘good’ incremental reach from digital will differ markedly between campaigns based on media weight and, therefore, it’s important to manage expectations accordingly.

Authored By Phil Sumner, Nielsen Client Business Partner

Asia Pacific – Mindshare, the global media agency network, that is part of WPP, has dominated the 2016 Asia Pacific new business leagues according to independent consulting firm R3.

R3, which publishes monthly new business results for both media and creative agencies covering more than 8,000 wins across 400 agencies, has officially closed out the results for 2016, leaving Mindshare a sizable lead and nearly 50% more revenue than the next closest competitor.

In addition to topping Asia Pacific overall the agency also took home the top spots in Thailand, India and China. Their wins in China alone accounted for almost half of the overall wins for the agency globally, and their domination in this market leaves them in a strong position for all multinational accounts and reviews.

This win comes as Mindshare hits another milestone as the agency turns 20 this year. Having started in Taiwan and being built with an ‘Asia first’ strategy has given the network an edge, which they have never relinquished. Their domination in Asia Pacific this year across all aspects of their business has been impressive. This year the agency boasts over 450 awards, including every major Agency of the Year competition and a Glass Lion.

Asked about the impressive growth the agency’s Chairman & CEO for AMEA & Russia/CIS Ashutosh Srivastava said:

“The vitality of an agency is driven by its ability to innovate and drive change. In this time of fast-changing technology, shifting consumer behaviour, and growing complexity in the marketing ecosystem, we have been rapidly transforming our work with clients, via a focus on both technology and talent to enable a more integrated way of working that we call Adaptive Marketing.

Winning big last year is a clear reflection of our current and potential clients being able to experience the benefits of our Adaptive Marketing approach on their campaign performance, via real-time insights which drive real-time creativity and actions in media”.

An obvious game changer for the agency this year was the launch of their ‘FAST’ team where apart from a data-driven approach to both branding and performance campaigns, they have also been pioneering client level trading desks. A practice that the agency believes is going to become essential to all marketers. Even if the agency can repeat their new business success in 2017, they expect that will only make up approximately half of their total growth with the rest coming from these types of specialist teams and services.