Origin Energy Regional Market Review November 2011

RTM is the marketing bureau for Regional free to air TV

Regional markets require a nuanced approach to fulfill maximum return to Origin Regional people have bigger homes and more kids – likely to be high consumers of energy and engaged with the category Regional consumers – like all Australians – are very aware of corporate social and environmental responsibility Community invovlement and support through the media has far greater meaning in Regional Oz than in the capital cities

Regional TV covers all areas outside capital cities and reaches 36% of population QLD NNSW SNSW TAS VIC REG. WA DIARY

Regional TV coverage includes large cities and fast growing coastal suburbs Newcastle & Central Coast Gold Coast Wollongong & Illawarra Canberra

Diary markets: 19% of total regional population Regional WA Port Pirie/ Broken Hill Satellite Griffith Mildura Darwin Loxton/Mt Gambier

Populations of major regional TV markets are comparable with the metros People Source: ATR & OZTAM 2011, Nielsen Media Research 2010 NNSW 2,079SNSW 1,410

Population Increase: 2001 vs Source: ATR & OZTAM 2011 Australian population moving North and to the coast. Over 30% growth in 10 years in some regional areas National average QLDNSWVICTASMETRO

Urbanisation and high population growth changing the profile of regional Australia Seachange: Baby boomers and young families Lower cost of living and lifestyle are main attractions Rural populations moving to regional hub towns Less than 4% of households depend on farming

Regional energy consumers are more likely to live in a house and have bigger family Source: Roy Morgan Research (12 months to June 2011)

3 % 7 live in Regional TV markets Source: OzTam AGB Nielsen ,573,000 Australian teens age 13-17

3 % 8 live in Regional TV markets Source: OzTam AGB Nielsen ,547,000 Australian GB’s with children 5-12

3 % 8 Source: OzTam AGB Nielsen ,141,000 Australian 55+ live in Regional TV markets

Seachange… … for baby boomers …for families

“Typical” Seachanger Ryan, 36. Wollongong NSW Made the seachange from the “Shire” to the “Gong”. Owns a small business in building trade Above average income & primary focus is kids and lifestyle. Loves footy, cars and teaching kids surfing.

Savings are at an all time high in both regional and metro markets Saving per discretionary $1000 Source: foreseechange 2005 – 2010: annual average, 2011: June 2011 survey

The need to pay debt continues to decline in regional but is growing in metro markets Source: foreseechange 2005 – 2010: annual average, 2011: June 2011 survey Loan Repayment per discretionary $1000

Regional consumers’ willingness to spend grew this year by 9% – against national trend Source: foreseechange 2005 – 2010: annual average, 2011: June 2011 survey Spending per discretionary $1000

Home price to income ratio is significantly lower in regional TV markets House price vs. income multiple Source: Residex median house *(includes apartment price) Jan – Jun 2011 & Roy Morgan Single Source 12 mths to March 2011

Average household incomes in regional TV markets are within 10% of national average Source: Roy Morgan Single Source (12mths to Mar 2011 ) P25-54: Average household Income

Incomes in regional and rural Australia are growing well above the national average Average household income growth since 2004 (P25-54) Source: Roy Morgan Single Source (12mths to Mar 2011 – 2004 )

Regional consumers are more optimistic about their current financial outlook… …and are more likely to spend on discretionary items over the coming year.

Attitudes to environment and corporate social responsibility – foreseechange Nov Australian are overwhelmingly favourable to the participation of companies in social and environmental good. The degree of support does not vary significantly between adults in Metro, Regional city, and rural areas There is a high degree of skepticism about what companies say they do for the good of the community and the environment. Corporate social responsibility should, therefore, be genuine, both in appearance and delivery.

Source: Roy Morgan Single Source (12mths to June 2011) Regional attitudes towards the environment marginally more conservative – age is a bigger differentiator

Companies should concentrate on making profits and forget about social & environmental issues Source: foreseechange 2011

Companies should not donate to charities Source: foreseechange 2011

Companies should not donate to political parties Source: foreseechange 2011

So long as the quality is the same, would pay up to 5% more for a product made by a company that did good things for the community Source: foreseechange 2011

So long as the quality is the same, would pay up to 5% more for a product made by a company that did good things for the environment Source: foreseechange 2011

Most companies talk about being socially & environmentally responsible but don’t actually do much about it Source: foreseechange 2011

News & current affairs Local TV ads Promotions Community sponsorships Regional TV is part of the community… “We live here too” …means greater engagement

Creating a regional voice for a brand will improve preference, loyalty and cut through True local (Newcastle Permanent, Southern Phone Company) Product offer localised (TCW, Rural bank) Tone of voice or context localised (youi, Greater Building Society, LaTrobe Uni) Support for local community (CBA Kids Cricket, NAB AFL, Surf Life Saving etc etc)

Regional consumers will reward Origin’s overt support and communication Opportunity is for Origin to take a leadership role in regional communities on environmental energy issues Regional consumers will reward value and honesty in business Regional FTA TV has reach and credibility far beyond any local media