Advertising and magazines Adam Smith Head of knowledge management ZenithOptimedia 26 th April 2005

ZenithOptimedia One of the leading global media services agencies 4,000 employees 162 offices in 59 countries Owned 100% by Publicis Groupe SA

How we forecast ad expenditure Historic base of actual spend from 1980 Four year forecast from local offices ‘Top-down’ analysis in London

Forecast headlines Stable global economic growth Corresponding growth in adspend Direct and interactive spend rising fastest

Stable growing world economy Gross Domestic Product: year-on-year % change in current prices Source: ZenithOptimedia

Major media* adspend growing Source: ZenithOptimedia * TV, Print, Radio, Cinema, Outdoor, Internet Adspend: year-on-year % change in current prices

Global adspend v GDP yr-on-yr % change (at current prices) Source: ZenithOptimedia

TV and internet gaining share $bn TV Newspapers Magazines Radio Outdoor 8% 36% 13% 6% 38% 9% 30% 14% 5% 38% 29% 13% 8% 5% 36% Source: ZenithOptimedia Internet 3% 5% $217bn $355bn $417bn Global adspend by media type

Magazine and newspaper share: world Source: ZenithOptimedia Newspapers Magazines

Magazine and newspaper share: Asia- Pacific Source: ZenithOptimedia Newspapers Magazines

Internet users developed markets and 14 emerging Source: ZenithOptimedia Developed Emerging Combined

Internet: no ceiling in sight Source: ZenithOptimedia Europe N. America Asia-PacWorld

Media adspend – declining share of marketing Spend 2004 v 2001 % change (US, Japan, Germany, UK, France) Source: Marketing Expenditure Trends Report, London Business School

Achieving ROI Ninah Consulting Econometric modelling Touchpoints Consumer contact audit The ROI Blueprint Practice manual

Retail Point of Sale Face-to-Face Customer Service Outdoor Mail Event/ Sponsorships Magazines Radio Newsprint Delivery Fulfillment Television Telemarketing Fax Placement/ Product Sampling Branded Games Banner Ads Full-page Banners Branded Mobile Phone Sites iTV Elevator Advertising Household PDAs Branded ScreensViral Mail Mobile Mkt. PDAs PVRs Telematics Screens on Exercise Bikes Image Content Scanner Bar Code ScannerBranded CDs Branded Web Content Brand to consumer

Media consumption % share of time % share of the average person’s media time Source: ZenithOptimedia

Media reach atomising High reach Low reach Personal Communication Mass Communication Analogue TV Radio Cinema Posters Print Digital TV PC Internet Mobile internet Source: ZenithOptimedia

Creatingawareness Mass media Integrated marketing Generatingresponse Direct Media Enhancingexperience Interactive Media Aim here

Honey – conventional media TV (lots of satellite) Press (7-19 year-olds) Radio

Honey – EMAP media partnership Dance competitions with local DJs On-screen ‘Bug’ on Kiss TV; advertorial in magazines Microsite linked to EMAP websites

Conclusion Traditional media good for cash, harder for growth New media good for growth but harder to manage Brand more vital in age of excess choice Brand defined by users not producers