From the desk of Strategic Resources
For any query, discussion or feedback, please contact Pavan Chandra, Head of Strategic Resources at pchandra@zenithoptimediaindia.com, +91-124-4195100. Office Address: 10th Floor, Vatika Tower, Block-B, Sector 54 Gurgaon -122002, Haryana, India.

Volume: VIII

November, 2007

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In these hyper charged times where news comes in as fast as it becomes outdated, we need a source that can keep track of what matters to us. At ZenithOptimedia we have created Wavelength to apprise all of us of the happenings in three areas i.e. 1. Trends in Digital, Retail, OOH, BRIC, Consumers and the International Advertising 2. Media & Advertising Research 3. Environment

Also included here are innovations and news that ZenithOptimedia is making across its network globally, under three sections 1. ZO Zone 2. Fast Forward 3. Touchpoints.

Simply click on any of the sections on our snazzy control panel and you will have the latest updates at your fingertips. Wavelength will reach you in the first week of every month so that you have information that leads to insights.

Drop in a mail at pchandra@zenithoptimediaindia.com with your suggestions and comments.

Emerging Trends: Consumer

01. KidSense 2007: Survey by Walt Disney India and GroupM on kids’ media interaction and consumption habits – (Oct 16-23)

According to the Walt Disney India and GroupM survey ‘KidSense 2007’:

· For purchase decisions, Kids are most influenced by the television, followed by print and radio. As an emerging medium, the Internet scores high among boys, while radio and magazines score with girls. Kids also respond to outdoor mediums with data showing that 83% kids notice ads outside homes.

· Kids, now segmented into three categories – kids, tweens and teens – are increasingly being consulted by their parents because of their increased product awareness. Thereby going beyond merely influencing key purchase decisions.

Source: Exchange4media, Exchange4media

02. Indian Consumer Mindscapes – Oct 15

Highlights of the “Indian consumer Mindscapes” seminar by Technopak:

· Hard-pressed for time, an Indian consumer generally chooses one particular brand and sticks to it. They seek branded products and display brand loyalty. Hence, to attract them, marketers should launch or market products with strong brand identity by combining brand intelligence and brand personality. Repetitive marketing or advertising communication such as an adhoc logo or packaging changes with no unique selling propositions should be avoided.

· Marketers should aim to understand the Indian youth as they are considered consumption catalysts and want to be perceived as "cool", "fast", and "fashionable". They seek to stay connected through social sites and desire the latest gadgets. Yet, they are traditional in certain aspects. For example they generally prefer "Ghar ka Khana" (home-cooked food) over other options.

Source: Agencyfaqs, Agencyfaqs

Emerging Trends: Digital

03. Net access through PC shrinks with increasing mobile net usage – Oct 06

According to TRAI's performance indicator report, the total internet connections declined to 9.22 million in April-June from, 9.27 million in the previous quarter. Even though internet connections are falling, the number of people accessing the web through their cell phones increased by 7 million to cross the 38 million mark. This trend showcases the emergence of mobile phones as a medium for internet access.

Source: Economic Times

Emerging Trends: Retail

04. Online travel portals to open physical stores in Tier-II and Tier-III cities – Oct 11

Travel portals such as Yatra.com and Cleartrip.com, along with other players in the online travel space, are considering opening outlets in Tier-II and Tier-III cities. The purposes stated behind this expansion are customers’ need for direct interaction regarding various schemes, and the slow penetration of broadband and Internet in the country.

Source: Hindu Business Line

05. Indian employees to find abundant opportunities back home in retail – Oct 05

With the new world of opportunities, in terms of building new processes and systems from scratch, and the excitement of applying their experience in India’s $350 billion retail sector, the former ‘Indian’ employees of the retail chains abroad have already embraced the Indian retail chains. India is ranked number one in the AT Kearney Global Retail Index 2006. According to industry estimates, the organised retail market is expected to grow to $427 billion by 2010 and further to $637 billion by 2015.

Source: Business Standard

Emerging Trends: Others

06. Bluetooth advertising – a relatively new concept in India – Oct 24

Bluetooth Advertising, though not new globally, is a relatively new concept in India. TELiBrahma Convergent Communications, a mobile solutions provider, has entered into a partnership with Commercial Street, a shopping area in Bangalore, to introduce what it calls ‘Blue Genie’, or a Bluetooth advertising solution. The Commercial Street is to be converted into a Bluetooth zone, and consumers will receive multiple advertising offers using the technology. Bluetooth is a zero cost and advertiser as well as consumer-friendly application. The relevant advertising messages are passed on to consumers at the point where consumers are most likely to make a purchase decision, such as in a shopping area.

Source: Agencyfaqs

07. Phone user base reached the 250 million mark – Oct 23

According to The Telecom Regulatory Authority of India (TRAI), with nearly six million new subscribers being added every month, the December 2007 target of 250 million has been achieved in October. The telecom body further said that “the 500 million targets by 2010 is a reality”. The total wireless subscribers reached 209.08 million in September 2007, with an addition of 7.8 million subscribers in September compared to 8.31 million additions in August. From April to September of 2007, 42.8 million telephone subscribers have been added compared to 29.7 million during the corresponding period in the previous year.

Source: The Hindu Business Line

08. Advertisers coming up with new mobile advertising solutions – Oct 23

With regulatory restrictions on mobile-based marketing and advertising activity, advertisers are exploring fresh solutions to reach their target audience through mobile phones. Companies such as Reliance ADAG and Paymate, a Mumbai-based mobile commerce firm, are developing solutions to tap the potential of the mobile phone. Solutions such as selling advertising spaces on SMS’s, which provide customer related data, sent to consumers are coming up. According to Mahesh Prasad, president of applications, content and solutions group for Reliance Communications, "The biggest advantage of these solutions is that it allows the customer to opt out at any point of time.

Source: DNA - Daily News & Analysis

09. Telecom operators targeting rural audiences – Oct 16

With over 200 million mobile subscribers in India, the next mobile revolution is going to come from smaller towns and villages. Industry estimates show that 35-40% of mobile customers are from rural areas. Telecom operators and content providers are targeting the rural audiences, according to their rationale, with no access to the Internet, as the only way a rural person can get access to instant information is through a mobile handset. Companies such as Reliance Communications, Reuters and Ericsson have already started developing information-based mobile services.

Source: Agencyfaqs

10. MipCom 2007 – Oct (8 - 12)

At the MipCom 2007, the international audiovisual content trade show, held at Cannes, from Oct 8–12, the following insights regarding Indian audiovisual industry emerged:

· The key factors, which will make the Indian media industry global, are the future revenue models, the evolution in content, and the role of Indian media companies.

· FICCI and Ernst & Young unveiled their survey ‘Indian Content on the Move’, which revealed that most Indian companies allocate less marketing expenditure for overseas marketing, as they concentrate more on the Indian market. The Indian urban audience demands more innovative and unique film content than the one that existed till now. With digitization of content, media has been able to reach niche audiences without spending too much and even piracy has been controlled in a few platforms.

· Gaming and animation will be the future of the Indian audiovisual industry.

Source: Exchange4media; Exchange4media; Exchange4media

Emerging Trends: International

11. Media publishers tying up with bloggers for more revenue– Oct 23

According to Standard & Poor's Equity Research, major media publishers are tying up with bloggers to increase their readership and ad revenues. Blogs provide the advantage of capturing a niche audience with their particular voice and point of view, and increase the potential for implementing targeted advertising. It also helps in targeting younger generations as they prefer new media. Internet segment companies such as CNET, Google, IAC/InterActiveCorp (IACI) and Yahoo! are also planning to pursue blog-related opportunities via content, advertising and tools.

Source: Media Post Publications

12. Online ad market to grow – Oct 12

According to the "The U.S. Interactive Marketing Forecast" by Forrester Research, the online ad market will exceed $61 billion by 2012, with ad spend evenly distributed among various channels. Interactive marketing growth over the next five years will be driven by mainstream businesses that will use innovative interactive tools to engage customers in new ways. Social media, display ads, and e-mail marketing will play a significant role as the most used medium of marketing.

Source: Media Post Publications

13. Neilsen survey on consumer attitudes toward various ad media – Oct 08

According to a global survey conducted by Neilsen, newspaper ads top the credibility index as 77% of the surveyed respondents trust the medium. Newspapers are followed by online comments (73%) posted by the peer users about the advertised product or service and television (65%). Only 24% believe in SMS ads, with three out of four persons rejecting mobile ads. Six of the top ten markets that rely most on recommendations from consumers are in Asia—showing that Asians are the top believers in the word of mouth. Hong Kong led the list with 93% saying they trusted what others said or thought of products, followed by Taiwan (91%), Indonesia (89%), India (87%), South Korea (87%) and Philippines (86%).

Source: Tmcnet.com

14. Deliverability to remain a key component in email marketing – Oct 04

Deliverability remains one of the hottest topics in email marketing. Marketers are still struggling with relevancy, list hygiene, and white lists and bounce management. To evaluate the success of major online retailers in managing their sender reputations—which is one of the keys to deliverability—the Email Experience Council examined sender addresses used by 95 retailers during the past 18 months. As per the result, a third of them used more than one email address to send their core marketing emails during the past 18 months. In 2007, 11% of the major online retailers sent welcome emails from a different email address. However, 75% of those retailers moved toward using a single sender address for all their core email marketing campaigns, including both welcome and regular emails.

Source: Media Post Publications

15. Shopper marketing to boost sales – Sep 28

According to a study by Advertising Age, the fastest-growing medium is not the internet, but shopper marketing, a new-age marketing discipline that aims at converting `shoppers into buyers' at the retail outlet. Among the 19 packaged-goods manufacturers surveyed, the share of shopper marketing in the overall marketing budgets grew from 3% in 2004 to 6% in 2007. Furthermore, the manufacturers expect the share to reach 8% of the marketing budgets by 2010.

Source: Adage

BRIC Zone - China

16. Growing middle and upper class income drives Chinese department store market growth– Oct 21

According to Erica Pon Werkun, head of China/Hong Kong consumer research, UBS, increasing consumption levels and growing middle- and upper-class incomes have resulted in growth in the department store market. There is aggressive expansion nationwide which is putting pressure on operators to offer favourable rates to concessionaires to attract brand names to new stores. Department stores are carrying aggressive promotion and marketing. According to Jessie Qian, regional consumer and media analyst, Macquarie Research, the market in top-tier cities is saturating and giving an opportunity to operators such as Parkson, a foreign-owned retailer, to grow further.

Source: South China Morning Post

17. China’s youth has an annual spending power of nearly $135 billion– Oct 17

According to a report titled "The Phoenix Generation: Insight into China's Youth" by Pearl Research, China's youth (age group 16-20 and 320 million in strength) has an annual spending power of nearly $135 billion and enjoys unparalleled access to electronic media and foreign consumer goods.

Source: Media Post Publications

18. Retail sales of consumer goods in China to reach approximately RMB 350 billion – Oct 09

In the National Day Golden Week, 7-day national holidays, the total retail sales of consumer goods were approximately RMB 350 billion, up 16% over 2006. The retail sales were boosted by the abundant supply of commodities as well as the robust consumer demand. However, according to the Ministry of Commerce, the prices of basic necessities remained stable.

Source: China Knowledge Press

19. China’s rural net users reach 37.41 million in H1'07 – Oct 06

According to the National Development and Reform Commission (NDRC), Internet use has expanded rapidly, with number of rural net users reaching 37.41 million by H1'07, approximately 5.1% of the total of rural population. Urban netizens have grown to 125 million, which is 21.6% of urban population. The rapidly improving telecommunications infrastructure in rural areas has facilitated the increase of net users. Young farmers and migrant workers are the primary net users in rural areas.

Source: The Press Trust Of India Limited

20. 2008 Beijing Olympic Games accelerating internet and mobile advertising in China – (Sep 28 – Oct 11)

With the approaching 2008 Beijing Olympic Games and the country’s increasing focus on network and mobile advertising, the total revenue from the Internet industry is expected to increase by 53.07% in 2007, approximately 1% higher than the initial forecast of 52.2% in January 2007. In addition, China's mobile advertising industry is expected to achieve over RMB 1.3 billion ($173.11 million) in revenues during 2008, which, in turn, will help in raising total industry revenues by 66.7%.

Source: China Knowledge Press; China Business Newswire

BRIC Zone - Brazil

21. Brazil Sep ’07 supermarket sales rise 5.37% year-on-year – Oct 25

According to supermarket sector association Abras, Brazilian supermarket sales increased by 5.37% year-on-year in real terms during September 2007. In nominal terms, Brazil's supermarket sales increased 0.72% month-on-month and 9.74% year-on-year. In the nine months ended September 2007, supermarket sales in the country grew by 6.46% year-on-year in real terms and by 10.11% year-on-year in nominal terms.

Source: Latin America News Digest

22. Internet advertising to reach R$470 million in 2007 – Oct 01

According to the IAB (Interactive Advertising Bureau), Internet advertising has expanded 40.16% in H1’07 to reach R$221mil, compared to the same period in 2006. The increase in internet advertising is supported by growth in PC sales and Internet user base, which is expected to reach 40 million by the end of 2007.

Source: IT Digest

BRIC Zone - Russia

23. Retail sales in Russia on the upswing – Oct 19

According to the Russian Federal State Statistics Service, Russia's retail sales grew 15.4% to $37.8 billion (RUR 940.1 billion) in September 2007. Between January and September, retail sales increased 14.8% to $301 billion (RUR 7.511 trillion), compared to the same period in 2006.

Source: RosBusinessConsultings

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