In case you missed it, comScore recently released a report on the global state of social networking, entitled It’s a Social World: Top 10 Need-to-Knows About Social Networking and Where It’s Headed. In the report, we examined the current state of social networking among online users around the world.

Over the past few years, social networks have evolved to become an integral part of the online experience, providing the means for users to facilitate offline connections and build new ones online. In the process, social networks have shaped the way we communicate and have even cultivated new social behaviors. Indisputably, the way we keep in touch with friends, find recommendations, and share ideas with others has changed with the advent of social networking.

Here are three of our key findings, which you can find in the full report available for download or in the accompanying presentation embedded below.

Social Networking is the most popular online activity worldwide
In October 2011, 1.2 billion users around the world visited social networking sites, accounting for 82 percent of the world’s population. Nearly 1 in every 5 minutes spent online around the world is now spent on social networking sites, making Social Networking the most popular content category in engagement worldwide.

Microblogging has emerged as a disruptive new force in social networking
Microblogging, a way of communicating through short-form content, has emerged as a leading social networking platform over the past few years, led by Twitter. In October 2011, Twitter reached 1 in 10 worldwide Internet users, reflecting its emergence as a leading global social network. Other microblogging platforms on the rise are Tumblr and Sina Weibo.

Mobile devices are fueling the social addiction
As mobile devices provide users with the means to connect on-the-go and interact in real-time, they show promise in taking social networking even further. Nearly one third of the U.S. mobile population age 13 and older accessed social networking sites at least once in October 2011. Across five leading markets in Europe, nearly a quarter of the mobile population reported doing so as well. With smartphones driving even more frequent social networking use through apps and the emergence of tablets, we expect mobile social networking to be the wave of the future.

“Why do some of my ad campaigns drive offline sales while others don’t?” This is one of the most common questions I receive from our clients, and the answer often resides – at least in part – in the quality of creative used. For this reason, I’m doing a 5-part blog series outlining proven techniques for designing effective digital creative. In each post, I will outline one technique along with its supporting research and case examples. I hope you enjoy them and look forward to hearing your comments and questions.

Technique #1: Include traditional branding elements in your digital executions (AKA Teaching a New Dog Old Tricks)

Based on years of research in the traditional media space, we know that the inclusion of key branding elements – such as brand differentiating key messaging, new product/feature information, convenience demonstrations, competitive comparisons, superiority claims and explicit value statements – helps to increase the likelihood of the ad to drive sales. But can these same approaches be effective for digital creative?

A recently released analysis by comScore and dunnhumbyUSA reported that five out of every six online ad campaigns we analyzed showed a positive lift in offline sales and a median lift of 21 percent. These findings were based on matched comparisons of the offline buying of households exposed to the advertising versus households who were not exposed.

As an extension to this analysis, we coded the presence of the above mentioned branding elements in the creative used in the campaigns. A clear pattern emerged. The campaigns that garnered the highest offline sales lift used these traditional branding elements at a substantially higher rate than the ads with the lowest sales lift (64% vs. 25%). Even more striking, of the 17 percent of campaigns that exhibited no offline sales lift, not a single one utilized any of the branding elements. This strongly suggests that the increased use of traditional branding elements in digital advertising will significantly improve the odds (and magnitude!) of offline sales lifts.

Problem solved, right? Well, there are still two major obstacles to overcome. The first is that it isn’t always possible to effectively include some of these branding elements in digital advertising. Typical display advertising, for example, often doesn’t provide the same “real estate” as full-page print ads or the same exclusivity of temporal attention as television ads. This is certainly one reason why we have seen a much lower percentage of ads containing key branding elements in digital advertising compared to TV and print advertising (see below chart).

Interestingly, however, many new digital ad formats are helping to overcome this hurdle. Good examples are AOL’s Project Devil, a large format premium ad unit with interactive panels, and Expo Communications’ user generated video reviews, full-motion, full audio alternative to text-based feedback. Additionally, creative agencies are becoming very adept at incorporating key branding elements into even the most basic of display ad formats. At the end of this post are images drawn from some recent, strong examples of this evolving ‘minimalist’ art.

The second obstacle to incorporating traditional branding content is the fact that its presence alone cannot ensure success. This inherently means that not only should brands experiment with several iterations of an ad pre-launch, but they should also invest in creative pre-testing. Testing has proven that even the most minor changes in how the branding message is delivered – in both traditional and digital formats – can have a major impact on advertising performance, and certain selling propositions can defy classical classification and still be highly effective.

I’ll conclude with one of the most popular quotes from the “Father of Advertising,” Mr. David Ogilvy, “The most important word in the vocabulary of advertising is test. If you pretest your product with consumers, and pretest your advertising, you will do well in the marketplace.” Even today, in a world where advertising has fragmented across platforms, his wisdom shines through. Marketers who place value in pre-testing have been able to truly leverage the power of digital as a branding medium that not only lifts sales online, but also in offline stores

Check back soon for my next post in this series, and feel free to send comments or questions to ffindley@comscore.com.

Examples of Traditional Branding Content in Display Advertising

Brand Differentiating Messaging

New Product/Feature Information

Convenience Demonstration

Competitive Comparison

Superiority Claim

With 2011 behind us, I thought you might be interested in some observations regarding what the holiday shopping season told us about the state of the consumer economy.

comScore reported that e-commerce had a strong season, with sales for the period from Nov 1 through Dec 25 increasing by 15 percent over the corresponding days the year earlier. The National Retail Federation reported that it expects total sales to be up about 3.8 percent versus year ago, which falls short of the 5.2 percent growth recorded during the 2010 shopping season, but is still a respectable growth rate. Nonetheless, with a growth rate about 4x faster than total spending, it’s clear that consumers continue to be attracted to the convenience and lower prices offered by the Internet.

So, how should we interpret these data? Are we seeing an improvement in the U.S. consumer economy? The answers seem to be mixed.

One reason we’re seeing increased consumer spending may be because the personal savings rate — the percentage of after-tax income that is not spent — fell to 3.5% in November from 3.6% in October. As recently as June, households were saving about 5% of their earnings. And, until July, the savings rate had consistently been at 4.5% or higher since late 2009. The latest savings rate is still better than the housing bubble months of 2005-07, when it generally hovered between 1% and 2%. Even so, the recent drop in saving indicates that although consumers want to buy things they put off during the shaky recovery, they don't have the income growth to support a more robust ramp-up in purchase activity.

Another reason for increased spending is likely because debt has been increasing. The government recently reported that household borrowing on credit cards, car loans, student loans and other kinds of installment debt rose at a 9.9% seasonally adjusted annual rate in November, the fastest monthly increase since November 2001.

On the jobs front, we’re seeing slow improvement. The government reported last week that December’s unemployment rate fell to 8.5% from 8.7% in November. That’s the lowest level in three years, suggesting that the U.S. recovery is gaining traction despite high oil prices and European turmoil. The economy added 200,000 jobs in December, double November's pace, with all of it coming from the private sector. This good news, however, was tempered by the fact that the labor market still faces big challenges. More than 13 million workers are jobless and another 10 million are underemployed, and it will take years—even if job creation accelerates sharply—to whittle down that number. Most economists agree that about 125,000 jobs need to be created each month just to keep pace with the growth in the population.

Finally, it’s clear that the consumer economy continues to be under stress. Going in to the holiday shopping period, comScore surveyed consumers regarding their view of economic conditions and found that 60 percent considered them to be poor, approximately the same level we observed six months earlier.

Consumer spending this holiday season was boosted by retailers, who were very active with promotions and discounts, both online and offline. In addition, online retailers offered free shipping to a degree we haven’t previously seen:

Each year, it seems that retailers’ promotions occur earlier in the season. This year was no different, with attractive deals appearing well ahead of Thanksgiving. Shop.org estimated that more than 90 percent of online merchants offered promotions over the Thanksgiving weekend, with 8 out of 10 offering promotions on Cyber Monday also. As a result, we saw Cyber Monday rank as the heaviest shopping day of the season for the second consecutive year, with total sales of $1.25 billion. At the same time, as consumers’ confidence in shipping has increased we’ve seen heavy online buying also occur later in the season. This year, for example, 2,600 merchants participated in Free Shipping Day (Friday December 16), offering free shipping with guaranteed delivery by Christmas Eve. Consumers responded enthusiastically, spending $1.072 billion and making it the sixth heaviest buying day of the season – which is particularly notable since Fridays tend to be one of the lighter online spending days of the week.

Consumer response to retailers’ deals on Cyber Monday was so strong that a significant shift occurred in the time of day that purchases were made online:

As a result of retailers’ heavy communication of deals ahead of Cyber Monday, coupled with consumers’ ability to easily locate them using both fixed and mobile Internet connections, we saw a significant increase in early morning buying as consumers chased deals to make sure they got them before they were sold out. And with retailers continuing to push promotions throughout the day, we also saw heavy buying continue later into the evening than in previous years.

So, the picture on the consumer economy is blurry. Spending is up but so is debt. At the same time, the savings rate is dropping. And while unemployment is slowly declining, the rate of new job additions is still slower than we would like to see at this stage of the recovery. We also can’t ignore one other key question that will remain unanswered until retailers report their financial results for the holiday season: to what degree have discounting and free shipping depressed gross margins? Because, while growth in consumer spending is on balance a good thing, if it does not yield higher profits for businesses then it’s unlikely to promote continued growth in jobs.

Brazil’s social networking market has a new leader. Earlier this week comScore released results showing that Facebook surpassed Orkut in December, becoming the largest social networking destination in Brazil for the first time.

Facebook’s ascent in Brazil is impressive with the site gaining 23.7 million unique visitors in the past year, tripling its audience and rapidly narrowing its gap with long-time market leader Orkut. Facebook closed out the year reaching 36.1 million Brazilians to secure the #1 spot in the market.

Perhaps even more impressive than Facebook’s audience growth is the rapid increase in engagement among its users. In only 12 months, average time spent on Facebook went from just 37 minutes per visitor to nearly 5 hours, making it the third most engaging web property in the country behind Microsoft Sites and Google Sites.

As discussed in the recent comScore study It’s a Social World, Brazil was one of just a handful of global markets where Facebook did not lead the local social networking category – until now.

A closer look at the top 10 fastest-growing markets for Facebook in terms of site visitors revealed that more than half of these were countries where Facebook either did not lead until very recently or where the site does not currently lead. Vietnam, which in December 2011 was the fastest-growing Facebook market when compared to the previous year, saw Facebook surpass local site Zing Me in November. Brazil, the second-fastest growing market for Facebook and largest in terms of absolute visitor increase, saw the site take the lead in December. In the Netherlands, the sixth-fastest growing market, Facebook surpassed local destination Hyves in July 2011.

In four of the top-gaining markets – Japan, South Korea, Russia and Poland – Facebook does not currently lead the local social networking ranking. But given Facebook’s growth in these markets, and if the example of Brazil is any indication, there is a likely chance that Facebook will capture the lead in at least one of these countries (and perhaps more) during 2012.

comScore recently released a report titled Next-Generation Strategies for Advertising to Millennials highlighting results from a study of the unique characteristics of this generation and how to effectively market to them across media. Figure 1 illustrates how trends of advertising effectiveness among differing age groups have stayed consistent over the last 50 years, with older audiences tending to generate higher lifts in Share of Choice (comScore’s advertising effectiveness metric) compared to younger audiences – Millennials being no exception as illustrated by the 2011 study.

Figure 1: Average Lift in Share of Choice among Older versus Younger Groups

At the core of the comScore report is the concept of targeted advertising, which enables marketers to more effectively reach a specific audience and address its unique needs rather than attempt to win over all segments of the population with one general message. Advertisers are recognizing the advantages of dividing consumer markets in an effort to increase share among specific, more valued segments deemed to be prime targets for their products.

The degree to which population segments are targeted tends to vary across advertisers. African Americans, for example, are a group targeted by marketing heavyweights Procter & Gamble and McDonald’s, who spend nearly $90 million and $38 million, respectively, advertising to them in one year alone¹. These examples are not typical, however, as the majority of marketers don’t target advertising to African Americans. In fact, of the $263.7 billion spent annually on advertising within the U.S., less than one percent targets African American consumers² . Why is this important? African American buying power is currently at an all-time high and is forecasted to exceed 1 trillion dollars by 2012³ , and there is an increasing amount of research demonstrating that African American audiences react positively to African American-targeted messages (Appiah, 2004). Thus, targeting this segment can be valuable for marketers.

Previous research has shown that African American consumers sometimes respond more favorably to ads that feature an African American cast compared to ads featuring a non-African American cast (Whittler, 1991). Simply manipulating the ethnicity of an ad’s cast may be a more cost effective alternative to developing an entirely different campaign. This claim is supported by results from comScore’s creative testing database. African American responses to two types of advertisements – those with an African American cast, and those without an African American cast – were compared using data sets balanced by product category. Over half (57%) of the diagnostic items examined scored significantly higher for ads that contained an African American cast.

Figure 2: African American Diagnostic Elements with Statistically Significant Differences (95%+ Confidence Level) between Ads with and without an African American Cast

Although a relationship can be observed between the response to advertising by an African American audience and the ethnicity of the cast, perhaps there is yet another layer of differentiation that should be taken into consideration. Some research suggests that factors in addition to using relevant images (i.e., cast ethnicity) -- such as the audience’s identification with its own ethnicity -- can also affect the extent to which an ad is received positively (Green, 1999). In other words, some research proposes that African Americans’ response to African American-targeted advertising is mediated by their level of ethnic identification. For example, a study revealed that African Americans with strong ethnic identities responded more favorably to African American-targeted media compared to media that was targeted to Caucasians. Conversely, African Americans with weaker ethnic identities displayed no difference in responses between the two types of media (Appiah 2004). While these findings contribute critical knowledge to the field of marketing research, it involves a construct (i.e., ethnic identity) that isn’t easily or efficiently accessible to marketers in the creative development stage of targeted advertising.

Similarly, another point of view contends that contrasting age groups experience and interpret their environment differently based on the state of societal norms. This may especially be true in the case of African Americans due to the dramatic shifts in civil rights that have occurred in the last century. Is it possible that an individual’s identification with his/her ethnicity is largely dictated by age, and this in turn dictates his/her cultural lens?

Ellis Cose might agree. In a recent book (titled The End of Anger: A New Generation’s Take on Race and Rage) Cose discussed various segments of African Americans that were a direct result from his research on age groups. The oldest group experienced much of the horrors of life during the times of segregation, the civil rights movement, and other racial struggles endured near the middle of the 20th century. While the following generation wasn’t directly involved with the civil rights movement, they were the first group of African Americans to break down walls of segregation at many institutions (e.g., universities, corporations, etc.). Finally, the youngest group termed “Believers” by Cose and roughly analogous to the Millennial generation, is a segment of African Americans who were raised in a world where explicit demonstrations of racism were condemned. This group, according to Cose, is likely to believe that racist barriers no longer apply and that no group is limited based on skin color.

Another comScore study used the comScore Share of Choice metric to determine ad effectiveness. Ads were separated into two groups: those with an African American cast, and those without an African American cast. Next, respondents were categorized into three age groups similar to those discussed by Cose — the youngest being the Millennial generation (age 16-29 years) and the oldest we term Seniors (age 50+ years). Finally, respondents were split into groups according to their ethnicity, focusing on African Americans and Caucasians only.

In the case of the non-African American casted ads, we see that Senior Caucasians scored substantially higher than the younger Caucasian Millennials. This aligns with comScore’s finding of older individuals generally being persuaded more easily. However, Senior African Americans’ results were, on average, nearly identical to those for the younger African American Millennials, indicating they are similarly persuaded in the case of non-African American casted advertisements.

Figure 3: Average Lift in Share of Choice for Non-African American Casted Ads (N=116)




We found the trend to be quite the opposite, however, when the cast was of African American ethnicity. Here we see the older group of African American Seniors scoring much higher than younger African American Millennials, which aligns with the general findings. Senior Caucasians, however, actually scored slightly lower than their younger Caucasian counterparts in the case of African American casted advertisements.

Figure 4: Average Lift in Share of Choice for African American Casted Ads (N=24)

These results suggest that, among African Americans, the older generation possesses strong ethnic self-identification likely based on their experiences with racism and the civil rights struggle, which in turn affects their perceptions of advertising communication. This can be seen both in the lack of typical lift versus younger African Americans when exposed to non-African American casted advertising and also the large lift versus the younger generation for advertising with an African American cast.

The findings for older Caucasians essentially mirror African American results. This suggests the presence of strong ethnic self-identification among older Caucasians and possibly lingering biased tendencies among some in this generation.

Interestingly, one could argue the trends are extremely similar to those revealed by Appiah (2004) if the age variable in the current study was used to represent ethnic identification level. Perhaps future research should examine the relationship between age and ethnic identification which may shed light on how the younger generation is altering societal views on race.

It is also both interesting and encouraging that among the Millennial generation, African Americans actually scored directionally higher than Caucasians for non-African American casted ads (5.5 vs. 4.4), and Caucasians scored higher than African Americans for African American casted ads (5.6 vs. 4.2). This should not be interpreted as saying that the younger generation responds better to advertising containing a cast of a different ethnicity from themselves. Rather, it is evidence that Millennials may be less affected by racial disharmony and barriers felt by preceding generations.

As for targeted advertising, these findings support the notion that it is critical for marketers to be able to identify their target audience so creative development can be tailored to optimize effectiveness. Using African American-targeted advertising when the intended audience includes older African Americans is likely to be worthwhile in terms of sales effectiveness. However, when the target is younger African Americans, there isn’t strong evidence of a payoff from the use of an African American cast.

For those of you who may not be aware, Saturday, January 28th is the fourth annual Data Privacy Day, a day devoted to promoting best practices to help equip business and consumers to protect their online data and privacy. comScore is delighted to be helping lead this effort as Data Privacy Day Champion.

In support of this critically important issue for our industry, I particularly enjoyed participating in the OnlineTrust Alliance panel at the Mid-America Club in Chicago this week along with three industry leaders: C. Steven Baker, Director of the Federal Trade Commission, Midwest Region; Chris Babel, CEO of TRUSTe; and John Roberson, Executive Director, Small Business Development & Resource Center, Chicagoland Chamber of Commerce. The panel was moderated by Craig Spiezle, Executive Director & President, Online Trust Alliance.

From Left to Right: Chris Babel, John Roberson, Craig Spiezle, C. Steven Baker, Gian Fulgoni

The panel focused on the importance of privacy and data protection for businesses large and small in the digital information age. Never has it been more important for any business to adhere to best practices and establish the proper procedures and protocols to prevent data incidents from occurring. In fact, I made the point during the panel discussion that I believe privacy and data protection should rank high on the priority list of every company CEO.

As a market research data and business analytics provider, comScore has long recognized the importance of this philosophy. In fact, I wrote a blog post about this several years ago that you can read here. comScore has invested substantial resources in making our data collection and privacy practices the best they can possibly be. Central to this effort is adhering to industry-accepted best practices regarding the collection and secure storage of the data collected by the software that our panelists provide us explicit permission to install.

The panel agreed that the vast majority of businesses want to get data privacy and protection right and do right by their customers. But to achieve this end, we must remain vigilant as a community, be proactive in our collective approach to these issues, and continue the education process so that businesses that are not adhering to best practices can get on board. It can take years for businesses to establish trust with their customers, yet erode that trust with a single incident of data loss, so taking proactive steps to ensure such issues never arise is vitally important in this day and age.

We thank the OTA for hosting this valuable event with us, and we look forward to continuing to champion the causes of data privacy and protection.