Havas today confirmed it has acquired a majority stake in crowdsourcing agency Victors & Spoils, the Boulder, Colo. shop that was founded in 2009 by former Crispin Porter + Bogusky vice presidents Evan Fry and John Winsor and Claudia Batten, a co-founder of gaming platform Massive. V&S is credited with being one of the first agencies to use “crowdsourcing” as a business model, which links virtually limitless numbers of talent by technology to brainstorm on client ideas. V&S' client roster includes Chipotle, Coca-Cola, Converse, Crocs, Discovery Channel, Dish, GAP, General Mills, Harley Davidson, Levi’s, Mercedes Benz, Oakley, PayPal, Smartwool, Smashburger, Unilever, Virgin America and WD-40. One of the first projects under the new ownership is to implement V&S’s proprietary technology to convert Havas’ own global network into 15,000-strong “crowd.” V&S’s own crowd stands at about 6,000. V&S will be folded into Havas Worldwide, the holding company’s flagship agency, but will retain the V&S branding. Winsor confirmed that plans are in the works to expand V&S to Europe and Asia, starting most likely with offices in London, Paris and Hong Kong. Winsor, CEO of V&S, is taking on the additional role of chief innovation officer at Havas, reporting to Havas CEO David Jones. In his new role, Winsor will focus on the latest digital technology advancements and opportunities for Havas to embrace them. He’ll also consider applications of new business models and talent. Winsor will remain based in Boulder. In an interview, Winsor said V&S had not really put out a “For Sale” sign on the agency. Rather, the acquisition came about as the result of a budding friendship with Havas’ Jones. The two first met about a year and a half ago at a TED conference and the dialogue eventually led to acquisition talks. “We were doing fine [and] didn’t really talk to anyone else” about selling the company, Winsor said. The three founders in V&S have retained a minority stake in the company and there is a mechanism for selling that stake to Havas tied to future performance. Jon Bond, the co-founder of Kirshenbaum Bond + Partners, left in 2010 to became an investor in V&S and took on an advisory role. Now, Bond is CEO of social media shop Big Fuel, which is controlled by Publicis Groupe. Bond is selling his shares in V&S.
WPP’s GroupM has created a new innovations unit called GroupM Next that will be overseen by Chris Copeland, the CEO of GroupM Search. The unit is designed to help clients at the company’s media shops -- Mindshare, MediaCom, MEC and Maxus -- better navigate the evolving digital sector and keep abreast of developments in areas such as social, mobile and addressable systems. It also identifies partnership opportunities between vendors and clients within the sector. According to Copeland, GroupM Next is not a new client offering; it is an operation designed to strengthen “the value of our agency and client relationships ... the primary focus of this unit is to amplify the efforts that are put forward by the collective of our GroupM agencies." “Every client wants to know how we can use the collective power of the organization to drive innovation that can benefit them,” added Copeland. Most clients are also looking for “first look” opportunities with the Facebooks and Googles of the world, but also with emerging players, like Spotify and Pandora. In some instances, GroupM Next will work with clients and newer platforms to create ad models that don’t yet exist. Pinterest, for example, has buzz -- but not a real ad product, he noted. The new group, which Copeland will oversee in addition to the search unit, is being folded within GroupM Next. It will also place an emphasis on new research to better understand how different digital platforms and technologies are impacting overall consumer media consumption. Separately, GroupM said it named Cary Tilds to be its Chief Innovation Officer, a new post at the media oversight arm. Most recently, Tilds was Mindshare’s North American digital leader. For now, she will remain based in Detroit. For GroupM Next, Tilds’ focus will be on technology and how the GroupM media shops can best interface with the latest platforms, while Copeland will oversee the research and insights efforts of the new unit. GroupM Next is based in St. Louis, where Copeland and GroupM Search are based. The unit comprises about 25 staffers spanning insights, research, technology and education, Copeland said. Most of the staff is in St. Louis and Detroit, but plans call for additional hires to be based on the East and West Coast. Part of the mission, he said, “will be to build on the thought and technology platforms” that currently exist within GroupM, such as social media specialist M80 and mobile shop Joule and research unit Kantar. The group also plans to hold a series of conferences designed to educate both clients and staff on the latest developments in the digital space. --
Growth rate of online revenue for local TV stations will slow down somewhat this year. Borrell Associates says there will be a 25% increase to some $2.7 billion in 2012 over 2011. In 2011, a 41% growth rate was witnessed -- to $1.97 billion. Good news for TV station operators: the pace of online revenue in 2012 will be slightly better than the overall local online marketplace, which will grow 21% this year. Last year, the total local online marketplace was $16.4 billion. At present, TV stations have a 12% share of the overall local online media market. Those independent local online media operators have the largest with a 46.2% share; newspapers are at a 24.7% share; and directories are at 12.6%. In the last nine years, TV stations' share has climbed from a scant 0.4% share of local online media revenues. Radio pulled in $295.2 million in local online revenue in 2011 -- a 1.8% share, slightly down from the year before. Predictions are that radio will reach $409.9 million in local online ad sales for 2012, a 35% increase over 2011. Borrell says TV has been a fast-moving business when it comes to local online revenue -- where it has had an compounded annual growth rate of 45%, faster than the industry as a whole.
The changing fortunes of the publisher of The Philadelphia Inquirer and Philadelphia Daily News encapsulate the long-term decline in the newspaper industry. Originally purchased by a group of private investors for $515 million in June 2006, Philadelphia Media Network’s buying price first tumbled to $139 million in October 2010, when it was acquired in a bankruptcy auction by a group of investors led by Alden Global Capital and Angelo, Gordon & Co -- then plunged to just $55 million in the latest transaction, when it was bought by another group of investors, led by Lewis Katz, a 70-year-old local businessman. The deal, which was agreed to this week, also provides a capital infusion of $10 million for continuing operations. Even so, the $65 million total represents an 87% decline in the value of the company since 2006. Part of this shrinkage can be attributed to the divestment of certain assets, including its office tower, sold last year for almost $23 million. But the main factor is the steep, continuing decline in the newspaper industry, due primarily to the loss of print ad revenues. While the company doesn’t report financial results publicly, a report in the Philadelphia Inquirer noted that a company spokesman recently justified a new round of layoffs with the admission that the “kind of revenue we have been generating has not been enough to sustain the personnel we have.” CEO Greg Osberg will be staying with the company, but it’s not clear whether the new owners intend to carry on with some of Osberg’s innovative programs revealed last year. In June 2011, Osberg said that the company would begin marketing a relatively cheap tablet-style reader using Google's Android operating system -- the Arnova 10 G2 tablet -- bundled with digital subscriptions to its newspapers. Under one plan, consumers can pay $129 for the tablet plus a one-year subscription to three newspaper apps, which costs $12.99 every four weeks. Under another plan, consumers pay $99 and get a two-year subscription to the apps for $9.99 every four weeks.
The Wall Street Journal has endorsed an ad man for president. Not for the U.S., but for France -- and the paper’s nominee is Publicis Groupe CEO Maurice Levy. French elections are set for May. The editorial ran in the April 3 edition -- as much a comment on the current state of French society and politics as it is about Levy’s abilities to run the nation. Commenting on Levi's qualifications, WSJ asserted that Levy knows how to drive economic growth, as demonstrated by his stewardship of Publicis Groupe over the last decade and a half. It noted that jobs is something France needs. "Under his leadership, the firm has grown nearly tenfold in 15 years and today employs 54,000 people. In 1996, it had 6,000." Levy, one of France’s most successful and socially connected businessmen, became the recent object of controversy over a huge payday ($21.5 million) he received as the result of a Publicis Groupe deferred compensation plan created in 2003. But with the French economy in disarray, and the country bracing for austerity measures, the two leading candidates in the French presidential race -- incumbent Nicolas Sarkozy and Socialist Party contender Francois Hollande -- denounced the payment as excessive. Commenting on the affair, WSJ essentially denounced the outcry as absurd, given the chaotic state of the country’s economy. “France should want more Maurice Levys -- many more,” the newspaper asserted. The paper concluded that “the main point of campaign agreement between France’s left and right is to deplore the success of a French CEO, [which] reveals a nation that is all too comfortable with its economic decline.” At deadline, a company rep had not responded to a request for comment on the WSJ's presidential endorsement.
Cash-rich MDC Partners continues one of the most aggressive acquisitions campaigns Madison Avenue has seen since the early days of the Saatchis and WPP Group, announcing yet another significant stake this morning –- this one in one of America’s oldest and most fiercely independent agencies, Detroit-based Doner. MDC did not disclose terms of the deal, but described it as “significant minority interest, with the option to increase its stake to a majority interest at any time.” The deal fits MDC’s model of acquiring significant and/or majority stakes in largely independent agencies and ensuring that their operating principals retain enough equity to keep their skin in the game. In its most recent deals, MDC acquired majority stakes in two of the industry’s biggest independent media services agencies, R.J. Palmer and TargetCast TCM. This morning’s announcement about Doner marks an end to one of the longest runs of a large independent agency. Founded in 1937, the Detroit shop claims a staff of 600 and billings of more than $1 billion with offices in Cleveland, London and Newport Beach. MDC said its connection developed after Doner recruited Rob Strasberg, former creative chief at MDC’s Crispin Porter + Bogusky, as its co-CEO. Doner, which has a strong creative reputation, has focused on expanding its capabilities over the past decade to include a strong media planning and buying practice, and sophisticated production facilities, advanced digital expertise and strong analytics capabilities. The shop has a roster of clients including ADT, AutoTrader.com, Avery Dennison, Choice Hotels International, Chrysler Group LLC, The Coca-Cola Company, The Coleman Company, Cox Communications, DuPont, Harman, Serta Sherwin-Williams, Shell Lubricants and The UPS Store.
More magazines launched than closed in the first quarter of the year, which saw the debut of 52 titles, versus just 12 titles shuttered, according to MediaFinder.com, an online database of U.S. and Canadian publications. The number of new launches was down slightly from the first quarter of 2011, when 54 titles began publishing. But at the same time, the number of closures fell steeply from 24 last year. The top category for new launches was restaurants, thanks to five new DiningOut guides from Pearl Publishing. Other big categories for new launches were hunting and fishing, with four new titles from J.F. Griffin Publishing, and lifestyle magazines, also with four new titles, including Bloomberg Pursuits. Magazine closures included Sandra Lee Semi-Homemade and Spa. The Q1 figures are roughly on the same pace as last year, when 239 new magazines launched -- up 24% from 193 new launches in 2010, according to Mediafinder.com. The number of magazines that closed last year decreased year-over-year, from 176 in 2010 to 152 in 2011. Both the number of new launches and magazines shuttered were down significantly from a few years before, when adverse economic conditions took a heavy toll on the industry. According to MediaFinder.com, a total of 596 magazines closed in 2009, while 275 launched that year. The magazine industry faces continuing declines in print advertising. According to MIN Online, total ad pages for big consumer magazine titles decreased 6.3% in the first quarter of 2012, compared to the same period last year. Just 34 of the 150 titles tracked by MIN showed ad page increases.
Online radio is the fastest-growing music-listening category among U.S. consumers, according to new findings from NPD Group. The market research firm found that 43% of U.S. Web users in 2011 chose to listen to music via Pandora, Slacker, Yahoo Music and other online radio services -- up nine percentage points from 2010. At the same time, music-listening on AM/FM radio and CDs remained relatively steady, at 84% and 74%, respectively. NPD’s annual music study found the number of online radio listeners grew by 18 million last year. The format is most popular among people in the 18-25 age bracket. But strong growth was also seen among people ages 36 to 50, which suggests that young listeners may be turning their parents onto digital radio. While demand for free online radio is increasing, the appetite for paid options remains low. Some 42% of Web users listened to free radio in 2011 compared to just 3% who paid for online radio. Sites like Pandora have benefited directly from the growing audience for online radio. Despite lower-than-expected revenue in its fiscal fourth quarter, the company still saw ad sales climb 74% to $72.1 million from a year ago. Privately held Spotify likewise made a successful entrance into the U.S. market last year. The U.K-based company, however, recently extended a promotion that allows U.S. users to continue to stream music for free, underscoring the challenge of converting people to paying subscribers. Outside the U.S., it also lifted a restriction imposing a five-song limit on free users. The NPD research indicated Facebook doesn’t play an influential role when it comes to online music. Only 12% of Web users listened to music integrated into Facebook or other social networks by services including Spotify and MOG. Spotify, for instance, has only about a dozen apps on its platform to date. “There’s no doubt that Facebook has helped drive music listening and discovery,” said Russ Crupnick, senior vice president of industry analysis at NPD. “But what is not yet clear is the platform’s importance, in terms of ongoing music usage and purchasing.” Facebook has long been rumored to start its own music service, but so far has relied on outside partners to supply music offerings through the site. The NPD study results were based on online surveys of 5,799 U.S. consumers age 13 and up, between December 14, 2011 and January 3, 2012.
Social media activity for TV shows is primarily used by viewers to keep preferred shows strong. According to a new study from TVGuide.com, 76% of people say the primary reason for their social media activity is to "keep my favorites on the air." This data is up from a 66% level in 2011. TVGuide.com conducted the study in partnership with Social TV Summit. Almost all of those who make comments on social media platforms -- 95% -- post their remarks after watching a show. This is way up from the 70% level a year ago. TVGuide.com now says 40% make comments during a show and 53% before a show. Big events pull in more social media interactivity. Before the Super Bowl, 62% of viewers intended to voice their opinion. Almost all of those -- 58% -- actually did. For entertainment awards shows, the social media activity-versus-intent was greater: 57% of those intended to comment on the Grammys and Oscars and 80% actually did. When it comes to using social media, more are interested in what other people are saying, versus saying something themselves. Thirty-three percent report "they wanted to say something about the event," while 69% "wanted to see what others were saying." Social activity for this survey included posts, status updates, check-ins and comments on social networks, fansites, official network sites, and entertainment sites and apps, such as TVGuide.com.
ACTV8.me, which powers second-screen interactivity synced with TV content, will launch apps linked with Fox shows such as “New Girl.” Fox has also taken an undisclosed stake in the company. ACTV8.me also has an undetermined relationship with a Mark Burnett production entity and has been running an app linked with NBC show “The Celebrity Apprentice.” The free Fox apps, which allow viewers to chat and answer trivia questions in real-time as a show airs, can be used on iPhones. In coming weeks, it will be usable on iPads and Android devices. ACTV8.me CEO Brian Shuster stated that the focus was to nurture new, compelling interactive and social features "that enhance the overall television entertainment experience and ultimately grow audience viewership." ACTV8.me is one of several entities, including Nielsen, trying to provide networks with systems allowing viewers to watch a show and interact with additional content (and other viewers) live on a second device. Networks can build engagement, as well as derive some ad revenue. An app for TBS’s “Conan” is sponsored by AT&T. “The Celebrity Apprentice” app offers contests, including one to win a Buick Verano. Buick is one of the advertisers that ACTV8.me said would sponsor its platform for the show this season. Others include Crystal Light and Walgreens. CEO Shuster added that there was an “overall goal of gamifying the second-screen experience."
A pair of Samsung ads were among the most effective during the first quarter, according to Ace Metrix. A spot for the Galaxy Note smartphone topped the charts, while an ad for TVs finished fifth. Two Super Bowl spots -- for Doritos and M&Ms -- finished tied for second with a score of 671, below the Samsung Galaxy Note’s leading 686. (The Galaxy Note spot was the most effective one during the Oscar broadcast.) Infiniti’s “See The Invisible Kid” ad came in fourth. The touching spot plugs a system that senses when there is something behind the car, preventing an accident when backing up. Tide, Hunt’s ketchup, Coke, Olive Garden and Panasonic finished 6th through 10th in order. The animated Coke ad with polar bears was a third Super Bowl spot in the top 10. Samsung debuted nine ads in 1Q -- with three leading the tech category in effectiveness, with scores ranging from 686 to 636. Apple premiered four ads -- the highest-rated of which had a 618 score, still above the 548 average for tech ads. On the negative side, a pair of spots from One Reverse Mortgage, part of Quicken Loans, finished first and second in the least effective rankings. Two H&M ads followed in third and fourth place, while another spot for the low-price retailer finished seventh. The troubled performance for H&M contrasts with its attention-grabbing Super Bowl spots starring David Beckham. Two Goldman Sachs ads also seemed to not resonate, finishing 6th and 7th. JCPenney debuted a series of ads starring Ellen DeGeneres during the Oscars, with one of them leading the retail category, followed in the top five by spots for Lowe’s, Target, Best Buy and Walgreens.
If content is king, then context is the power that lies behind the throne. Conventionally, when we speak of context in media terms, we are typically -- and understandably -- referring to the programming environment in which an ad appears -- the media context, if you will. Turner has illustrated the importance of this through its InContext ad sales initiative. It has had some rigorous research applied to it that illustrates that some pretty powerful uplifts in key metrics can occur when ads are placed within the right media context. But while this is undoubtedly a critical part of the contextual mix, given the audience delivered and the tonality of the programming that sets a mood, it’s not the whole picture. As media has become so much more multifaceted, there are situational factors to bear in mind, which were less important in the days before interactivity, mobility and the fragmentation of media platforms. Now context is about more than the medium. Marshall McLuhan wasn’t wrong when he declared the medium to be the message -- but he was only 20% right as far as today’s communications landscape is concerned. Why 20%? Because in these modern media times, when a consumer-centric perspective is no longer a luxury or a throwaway remark in a conference speech but a critical part of a brands communications DNA, there are five dominant dimensions to context that need to be understood and planned for: