Essential Reading for Marketing & Business Professionals
Tuesday February 18th 2008

Insights in this issue:
* Web 2.0 hits the buffers
* Are Marketing Budgets under threat?
* Do Inserts still work?
* Data Protection Compliance 2008 - DATE CHANGE

Inserts vs Web 2.0 - which is a better
home for your marketing budget? Well, in two
articles this week we take a look at both -
the conclusion may surprise you!

The CMO council has just released the
results of its latest marketing spend survey
and it makes for some interesting reading. It
looks like 2008 will be the year of doing
more for less! Expect howls of pain from your
creative agencies!

James Pearson - Editor

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Web 2.0 hits the buffers

A recent review published in Business Week
magazine suggests that Social networking
sites - which make up much of the vaunted Web
2.0 arena are not proving to be as beneficial
to advertisers as was originally hoped. One
retail advertiser reported seeing clicks fall
by 90%, from 1% to 0.1% between 2006 and 2007.

But its not just retailers who are feeling
the pinch, even giants like Google are
struggling, with their
Chief Financial Officer saying : "We have
found that social-networking inventory is not
monetizing as well as expected," In other
words, Google ads, placed on social
networking sites aren't being clicked either.
So what's going on? Perhaps the corporate
world has misunderstood users who generate
content - and user-generated content is a
major component of Web 2.0. If they
go to the effort of generating content, they
don't want someone else to profit from their
efforts - that was never part of the deal. So
they vote against it by deliberately NOT
responding to ads.

Resistence to ads isn't the only problem -
the other is declining visits and declining
time spent on the sites. ComScore claims
that MySpace has lost over 3 million visitors
in the US alone between October and December
2007. And time on the sites has also declined
- by over 24%
year-on-year. So if social networking site
advertising is part of your media plan for
2008 our advice is to keep a very close watch
on the results and don't be surprised if
they are disappointing. For when even Google
founder Sergey Brin says he's failed to find a
"killer best way" to advertise on these sites
then I think us mere mortals are entitled to
find it tough!

~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~
Are Marketing Budgets under threat?

The latest CMO council findings suggest
probably not. Fewer than 13% of respondents
reported that they expect their budgets to
fall this year. Perhaps what's more
interesting is that 38% say their budgets
will be unchanged - which, given inflation in
marketing costs, means a real cut - unless
they drive harder bargains with suppliers.
And there is some evidence that this is
indeed what is happening across many sectors
of the marketing industry.

The good news is that over 50% expect to see
their budgets grow in 2008 - with 7% being in
the happy position of enjoying double-digit
growth in their marketing budgets. Here is a
summary of the findings::

· 37.6 percent of respondents say annual
budgets will not change in 2008, while 33.1
percent expect to increase spend by up to
five percent, and almost 10 percent say their
budgets will grow between six and 10 percent.
Only 7.6 percent expect to see budget
increases greater than 11 percent.

· When asked how they tracked and measured
return on marketing spend, nearly 20 percent
of marketers said they did not, and 34
percent said they were planning to introduce
a formal ROI tracking system.

· Quantifying and measuring the value of
marketing programs and investments remains
the top challenge in the year ahead, report
some 53 percent of survey respondents. Other
key priorities include growing customer
knowledge, insight and conversations, as well
as upgrading the efficiency and effectiveness
of marketing groups.

· Marketers reported significant agency
turnover in 2007 with advertising (41
percent), web design (38 percent) and public
relations (26 percent) firms most frequently
changed in 2007.

~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~
Do Inserts still work?

We've had some interesting conversations
recently with clients who use inserts as part
of their "marketing mix" and the consensus
seems to be that the answer is "not as well
as they used to". So we decided to take a
look at the available research to try to
ascertain what exactly is going on.

We found that inserts are ceasing to work as
well as they used to because of several factors:

* Too many inserts in many publications

* Readers are spending less time reading so
reading inserts takes up too much time

* A general irritation with what are seen
as "environmentally unfriendly" marketing
techniques

We have created a more detailed presentation
on the topic, which you can download free of
charge from our website.

Click here to download the full presentation

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Data Protection Compliance 2008 - DATE CHANGE

The second annual Data Protection conference
for companies doing business in the US and
the EU takes place in Dublin on 21st February
2008.
And like last year the Agenda is packed
with interesting and insightful speakers.

This conference is not designed purely for
Lawyers, it has very useful content for
Marketers who are genuinely concerned about
ensuring they stay on the right side of the
law when engaging in marketing activities in
the EU.

For the full Agenda and booking form, please click here