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Marketing Briefing: Marketers seek more performance marketing given the economic uncertainty

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Marketing Briefing: Marketers seek more performance marketing given the economic uncertainty

If you ask marketers and agency execs about the ongoing economic uncertainty’s impact on advertising today, you’ll likely hear about how brands were hurt in the long-term by cutting marketing spend in 2008.

As CFOs look to cut costs even more than usual, marketers have to once again prove the value of advertising to maintain their budgets so it makes sense to look back at the last major downturn. But today’s economic uncertainty isn’t like it was in 2008 and advertising budgets don’t look like they did then.

Marketers have also been dealing with waves of uncertainty for the last two years, making them more nimble and ready to make moves as necessary. “We see most brands are in a wait-and-see mode,” said Mediahub U.S. CEO Sean Corcoran. “While some have pulled back, most are actively looking at consumer trends and are ready to adjust as needed, but we’re not seeing major pullback at this point. And some sectors, like travel, retail, and entertainment, have huge demand and are way up.”

To deal with the current climate, many marketers today are pushing for more performance marketing efforts that can help them prove the efficiency of their budgets and the value of their advertising efforts with some brands retooling their creative to tout the value of their products or offerings. Search consultants say that brands seeking new agencies have also made performance marketing a focus.

“Generally speaking there’s more of an emphasis on performance,” said Brendan Gahan, chief strategy officer and partner at Mekanism. “That doesn’t always equate to value messaging. However, given economic uncertainty, we’re seeing a greater emphasis on tracking sales and making sure that buys, etc are efficient. A number of media spends have been concentrated around performance. As a result, with some brands, we’re seeing a bit of a pause on experimental budgets/activations.”

Focusing on what’s proven to deliver sales or support sales isn’t surprising. That said, ad agency execs believe clients need to be careful to not rely too much on performance marketing over brand building as doing so can lead to a loss of market share.

“During every downturn, it makes sense to double-down on performance marketing but it doesn’t mean you should cut your brand building,” said Kari Shimmel, chief strategy officer at Campbell Ewald. “It’s important to help clients see the long-term impact of brand messaging and spend and the market share and brand health metrics they can potentially lose when they go silent. We see brands leap-frog their competition in these moments when they lean in and build their brand when others turn off their spend.” 

That said, brand-building efforts and performance marketing efforts aren’t as siloed as they once were. Marketers and agency execs say that performance marketing efforts may need to incorporate more brand-building efforts to do both simultaneously. What that looks like will vary by brand and agency. (It’s worth noting that search consultants say there has been an uptick in RFPs seeking performance marketing agencies able to do brand-building work.)

“Performance and branding aren’t seen as distinctly different as in the past,” said Gahan. “You can still brand build, but at the end of the day more and more efforts have to be tied to meaningful business goals.”

3 Questions with Katie Zapata, vp of brand marketing at FreshDirect

FreshDirect celebrates 20 years in business this year. What’s the marketing strategy around the anniversary?

In the summer, a lot of our customers go out to the Hamptons and Jersey Shore for the summer. We follow them and bring our service there. We’ve wrapped the Hampton Jitney, which drives around Manhattan and then heads out to the Hamptons. We have some billboards on highways on the way there. We’ve also been doing aerial banners that fly over the beaches. We also did a buy on the Long Island Railroad, on their new live screens on the trains.

OOH isn’t a new media channel for FreshDirect. What makes your team so bullish about it? 

We see the results. We see people coming back to the site. We look at promo code redemptions. For us, promo codes are the best way to track whether people are engaging with the advertising. We’re seeing engagement. We see our awareness go up. That’s why we’re really bullish on out-of-home. As the technology has evolved and improved, we’ve been there. We started advertising on [LinkNYC] probably four or five years ago now.  As new technologies are available, we try them.

What can other marketers learn from your strategy?

In the past, we’ve been operationally-focused. We were looking at ROI on each single promo code, on each media buy. It’s really a mix of media that you need. You need surround sound to reach people and to have your message resonate. Out-of-home plays a really big part in that, especially in New York City. –– Kimeko McCoy

By the numbers

The streaming wars are reaching a fever pitch as service providers like Netflix and Disney gear up to roll out ad-supported offerings. New research from Hub research company reveals that not only do consumers tolerate ads on streaming platforms, they embrace them. Find details from the research below:

  • In Q2 of this year, 55% of consumers say they use at least one FAST (free, ad-supported TV streaming service), such Pluto TV, the free version of Peacock, the Roku Channel, TubiTV, Freevee, etc.
  • 56% of those who responded to the survey say they’d rather watch ads and pay $4-$5 less per month for a streaming service.
  • For those who did remember ads that seemed relevant to them, 69% said they enjoyed the entire experience of watching the show. For those who didn’t see relevant ads, viewing enjoyment was just 48%. — Kimeko McCoy

Quote of the week

“When abortion was illegal 50-something years ago, the internet didn’t exist. Now, literally, our whole lives online are being tracked and exist in the cloud. Yes, these raise concerns, but so many things raise concerns right now.”

— said Jen Caltrider, lead researcher for Mozilla’s Privacy Not Included initiative, as the company released a report on the data pregnancy and period tracker apps release to advertisers.

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NASA Says Hurricane Didn’t Hurt Artemis I Hardware, Sets New Launch Window

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NASA Says Hurricane Didn’t Hurt Artemis I Hardware, Sets New Launch Window

NASA’s Artemis I moon mission launch, stalled by Hurricane Ian, has a new target for takeoff. The launch window for step one of NASA’s bold plan to return humans to the lunar surface now opens Nov. 12 and closes Nov. 27, the space agency said Friday. 

The news comes after the pending storm caused NASA to scrub the latest Artemis I Iaunch, which had been scheduled for Sunday, Oct. 2. As Hurricane Ian threatened to travel north across Cuba and into Florida, bringing rain and extreme winds to the launch pad’s vicinity, NASA on Monday rolled its monster Space Launch System rocket, and the Orion spacecraft it’ll propel, back indoors to the Vehicle Assembly Building at Florida’s Kennedy Space Center. 

The hurricane made landfall in Florida on Wednesday, bringing with it a catastrophic storm surge, winds and flooding that left dozens of people dead, caused widespread power outages and ripped buildings from their foundations. Hurricane Ian is “likely to rank among the worst in the nation’s history,” US President Joe Biden said on Friday, adding that it will take “months, years, to rebuild.”

Initial inspections Friday to assess potential impacts of the devastating storm to Artemis I flight hardware showed no damage, NASA said. “Facilities are in good shape with only minor water intrusion identified in a few locations,” the agency said in a statement. 

Next up, teams will complete post-storm recovery operations, which will include further inspections and retests of the flight termination system before a more specific launch date can be set. The new November launch window, NASA said, will also give Kennedy employees time to address what their families and homes need post-storm. 

Artemis I is set to send instruments to lunar orbit to gather vital information for Artemis II, a crewed mission targeted for 2024 that will carry astronauts around the moon and hopefully pave the way for Artemis III in 2025. Astronauts on that high-stakes mission will, if all goes according to plan, put boots on the lunar ground, collect samples and study the water ice that’s been confirmed at the moon’s South Pole. 

The hurricane-related Artemis I rollback follows two other launch delays, the first due to an engine problem and the second because of a hydrogen leak.

Hurricane Ian has been downgraded to a post-tropical cyclone but is still bringing heavy rains and gusty winds to the Mid-Atlantic region and the New England coast.

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What You Get in McDonalds’ New Happy-Meal-Inspired Box for Adults

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What You Get in McDonalds’ New Happy-Meal-Inspired Box for Adults

You’ve pulled up to McDonald’s as a full-on adult. You absolutely do not need a toy with your meal, right? Joking. Of course you do.

The fast-food chain will soon sell boxed meals geared toward adults, and each one has a cool, odd-looking figurine inside. 

The meal has an odd name — the Cactus Plant Flea Market Box — that’s based on the fashion brand collaborating with McDonald’s on this promotion. 

According to McDonald’s, the box is inspired by the memory of enjoying a Happy Meal as a kid. The outside of the box is multicolored and features the chain’s familiar golden arches. 

The first day you can get a Cactus Plant Flea Market Box will be Monday, Oct. 3. Pricing is set by individual restaurants and may vary, according to McDonald’s. It’ll be available in the drive-thru, in-restaurant, by delivery or on the McDonald’s app, while supplies last.

You can choose between a Big Mac or 10-piece Chicken McNuggets. It will also come with fries and a drink.

Now about those toys. The boxes will pack in one of four figurines. Three of the four appear to be artsy takes on the classic McDonald’s characters Grimace, Hamburglar and Birdie the Early Bird, while the fourth is a little yellow guy sporting a McDonald’s shirt called Cactus Buddy.

In other McD news, Halloween buckets could be returning to the chain this fall. So leave some room in your stomach for a return trip.

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Why companies like iHeartMedia, NBCU rely on homegrown IP to build metaverse engagements

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Why companies like iHeartMedia, NBCU rely on homegrown IP to build metaverse engagements

To avoid potential blowback from a skeptical audience, retailers as well as media and entertainment companies are learning to invest in their homegrown intellectual properties while building virtual brand activations inside Roblox or Fortnite.

Take, for instance, when they get it wrong.

Earlier this week, Walmart launched its own Roblox world — called Walmart Land — and was roundly mocked for it across social media given the announcement’s disjointed brand message and apparent lack of life. In one viral tweet, a Twitter user described a clip of Walmart CMO William White introducing the Roblox space as “one of the saddest videos ever created.”

This video of Walmart’s chief marketing officer on a stage in Roblox talking about its new “Walmart Land” experience is one of the saddest videos ever created. pic.twitter.com/HtIIToShKs

— Zack Zwiezen (@ZwiezenZ) September 26, 2022

To some extent, this sort of criticism is to be expected during the early days of the metaverse.

“Walmart is an iconic brand; when you see them coming into a platform like Roblox, people are going to be 10 times more critical of what is being launched,” said Yonatan Raz-Fridman, CEO of the Roblox developer studio Supersocial.

But Walmart’s size is not its only disadvantage as it dips its toes into Roblox. Although Walmart has a widely recognizable brand, it owns few intellectual properties that users are actually interested in experiencing virtually — a shortcoming reflected by the somewhat cavernous emptiness of Roblox’s Walmart Land.

Provided by NBCUniversal

The success of other recent brand activations is evidence that media and entertainment brands are better equipped to build metaverse spaces that can dodge online skepticism, thanks to their wealth of owned IP.

“They are having to reinvent themselves, to a certain degree, but that is in their DNA,” said Jesse Streb, global svp of technology and engineering at the agency DEPT. “So they have a unique advantage over, say, some kludgy company that sells lumber, or a construction company.”

For example, iHeartMedia’s Roblox and Fortnite spaces were inspired by the mass media corporation’s wealth of popular real-life events, such as the Jingle Ball Tour and iHeartRadio Music Festival, with virtual versions of musicians like Charlie Puth performing pre-recorded concerts that allow real-time audience interaction.

“There’s a strong brand association with the IP, down to a station level — you’re in the New York area, you probably know Z100,” said iHeartMedia evp of business development and partnerships Jess Jerrick. “The same is true for the event IP, or the IP that we now have in the podcasting space, and of course our radio broadcast talent. So there’s no shortage of really strong IP we can bring into these spaces.”

Translating real-life properties into the metaverse is also an enticing prospect for brands that view metaverse platforms as an experimental marketing channel, allowing them to bring tried-and-true IP into their virtual activations instead of designing them from the ground level. This was part of the strategy behind the recent Tonight Show activation in Fortnite Creative, which was designed in collaboration between NBCUniversal and Samsung. “We’re looking at it holistically — how do we find fans in new ways, and use IP that fans love in new ways?” said NBCU president of advertising and client partnerships Mark Markshall.

Since opening on Sept. 14, iHeartLand has already enticed over 1.5 million Roblox users to visit. The company aims to retain that attention with a schedule of virtual programming featuring popular musicians and personalities.

“At our core, we are essentially an influencer network; our broadcast talent are some of the most connected, most engaging influencers at work in media today,” said Conal Byrne, CEO of iHeart Digital Audio Group. “That gives us this sort of superpower, to be able to go into new-ish platforms, like Roblox or Fortnite, because we talk to our listeners through those influencers.”

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