Clear Digital Digest: MP3, marketing spend and movies sur l’eau

Today’s Clear Digital Digest reviews a recent survey on changing customer attitudes as well as the latest IPA Bellwether marketing spend report.  The MP3 is 25 years old this week and although not widely used these days, as the key tech that paved the way for streaming its influence can often be understated, as we explore below.  Plus a look across the Channel at a new, unique way to watch films…
 
CONSUMER ATTITUDES AND MARKETING SPEND
Amongst the latest insights that emerged this week, Wunderman Thompson’s “Covid, Commerce and the Consumer” report stood out, based on a survey of 2000 UK consumers in early June.  Some key highlights include:

• Future outlook was understandably negative, with 48% of consumers feeling less positive about the future, with an identical number feeling less positive about future finances.
• 62% of consumers feel less positive about shopping in-store, slightly mitigated by 43% now feeling more positive about online shopping.
• Amazon accounted for 35% of all online shopping during lockdown (up from 30% before), with a huge 94% of respondents having made at least one purchase from Amazon.
• Grocery is the other online channel to see a significant increase in share of spend, as we also covered in last week’s Digest.

Estimated lockdown % online shopping share, source: Wunderman Thompson

• Some more interesting (albeit depressing) data from the IPA this week, as they reported that recent marketing budgets have been slashed by more than ever previously recorded in the 20 years plus of their IPA Bellwether report.
• 64% of respondents had their marketing budget cut, albeit 13% saw a rising budget, leading to 51% of companies cutting their marketing budget in the second quarter of 2020, up from 6% in Q1.
• The graph below shows the historic trend, with the credit crunch related downturn in late 2008 the only comparable slump, albeit marketing budgets did then bounce back fairly quickly in a V-curve. 
• With this unprecedented crisis, the Bellwether report predicts total ad spend falling by 11.3% this year, followed by growth of 6% in 2021.  In 2022 and 2023 it once again expects above-average growth, before stabilising at average growth rates in 2024 and 2025.

IPA Bellwether Report, source: IPA/Marketing Week

MP3 TURNS 25
There was an important but fairly unheralded digital milestone this week, as the MP3 file turned 25.

• In this typically excellent article by music industry journalist Eamonn Forde on The Quietus website, it is argued that the MP3, and not say the vinyl album, was the most revolutionary format in music history.
• Forde breaks down the MP3’s life so far into 4 distinct phases and demonstrates how it has led to Big Tech taking the dominant hand in the music business from the traditional record labels, as MP3s paved the way for the streaming supremacy we see from the likes of Spotify and Apple Music today.
• For further reading about the evolution in music consumption, the recent Clear Digital article “Discogs – the digital success story of the vinyl revival” covers similar ground; for example, how streaming now accounts for 60% of record label income and actual physical music products (ie CDs and vinyl) just 20%.

AND FINALLY...
With cinemas closed until recently and only gradually re-opening now, one new trend has been the emergence of drive-in cinemas to bring some US retro flavour to cinephiles who are seeking more than another Netflix binge.  Venues as varied as Brent Cross Shopping Centre car park and Alexandra Palace will be accommodating such yearnings this summer.

However, Haagen-Dazs are adding a new flavour in Paris with their “Cinema Sur L’Eau” concept: a socially distanced cinema where customers will sit in boats rather than cars.  Further investigation reveals they will be showing a film entitled Le Grand Bain (English title: Sink Or Swim), about a group of men who start their own synchronised swimming team.  Certainly a wiser choice of movie to show in this environment than Jaws or Titanic.