When rebrands go wrong

(And how to avoid the pitfalls)

2012: The year in digital

2012 was another supersonic year for digital in terms of innovation and the growth of online and mobile as formidable marketing channels. Marketing Week picks out the key developments of the last 12 months.

Facebook’s IPO

Facebook stock market

Facebook staff on the company’s stock market debut

Ever since Facebook announced its plans to float on the stock market in February the social network was barely out of the papers in the months leading up to and after its actual May flotation.

Facebook’s flotation was the biggest ever achieved by an internet company and the third largest US IPO ever, making the website more valuable than McDonald’s.

Its debut stock price ($38/£24) quickly took a tumble to below $20 (£12.44), however, as investors took on board the importance of Facebook’s admittance in its SEC filing that it did not “generate any meaningful revenue” from mobile.

facebook

A few months on and the company is far more bullish about its mobile strategy, having built out mobile app install ads and beginning to test a mobile ad network to better monetise its 604 million monthly active mobile users.

In October founder and chief executive Mark Zuckerberg announced mobile accounted for 14 per cent of Facebook’s ad revenues in its third quarter, which he claimed “dispels the myth that [the site] can’t make money on mobile”.

Its share price currently stands at $27.84 (£17.32).

Data, data, data

If 2011 was the year marketers really got a handle of how to create campaigns for social media, 2012 was when they realised the importance of data to assess how successful those projects were for their business.

Early in the year both Facebook and Twitter were lambasted by marketers for not providing them with enough detail to accurately measure the ROI of their campaigns - which in part led to General Motors’ high-profile boycott from paying for ads on Facebook just days before its aforementioned flotation.

The social media sites in question soon began their fightback by running events for brands, publishing research and partnering with analytics companies in a bid to convince doubters of the power of their platforms.

4G’s UK launch

The UK’s first “super fast” 4G network launched in October, backed by a multi-million pound marketing push fronted by Kevin Bacon from new brand EE - formed by the owner of Orange and T-Mobile.

EE managed to steal a march to launch 4G six months before its rivals after Ofcom granted it permission to launch LTE services using its existing 2G frequencies.

EE Logo

The move to give EE the early green light was immediately met by criticism from O2, which said the move was anti-competitive. Both O2 and Vodafone then took to marketing in an attempt to downplay the effect of EE’s launch and its own sizeable advertising activity.

EE’s early launch has not been without teething problems. The majority of consumers feel its tariffs - which range from £36 to £56 - are too expensive, according to research commissioned by Marketing Week. Many new customers that did opt to sign up to the new network experienced difficulties in receiving their SIM cards and delays in accessing the high speed network.

All eyes will be on EE’s competitors next year to see how they go about educating consumers about the benefits of upgrading to 4G - and to see whether they choose to underprice their “expensive” rival.

Streaming wars

Services such as Netflix and Sky’s Now TV launched in the UK this year, while existing brands such as Apple, Amazon, Domino’s and Google branched out their offerings to include movie streaming and downloads to take on industry stalwart LoveFilm. And, of course, YouView finally launched, which also offers access to streaming services.

BlinkBox

It’s little wonder Kate Simon, Blinkbox’s - which was all but acquired by Tesco this year - director of sales and marketing, said last month that the film and TV streaming sector had become a “confusing and cluttered marketplace” - especially considering the marketing backing the launch of the major new services have recently received.

Most of the brands have positioned their marketing around price and the availability of new releases. Next year it will be interesting to see how these communications extend to include more differentiations around each brand and added value propositions, such as “a movie and a meal”.

Mobile no longer a siloed discipline

Mobile ad spend continued its meteoric rise as UK smartphone penetration reached 58 per cent, boosted by strong sales of the Samsung Galaxy S3 and the iPhone 5.

Mobile advertising grew 132 per cent and accounted for 7 per cent of all digital ad spend, according to the IAB and PwC’s advertising expenditure report for the first half of the year.

Mobile Apps

Brands from Burberry to Coca-Cola and Google all set out their stalls as “mobile first” companies this year as mobile becomes less of a siloed niche discipline and now a major ingredient in the marketing mix.

There’s still much work to be done to convince all brands of mobile’s power, however, as another IAB study found just 37 of the top 100 advertisers have mobile optimised sites.

Hopefully initiatives such as the mobile operator ad sales joint venture Weve and strong case studies from the more traditional and less “tech by default” brands will bring the discipline further to the fore in 2013.

See all our other 2012 round-ups here

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