Razorfish, one of the largest digital marketing companies in the world, declared in its fifth annual Digital Outlook Report that television has morphed from a mass distribution channel to a collection of interactive and personal experiences. The report,  provides insightful industry commentary on topics such as the future of TV and Social Influence Marketing™ and examines media buying, planning and distribution trends from the past year.

Razorfish publishes the report to help marketers make smarter choices about their digital media spend and investments in digital marketing channels.

“Marketers have been talking over the past few years about the long tail of the Internet, but now we are seeing the development of a long tail of television,” said Terri Walter, vice president of emerging media at Razorfish. “TV is alive and well, but the viewing experience is moving from mass to niche in terms of both audiences and programming as consumers divide their time between computer screens, TV sets, mobile devices, gaming systems and set-top boxes. As viewership fragments, advertisers must find a way to adopt their messages to smaller, but potentially more valuable audiences.”

In addition to exploring the fundamental shift happening in television, the Razorfish Digital Outlook Report offers insights into digital media trends that are affecting the media industry overall, and in particular, search and social media. For example, Razorfish saw a significant increase in client spending in paid search, which rose from 31% in 2007 to 36% in 2008.

“As the economy began to soften toward the end of the year, we witnessed a renewed focus on search because it delivers a stronger ROI than many other tactics,” said Sarah Baehr, vice president and national media lead at Razorfish. “We also saw a continued shift in digital ad spending toward niche sites as clients realize the value of targeting precise audience groups.”

The comprehensive report provides research, predictions and recommendations from agency thought leaders and a stellar group of guest contributors. Key findings include:

• Explosion of Social Influence Marketing™ – Razorfish predicts “Your CEO will join Facebook” this year. The traditional C-Suite is finally responding to the pressure that social influencers have on their brands, and they’re getting onboard. The Digital Outlook Report discusses ways to measure the value of social influencers, including the proprietary Razorfish Generational Action Tag technology.
• Findings on the “connected class” – Razorfish found that those in the digitally savvy, 18-25 age group are becoming more selective and sophisticated in their digital choices, and are not afraid to ignore superfluous online video content or reduce the number of their ‘connections’ on social networking sites. Marketers would do well to respect the discerning nature of the “connected class.”
• Defining a new retail experience – As customers are now demanding the same level of personalization in brick-and-mortar stores as they receive online, retailers need to deploy modern tools such as digital in-store signage, coupons delivered via mobile devices and interactive store floor plans and merchandise directories.
• Annual “Publisher of the Year” award – Razorfish’s media team named New York Times Digital, Yahoo! and FM Publishing this year’s publishers of the year based on their service, creativity, responsiveness and the ability to deliver meaningful solutions to the agency and its clients.

As in previous years, the Digital Outlook Report incorporates essays from guest writers who bring fresh insights into all things digital. The 2009 report includes contributions from Mike Steib, director of Google TV Ads; Davina Kent, director of strategic alliances, Comcast; media visionary and consultant Jack Meyers; Dean Carignan, director, advertising business group, entertainment & devices division, Microsoft and Mark Kroese, general manager, advertising business group, entertainment & devices division, Microsoft; and Alec Gerster, CMO, Navic.
About Razorfish
Razorfish is one of the largest interactive marketing and technology companies in the world. With a demonstrated commitment to innovation, Razorfish counsels its clients on how to leverage digital channels such as the Web, mobile devices, in-store technologies and other emerging media to engage people, build brand loyalty and provide excellent customer service. The company is increasingly advising marketers on Social Influence Marketing™, its approach for employing social media and social influencers to achieve the marketing and business needs of an organization. Its award-winning client teams provide solutions through their strategic counsel, digital advertising and content creation, media buying, analytics, technology and user experience. Razorfish has offices in markets across the United States, and in Australia, China, France, Germany, Japan and the United Kingdom. Clients include Carnival Cruise Lines, MillerCoors, Levi’s, McDonald’s and Starwood Hotels. Visit http://www.razorfish.com for more information.
Contacts:
Sally O’Dowd Sally.odowd (at) razorfish (dot) com (direct) +1.312.696.5068 (mobile) +1.773.458.3740
Katie Lamkin Katie.lamkin (at) razorfish (dot) com (direct) +1.312.696.5241 (mobile) +1.773.308.3425

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8% of those who are over the age of 65 use SMS, and 4% subscribe to social networks. Another surprising data point is that 42% of teens prefer to communicate via SMS, yet 62% prefer to receive promotions via email vs. only 1% via SMS. The new study by ExactTarget confirms that there are marked differences between age groups not only in the usage of media, but also their acceptance of and attitudes towards each type and using multiple forms of media concurrently. And, consumer profiles and habits are changing… sometimes dramatically. A majority of people prefer to communicate with friends and family via the phone rather than email. This preference is positively correlated with age.

Highlights of six personas and how they interact with different media include:

Wired Consumers tend to be young males, between the ages of 18 and 34 years old, without kids. They are employed full-time or self employed, have a good income-an annual household income of at least $35K-and have at least a college education. 20% of Wired Users subscribed for marketing communications via SMS (more so than any other group) but want to receive texts only for urgent customer service issues, like financial alerts or travel updates. Consumers in this group are exposed to more media throughout the day than any other group, primarily though computers. These consumers spend an average of 8 hours a day on their computers accessing the internet, email, and using some sort of computer software, including games. By comparison, exposure to television and radio is relatively low, but not nominal, at nearly 3 hours of television a day. In addition to computer and television time, these consumers are on the phone an average of one hour per day. More than two-thirds of phone time is on a landline phone.

Young Homemakers are females, between the ages of 18 and 34 years old, who consider “homemaker” to be their primary occupation, and typically have an annual household income of at least $35K. Over half of Young Homemakers use social networks and SMS during the day, but direct mail and email are their preferred marketing channels. Across the board, Young Homemakers spend approximately 40% of their day exposed to 2 or more forms of media concurrently. Young Homemakers’ media use is split between two subgroups: heavy traditional media consumers (High Media), and low traditional media consumers (Low Media). The Low Media group is slightly larger than the High Media group. Within the High Media group, television watching is among the highest in the study at just over 6 hours of television exposure per day. For the Low Media group, television viewing is less than 2 hours per day. The High Media group spends more time online, almost 3 hours a day, compared to an average of 1-2 hours per day for the Low Media group. Additionally, the High Media group spends more time reading magazines and newspapers, 40 minutes per day, compared to approximately 10 minutes per day for the Low Media group. Personal communication is a high priority and Young Homemakers don’t want to be interrupted. For them, it is about feeling in control and being heard. Marketers should seek to build an opt-in relationship with this group for email, or leverage their affinity to direct mail with relevant, helpful information and products.

Retired consumers spend more of their day with the television on than any other group (more than 7 hours per day on average). They also spend a significant amount of time reading a combination of newspapers and books. The time they spend reading magazines is consistent with other groups, less than 10 minutes on average per day. And, men tend to spend more time listening to the radio than women. This group consists exclusively of people who have retired, and includes both men and women, though the sample is skewed toward male respondents (57%). Of this group, 80% have attended college, and 41% received at least a Bachelor’s degree. 81% of the Retired community purchased online and 94% have been influenced by some form of direct marketing to make a purchase Unlike younger consumers, little of their day is spent with more than one media form at a time. Only 15% of media exposure is concurrent. Relatively, they spend only a small amount of time online. For those people who are online, using email is a central component of their internet experience. Mobile email is virtually non-existent, only 3% have a smartphone capable of sending and receiving mobile email. Retired consumers prefer traditional direct channels. Of interest is the reality that email now fits into this category, along with direct mail and telemarketing.

College Students, predominantly 18-24 year olds in the sample, believe private communication channels (e.g., SMS, social networks) are off-limits for marketers. College Students want to keep personal and business affairs separate. Marketers should remember that email is the channel for “official” communications. Media exposure within this group varies dramatically, making generalizations difficult. That said, on average media exposure is generally lower than may be commonly believed, marked primarily by relatively low exposure to television in the typical day. College students are heavy internet users, and spend considerable time reading books, listening to music, and watching movies. Significant portions of their day is spent using media concurrently, with the computer seldom far away. The heavy time demands of college study and college life shape the media usage for this persona; there may be a tendency to favor media that allows the user control over where and when they are used. Time with media tends to be an even mix between home and school access.

Teens consist exclusively of high school students between 15 and 17 years of age. The sample skews slightly higher than average in annual household income. Though Teens use social networking more than any other group, they are more likely to make a purchase from direct mail, followed by email, SMS, and social network sites. In out-of-school settings, Teens engage heavily with the computer, television, print (in the form of magazines), and music through MP3 players. Aside from reading school textbooks, teens are heavily inclined toward screen-based media, frequently having more than one such medium accessible at a time for inbound or outbound communications purposes, entertainment etc. Teens are open to marketing through a variety of channels, and nothing is completely off the table, which requires allocating resources to multiple communication channels and providing individuals with a choice.

Established Professionals are moderate media consumers. Television exposure is near average at approximately 3 hours per day, while radio exposure is the highest of any group identified (more than 3 hours per day on average), much of which happens in the car commuting for work. They are online multiple times throughout the day, typically spending more time online at work than at home. They are average consumers of newspapers and magazines. This group consists of professionals employed full-time, age 35 or more, with annual household incomes greater than $75K per year. 65% are between the ages of 35 and 54 years of age. The sample is evenly split between men and women Within the group of Established Professionals, women are more likely than men to use new digital media channels like IM, SMS, and social networking to communicate with friends and family. 92% of consumers in this group, both men and women, have made an online purchase For Established Professionals, it’s about email and direct mail…and that’s it. The take-away is that there is big opportunity with this group. Marketers need to focus on relevance, because this group has money to spend and does so frequently.

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