April 2009

Updated segmentation system features latest demographics and social values

TORONTO– Environics Analytics has launched Envision, a Web-based micromarketing tool that provides business intelligence on customers and markets anywhere in Canada.

The company has also announced the release of the second generation of its popular segmentation system, PRIZMC2, updated with the 2006 Census, newly released Social Values from Environics Research and EA’s 2009 Demographic Estimates and Projections (DEP) database.

Like its earlier version, PRIZMC2 classifies all Canadians into one of 66 lifestyle types—with names like Cosmopolitan Elite, Electric Avenues, Les Chics and Lunch at Tim’s—based on their demographics, lifestyles and Social Values. But this model reflects demographic and values shifts that have occurred between 2001 and 2006, and thanks to 2009 DEP, also includes accurate current-year demographics.
While the overall segmentation schema has not changed dramatically, PRIZMC2 captures subtle differences that are important to understanding the complexity of the Canadian populace. Many clusters have evolved. Cosmopolitan Elite, a traditionally older and wealthy lifestyle type, has grown somewhat younger as a result of the increase of well-off, middle-aged families in Alberta and upscale neighbourhoods like Toronto’s Rosedale. Pets & PCs, an upscale suburban group, has expanded in size and now at 5.2 percent of the population, is the largest cluster as a result of the growth in the suburbs of many major cities.

“This is the time for marketers to be smarter about how they spend their money,” Environics Analytics president Jan Kestle emphasizes. “Our new products can help users efficiently find their best customers whether the targeting is based on their life stage, assets, what language they speak at home or their views towards green products.”

Meanwhile, the release of Envision, the company’s new microtargeting tool, comes at a time when businesses and not-for-profits are struggling with challenges brought on by the global economic downturn. The tool employs a point-and-click interface—allowing users to create custom maps, customer profiles and executive summary reports along with rankings for markets, behaviours and product consumption. Companies and not-for-profits can classify their best customers, and most important target segments, and thereby find the most promising prospects to develop marketing campaigns at the national, regional and local levels. Envision draws on Canada’s most comprehensive set of demographic, marketing and media databases, offering EA’s newly updated segmentation system, PRIZMC2, just-released Social Values from Environics Research and EA’s 2009 Demographic Estimates and Projections (DEP) database. It brings together key Canadian media and marketing databases through PRIZMC2 links, to data from Statistics Canada, PMB, BBM Canada, infoCanada, Polk, NADBank, TeleAtlas and Canadian Financial Monitor. Envision was developed specifically for the Canadian marketplace by veteran research analysts, modelling statisticians and marketing pros.
“With Envision, we can customize both the data components and the functionality by industry, even for each client, helping our customers be more productive at a lower cost,” Kestle explains. “This is what businesses need in the best of times and even more so in our current economy. And this new software captures analytical methods that we’ve developed over decades from working with hundreds of customers in dozens of industries so it’s exciting for us to put our expertise at our clients’ fingertips.” For more information, visit www.environics analytics.ca.

IAB Canada unveils first Canadian mobile
advertising revenue survey results

Mobile advertising revenue figures in Canada for 2008 are expected to reach $5.2 million, once final figures are compiled, according to the first survey on the sector.

The figures were generated from the survey compiled by Ernst & Young and sponsored by the Toronto-based Interactive Advertising Bureau (IAB) of Canada. The survey covers three years, in order to establish baseline values for the Canadian mobile advertising market from the industry’s practical inception.

Mobile advertising revenue grew from $1.1 million in 2006 to $2.7 million in 2007, and is expected to almost double again in 2008 to the $5.2 million figure.

The figures do not include French-Canada. Once critical mass is achieved in the French-Canadian mobile market, IAB Canada plans to provide separate mobile advertising revenue breakouts for French-Canada as well.

The comprehensive survey – which garnered a 60 percent response rate - included all major mobile carriers and mobile marketing companies including mobile aggregators, online publishers offering mobile advertising solutions (including mobile search advertising), mobile application developers and mobile advertising networks.

“We had to identify every known mobile provider and carrier,” says Steve Rosenblum, director of research for IAB Canada. “And the questions were ultra-detailed, clear and concise. It took months to develop and pull together as detailed report as possible and to be sure that there would be no duplication of figures.”

Among the many findings were that standard SMS advertising programs currently generate 75 percent of the total Canadian mobile advertising revenue, with the remainder divided across premium SMS, mobile content, mobile (display) advertising, mobile search and mobile applications. All forms of mobile advertising are growing rapidly year-over-year, with the exception of mobile search, which is virtually non-existent. At eight percent, mobile content represents the next largest share of 2007 revenues, followed by mobile (display) advertising and mobile application development, both at five percent.

While mobile advertising revenue is growing exponentially compared to other major media - 143 percent between 2006 and 2007, compared to the five percent growth rate of all major media and online’s 38 percent growth over the same time period -this is to be expected, given mobile’s relatively small and nascent advertising revenue base.

Of all mobile advertising revenues, 25 percent is currently being derived from the telecommunications sector, followed by revenue from the packaged goods sector at 19 percent. Retail and media/entertainment categories were tied for third place at 12 percent each.
The top ten mobile advertising earners took in almost 81 percent of the total mobile revenues earned in Canada in 2007. (This represents a slightly higher degree of concentration than in the online market, where the top ten earners currently earn approximately 77 percent of all online advertising revenues.)

Peter Vaz, vice-president and director digital communications, M2 Universal Digital, and vice-president of IAB Canada's Emerging Platforms Council, says, "The results show not only the rapid growth of the market to date, but beyond that, the fact that mobile marketing is poised to move from one-off experimental campaigns to becoming an important part of the overall Interactive marketing mix.

“Moreover, as multimedia and network capabilities evolve within the channel, the nature of the advertising offer will evolve as well, moving well beyond current SMS programs, into more sophisticated and personal mobile content, video and application campaigns across an even wider range of advertiser categories."

Yet there are obstacles to overcome. Mobile marketers cite their main challenges in the next 12 months are: the small size of the Internet-enabled mobile audience; constraints posed by the current carrier/provider business model; low levels of advertiser/agency understanding and comfort with mobile as a viable advertising medium; and, the ability/need for mobile marketers to demonstrate mobile’s return on investment. There is, naturally, concern about the current economic downturn and the impact it could have on mobile advertising growth in 2009.

"Fortunately, like all other Interactive media, one of the key strengths of the mobile channel is its inherent measurability," says Adrian Schauer, managing partner, Vortex Mobile, and chair of IAB Canada’s Mobile Committee. "Add to that the very immediate, targeted and opt-in nature of the advertising, and you have a golden triangle of opportunity for accountability and future growth that is of paramount importance to all clients, regardless of economic climate."

Robust operating systems, new developer tools, the proliferation of smartphones, expanding services and more attractive consumer mobile phone and pricing plans, are all seen as central to growing mobile’s active user base, in order to draw greater advertising revenues to the medium.
“Drivers will be such items as the iPhone and the Blackberry Storm,” forecasts Rosenblum.