According to a recent study by the Custom Content Council in partnership with ContentWise, branded content initiatives are considered by marketers to be more effective than any other leading form of advertising and marketing. The study shows that content spending is the second highest ever per company. Print represented 43% of the total spending, while electronic and other accounted for 35% and 12%, respectively. The number one reason for using branded content is customer education and retention, says the report. Keith Sedlak, Chair of the Custom Content Council, says that “… the 2010 numbers illustrate a spending level that is nearly 100% above 2008… 68% of companies surveyed continue to shift their ad dollars to branded content… there was a 20% increase in companies surveyed this year versus last year that plan to grow their branded content budgets.”
Reason for Using Branded Content and Its Effectiveness:
* 66% of marketers think branded content is superior to direct mail and 63% think it is superior to public relations
* The primary reason to deploy branded content initiatives is to educate customers, according to 54% of the companies surveyed, followed by customer retention (23%)
* The leading secondary reasons were customer retention (35%) and educating customers (27%), though brand loyalty factored in at 26%.
Spending as Part of the Media Mix:
* 29% of the average overall marketing, advertising and communications budget funds were dedicated to branded content. This is the second greatest ever (first was 32% in 2009).
Electronic and other forms of branded content are impacting cost factors, showing an emphasis on acquiring personnel skilled in this area.
* The average spending for print forms is $256,655 on personnel, $214,874 on production, and $125,343 on distribution.
* The average spending for electronic forms is $267,632 on personnel, $81,246 on production, $62,129 on distribution, and $66,908 on programming.
* The average spending for other forms is $169,255 on personnel, $81,709 on production and $40,855 on distribution.
The use of services of external agencies (such as custom publishers, PR/Marketing firms, design firms, video production companies or interactive agencies) to handle some aspect of branded content initiatives remains consistent at around 50%.
* Outsourcing was more prevalent among print forms (45%) of branded content, than it was among electronic (19%) or other (23%) forms. Of all the branded content initiatives, some portion of these initiatives was outsourced 31% of the time.
* The average spent among those companies that did outsource (thus excluding those who did not outsource) was $583,500 versus a previous high of $885,646 in 2009.
For the first time this year, responders reported to what degree their organization is shifting from traditional forms of advertising and marketing to new forms (i.e. branded content, content marketing, custom publishing, or custom media).
* A total of 68% of companies indicate that they are shifting to branded content.
* The majority of companies (61%) have experience a moderate shift in their spending while 7% report an aggressive shift.
The research was conducted via online and mailed methods targeting a random sample of companies across all industries, producing a +/- 6% degree of accuracy at a 90% confidence level.
For additional information, please visit the Custom Publishing Council here.
