5 things that mattered this week

Facebook will be ‘all video’ in five years, says Nicola Mendelsohn

With video continuing to grow rapidly for Facebook, its EMEA vice president Nicola Mendelsohn has made the bold prediction that within five years the social media giant will become, more or less, “all video”.

Speaking at the Fortune Most Powerful Women International Summit this week, Mendelsohn also noted the importance of virtual reality and the rise of 360-degree immersive content, which she believes will soon become commonplace.

Amid a backdrop of a decline in text and an increase in user sharing through pictures and video, Mendelsohn says the makeup of Facebook could change quite dramatically.

“If I was having a bet I would say video, video, video. Video is happening even faster than mobile and we’re seeing the exponential growth of video on mobile. We’ve gone from a billion video views a day to 8 billion daily views in a year,” she said.

“And we’re not only watching more video, it’s also down to the type of video. It is much more immersive. We love 360-degree videos that let us move around and explore, which people can interact with. Facebook Live video now attracts 10 times more comments from Facebook’s 1.65 billion-strong audience than a standard video”

Microsoft’s LinkedIn acquisition is a data and advertising play

Microsoft announced a deal this week to pay $26.2bn for the professional social network LinkedIn this week. With LinkedIn’s 433m members, Microsoft will be paying $60 for each user, or $250 for each of its 105m monthly active users — those who not only join but also regularly use the platform.
And Microsoft’s boss Satya Nadella said the deal would create “easy wins” for the two companies, including the ability to allow LinkedIn users to share their Microsoft calendar with their news feed or to make it easier to access LinkedIn by incorporating it in their inboxes, browsers and Microsoft’s voice search service Cortana.

In particular, Nadella believes combining LinkedIn’s profile information with what Microsoft knows about workers’ projects, calendar and companies could help “solve a relevance problem”.

“This can drive targeting and relevance to the next level,” he said. “There will be deeper integration that offers more value but puts customers in control.”

Microsoft will be hoping the Linkedin acquisition works out better than the deal it made to buy Nokia in 2013.

Asda’s new boss will need to turn around the brand, not just its sales

Following a difficult period for the struggling supermarket giant, Asda announced this week it is parting ways with long-term chief executive Andy Clarke.

Sean Clarke, most recently CEO at Walmart China and with ties to Asda from the mid-90s, will take over in the role from 11 July. Current CEO Andy Clarke, meanwhile, will remain as an advisor at Asda until the end of 2016.

Asda has had a difficult year as the continued success of the discounters Aldi and Lidl and the resurgence of Morrisons and Tesco ate into its sales. Like-for-like sales fell by 5.8% over the Christmas 2015 quarter, its worst performance in history. Clarke called that Asda’s “nadir” but results were even worse the following quarter and have struggled ever since.

How Heineken is revising its sponsorship strategy with F1 deal

In a bid to reach 250 million more consumers, Heineken has been announced as a new sponsor for Formula 1. Speaking to Marketing Week, the beer brand’s director of global Heineken sponsorships Hans Erik Tuijt said it is eager not to compete with local beer brands as a result of the deal.

Tuijt says the sponsorship will also give Heineken more global appeal. “We sponsor a lot of local initiatives as well, but the ones that really cut through are our global sponsorships. It reaches so many more people, which is something that local beer brands can’t. If you compare the return on investment from local versus global [partnerships], global is more effective,” he explained.

“We want to outperform the cost of local sponsorship. We aim to have 60% of Formula One fans that drink beer know about our sponsorship in three years. I think it’s achievable.”

The Formula One (F1) partnership, which comes into effect in 2017, will include campaigns based around Heineken’s global ‘Open your World’ and ‘If You Drive, Never Drink’ initiatives. Activations will include F1 circuit branding, TV ads, digital and social activity, live fan experiences and events, and point-of-sale activations. David Coulthard and Sir Jackie Stewart will be ambassadors for the respective campaigns.

Keeping marketers tuned into radio

In the first of a new series examining the effectiveness of media channels, Marketing Week has looked into the current state of radio.

Commercial radio still reaches 89% of UK adults every week (equal to 48.2 million people) – the same as in 1999. It also seems to be reaching coveted youthful audiences, with 2016 Rajar figures showing that 77% of 15 to 24-year olds and 72% of 25 to 44 year-olds tune in every week. Meanwhile, the BBC reaches 35% of 15 to 24-year-olds and 59% of 25 to 44-year-olds.

And, according to Advertising Association and Warc figures, total ad spend on radio grew 2.9% to £591.5m in 2015, with overall UK ad spend increasing by 7.5% to £20.1bn. The Radiocentre, meanwhile, predicts that radio will grow 4.3% year-on-year for 2016.

Citing Radio Advertising Bureau figures, that found that, after TV, radio has the highest ROI of any media, James Cridland, managing director of media.info, believes radio continues to be  a compelling option for marketers.

He explained: “There are so many more ways of making the most out of the content radio produces and owns. It’s about understanding that radio is far more than just a musical jukebox. It’s all about the human connection and the shared experience.”