Branded Content: Growth for Marketers and Media Companies

Branded Content: Growth for Marketers and Media Companies

          
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Branded Content: Growth for Marketers and Media Companies

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  • Consumers to Brands and Media: “Give Us More”

    In contrast to how they view advertising, consumers react positively to branded content in two critical ways: they generally like and trust the content they encounter, and they trust the media platforms on which it’s delivered.

    In March and April 2015, BCG surveyed consumers in four countries—the United States, Germany, Italy, and the UK—on their views of branded content. We explored five product categories and asked about a wide range of media, including all major online and offline platforms.

    Five findings stand out as having implications for both marketers and media companies.

    Branded content is a powerful tool for many brands. Many brands can use branded content to create and deepen consumer engagement, as well as increase the likelihood of a purchase. While there are distinct national differences (see below), consumers in the four markets we surveyed generally like and trust a brand more—​and are more likely to purchase it—after encountering branded content. Of particular significance for marketers, this finding applies to brands about which consumers previously had no clearly defined attitude.

    Branded content magnifies existing perceptions. Marketers can use branded content to positive effect throughout the purchasing pathway, from building awareness through postpurchase reinforcement, but they should plan their campaigns with care. Branded content has a mostly positive impact on consumers’ view of a brand, but it also intensifies existing perceptions: those who are favorably disposed become more so, while unfavorable attitudes are reinforced.

    Brands and media companies therefore need to carefully target the right consumers. (See Exhibit 4.) Polarizing brands should consider focusing their strategy on platforms that they own or control, rather than on third-party properties. Similarly, media companies may want to filter the content they accept or agree to participate in.

    exhibit

    Media companies can play. Consumers do not believe that there must always be a rigid line between editorial and promotional material, and they are giving most media properties permission to carry branded content. But there are important distinctions by platform and market.

    Consumers are more receptive to branded content on media-consumption platforms than on interactive platforms. Across all markets, they react negatively to branded content on gaming platforms, which have little history of advertising. Significant percentages of consumers in both Germany and the UK also react negatively to branded content in social media. But for most websites and print platforms, the traditional line between editorial and advertising is being blurred if not erased. The majority of consumers in all four markets have the same or a greater level of trust in media properties that carry branded content, but players in each media category must take into account consumers’ views of each type of platform. (See Exhibit 5.)

    Not all branded content works in the same way with everyone, everywhere. Age, national culture, brand category, brand affinity, and other factors come into play. Marketers need to determine in advance whom they want to talk to and how they can best engage their audience.

    In the US, for example, almost all consumers have encountered branded content and appreciate the experience. Italian consumers are similarly enthusiastic. More than 30 percent of consumers in both countries are more likely to purchase a product after encountering branded content. The impact of branded content on consumers in the UK and Germany, while still positive, is more muted. Global marketers, in particular, should take note that branded content, like other forms of marketing, needs to be adapted to local realities.

    Brands reaching out to younger consumers should embrace branded content quickly and fully, as these consumers are the most receptive that marketers will find. In the US, for example, Millennials (ages 18 to 34) show a net increase of almost 30 percent in both affinity for and trust in a brand after experiencing branded content. On the other hand, brands that appeal to older consumers, and media properties whose audience is older, should be very conservative in their branded-content strategies. So-called silvers (ages 65 to 74) in the US show a decrease of almost 15 percent in affinity and trust after encountering branded content—and a similar drop in affinity for media companies carrying the content. However, this is the only age demographic that evidences significant negative perceptions of branded content.

    Among the brand categories we tested (automobiles, electronics and technology, foods and beverages, luxury goods, and personal-care products), branded content associated with high-end and lifestyle categories resonates most strongly with consumers. This is true both for the brands themselves and for the media companies that deliver the content. High-end products generally require more consideration before a purchase is made, they are more aspirational, and they tend to involve a stronger emotional connection with the consumer, all of which play to the strengths of branded content. Brands with a high degree of consumer affinity should pursue aggressive branded-content strategies, especially in countries where consumers show high receptivity, such as the US and Italy.

    Credibility is critical—and style counts. For branded content to be accepted, marketers and media companies need to be honest and sincere. Strong majorities of consumers in all markets put credibility at the top of the list of must-haves for branded content. Tone and style are also important (just as they are with nonbranded editorial or entertainment content). Humor and thought-provoking ideas help promote engagement. Readers want attractive design and layout. And there’s a strong desire in all markets for marketers and media companies to keep the content brief.