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WORD-OF-MOUTH RECOMMENDATIONS REMAIN THE MOST CREDIBLE

Online formats make it easy for consumers to take action 

TV still a major influencer in route to purchase

More than half of consumers say real-life situations in advertisements­­ resonate most

Jakarta, 02 October 2015 – While advertising in the form of word-of-mouth recommendations from people they know and trust, continue to be the most trusted source of advertising by consumers in Southeast Asia, owned online channels are increasingly finding their way into the consumer’s circle of trust, according to a new report released recently by Nielsen.

Nielsen’s Global Trust in Advertising Survey polled 30,000 online respondents in 60 countries to gauge consumer sentiment in 19 forms of paid, earned and owned advertising mediums. The results identify the ad formats resonating most strongly with consumers and those that have room to grow.

Across Southeast Asia, 88% of consumers placed the highest level of trust in word-of-mouth recommendations of from people they know, with Filipino consumers leading the way at 91% (up 1 point from 2013). Word of mouth endorsements gathered the biggest increase in approval from Vietnamese consumers, up eight points to 89%. Similarly, 89% of Indonesians (up four points) gave the advertising source the nod, followed by Malaysians (86%, up 1 point), Singaporeans at 83% (down two points) and Thais at 82% (three-point increase).

“Undoubtedly, word-of-mouth recommendations from people they know and trust are the best way to promote your product to consumers, especially when combined with the power of television and digital advertising” Craig Johnson, Managing Director, Marketing Effectiveness and Reach portfolio, Nielsen Southeast Asia, North Asia and Pacific.  “Mastering online word-of-mouth marketing techniques can result in quicker and viral reach.  Brand marketers can widen the circle of trust, by engaging passionate brand advocates to amplify their message and giving them a compelling reason to talk. Trust is fragile. Practice transparency and accountability, because if trust is broken, your advocates also have the power to damage credibility and reputation.”

Owned online channels are also among the most trusted advertising formats in Southeast Asia, with branded websites as the second-most-trusted format at 77%. Meanwhile, 71% of survey respondents indicate that they trust consumer opinions posted online.

TRUST IN TRADITIONAL ADVERTISING LIVES ON

Ads on television, magazines and newspapers continue to be among the most trusted forms of paid advertising in Southeast Asia. Nearly eight in 10 consumers in Indonesia (79%), Thailand (78%), Philippines (75%), Vietnam (69%), Singapore (64%), and Malaysia (63%) indicated their trust in television ads — all above or consistent with the global average of 63%.  Seventy percent of Southeast Asian consumers continue to trust ads in magazines and 69% in newspaper ads.

“The proliferation of online formats has not eroded trust in traditional (offline) paid channels. TV still delivers the highest unduplicated reach (i.e., the ad reaches each audience member only once) of 85-90%,” said Johnson. “While digital ads can present considerable advantages—such as precision-focused campaigns, in-flight adjustments and more creative options—moving from TV to an all-display digital plan is a bold move for any marketer. A mix of offline and online channels can yield the best ROI.”

CREDIBILTY OF MOST ONLINE PAID AND MOBILE ADS GROWS

Among online paid ads, those which are served in search engine results received the highest credibility with close to six in 10 or 57% of consumers indicating trust in this channel. Thailand has the highest trust score (63%, up seven points) followed by Indonesia (61%, a four-point increase), Philippines (56%, no change), Vietnam (55%, up 11 points), Malaysia (46%, down six points), and Singapore (46%, one-point decline).

The credibility of advertisements in social networks and online video ads closely follow at 53% and 52% respectively. Six in 10 Thai consumers (60%) say they trust ads delivered through social networks, as do consumers in the Philippines (59%), Indonesia (54%), Vietnam (48%), Malaysia (47%), and Singapore (44%).

Trust in online video ads increased in four out of six markets in Southeast Asia with the Philippines and Thailand leading the way at 56% (both up five points), Vietnam (+11 points) and Indonesia (no change from 2013) both at 52%, Singapore at 47% (up four points), and Malaysia at 41% (-9 points).

While less than half of the consumers in the region trust online banner ads (47%), mobile advertising (45%), both exceed the global average of 42% and 43% respectively. Trust by Southeast Asian consumers in mobile text ads is at 35%, a point less than the global average.

ONLINE FORMATS MAKE IT EASY TO TAKE ACTION

The Nielsen report also revealed that although trust and action are clearly linked, credibility is not always a prerequisite to purchase intent.

In Southeast Asia, action exceeds trust across the 19 advertising formats in the survey. Respondents that trust the recommendations of people they know claim they take action on these opinions majority of the time (91% vs. trust at 88%) while self-reported action for branded websites and ads on TV are at 81% respectively (see Chart 1).

Aside from being highly credible among consumers, ads on TV also received the highest self-reported action among traditional offline formats at 81%, exceeding trust by seven points. “TV continues to be a major influencer in the purchase decision of consumers,” said Johnson.

Formats which earned lower trust levels can be extremely effective in driving consumers to the point of purchase. This is particularly true for online and mobile formats. Self-reported action exceeds trust by more than double digits for ads on social media (53% trust; 72% take action), text ads on mobile phones (35% trust; 54% take action),  ads served in search engine results (57% trust; 74% take action), online banner ads (47% trust; 63% take action), ads on mobile devices (45% trust; 60% take action), e-mails that respondents signed up for (62% trust; 76% take action), and online video ads (52% trust; 65% take action).

Hellen Katherina, Director, Media, Nielsen Indonesia, said, “Online and mobile formats make it easier for consumers take quick action on the advertisement, for instance direct purchases, because with only a click, consumers are directed to a place where they can receive more information or purchase the item.”

ADS THAT MAKE THE GREATEST IMPACT

Advertising that used real-life situations was  most likely to resonate among Southeast Asian consumers, while ads that are family-oriented, health-themed, value-oriented, and humorous also fared well (see Chart 2).

“To make a lasting and significant connection with consumers, the formula remains the same. Advertisers need to understand the audience and their preference,” advised Hellen. “Advertisements that feature relatable situations and comedic relief and which focus on family, values and health greatly appeal to consumers in Southeast Asia, eliciting the most positive response.”

Chart 1.  Southeast Asian Consumers’ Trust in Forms of Advertising vs. Action

Source: Nielsen Global Trust in Advertising report, 2015

Chart 2. Most Resonant Advertising Messages in Southeast Asia

Source: Nielsen Global Trust in Advertising report, 2015

About the Nielsen Global Survey

The Nielsen Global Survey of Trust in Advertising was conducted between Feb. 23 – March 13, 2015, and polled more than 30,000 consumers in 60 countries throughout Asia-Pacific, Europe, Latin America, the Middle East, Africa and North America. The sample has quotas based on age and sex for each country based on its Internet users and is weighted to be representative of Internet consumers. It has a margin of error of ±0.6%. This Nielsen survey is based only on the behavior of respondents with online access. Internet penetration rates vary by country. Nielsen uses a minimum reporting standard of 60% Internet penetration or an online population of 10 million for survey inclusion. The Nielsen Global Survey, which includes the Global Consumer Confidence Index, was established in 2005.

About Nielsen

Nielsen N.V. (NYSE: NLSN) is a global performance management company that provides a comprehensive understanding of what consumers Watch and Buy. Nielsen’s Watch segment provides media and advertising clients with Total Audience measurement services across all devices where content—video, audio and text—is consumed. The Buy segment offers consumer packaged goods manufacturers and retailers the industry’s only global view of retail performance measurement. By integrating information from its Watch and Buy segments and other data sources, Nielsen provides its clients with both world-class measurement, as well as analytics that help improve performance. Nielsen, an S&P 500 company, has operations in over 100 countries that cover more than 90% of the world’s population. For more information, visit www.nielsen.com.