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What: Hyundai Motor America (HMA) backed ad agency group Innocean is partnering with U.S. independent agency giant Horizon to launch a separate standalone media organisation called Canvas Worldwide.
Why it matters: The new media agency is born with US $700 million business worth of business for the Hyunday and Kia accounts IP. For Horizon, an affiliation with Innocean brings international scale and Hyundai, an automotive client that fills one of the few holes in the shop’s robust client portfolio. Innocean gains a very strong U.S. presence.

Canvas Worldwide will be the nearly US $700 million U.S.media business for Hyundai Motor Group’s US brands, including both Kia Motors America and Hyundai Motor America. “I’m interested in building out a new entity. I think there’s enormous white space here,” said Bill Koenigsberg, CEO and founder of Horizon.
Koenigsberg has invested millions in building the new infrastructure, and aims to hire around 200 people by the beginning of next year to service the shop’s first account. The company will announce a CEO in the coming weeks, he said.
horizon-media-raises-the-bar-on-digital-advertisingHyundai North America (HMA) indicated in a statement, “Canvas will bring a new, entrepreneurial team that is not associated with any media holding company, providing independent thought and action. Canvas will be inventing a new future in the media world, while using all of Horizon’s known strengths to function at full effectiveness from the moment it begins working for Hyundai Motor America in January, 2016.”
The automaker also referenced the new media agency’s transparent buying model as a main selling point at a time when there’s a lot of debate around buying.

Canvas will be inventing a new future in the media world, while using all of Horizon’s known strengths.

“Hyundai has been impressed by Horizon’s existing ability to fully offer a transparent system for media buys and understands this will be a key component of the Canvas philosophy,” the company said in its statement. “This transparency, and the accountability that goes with it, are critical to HMA.”

Innocean IPO and U.S. Growth

The new joint venture also furthers Innocean’s goals for growth (check out our recent Profile of Innocean). The company, which was started by Hyundai over a decade ago and completed its initial public offering in Seoul last month, said that it would take 134 billion won from the 340 billion won it raised from its IPO and use it to expand and diversify its client base beyond Hyundai.

The Hyundai and Kia business accounted for around 70% of Innocean’s revenues last year.

For Horizon, an affiliation with Innocean brings international scale and Hyundai, an automotive client that fills one of the few holes in the shop’s robust client portfolio.
Horizon offers Innocean a hefty U.S. presence and a portfolio of strong and diverse client relationships that would expand the shop’s Hyundai-heavy client roster. The Hyundai and Kia business accounted for around 70% of Innocean’s revenues last year, according to Reuters.

Join us at PORTADA Mexico!

Elevator Pitch:

Think big and act small is the mantra of this Huntington Beach agency that’s infused with the maverick surfer ethos.

Secret Sauce:

Thinking big means coming up with wild ideas for challenger brands – as well as for Hyundai/Kia. Innocean USA partnered with neuroeconomist Paul Zak, AKA Dr. Love, to explore the love we have for brands; and it wrangled film director Amir Bar-Lev and Grammy-winning musician Mark Ronson, of “Uptown Funk” fame, to host a seminar at the Cannes Lions Festival of Creativity.

Origin story:

Innocean USA, part of the Innocean Worldwide agency, was founded to provide advertising services for Hyundai and Kia, but it’s expanded its U.S. footprint and client roster since 2012, when golf-wear-maker Footjoy became its first non-automotive client. The U.S. branch is now 300 people strong, with offices in New York, Chicago, Dallas and Hawaii. The agency is cagey about just how much of its billings come from Hyundai/Kia, but in 2014, Reuters reported that its domestic Hyundai-related business had dropped to 43 percent in 2013 from 100 percent in 2005.

Greg Braun
Greg Braun

Media decision-makers:

Innocean has a full-service media team that includes strategy; planning; execution; optimization; and reporting on results and ROI. According to Executive Creative Director Greg Braun, the agency’s creatives and media experts work collaboratively. “We don’t want media to be an afterthought,” he says. “When we attack projects and campaigns, we always want our media experts shoulder to shoulder with creatives, strategists and account people.”

According to James Zayti, group director of Hyundai Media, as the account planning team begins to define the target for a campaign, “We build a thematic of what our target does on a daily basis: Where are they most receptive to messaging?”

Notable Clients:

Innocean USA provides media account management for Hyundai/KIA; Berkshire Hathaway Homes; energy company NRG; Alpina Foods.

James Zayti
James Zayti

Cool Campaigns:

For the FIFA World Cup Tournament, Innocean worked with ESPN, Univision and other media partners to embed Hyundai into the programming. Says Braun, “Most of the brands made platforms for famous athletes. We love them too, but we made it a forum for fan passion.” Innocean created the meme #BecauseFutbol, using it in TV spots and social media. Braun says, “It becomes not only a rallying cry but an excuse for any crazy thing you might do.”

futbol socialZayti adds, “Each time we’d run the work in halftime, our brand would trend organically on Twitter.” In fact, Hyundai saw a 1,415 percent lift in Hyundai mentions in relation to World Cup or soccer chatter, with 92 percent positive sentiment, shattering pre-campaign benchmarks with 95,328 total mentions of #BecauseFutbol.

In February of this year, Hyundai became the exclusive auto sponsor of IFC’s Comedy Crib, and Innocean created a web series called Sound Advice, featuring Vanessa Bayer of SNL. Each episode opens with a custom Hyundai integration featuring Bayer driving or vamping in front of a Hyundai Veloster; then, her character, a ditzy media coach named Janessa, attempts to give advice to famous musicians, including Al Yankovich and tktktk.

janessa and carsZayti says, “We looked at the media side and saw IFC as a great space that shared a lot of brand identity with Hyundai. Then, speaking with the creative side, we took it another step.” Moving beyond product placements, Innocean’s writers worked with IFC’s writers to integrate the brand further into the segments.

“For all product integrations, we sit down as a team to see where we can take it,” he says. “Sometimes we just want a car in a TV show or movie, but sometimes we think there’s an appetite to take it much further.”

Check out other agency profiles recently published by Portada:
-Spark, a Boutique Backed by a Global Agency Network
-The Media Kitchen, How Chefs Cook Up Media Plans

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With increasing pressure from digital, broadcasters will strut their best and brightest stuff this week. Here’s what media buyers from Zubi Advertising, Horizon Media, Havas Media, Dieste, Bromley and Innocean USA expect.

-baila-si-puedes-1971641
Azteca’s Baila si Puedes

Ahead of the TV Upfronts, Azteca America gave a sneak preview of “La Hora Ganadora,” an hour of family-oriented programming that will rotate shows in short seasons of a few weeks.

Says Manuel Abud, president and CEO of Azteca America, “For advertisers, it means I am committing to a genre that will bring a similar type of viewership.”

“La Hora Ganadora” offerings include dance competition “Baila si Puedes” and game show “El Rival Más Débil.” Each show will run for around eight weeks. Abud says of the new approach, “It’s getting more difficult to get an audience engaged for a longer period of time, so we don’t ask for such a big commitment as in the past.”

La Hora Ganadora
La Hora Ganadora

His statement is central to the conundrum of the Upfronts, as networks try to get advertisers and agencies excited enough about shows to put big bucks upfront – as viewing habits and media consumption change.

TV: Still Relevant

Make no mistake, though. TV as we know it is not going away, and neither are the Upfronts. Certainly, TV consumption overall is changing, with people – especially younger people – watching less broadcast and more over-the-top and direct-to-digital video. Nevertheless, media buyers say television is important for reach.

karina-dobarro-188“We are dealing with a consumer that over-consumes media, so we are still able to find them through linear TV as well as online video,” says Karina Dobarro, vice president and managing director of multicultural brand strategy for Horizon Media.

Media buyers agree that television remains the fastest and best way to generate reach, even as it evolves.

Media buyers agree that television remains the fastest and best way to generate reach, even as it evolves. It’s important even when reaching Hispanic millennials, according to Isabella Sanchez, vice president of media integration for Zubi Advertising – and so is Spanish-language programming. “People think millennial equals English, and that’s not necessarily the case. Millennials just happen to be younger. If you look at Univision’s numbers on any given day, they have a huge foothold on the 18-to-34-year-old populations,” she says.

Isabella Sanchez_Zubi_BW
Isabella Sanchez, Zubi

A case in point is the gigante gap in Sunday-night television that will be left with the demise of the elderly and beloved Sabado Gigante. Univision may reveal a replacement during its upfront. Says Sanchez, “It looks like a dated program, but millions of people watch it. I have no doubt Univision will come up with something tremendous as a replacement.”

Sabado Gigante looks like a dated program but millions of people watch it. I have no doubt Univision will come up with something tremendous as a replacement.

Meanwhile, says Dobarro, the end of the show “represents an opportunity to continue to attract their current TV audience while trying to grow that younger audience.”

Broadcasters Expand Digital

Of course, digital placements on network dotcoms have been available for years. As TV consumption continues to move fluidly across screens, media buyers are interested in seeing how networks will showcase and handle digital.

At last year’s Upfront, Azteca America announced a partnership with YouToo Technologies, a “social TV platform.” This year, Azteca and YouToo will offer online and mobile trivia games for new programming including “La Hora Ganadora” and “Viernes Futbolero.”

Manuel Abud foto
Manuel Abud, Azteca America

Abud says, “Digital will be a bigger part of the upfronts in general. As the technology keeps moving, we will.” Because consumers have become device-agnostic when viewing TV, he says, “My focus is on developing content-centric franchises.”

Eric Bader, CMO of RadiumOne, a provider of programmatic advertising solutions, points out that television and digital aren’t so much at odds with each other when it comes to marketing goals. He says, “Television is essentially designed to meet brand and exposure metrics at the top of the funnel. Digital has effectively grown to service the bottom of the funnel and more direct marketing expectations.” Instead of buyers trying to decide which content is superior, or how much budget should go to TV versus digital, he advises, “The first thing that has to happen is that the advertiser has a full picture of both the brand goals and the direct engagement goals. It has to start with the measurement goals being defined, and then going into the market and seeing where you will find the audience that meets these goals.”

Says James Zayti, group director of Hyundai Media at Innocean USA, “We have to think about all the touchpoints where someone buying a car would be viewing content. For younger consumers, that would be more digital touchpoints, but we definitely need a marriage of both.”

Horizon Media’s Dobarro has seen a shift in how Spanish-language networks position their digital offerings. While they used to compare their online video to established, digital-native content companies like Yahoo, now they are going up against other broadcaster dotcoms. “It’s more of an even playing field for them,” she says. “They have realized they are not going to be able to gain the audience and reach of Google, for example.”

Still, much more needs to be done, according to Sue De Lopez, group account director for Bromley. The new marketing model, she says, is “dynamic, always-on and iterative. There is a tremendous void in multi-platform and multicultural content right now.”

She is seeing advertiser budgets shift from television to digital and to multiscreen. In fact, Bromley has shifted its own rhetoric, now talking about “video” instead of TV/digital; and it now sees its teams as working in content instead of advertising.

Meanwhile, De Lopez says, “Broadcasters are offering digital, but the units they offer are basic, the same old units: banners, static, B-roll videos. It’s all very cookie cutter. Brands and agencies are looking beyond the expected digital offerings. We want to know how we can tap into culturally relevant digital content that is customizable, so brands can fit in in a very organic way.”

The question of rates

In earlier days, broadcasters may have thrown in some digital advertising on their dotcoms as a value-add. With today’s shift to digital, that would be crazy.

Says Bader of RadiumOne, “Now they are bundling it in a different financial package, because there is more viewership on those platforms.”

Abud says that Azteca will be flexible – but not give freebies. “There are some clients that want to deal with digital separately, some want to see it as a combined effort,” he says. So, some advertiser budget that formerly went to Azteca broadcast may now be split. He adds, “Digital is still a complement for broadcast. Someday it will have a life of its own, but I’m not there yet.”

Univision has one strong property next year — soccer — and will probably try to bring in a lot of revenue for that

Zubi’s Sanchez acknowledges, “Everyone always wants to increase their rates; it’s the game we’ve all been playing for years. They ask for a lot and then buyers fight them on it.” She thinks that more cross-platform opportunities can help networks increase revenue without raising television rates. She notes, “Univision typically has led the pack in setting CPM increases. They have one strong property next year — soccer — and will probably try to bring in a lot of revenue for that. But all predictions say it will be a soft upfront when talking about base programming.”

Greater accountability from networks

Measurement continues to be a concern of TV buyers. Dave Morgan, CEO of Simulmedia, says, “There is no question we will see a greater use of data. There is a lot of rhetoric with buyside and sellside positioning, both saying they are bringing their best data to the table.” Simulmedia uses data to aggregate audiences for agencies and advertisers, mostly in the scatter market. “Brands and marketers themselves are clear that they want true ROI, but that isn’t how most TV media has historically been bought.”

Joseph Abruzzo, Havas Media
Joseph Abruzzo, Havas Media

Joseph Abruzzo, chief exploration officer for Havas Media, concurs. “One thing that’s changing is networks are very interested in protecting their revenue base. They will be selling greater accountability [by] starting to offer data-infused targeting options,” he says.

For example, Azteca is working with Furious Corp, the Nielsen-funded startup that works with television programmers to use real-time data from smart TVs and other connected devices to plan and optimize revenue across platforms. Meanwhile, Turner Broadcasting System, CBS and NBCUniversal have announced initiatives to add performance-based metrics to TV buying.

Abruzzo says that merging third-party data sets gives broadcasters the ability to create richer profiles of those who are actually watching a program, so an advertiser could target, for example, people who are most likely to buy a Lexus. “These are still linear buys,” he says, “but you are buying a program that has an audience composition mostly made up of [your target audience].”

Better targeting is especially important to buyers on multicultural desks, according to Greg Knipp, CEO of Dieste. “In our space in past, it’s been Univision and Telemundo, and then you fill in around those two. As we get more sophisticated in segmenting our audience, and the more targeting we can get in traditional media, the better off we’ll be.”

Knipp expects even greater shifts in the media landscape in years to come. He notes that a lot of the most talked-about content among young Hispanics and bi-culturals is stuff you can’t buy: programs like “Game of Thrones” and “Orange is the New Black.” Acknowledging that broadcasters must be more conservative than OTT providers, the question he sees is, “How will we reach this audience that is watching things that don’t have advertising?” The answer, in his opinion, is using data from set-top boxes and smart TVs, combined with third-party data, to get better addressability.

Morgan of Simulmedia thinks it’s possible that measurement could actually show that some TV spots are undervalued. His question for agencies is, “Now that you have sellers willing to sell on ROI, are buyers willing to buy on ROI?”

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