MUMBAI: Faced with media fragmentation and
escalating demand for measurable results, US marketers are significantly shifting their spending from brand building to direct response-oriented
promotional channels.

This finding is contained in a report released today by Winterberry Group, a strategic consulting firm serving the direct marketing, marketing services and marketing technology industries.

The report was commissioned by V12 Group. It provides below-the-line marketing services, which uses its proprietary databases and multichannel delivery model to provide measurable customer acquisition results for more than 400 clients. The findings were based on Winterberry Group data and
secondary research from sources including the Direct Marketing Association, JupiterResearch, Universal McCann, Forrester Research, eMarketer
and executive leadership in the marketing community.

The report defines and quantifies, for the first time, the shift in spending from above-the-line (ATL) to below-the-line (BTL) marketing channels. Winterberry Group defines ATL marketing channels as those that strive to reach mass audiences with messages that reinforce brands, communicate general product information or inspire emotional response. This includes television,
radio and print advertising, as well as outdoor advertising and yellow pages.

BTL marketing, on the other hand, includes targeted, direct marketing efforts that offer convenient response mechanisms and comparable ease in measurability. Examples of BTL marketing are database marketing, direct mail, interactive marketing, insert media and promotional marketing.

From 2003 through 2007, ATL advertising is expected to grow by an average of 5.5 per cent per year, with BTL spending growing at 7.8 per cent annually.

ATL spending was expected to grow 5.6 per cent in 2005, a full 1.7 per cent behind overall marketing spending. The difference will be more pronounced in 2007, as ATL spending will grow just 4.6 per cent for the year, compared with 7.3 per cent overall industry growth.

Led by interactive marketing -- including search, e-mail and online advertising -- nearly all BTL channels are projected to grow in excess of the 6.9 per cent annual growth forecast for the whole industry between 2003 and 2007.

The growing prevalence of measurable BTL campaigns has had an effect on the duties of marketing executives and ad agencies. It is forcing them to look beyond brand evelopment and the overall reach of their message. To explain the BTL phenomenon, Winterberry Group identified seven key trends
directly affecting the shift in marketing budgets.

They are:
* Changing consumer demographics decrease the influence of traditional mass-media (i.e. "one-size-fits-all") marketing messages.

* Growing consumer sophistication heightens the demand for channel-agnostic communications.

* Widespread marketing 'clutter' is diminishing the impact of commercial messages that don't address specific and individually relevant consumer
needs.

* Enhanced information availability empowers both marketers and consumers with insight that allows for precise customer targeting and intelligent purchase decisions.

* Heightened client pressure to deliver quantifiable value forces marketing service providers -- especially agencies -- to re-evaluate services platforms.

* Growing effectiveness of "multichannel" campaigns (those that cross multiple media) reinforce demand for tactics that establish one-to-one relationships between marketers and consumers. The Internet Advertising Bureau found that well-executed multichannel campaigns generate a 7 to 34 per cent sales lift.

* Rapid technological advances allow for consumer/marketer interactions that are frequent, easier and more relevant than previously possible.

Winterberry Group MD Bruce Biegel says, "Simply stated, above-the-line marketing that utilizes generic messages to build awareness is no longer the best way to influence customer behaviour. Below-the-line
initiatives are more successful because they stress targetted and customer-centric communications. Below-the-line also creates measurable results and ROI metrics, which are important to marketers under growing pressure to prove the value of their campaigns. We expect that this demand for quantitative results will continue to intensify for at least the next five years."

V12 Group founder and CEO Paul Chachko says, "This report shows the extent of the budget shift we identified in the market, leading to the formation of V12 Group to deliver below-the-line services across a number of channels,

"It is valuable to see the shift quantified for the first time by a firm as respected as Winterberry Group, and we look forward to capitalising on the increasing demand for measurable marketing campaigns."

The Winterberry Group is a global strategic consulting firm that helps direct marketing, marketing services and marketing technology firms build profits and propel shareholder value. Services include business planning and assessment -- through its flagship Opportunity Mapping and Value Driver Assessment processes -- plus market intelligence, sector research and tactical execution support.