Germany: Special Report - Germany cheers up

Recent advertising in Germany reflects a more optimistic mood in the country. But can it last? Friedhelm Gieseking reports.

Okay, so they didn't make the final. But, if hospitality and good cheer had counted during the four sizzling summer weeks of the World Cup, the Germans would surely have been crowned world champions.

Germany proved an impeccable host, living up to the country's official World Cup slogan "Die Welt zu Gast bei Freunden" ("A time to make friends"). The country showed it could not only stage the world's most popular sporting event with trademark efficiency, but could have some fun while doing so. This came as more of a surprise to the Germans themselves, still feeling the effects of a wearisome recession, than to the million visiting football fans from Sweden to Saudi.

Despite the lift in national mood, the World Cup wasn't always good news for the media and advertising sectors.

Of the TV stations, the state broadcasters ARD and ZDF showed most of the live matches, which meant audiences and revenues at non-rights owners such as ProSiebenSat.1 suffered.

World Cup matches attracted an average 11 million fans (around a 50 per cent audience share), and 26 million people (72 per cent share) watched the final. But the tournament wasn't the cash cow it had promised to be. After a slow start, ARD and ZDF managed to sell between 80 and 90 per cent of the commercial slots to hesitant advertisers wary of clutter.

Surprisingly, print media was a brighter story. Five per cent more ad pages were sold by magazines from January to June this year - and yet the World Cup was only partly responsible. In fact, all traditional media, with the exception of radio, recorded boosts to ad revenue during that period (Nielsen Media Research reports an increase of 6 per cent gross adspend for the first half of 2006).

The World Cup period itself proved disappointing. TV stations without broadcast rights contributed to a 3 per cent drop in spend, Michael Zimmer, the commercial director at Nielsen Media Research in Hamburg, says.

This isn't to say the World Cup did the ad economy no favours, although the boost came before the tournament, not during it. "There was definitely a positive effect on the German advertising market," Zimmer says. "The closer we came to the championships, the more World Cup-related campaigns began to appear." Stephan Schroder, the manager of the Cologne-based research company Sport + Markt, agrees: "At last count, around 500 brands had used a football theme," he says. "I can only assume this had something to do with the spend hike."

As for brand owners, Sport + Markt measured the performance of sponsors and non-sponsors. Relations between the German national team and its sponsor Adidas turned sour last month after the players threatened to strike over being forced to wear the triple-striped boots. But during the World Cup, Adidas came out on top in its ongoing tussle with Nike. In a day-after recall survey, Adidas showed the highest awareness levels - followed by Deutsche Telekom, Coca-Cola and McDonald's. "Nike did not play a dominant role this time round," Schroder says. In addition to its "+10" TV and print campaign, Adidas impressed with various stunts created by TBWA, including a giant-sized image of Oliver Kahn at Munich Airport.

"This time, the official sponsors really did their homework," Schroder says. Campaigns started a lot earlier and concepts were developed using a plethora of channels rather than a lone TV campaign. This was particularly true of Deutsche Telekom. The World Cup sponsor launched its multichannel push last November through the Hamburg agency Economia, inviting Germans to be part of "the biggest national team ever". Fans wore a "welcome jersey", giving them the chance to appear in Deutsche Tele-kom posters or TV spots. More than one million people took part.

As in the UK, however, most World Cup advertising was predictably dreary. "Too many companies relied on lazy stereotypes and endless images of balls and players," Florian Schindler, the managing director of BBDO Berlin, grumbles. "The results were costly me-too campaigns that failed to differentiate brands."

Non-sponsors, forced to think of ways to get round Fifa's Draconian regulations, were more imaginative. BBDO Dusseldorf exploited the wave of new-found patriotism with a campaign for Persil Colour that used a photo of a stack of towels in the national colours of black, red and gold. The copy read: "For a country that has rediscovered its colours this summer."

In general, though, it was the lift in the mood of the German public that was of most value to the economy and, in turn, the ad industry. But was a more liberal relationship between consumers and their wallets to last? "The World Cup only had a temporary influence (on the economy and the ad industry)," Schroder points out.

Consumer confidence reached a new high this July, according to figures from the research institute GfK. But there is a catch: the only part of the survey that caused the figures to rise is a greater inclination for consumers to buy bigger-ticket items - while an underlying concern remains over the health of the economy.

There are three key reasons why Germans remain uneasy. First, VAT will rise by 3 per cent in 2007, (which is why consumers are likely to make larger purchases before the end of the year). There is also worry over a proposed health service reform that will mean higher taxes. Furthermore, Germans worry about rising fuel bills.

With so many clouds on the horizon, the honeymoon period of the chancellor, Angela Merkel, and the Grand Coalition of Christian Democrats and Social Democrats is well and truly over. Approval ratings for Merkel have been dwindling, leading most Germans to conclude that they are better off believing in themselves than in the politicians who govern them.

On a more positive note, German exports (according to BASF chemicals, DaimlerChrysler and Siemens electronics) continue to boom. Many companies are reporting impressive profits despite some of the highest labour and tax costs in Europe, personal incomes are growing and unemployment is ebbing slightly. This leaves Germans in an ambivalent mood. "There are now two camps in Germany," Michael Trautmann, the boss of Kempertrautmann, says. "Doomsayers who predict a return to darker days. and the optimists who have faith in the positive signs of economic recovery."

The advertising and PR industries attempted to lift the doubters out of the dumps and kick-start the economy with two initiatives launched last year. The government joined the business community to pool more than EUR20 million into a campaign by Scholz & Friends with the slogan: "Deutschland - Land der Ideen" ("Germany - land of ideas"). The campaign, which is still running in Germany as well as abroad, is essentially a PR push, but includes traditional media advertising. Critics complain that it hasn't attracted the attention it should, and it has taken a new series of posters featuring Claudia Schiffer to get people to take any notice at all.

Another bid to boost German self-esteem, lauded as the country's biggest-ever social marketing initiative, had no trouble getting noticed. The backers of the campaign, 25 blue-chip media companies, provided airtime and space worth EUR30 million. Created by the German hotshops Jung von Matt and Kempertrautmann, it revolved around the slogan "Du bist Deutschland" ("you are Germany"). A number of famous Germans - Beethoven, Einstein, Michael Schumacher and others - were used to evoke a sense of national pride and renewed confidence.

When the first phase of the cam-paign ended in January this year, its creators claimed it had achieved its aim. A survey by GfK showed a campaign awareness rating of 58 per cent - ten million Germans said they were motivated by it. The biggest reaction, however, came from website satires and bloggers who slammed the campaign as, at best, kitschy and, at worst, nationalistic. One blogger unearthed a photo from the 30s that showed Hitler's face next to the uncannily similar slogan: "Denn Du bist Deutschland" ("Because you are Germany"). But Oliver Voss, the creative chief at Jung von Matt, is unfazed. "Something that doesn't divide opinion won't get a reaction," he says.

Consumers aside, adland has reason for good cheer, at least until the end of the year. ZAW, Germany's equivalent of the UK's Advertising Association, forecasts a 2 per cent hike in net ad revenue for 2006, breaking the EUR30 billion barrier. (Although it's not quite as optimistic about 2007.) GWA, the German association of ad agencies, expects industry growth of around 3 per cent this year. And the readiness of consumers to spend more is good news, too. Schindler believes Germany's miser mentality is a thing of the past. "People are now more willing to pay more for branded goods," he says, hinting that the days of obsessive bargain-hunting in shops such as Lidl and Aldi may soon be over. In a survey by the branded goods trade body Markenverband, 71 per cent of its members expect rising sales and 50 per cent plan to invest more in marketing.

Of course, there is no certainty that this growth is sustainable. But more confidence and optimism are beginning to show in the tone of advertising across a range of product categories. The focus is now more on value and image. Retail chains are suddenly emphasising quality and service - as seen in Edeka's image campaign "Wir lieben Lebensmittel" ("we love food") by Grabarz & Partner in Hamburg. Then there is an optimistic new campaign for Deutsche Telekom by Kolle Rebbe, "Hallo Zukunft!" ("Hello future!"): evidence that World Cup cheer is still around.

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