Archive for the ‘Marketing’ Category
Monday, May 20th, 2013
Try it, you’ll like it… talk about it and buy it! Keller Fay Group , which conducts word-of-mouth research, today released new findings that support and explain the success of word of mouth marketing driven by an in-person experience.
The research study, “Experience-Driven Word of Mouth: The Key to Powerful Social Marketing” was commissioned by House Party Inc. , a social marketing company.
A lack of solid, projectable research about what motivates consumers to talk about brands — and about the impact of that talk — leaves many marketers to make marketing decisions that fail to fully capitalize on the opportunities that are afforded by today’s highly social marketplace.
This research explores the factors that trigger word of mouth and assesses which have the greatest impact.
Positive brand experience starts conversations
The research finds that the most powerful conversations are started by a positive brand experience, both in terms of quantity and quality. In fact, topline findings show that over 50% of conversations triggered by an in-person experience spark action to pass along and purchase.
For this study, Keller Fay Group looked at the beverage, household product, media & entertainment, technology, and food & dining categories. Results from over 30,000 consumer interviews, ages 13-69, showed:
- Experience-driven earned media sparks the most action, especially when it references the brand’s media/marketing:
- 55% rate it highly likely to spur them to pass it along, 8 points (17%) higher than media/marketing WOM alone.
- 45% rate it highly likely to spur them to seek more info, 8 points (22%) higher than media/marketing WOM alone.
- 56% rate it highly likely to spur them to purchase, 10 points (22%) higher than media/marketing WOM alone.
- After “need,” “good experience” sparks the most earned (17% and 15%, respectively).
- Ads spark just 5%.
- Social media sparks just 3%.
- Experience-driven earned is the most credible
- 63% rate it highly credible – 10 points (19%) higher than media/marketing WOM, at only 53%.
- Over half of experience-driven earned contains strong recommendation to buy/try — 51% of it does, 11 points (28%) more than media/marketing WOM alone
One fast-growing marketer is all over this magic combination. SodaStream, the leader in at-home soda-making, has been shaking up the soft drink market using word of mouth driven by an in-person experience.
According to Kristin Harp, SodaStream U.S.A’s Marketing Manager, “We’ve built our business on word-of-mouth and turbo-charged our campaigns by adding the in-person experience. We have seen that by putting our soda makers and flavors into the homes and hands — and the social networks — of consumers leads to powerful advocacy coupled with sizable lifts in awareness as well as purchase intent.”
Word of mouth provides credibility
According to Brad Fay, COO of Keller Fay Group, “With all the enthusiasm over social media, it is easy to forget that the most powerful WOM starts with a great in-person experience.
While there are many ways to help drive word of mouth, the best is always positive experiences. In fact, 83% of all WOM about products involves someone who has had personal experience with the brand, and without it credibility and likelihood to purchase falls dramatically.”
The research in this white paper comes from Keller Fay Group’s TalkTrack®, a national syndicated program measuring word of mouth in all forms — face-to-face, over the phone, and digitally via texting, social networking sites, and email. Daily WOM volume and metrics in this white paper are based on interviews collected April 2012 – January 2013. During this time 31,108 interviews were completed among people 13 to 69.
Monday, May 20th, 2013
Based on polling more than 500 restaurant decision makers, including 152 who have participated in daily deal campaigns, and taking into consideration what prior research has shown, Groupon (NASDAQ: GRPN) and the National Restaurant Association are providing restaurateurs with some of the top tactics for success with daily deal marketing campaigns.
While these tactics are specific to restaurants, we think almost any retailer can gain insight into what makes daily deals work from them.
Here’s an infographic illustrating the findings:
Research shows that best practices for restaurateurs to help ensure daily deal success include:
- Prepare staff to focus on customer service, look for upsell opportunities and track offer redemption
- Schedule daily deal timing based on business needs and seasonality
- Estimate and understand the promotion’s impact on profitability
- Measure success by using free tools provided by daily deal company
- Encourage repeat visitors with a customer loyalty program
Results from the recent online survey conducted by Ipsos MediaCT showed restaurateurs who had successful daily deal experiences stood out as experimental marketers that use a variety of different channels and tactics to drive customer acquisition and retention:
- 94 percent engage with customers via social media (vs. 75 percent of non-daily deal users)
- 77 percent have run more than one daily deal
- 73 percent connect with customers via email (vs. 59 percent of non-daily deal users)
- 79 percent monitor online review sites to see what others are saying about their business (vs. 68 percent of non-daily deal users)
- 71 percent have promoted their business with traditional newspaper and magazine ads (vs. 58 percent of non-daily deal users)
“Daily deals remain a very popular form of marketing for our members, and these are some important steps restaurateurs can take to help ensure a greater return on their investment,” said Julia Kanouse, VP, Strategic Marketing, National Restaurant Association.
“This study reveals how daily deals and the analytical tools that Groupon provides have become a powerful and measurable part of an active restaurateur’s marketing mix,” said Sanjay Gupta, VP, Merchant Marketing, Groupon.
Groupon and the National Restaurant Association have an ongoing partnership to provide restaurateurs with educational content and important marketing resources to help their businesses grow. This content will reside on www.grouponworks.com andhttp://www.restaurant.org.
Friday, May 17th, 2013
According to newly issued original research, Arnold Worldwidehas uncovered the emergence of what it calls “Sherpa Brands.” Brands that provide consumers with increased guidance while celebrating their successes and accomplishments, ultimately leading consumers to feel more empowered and satisfied.
In the same report, ArnoldOn: Sherpa Brands-Guiding Consumers to New Heights, the agency also revealed that 81 percent of consumers believe it’s important for a brand to guide them to better decisions.
Sherpa Brands make the decision-making process simpler, minimizing stress and providing tools, information and recommendations to help people navigate their personal journeys and make better decisions along the way.
“We call them Sherpa Brands because, like a Sherpa who helps climbers navigate the journey up a mountain with the right information and tools and then stands back so the climber can revel in his/her accomplishment, these brands provide both guidance and the ability for the consumer to celebrate his accomplishment,” said Neela Pal , Managing Partner, Global Director of Business & Brand Strategy at Arnold Worldwide.
Here at the TechJournal, we like this concept. When a brand makes us hunt for information (without guiding us to it) or raises questions without answering them, we often end up buying elsewhere. How about you?
This sharply aligns with the close to 90 percent of consumers who prefer brands that provide the right tools, information and recommendations:
- 87 percent of consumers want brands to provide helpful information
- 86 percent of consumers want brands to make things easier/less complex
- 85 percent of consumers want brands to help provide a solution to a problem
Lots of opportunity
“The ultimate goal of a Sherpa Brand is to guide people through a process, whether it’s a path to better health, financial freedom, or achieving a life goal. And importantly, once they’ve achieved that goal, celebrating and rewarding that achievement. Ultimately, this guidance and support leads to higher levels of trust and brand loyalty,” said Pal.
“Through our research we’ve found that while some brands may have some Sherpa attributes, there is a lot of opportunity for the majority of brands to enhance their marketing strategies to become true Sherpa Brands.”
We’d second that notion. Way too many brands are like celebrities hiding under hoodies and dark glasses instead of leading us where we want to go – or where they want us to go, for that matter.
The Shift to Sherpa Brands
Arnold’s research revealed that in a world of “too”—too fast, too many choices, too complex—people value having more control and being able to make decisions that better reflect their priorities and personal values. Sherpa Brands provide the guidance that enables smarter decision-making and opportunities to celebrate the result, which builds a stronger relationship.
- 65 percent of survey respondents agreed that they “Trust brands that help guide them to decisions that make the most of their daily life.”
- 48 percent of consumers agree that “A brand that helps guide them to the decisions that make the most of their daily life makes them more likely to purchase the brand.”
Sherpa Brands strike a balance between doing everything for the consumer and the consumer doing everything. These brands empower consumers by helping them be in control while rewarding them at milestones along the journey.
Friday, May 17th, 2013
Despite being far more tech-savvy than previous generations, Generation Y, the 80-million strong cohort of Americans between the ages of 18 and 35, has not forsaken shopping in stores for online purchasing – as long as retailers keep their offerings “fresh” and interesting, says a new report from the Urban Land Institute (ULI).
The report explores the shopping preferences of Gen Yers, who associate shopping with socializing, and who place a high value on living close to retail (another ULI report released this week found that 62 percent of Gen Yers prefer developments offering a mix of shopping, dining and office space).
They bore easily
It notes that while Gen Yers enjoy shopping and dining out, they tend to bore easily, compelling retailers to constantly update their merchandise and find new ways to engage these consumers.
The study found that 37 percent of Gen Yers love shopping and 48 percent enjoy it. Half of the men surveyed and 70 percent of the women consider shopping a form of entertainment and something to share with friends and family. The appeal of shopping is particularly strong among Gen Yers who are Hispanic and African American.
Gen Yers tend to spread their dollars around generously, the study found, with more than half visiting a variety of retail centers at least once a month, including discount department stores (the retail type most frequently visited by Gen Y), community shopping centers, enclosed malls, department stores, big-box power centers, chain apparel stores, and neighborhood business districts.
At the same time, 91 percent of respondents said that they had made online purchases over the previous six months, with 45 percent spending more than an hour a day looking at retail-oriented websites.
“Contrary to what some retailers have feared, we found that Gen Y still does most of its purchasing in stores,” said Lachman, president of real estate consulting firm Lachman Associates LLC and executive-in-residence at Columbia University’s Graduate Business School.
Definitely multi-channel shoppers
“Gen Yers use the Internet to research products, compare prices, envision how clothing or accessories might look on them, or respond to flash sales or coupon offers, as well as to purchase items; they are definitely multi-channel shoppers.”
“Gen Yers have grown up with information technology, and they are accustomed to stimulation in the form of music, light, color, and action,” commented ULI Chief Executive Officer Patrick L. Phillips . “Retailers need to continually change their looks, services, and merchandise offerings in order to keep up with this trend-oriented generation.”
One activity that keeps Gen Y on the move, according to the new ULI report, is dining out: 46 percent of the survey respondents said they dine out at least once a week with friends or family; one quarter do so several times each week. Many consider themselves to be serious “foodies.” When they do eat at home, 65 percent shop at least once a week for groceries.
Gen Y is strong not only in numbers but also in purchasing power. Survey respondents’ median income is over $47,000, even though many are in school and are working only part-time.
Over a third of Gen Yers receive financial assistance from their parents. Many grew up relatively wealthy, and less than nine percent have ongoing credit card debt exceeding $6,000.
The findings from the survey have numerous implications for today’s retail property owners, developers and managers, including the following:
- Restaurants at all price points are popular with Gen Y, but owners should be careful of providing tenants with generous improvement allowances to attract them. Young consumers tend to move from one “hot spot” to another; vacancies can result when a hot trend turns cold.
- Enclosed malls remain popular, but can face challenges to retain their appeal among fickle consumers. To keep shoppers visiting, mall owners should refresh interiors frequently, encourage social gatherings, incorporate movie theaters and renovate obsolete ones, add specialty food purveyors and grocery stores, serve as pick-up points for merchandise ordered online, and encourage pop-up stores.
- Malls are big contributors to the chronic inventory of excess retail space in the U.S.; many are ripe for redevelopment. Smaller formats are more suitable for time-conscious shoppers, many of whom may just be looking at goods that they will ultimately buy online.
- Gen Y strongly supports discount department stores and warehouse clubs – a format that could supplant aging malls and be suitable for infill sites. In contrast, power centers with single-focus “big box” stores are losing out to both warehouse clubs and online aggregators such as Amazon.
- Most lifestyle centers target older, affluent shoppers; to attract Gen Y, owners should focus on apparel brands favored by Gen Y, offer more choice in eateries and include specialties such as a gym, salon, “green” grocer, bike shop, pet store and/or dog run, and uniquely local offerings.
The big winners in Gen Y’s multi-channel purchasing patterns, the report concludes, are warehousing and logistics. E-commerce needs both distribution warehousing and “pick-and-pack” operations. Retailers will continue to experiment with different methods of online and in-store fulfillment in search of cost efficiencies and faster deliveries.
Generation Y: Shopping and Entertainment in the Digital Age, authored by ULI Trustee M. Leanne Lachman , president of real estate consulting firm Lachman Associates LLC; and Deborah L. Brett , founder of Deborah L. Brett & Associates, was released during ULI’s Spring Meeting this week in San Diego. It is based on an online survey of 1,251 Gen Yers conducted by ULI and Lachman Associates, a focus group conducted at Columbia University’s Graduate School of Business, and a literature search.
Friday, May 17th, 2013
Mother’s Day online shopping grew 15 percent in the week leading up to Mother’s Day, compared to the same time period last year.
Spurred by mobile commerce, mobile percentage of sales reached 17 percent, according to IBM’s (NYSE: IBM) Digital Analytics Benchmark, a cloud-based analysis of the online retail market.
Here at the TechJournal, we see this as more evidence that digital shopping – and particularly mobile – is the future of retail.
With the National Retail Federation (NRF) estimating Mother’s Day sales reaching $20 billion this year, retailers made it easier for consumers to buy for mom through their smartphones and tablets.
According to IBM’s Benchmark, mobile commerce led the way this Mother’s Day. In the week leading up to Mother’s Day, consumers flocked to their mobile devices, with mobile traffic reaching 25 percent, an increase of 43 percent year over year, with the Apple iPhone and iPad as the consumer shopping devices of choice.
As retailers are making it easier for mobile shoppers to browse and buy with a tap of a finger, customizing mobile apps and web sites for on-the-go consumers, the mobile customer experience has become a top priority for retailers looking to streamline the buying process.
In the week leading up to Mother’s Day, mobile shoppers browsed and completed purchases in three-and-a-half minutes, while desktop users took twice as long, more than six minutes, to complete their shopping session.
That three and a half minute shopping experience for mobile is an eye-opener. Does your mobile app let someone make a purchase that quickly and easily? The six-minute mark for desktop online shopping seems reasonable, although when we know what we’re looking for, it doesn’t take more than a minute at one-click sites such as Amazon.
As merchants continue to invest in upgrading support for digital shopping channels, retailers are designing for a MobileFirst market by simplifying the client experience and deepening connections to consumers.
Key findings from the IBM Digital Analytics Benchmark:
- In the week leading up to Mother’s Day, online shopping grew by 15 percent, with average order value reaching $209, representing a four percent increase compared to the same period last year.
- Department store sales grew by more than 20 percent in the week leading up to Mother’s Day compared to the same period last year. Retailers simplified the digital buying experience for customers, with iPad conversions increasing dramatically by more than 315 percent, with iPhone conversions increasing 184 percent.
- In the three weeks leading up to Mother’s Day, online jewelry sales steadily increased, nearly tripling with a 180.6 percent increase in that same period. In the week leading up to Mother’s Day, mobile traffic reached 42 percent, up almost 59 percent over 2012. Mobile sales reached 48 percent, an increase of 38 percent compared to 2012.
- Online sales of gifts including flowers and chocolates more than doubled the week just before Mother’s Day compared to the week before, an increase of 140 percent. Mobile percentage of sales was up 109 percent, reaching 28 percent and mobile site traffic was up 95 percent, reaching 34 percent, in the week leading up to Mother’s Day, compared to the same period last year.
- In the week leading up to Mother’s Day, health and beauty sales were up 40 percent compared to the same time last year, with similar mobile commerce gains. Mobile percentage of sales reached 18 percent, a gain of 16.4 percent, with mobile traffic reaching 27 percent, up 33 percent over last year.
By analyzing these trends, Chief Marketing Officers (CMOs), sales, e-commerce and customer loyalty executives can better understand and respond to the needs of customers in terms what and how they prefer to buy.
Wednesday, May 15th, 2013
Videology—a digital advertising platform and solutions provider— recently released a report showcasing research on the link between digital video advertising and offline sales results for consumer packaged goods (CPG) brand advertisers.
CPG is an extremely important category for digital video, comprising 22% of total video ad impressions—more than any other sector—according to a Videology Q1 2013 analysis.
“After 50 years of television-centric marketing, (CPG advertisers) know the right television equation to move product off the shelves. But data has the potential to bring this same level of ROI confidence to other media—including digital video, the natural complement to a brand’s television spend,” the report stated.
TV is still king
“Television is still king for CPG advertisers because they know what works and what doesn’t to move product off the shelves,” added Scott Ferber , CEO and Chairman, Videology. “We need to similarly define video’s value by showing how video ad exposure equates to sales success. And, as this study proves, we can.”
Videology analyzed over 186 million video impressions served across online and mobile video for CPG advertisers to determine digital video’s ability to drive key sales metrics including Penetration Lift, Unit Velocity Lift and Sales Velocity Lift using Kantar Shopcom data.
“The proliferation of media platforms offers brands more choice for when, where and how to capture consumers’ attention,” saysKatie Casavant , CEO, Kantar Shopcom . “Brand marketers from across the CPG landscape use Shopcom audience data and campaign impact measurement to optimize their media planning, buying and execution for maximum conversion return.”
Report highlights include:
- All online video campaigns analyzed drove an increase in Sales Velocity Lift from 4% to an impressive 35%.* However, since ad campaigns often correspond to promotional pricing efforts, Sales Lift on its own does not tell the whole story.
- Lift in household penetration is perhaps a truer gauge of performance. An increase in the number of households purchasing a product after exposure to a brand’s video ads ranged from 9% to 28%.*
- When the number of households buying the brand increases (Penetration Lift), more units are sold (Unit Velocity). In the study, lift in Unit Velocity ranged from 8.5% to as high as 30%.*
- Audience targeting based on purchase data performed 20% better than demo targeting.
- Demo targeted ads, however, still drove stronger lift than the control group. Overall, both targeting sets play a role in successful online video campaigns, with demo targeting providing scale and purchase-data targeting driving specific lift metrics.
- Completed views and total reach were the two most important metrics for increasing product penetration and driving units sold. Click through rate was not associated with a higher lift in sales.
*Compared to the control group not exposed to the ad.
This research was conducted using Sales Impact, Videology’s ROI attribution and tracking tool for brand advertisers.
Tuesday, May 14th, 2013
Rich media ads with interactive elements can boost consumer engagement by up to 1,000 percent, according to R2integrated.
In 2012, eMarketer reported that $15.51 billion was spent on display advertising in the U.S., demonstrating that display advertising is still an important and effective medium.
A shift has occurred from the display of primarily flash banners to rich media units, which allows marketers to take advantage of interactive features that help to engage and captivate consumers. R2i details the opportunity and benchmark data for interactive features such as videos, product carousels, data capture forms, and more.
Here’s R2′s infographic detailing industry benchmarks for rich media that marketers should know:
Friday, May 10th, 2013
Maritz Loyalty Marketing unveiled the results of a comprehensive study into U.S. consumer loyalty programs, including what American consumers consider to be the highest rated programs, the first annual Maritz Loyalty ReportTM: U.S. Edition,
“Maritz has been designing and running consumer loyalty programs across North America for more than 25 years,” said Bob Macdonald, president and CEO of Maritz Loyalty Marketing. “Our expertise and unique approach to brand loyalty, combined with the insights we glean from this study, help clients drive significant business results by continuing to improve the effectiveness of their brand’s engagement with customers.”
The following programs rated highest in terms of overall satisfaction within each respective category in the Maritz Loyalty Report:
- Financial Services – Chase Ultimate Rewards (84 percent)
- Entertainment – Carmike Cinemas Rewards (79 percent)
- Retail programs – Kohl’s Rewards (73 percent)
- Hospitality / Hotel – IHG Priority Club Rewards (67 percent)
- Grocery – Kroger Rewards (83 percent)
- Airlines – Southwest Airlines Rapid Rewards (58 percent)
Room for More Cards – A Cause for Concern
The Maritz Loyalty Report results suggest that 71 percent of members would join more loyalty programs, even though the average member is already enrolled in 7.4 programs. The report also found that members are only actively participating in 63 percent of the programs in which they are enrolled.
“Our study revealed that 47 percent of members have stopped participating in one or more programs in the past year. This number is disconcerting for program operators, yet of even greater concern is that only seven percent of these defecting customers actively defect – meaning, they actually formally request to leave a loyalty program,” said Scott Robinson, senior director of loyalty consulting for Maritz Loyalty Marketing. “Given the high percentage of passive defection, it is paramount that loyalty marketers proactively identify the early warning signs of disengaged members.”
“Our approach to lifecycle management and member communications enables our clients to understand and react to these early warning signs and develop highly engaged members, who are less likely to shop for a competitor brand,” Robinson added.
Getting it Right
Overall, 65 percent of members are satisfied with the loyalty programs in which they participate. The Maritz Loyalty Report also includes customer ratings on more than 35 program attributes. Some of those attributes, also considered key drivers of satisfaction, include:
- Program values: pride of membership, program uniqueness, meeting customer needs, etc.
- Program mechanics: ability to earn and redeem points, quality of rewards, etc.
- Ability to interact with programs: website, mobile, customer support, etc.
- Program innovation: program freshness, access to exclusive events, personalized experiences, etc.
- Communications from programs: means, relevance and frequency of communications, etc.
Top programs rate similarly on many of these attributes, and the top program tends to discern itself from next-best programs by ahigher rating on only one key attribute. In some program categories, such as retail loyalty and airline loyalty, top-rated programs and next-highest rated programs score similarly on all attributes. In these competitive categories, the attribute on which the highest-rated program discerns itself from next-highest rated programs is a secondary and differentiating driver.
“The implication for program operators,” said Robinson, “is that in order to be competitive, especially in categories with many largely undifferentiated programs, it is essential for programs to deliver effectively on both the key drivers of satisfaction and also the secondary drivers of satisfaction.”
Friday, May 10th, 2013
New research unveiled shows that engaging with digital coupon users dramatically impacts effectiveness of new product introductions for brands.
Conducted by Millward Brown’s Dynamic Logic, a leader in digital insights, and commissioned by Coupons.com, the study measured effectiveness of site display advertising and/or site sponsorships across three consumer packaged goods (CPG) brands.
Findings showed substantially higher increases in consumer recall and purchase intent, compared to industry benchmarks from Dynamic Logic’s MarketNorms ad effectiveness database.
Conducted in January and February of this year, the study evaluated online display and/or site sponsorships on Coupons.com for new product introductions by three well-known CPG brands in the food, beverage and household cleaning supplies categories.
The campaign for the new household cleaning product included display advertising; the campaign for the new food product included a custom site sponsorship; and the campaign for the new beverage product involved both display advertising and a custom site sponsorship.
“Brands marketing to digital coupon users not only benefit from increased ad recall and purchase intent, they also gain awareness among this group of consumers that shops more frequently than the average grocery shopper and spends more each time they do,” said Tony Biancalana, regional vice president of media solutions at Coupons.com Incorporated. “The new research further underscores the benefits for marketers to connect with this audience.”
Research by Coupons.com has shown that a large percentage of digital coupon users are in pre-shopping mode when browsing online coupons. Specifically, 59 percent of visitors planned to visit a grocery store within two days and 43 percent planned to shop within the next 24 hours.2
Increased Consumer Recall of Brand Advertising
Consumer recall for each of the three campaigns greatly outperformed CPG industry benchmarks, helping the brands to attract attention for their new products. 36.3 percent of people were more aware of the brand advertising for the food category product after exposure to the brand sponsorship. In addition, the beverage category product saw an increase of 7.2 percentage points in ad recall and the household cleaning category product experienced an 11.9 percentage point increase in ad recall. For comparison, the average increase in online ad recall for CPG category campaigns is approximately 4.8 percent, according to Dynamic Logic’s MarketNorms. By messaging consumers in receptive pre-store shopping mindsets, the average increases in ad recall from the Coupons.com campaigns were 3.8 times better than industry benchmarks.
Increased Purchase Intent For Product Line Extensions
The results provided by Dynamic Logic’s AdIndex Dash®, which measures advertising effectiveness, isolated the increases in purchase intent generated amongst consumers exposed to the advertisers’ messaging on Coupons.com. The additional attention that the three new product launches captured translated to increases in purchase intent for all three brands: +16.6 percent for the food product, +6.6 percent for the beverage product, and +7.0 percent for household cleaning product. These increases are higher than Dynamic Logic’s CPG industry benchmark increase for purchase intent of 1.1%, indicating that shoppers were, on average, 9.2 times more likely to consider purchasing the new products featured on Coupons.com, compared to Dynamic Logic CPG category benchmarks.
Complementary Research on Digital Coupon Users Also Released Today
Additional new research was released today by GfK regarding spending habits of digital coupon users. The report shows that digital coupon users shop more frequently and spend significantly more during each trip than the average U.S. consumer.3 Specifically, the study found that digital coupon users spend 42 percent more on groceries annually ($4,295) compared to average shoppers ($3,035).
The research found that, compared to average shoppers, digital coupon users:
- Make 25 percent more shopping trips per year
- Spend 13 percent more per shopping trip
- Spend 42 percent more per year on grocery purchases
Thursday, May 9th, 2013
The mobile marketing ecosystem generated $139 billion of incremental output to the U.S. economy in 2012, a significant surge from $48 billion in net sales previously reported in 2010.
While the Internet took a decade to begin fulfilling its early promise as an economic engine, mobile has exploded as a major force and an job-creating economic engine in just a few years – and it continues to flourish and expand.
Over the next five years, this figure is set to skyrocket to $400 billion representing an annual growth rate of 52 per cent. To accurately assess mobile’s economic impact, both consumer (B2C) and business (B2B) mobile sales were measured against total U.S. sales in 2012, approximately $33 trillion.
The data was reported in the “MMA Mobile Marketing Economic Impact Study,” commissioned by the Mobile Marketing Association (MMA), the leading global trade association for the mobile marketing industry.
“MMA Mobile Marketing Economic Impact Study” is the first objective and comprehensive overview of U.S. economic performance across the mobile marketing industry.
Key findings from the report indicate that mobile is an economic engine that will continue to stimulate nationwide growth as a vibrant and lucrative platform. Given that mobile enables marketers to move closer to consumers than ever before, the “MMA Mobile Marketing Economic Impact Study,” clearly proves the value and power that mobile marketing offers to marketers.
Mobile Marketing Sales Impact in United States ($Millions)
|Total Sales Impact
|Mobile Media Adv
|Mobile DR Enhanced Adv
“Results from this study prove that mobile should not be underestimated as an economic stimulator. Only a few years ago, mobile’s impact was measured by its function as a basic phone and now it is impossible to envision a world without smartphones and tablets,” said Greg Stuart , CEO, Mobile Marketing Association.
“The health of the U.S. economy depends on platforms like mobile that offer unlimited potential for growth and innovation. No other media will evolve at this pace with unforeseen opportunities to reimagine the user experience.”
Mobile to create 1.4 million jobs
Despite a recessionary economy and unstable job market, mobile marketing created 524,000 jobs in 2012 from the combination of advertiser employment as well as product seller employment. Focusing on the next five years, mobile is predicted to generate 1.4 million jobs.
To drill down into mobile’s potential on the marketing ecosystem, mobile marketing spend was measured by industry category. In 2012, marketers and retailers spent $6.7 billion on mobile marketing.
The total expenditure for mobile marketing was calculated from mobile advertising, mobile direct response or enhanced traditional media, as well as mobile CRM. Combined spend across the three categories is forecasted to increase to $19.8 billion by 2015. Mobile advertising alone (includes voice, messaging, web, email, apps proximity and recognition) is projected to climb to $9.2 billion over the next five years.
Mobile Marketing Communications Spending in United States ($Millions)
|Total Mobile Mktg Expenditure
|Mobile Ad Expenditure
|Mobile DR Expenditure
|Mobile CRM Expenditure
The study evaluated mobile marketing expenditure across 16 industry groups. Finance, retail (excluding CPG) and manufacturing (excluding CPG) were the three largest industries, resulting in $3 billion or roughly half of the total mobile expenditure in 2012. Surprisingly, the industries that spent more on mobile marketing and advertising also represent the largest markets for mobile employment.
Mobile transforming society
“Even in its infancy, mobile has irrevocably transformed society,” said Peter A. Johnson , Ph.D., mLightenment. “With the introduction of new technology to increased accessibility and connectivity, mobile has the ability to reinvent itself and remain indispensable to the consumer and marketer relationship.”
To further demonstrate mobile’s effectiveness as a marketing communications tool, Marketing Impact Ratio (MIR) was calculated by measuring mobile sales impact against marketing expenditure. In 2012, mobile MIR peaked at $20.77. After reviewing MIR data, an unexpected insight was raised; mobile marketing has yet to experience the law of diminishing returns.
By reviewing MIR figures for the top four mobile marketing spenders, data indicated that spending more across mobile marketing platforms does not decrease the impact rate. In fact, those that spend more on mobile achieved the highest impact ratio and thus gained the most value for their mobile marketing investment. While this observation requires additional exploration, it has the potential to further distinguish mobile from other media.
A mobile-enhanced economy
Looking beyond the numbers, insights from the “MMA Mobile Marketing Economic Impact Study,” clearly indicate that mobile has sparked a “mobile-enhanced economy” in which mobile converts every object into a medium and every place into an opportunity for a message. By empowering the “always on, always on the go” consumer, mobile has transformed people into interactive, creative, and responsive partners in the marketing process.
“While mobile’s economic value is the heart of this study, mobile is also inspiring the industry to rethink their discipline for a world that is no longer static,” said Joseph Plummer , Ph.D., mLightenment. “As people rely more on mobile devices, they will become ‘co-creators’ in the marketing process and control both the context and content of the overall brand experience.”
It would be impossible to evaluate mobile’s economic impact without addressing privacy and the current legislative climate. In recent debates, government authorities have discussed restricting or limiting the trail of information that mobile offers to marketers and publishers.
The MMA supports self-regulation and transparent communication to consumers about when and how mobile data is collected. There is a risk of overregulating the mobile marketing industry and stifling innovation if some measures being considered go into effect.
Room to evolve and innovate needed
In order for mobile sales, employee resources and marketing spend to continue to grow, as the “MMA Mobile Marketing Economic Impact Study” strongly suggests, mobile marketing needs room to evolve responsibly and foster innovation without undue constraint from legislators, regulators or private sector bodies.
“Mobile’s influence extends far beyond the device. It is a catalyst supplementing the growth and revenue across all other mediums, traditional and digital,” said Stuart. “Currently, mobile is at a tipping point. It is not just how big mobile is and will continue to be, but it has triggered a ‘mobile-enhanced economy’ that redefines the entire marketing industry. Restricting its development by overregulating the industry would cause irreparable damage and thus reverse progress.”
Google, mBlox, The Coca-Cola Company, ExactTarget and Target assisted by underwriting the research for the ”MMA Mobile Marketing Economic Impact Study.”
Wednesday, May 8th, 2013
By Allan Maurer
Mike Perla will discuss how to show ROI from usability testing at the upcoming Digital Summit in Atlanta.
If you want to show a return on investment from user testing your digital marketing, you need to get your client involved and on board from the beginning. So says Mike Perla, director of conversion optimization and creative at Fathom.
Perla knows his stuff.
He joined Fathom in 2006 and has over 10 years of experience as a designer, developer and marketer. He regularly presents on the topics of CRO and UX for organization like the Conversion Conference and UXPA. He also frequently hosts webinars with an international cast of CRO experts through the Conversion Rate Optimization Professional Association (CROPA).
His testing case studies are often published by WhichTestWon (WTW), and in early 2013, he won a gold ribbon in the WTW 2013 Online Testing Awards, where his case study was inducted into the WTW Hall of Fame.
He’ll refer to some of those case studies when discussing how to show ROI from usability testing at the Digital Summit in Atlanta next week (May 14-15) where he’ll join more than 100 other digital thought-leaders from brands that include Google, Twitter, AOL, Adobe, the Wall Street Journal and many others.
Usability testing a difficult sell
Usability testing can be “a difficult sell,” Perla notes. “Even if your marketing budget increases, you also always see an increase in the digital channels you can spend the money on. To show ROI, you need, first, to make sure the client believes in the numbers you’re showing him.”
To do that, he suggests, do your user testing on your payment process, implement fixes based on the results, then split traffic between the original process and the new one to see which performs better.
With something like the payment process, “You can tie it right into revenue,” Perla says.
With lead generation clients, you need to develop a simple calculation to get a basic lead value, he adds.
Userlytics tool recommended
He also says that unless you have a background in user testing, you should “Start out small. No one will hand you a bunch of money to do user testing if you haven’t done it in the past.” Since user testing can be fairly expensive, he recommends trying a tool such as Userlytics. It lets you show a video of a user trying your product or process so you can see any place the consumer has trouble.
“You can jump to sections of the annotated video and say, “Hey, here’s someone frustrated with the process. They’ll see that. Once you get the main stakeholder on board by showing them the results of user testing, others will fall in line.”
“Do a test and show it to the client,” he says. “Get them involved so they feel ownership of the project and they’re more likely to participate and help you overcome any hurdles that happen. You might also want to get the IT department, designers and developers of the existing site on board.”
Even if they’re initially reluctant, once you get that, says Perla, “you’re in a much better position.”
Wednesday, May 8th, 2013
By Allan Maurer
As startups go, Shinola has a story that’s right on time. The company, founded in 2011, is making watches in a 35,000 square-foot facility in Detroit. No one has manufactured watches in the U.S. in 50 years,” notes Jacques Panis, director of strategic partnerships for the firm.
Shinola also diversified and now makes bicycles (in Wisconsin) and stationary products. But in an era when many people use smartphones or other digital devices to keep track of the time, we asked Panis, why watches?
“People are starting to wear watches more and more. It’s a trend,” says Panis. “People look at watches as part of their style or persona. A watch is a fashion piece in a lot of cases. People make a statement with a watch, especially in urban environments and among fashion forward trend-setters.”
Experience spans marketing, branding and sales
Panis has over 10 years of experience spanning marketing, branding and sales. He founded Webosaurs in 2007, an online brand created to educate children globally on the history and diversity of our planet. He collaborated with animation studio Reel FX to expand the Webosaurs project while running the Reel FX interactive division. Panis joinedShinola in 2010 to oversee product development and strategic direction for the company.
He’s among more than 100 digital and marketing thought-leaders participating in the Atlanta Digital Summit next week (May 14-15). The event includes speakers from brands such as Google, Twitter, AOL, Adobe, the Wall Street Journal, AT&T, and many others. Fewer than 100 seats remained for the event, the largest in the Southeast, as of Wednesday (May 8). About 1,500 people are expected to attend.
Panis, who is on an engagement panel, tells the TechJournal, “We’re story tellers at the end of the day and digital channels and social are a big part of our marketing effort.” Shinola tells its story on product specific blogs (dedicated to bikes or watches, for instance) and others. It sold a 2,500 limited edition watches online supported by traditional ads in major newspapers.
So far, however, most of the company’s marketing has been “organic,” Panis says. It does have a good story – bringing manufacturing and jobs back to the United States.
The Digital Summit is the largest event of its kind in the Southeast.
People who attend TechMedia’s events such as the Digital Summit often go not only for the programming – whether as participants or audience – but also to find partners, customers, and scope the lay of the digital landscape.
“We’ll be at the show (the Digital Summit) looking for a digital marketers who can help us drive traffic to our site and help us move watches,” he says.
The company isn’t looking for just anyone, though.
“We want a Triple A kind of guy or gal,” Panis says. “We want to shake up how people shop for watches and driving people to our site is critical to how we’re going to run this business. If we can find people to help us drive traffic and refine our funnel, it will be fascinating to see how the rest of the watch industry responds.”
Panis says he’s also looking forward to hearing more about what marketers are up to and how consumers are shopping online.