The Retail Advertising, Marketing and Promotions Blog

Green Marketing Believers and Skeptics

Universal Ad — Wed, 23 Jul 2008 07:06:00 GMT

A long, long post today all about the green/environmental/sustainability movement and its effect on consumers. So take a deep breath and start reading...

Burst Media's widely covered report on green advertising (Direct, eMarketer, MediaPost and Advertising Age) shows that while consumers have a high recall (37% frequently recall and 33% occasionally recall) of green advertising messages for environmentally friendly products or services, they don't necessarily believe the claims made in those ads (23% seldom believe and 65% sometimes believe).

Actually, ads are only the fourth most important source of information about green companies, initiatives and products for consumers, preceded by news stories, word-of-mouth and personal research. Nearly 80% use the Internet to research and more than 40% frequently or occasionally investigate ad claims. Unfortunately, most people complain that companies do not offer enough info about green products and services (= average at best).

The most dedicated green consumers (the top 5% who are "completely green" - 10% for 18-34 year olds) are the biggest cheerleaders of green ads - 44% think advertisers are doing an excellent or good job at providing info on green claims. In comparison, less than 20% of "aspirationally green" consumers (those 44% that incorporate a few things that are green into their daily lives but "have a long way to go") think the same.

Bottom-line: The popularity of current green-marketing initiatives offers a unique marketing opportunity and the Internet with its targeting possibilities is a good place to start. "Businesses that can support their claims in their green messaging and sustainability topics in a way that incorporates the consumers in the conversation are at an advantage in the marketplace. In providing information that is accessible, transparent and easy for consumers to share, businesses have the opportunity to reach consumers in relation to a core personal value."

An IRI study on sustainability (covered in Progressive Grocer) showed that half of U.S. consumers consider at least one sustainability factor when selecting brands to buy or stores to shop, 30% look for eco-friendly products and packaging in their brand selection, 25% consider fair trade practices along with eco-friendly or organic designations in selecting a shopping destination, and 40% search specifically for organic products. A related study from Mintel (covered by RetailWire) also shows that green is going mainstream - more than twice as many green products were rolled out in 2007 compared to 2005. And for good reason - 36% of adults regularly buy green products (triple the number from 16 months ago) and only 10% never buy green products (down from 20%.)

According to a Mambo Sprouts Marketing survey (covered in Progressive Grocer and eMarketer) consumers remain interested in purchasing environmentally friendly items and organic food, despite the economic situation. More than half are buying the same amount compared with 6 months ago and 36% are buying even more. In order to make it work, they shop closer to home, combine trips, rely more on coupons and sales, stock up on products and cook at home. In fact, nearly 70% are still OK with spending 20% more for sustainable items. For a different take take a look at the Landor Associates study (covered in MarketingDaily) which maintains that consumers are cutting back on often-pricier green purchases and plan to spend even less in the coming year.

While more consumers are going green, they don't always understand what it means. According to a Shelton Group's EcoPulse study (covered in BrandWeek) there's still a lot more education to be done. For example, while 49% said a company's environmental record is important in their purchasing decisions, only 21% had chosen one product over the other for this reason and only 7% could name the product they purchased. Additionally, more people put their personal comfort ahead of the environment (46% vs 31%) and 40% had negative or ambivalent responses to increased media attention regarding our impact on the environment. A related study by BuzzBack (also covered in BrandWeek) found that while more than half of US and UK residents agree that "the environment is the most important issue, only one-third knew what 'sustainable' means.

Finally, a study from Cone (covered in MarketingDaily) reports that while nearly 25% consistently buy products they believe to be environmentally friendly, 48% think that "green" products are actually beneficial for the earth and only 22% understand that such purchases are simply less harmful than competing products. Additional findings:

47% trust companies to tell the truth in environmental messages and 45% believe companies accurately communicate information about their environmental impact.
80% say that third-party certification is important and 63% are influenced in their purchasing by these designations.
70% said that quantifying a product's environmental impact influences their decisions, and the more specific it is, the better. For example, while 36% find a paper product labeled "environmentally friendly" credible, for example, 60% say that one marked as "made with 80% post-consumer recycled paper" is believable.
74% are more influenced by messages that link a product with a specific environmental result--for example, hybrid cars produce lower emissions.
Only 14% say environmental messaging makes them either feel cynical or overwhelmed, 38% say they feel informed by green marketing messages, and another 11% say they feel empowered or inspired.

Posted by Universal Ad

How to Make Your Web Analytics Data Actionable

Universal Ad — Tue, 22 Jul 2008 05:49:00 GMT

How's your web analytics program doing? Is it bringing in results or are you too busy with other stuff to really take advantage of all the data that has accumulated? Here are three articles that provide some interesting tips on how to improve your usage of web analytics programs:

How to Make Your Web Data Actionable - As web analytics gains momentum, the question remains, “How do we make it actionable?” Getting more Web data but don’t know what to do with it? You can figure it out with analytics. Every marketer wants actionable data. And it’s there for the taking—if you integrate your marketing/web analytics and move beyond mere traffic analysis. So where do you start? A highly successful strategy is to use web analytics for gauging the effectiveness of your e-mail marketing initiatives and determining optimization tactics to improve your overall campaign performance.
How to Measure Customer Satisfaction with Web Analytics - One of the major tenets of Web analytics is to gain insight into your Web site visitors. This is why the leading pundits always talk about the power of segmentation. Segmentation can be used to break your visitors into various groups, or "segments," and separately analyze the behavior of each group. Another major area of interest today is that of landing page optimization, or site optimization. This is the practice of conducting A/B tests or multivariate tests to find which version, or versions, of your Web page brings the best results. But what about customer satisfaction with your Web site? Wouldn't that data be incredibly valuable?

How to Measure Website Engagement - A campaign can drive lots of visitors to your website. Some will leave without making another click; others will click on a few links before surfing elsewhere. Then there are visitors who will spend a lot of time – the visitors every marketer targets. But most marketers sit in the dark -- or a dimly lit room -- about how many visitors actually engage with their website. Measurements like click depth and duration shine some light on engagement, but not much – until now.

Posted by Universal Ad

Five Fundamentals of Integrated Marketing

Universal Ad — Mon, 21 Jul 2008 05:28:00 GMT

While companies have created some good integrated marketing campaigns by leveraging multiple tactical elements across channels, there don't seem to be many companies (if any) that have a truly integrated and unified marketing strategy, one that goes beyond keeping their messaging consistent across channels while working with the strengths of each channel.

While this may seem a daunting challenge to most marketers and marketing organizations, two recent ClickZ articles (the first about integrated marketing in general and the second about technology-enabled integrated marketing) explain the basics so you can start out slow and easy down this road.

First the five customer-focused fundamentals:

Integrated Marketing Starts With the Customer - put the customer at the center of your strategy and ensure excellent execution across all channels.
Integrated Marketing Emphasizes Customer Processes - understand and coordinate how each channel and customer touch point helps the customer achieve her goal.
Integrated Marketing Transcends Campaigns - evaluate metrics that transcend an individual campaign, such as engagement, value, and profitability.
Integrated Marketing Requires Interaction and Dialogue - utilize two-way communications that are responsive to customer behaviors.
Integrated Marketing Is a Fusion of Sales, Marketing, and Service - leverage all aspects of customer contact with the company to create the right image

Bottom-line: CMOs must establish an integrated marketing strategy that creates "relevant communications, interactions, and content, regardless of channel and customer interaction point...that crosses product, channel, geographic, even functional boundaries."

While technology is not a cure-all for these issues, it can help through automation (campaign management), collaboration (marketing resource management) and integration (marketing application suites). At the same time, they must work without the help of technology to mature their skills, consider new metrics and overcome organizational silos.

Marketing must also make sure that everyone understands how critical technology has become to marketing operations. Ideally, technology expertise should be brought into the marketing organization, "either internally or through a trusted service partner that behaves as the marketing team's extension." On this level SaaS solutions are very promising as they cost less upfront, shorten time-to-market and reduce the need for IT involvement.

Posted by Universal Ad

Social Influence Marketing: The New Way to Win Customers

Universal Ad — Fri, 18 Jul 2008 02:25:00 GMT

ZenithOptimedia research (covered in MediaPost, RetailWire and AdvertisingAge) shows that recommendations by friends and family (WOM=word-of-mouth) have the greatest influence on brand choice and purchasing decisions (with a score of 8), more than any marketing contact, including TV ads (69), Internet searches (67), magazine ads (60), newspaper ads (55), outdoor ads (45), radio ads (42) and online banner ads (41).

The question, of course, is how do you get friends and family to recommend your product or your store? How do you make WOM scalable? How can you leverage its power? How can you manage the process instead of just hoping for it?

One idea that's quick taking hold - targeting influential product reviewers, bloggers and social shoppers. According to Jupiter (as covered by eMarketer), online social network users are three times more likely to trust their peers’ opinions over advertising when making purchase decisions. Social shopping sites in particular "attempt to replicate the emotional and social aspects of real-world shopping" in order to make people feel that they're part of a community where they can get recognition from their peers.

But before you jump to conclusions, you need to consider another study which shows that the popularity of online influencers, such as popular bloggers and other social media stars, doesn't always equate to credibility. This study, by Pollara (covered by eMarketer and OnlineMediaDaily), showed that while almost 80% of Canadian adults are very or somewhat likely to trust the recommendations of their loved ones, only 23% said the same of other Internet influencers.

Despite these numbers, keep in mind that Pollara also found that 59% considered social media sites, such as blogs, social networks, or community forums, very or somewhat important in learning about products, services, organizations, and brands, and that 57% of 18-34 year old think social media tools are very or somewhat important for sharing their thoughts on products, services, organizations, and brands.

A Multichannel Merchant article on this subject provides a few specific ideas on how "marketers can employ social media as part of the entire lifecycle of a marketing campaign—and beyond":

Become your customer (participate honestly in online conversations on an ongoing basis)
Aggregate information for the consumer (even if the conversation is negative, you win over the long term)
Articulate product benefits better (create happier customers who'll then do the marketing for you)
Create multiple, authentic voices (empower internal constituents to serve as brand ambassadors)
Amplify favorite business stories (direct consumers to those who are already predisposed to your products)
Let consumers shape and share the experience (allow them to extend the brand wherever they want)
Go where your customers go (provide them with the messages directly on social sites)
Don't do it all at once (focus on strong ideas using the most appropriate channels)

Posted by Universal Ad

Measuring the Impact of Multichannel Marketing

Universal Ad — Thu, 17 Jul 2008 06:17:00 GMT

According to a Multichannel Merchant article marketers must integrate Web metrics data with their other channels. You need to "consolidate prospect and customer data, combine all the operational, attitudinal and transactional data they hold, and link it up with related campaign history," in order to determine what message to send, who to send it, when to send it and on what channels. Then you need to figure out how much to invest across the different channels in order to optimize your spending and reach your goals.

So much to do, so much data, so little time. Where do you start? How do you avoid 'analysis paralysis'? How do you separate the signal from the noise? Here are some key facts you need to remember before you start:

The best returns come from integrating the use of traditional and digital channels, "in the same way that customers do, switching between them as appropriate."
You need to determine what kind of response rate and ROI you should be achieving across all channels by benchmarking your campaigns.
Never look your online metrics in isolation as you need to determine whether an online customer is a new one or one that just switched over from shopping over the phone or through your catalog.
Carve your data into meaningful chunks - "the Web page is the basic unit of measurement, and customer behavior is analyzed by department, product or product category."
Use online analytics to enhance, enrich and verify the data you already have from other channels by asking voluntary questions when users log in.

Looking at this question from a different angle, a SearchEngineWatch article discusses how the impact and effectiveness of offline marketing campaigns can be measured with online analytics tools. Some ideas from the article - localize the campaign and then check for local traffic spikes, focus on a particular product and watch for sales/search spikes, measure the blog buzz and search queries, leverage microsites for easy measurement, use unique response codes/pharases, and allow customers to provide direct feedback.

Posted by Universal Ad

The Off-Line Impact of Online Ads, and Vice Versa

Universal Ad — Wed, 16 Jul 2008 06:16:00 GMT

A recent Harvard Business Review article maintains that "online campaigns increase sales more at advertisers’ retail cash registers than on their websites." While it's relatively easy to measure the online sales impact of a Internet ad campaign, analyzing its offline impact on sales requires more complex techniques, such as utilizing surveys or loyalty program data.

A study quoted in the article shows that the US sales of a major retailer "increased by 40% online and by 50% off-line among people exposed to an online search- and display-ad holiday campaign. Because its baseline sales volumes are greater in physical stores than on the internet, this retailer derived a great deal more revenue benefit off-line than the percentages suggest."

Specifically, search ads create a more positive impact on sales compared to display ads, although they're more expensive per impression. A combined (search and display) ad campaign is even better as it increase sales more than the combined results of two separate campaigns.

A related Google/NAA study (covered by MediaPost and MarketingVox) showed that the opposite (sort of...) is also true - newspaper ads drive consumers to research and buy (offline and online). 30% of Internet-using newspaper readers went online to research a product they saw in a newspaper, and 70% of them (21% overall) subsequently made a purchase. Of this group, 47% went directly to the URL in the ad and 31% used a search engine.

The study also found that "consumer confidence is boosted by newspaper ads". 48% said they would trust the product more if they saw it in the newspaper after seeing it online, and 52% would be more likely to purchase that product. Additionally, 68% said newspapers are more useful than the Internet to learn about promotions and 54% said they were more useful for deciding when and where to buy.

These results require marketers to create more "holistic and integrated advertising campaigns that take advantage of each medium's strength, including branding and direct response for newsprint."

Posted by Universal Ad

Mobile Marketing Fantasy Vs. Reality

Universal Ad — Tue, 15 Jul 2008 08:02:01 GMT

A recent Nielsen report (covered by Multichannel News and MediaWeek) showed that "mobile Internet extends the audience reach of Internet sites by an average of 13% over home PC traffic alone." Shopping sites, for example, have a mostly duplicated audience - mobile users who access shopping sites on their phone likely also do so over their home PC. According to the report, 87 million U.S. mobile users subscribe to mobile Internet services (of more than 200 million people with mobile devices), and 13.7% actively uses mobile Internet each month.

While it has taken mobile advertising and promotions longer to catch on than expected, with many large brands still only in the testing phases, things are beginning to change as proofs of direct ROI begin to emerge. While it make take a few more years to reach the mainstream, Forrester expects that spending on mobile marketing will double every year through 2009 because when "properly used it is the most effective mechanism to interact with customers and prospects."

So if you're looking to create, improve or enhance your mobile marketing programs, here are a few suggestions:

Mobile Marketing Fantasy Vs. Reality - The article provides nuggets of reality (customers love mobile games, convenience works, the iPhone changed everything, the mobile ecosystem is evolving rapidly, and standards are needed) while debunking ideas that are more in the realm of fantasy (people will never use their phones to buy stuff, texting/SMS isn't effective, it's getting easier to run mobile marketing programs and "there is one killer application".)
Avoid the Pitfalls of Mobile Marketing - As with any emerging marketing medium, advertisers should try to learn from some of the key lessons of those who were willing to blaze the online trail before us, in hopes of not making the same mistakes. The article makes these main points - give consumers what they want...when they want it, let consumers show you the way, advertising isn't a one-size-fits-all solution, and find success metrics.
Understanding the Mobile Marketing Ecosystem - To successfully navigate the mobile marketing ecosystem you need to have enough information and understanding about all the players. The first step is to understand the roles of the six interconnected entities in this ecosystem - advertisers (and agencies), aggregators (or mobile enablers), content providers (media companies), carriers (four large ones + lots of little ones in the US), industry organizations (MMA, CTIA, IAB and others) and consumers.
Banner Ads for Mobile Screens - A mobile banner ad needs to work really hard despite its diminutive size. Like its beefier counterpart on a standard HTML site, the mobile ad needs to quickly distract the visitor away from the rest of the screen, create a user-ad connection, enumerate the features and benefits, per-qualify the viewers, describe the action and the call to action itself. Bottom-line: "Keep it simple, make the benefit and action clear, and you'll be enjoying those double-digit CTRs every time."
How to Build a Mobile Ad Campaign - 18.6% of marketers have already allocated resources for this year’s mobile efforts so how can you create a mobile ad program? According to this article the most important thing to do if you want to create effective mobile ads is to ensure that your strategic plan includes four basic elements - value, relevancy, simplicity and honesty - as an integral part of the campaign.

Posted by Universal Ad

Five Things You Don't Know About Baby Boomers

Universal Ad — Mon, 14 Jul 2008 06:48:00 GMT

A whole bunch of articles have been written about the Baby Boomer generation during the past few months, based on a wide range of recently published reports, each looking at a different aspect. Below is a selection of the best articles with the most practical insights and tips for retail marketers and advertisers:

Five Things You Don't Know About Baby Boomers (The Boomer Project/BIGresearch) - Marketers and retailers are too often guilty of treating baby boomers as a homogeneous group with uniform attitudes and purchasing behaviors. Ironically, what they end up with is a pitch that is as generic – and disposable – as a plain brown bag. As a group, one quarter of the US population, is much too large and diverse to share a single lifestyle, life stage, purchasing proclivity or political agenda. And most of them are too wealthy to be ignored by marketers and retailers obsessed by youth. “Boomers still dominate the U.S. retail marketplace.”
'Generation Buy' Fickle Yet Free Spending (TV Land/OTX) - Baby Boomers not only are at the peak of their earning potential but also are making the majority of buying decisions for themselves, small children and their elderly parents, according to a recent branding survey. Not only are they spending more on themselves per month than Millennials and Gen Xers but, more interestingly, they are spending twice as much as their younger cohorts on others in their lives. With so many people to shop for, Boomers are “making several multi-generational purchase decisions at once and—contrary to common assumptions — they are far less brand loyal than Millennials and Gen Xers.”
Boomer Shoppers to Become Pragmatic with Age (FH Boom/the National Marketing Institute) - 86% of Baby Boomers plan to be more practical and pragmatic in their purchases when they reach the age of 70, and much less concerned about trendiness and indulgences. This turn to the pragmatic is highly correlated to the fact that only 41% of Boomers state they have a secure, financially sound plan for retirement. After paying their basic living expenses, Boomers anticipated that they will have on average 22% of their income left to spend on discretionary purchases. But the buying pragmatism may also reflect Boomers re-adapting more hippie-like values held in their younger days.
Baby Boomers Revealed (AARP/Focalyst) - “Contrary to many common assumptions, Boomers are making retirement obsolete, are very savvy about advertising and are experimenting with new products.” Only 11% of Boomer respondents say they will stop working entirely when they reach the retirement age of 62. Two-thirds of Boomers surveyed said that ads have become more crude in recent years and 67% said they are less likely to purchase a product if they find the advertising offensive. More than 60% of Boomers agreed with the statement, “In today’s marketplace, it doesn’t pay to be loyal to one brand.”
Rich Baby Boomers are Buying Online (The Media Audit) - It seems to happen every generation: while advertisers and marketers focus relentlessly on young consumers, someone realizes that older consumers actually have more money to spend. The number of US consumers 50 and older with annual incomes of $50,000 or more increased to 22.3 million in 2007 and more than 60% had incomes of $75,000 or more. Since 2004 the percentage of 'graying and affluent' households has increased from 13.1% to 15.7% of all households in the markets and this group is very rapidly embracing the Internet as a shopping medium.
Baby Boomers and Social Networking (JWT BOOM/Third Age) - While less than 25% of US Internet users ages 40 and over use social networking Web sites, 93% read an article about a Web site in print and later visited the site, 83% visited a Web site after seeing an ad for the site in a newspaper or print magazine, over three-quarters received promotional e-mails about products and services and then clicked through to the site being promoted, and more than 55% purchased a product or service promoted in an e-mail. The reasons include privacy, time and just not seeing the point and, although each of these barriers can be addressed, marketers might also consider that social networks are just not yet the best way to reach boomers.
Targeting the 50-Plus Audience Online (quotes a variety of surveys) - Within their online activities, boomers like financial planning, healthcare and games but only recently do they seem to be warming to social networking. They are savvy buyers, but they've been fooled enough times in their lives that they are very cautious about advertising. Blinking ads that say "you've won a free PC" don't get clicked because boomers aren't that gullible. Marketing to boomers must be accomplished by embedding ads into content and as a part of the content; it shouldn't look or sound like an ad.

As a bonus here are two eMarketer articles (Seniors Are Increasingly Active Online and Seniors Underserved by Online Merchants) about senior citizens ages 62 and over - a potentially lucrative consumer segment whose special needs and aspirations should be better understood by retailers, online and offline.

Posted by Universal Ad

Businesses Feeling Out Virtual Worlds

Universal Ad — Sat, 12 Jul 2008 10:18:35 GMT

A Gartner report (covered by eMarketer) shows that 90% of corporate attempts to use virtual worlds fail within the first 18 months. Despite this finding, Gartner says that virtual worlds could still play a vital role in the future with 70% of organizations developing a private internal virtual world by 2012.

The projects so often fail either because they are launched for the wrong reasons (for the cool factor or to keep up with competitors) or because marketers don't understand at a fundamental level how virtual worlds ("Web places") are different from the rest of the Web (the pages that compose the "2-D Internet"). "Realistic graphics and physical behavior count for little unless the presence is valued by and engaging to a large audience."

Another eMarketer article reports that brand marketers are scared of wasting more money on virtual worlds after previous failures. Problems include a lack of established marketing metrics and benchmarks for virtual worlds and a perception that statistics on the number of people who regularly visit virtual world have been inflated.

One of the things marketers need to take into consideration when it comes to virtual worlds is consumer engagement. For example, "Toyota's Scion campaign let Second Lifers test drive in-world versions of the vehicle, making for a more engaging experience than items which couldn't actually be used in the virtual world."

Finally, iMedia Connection offers an extensive article (highly recommended for those of you looking at virtual worlds) on how consumers behave in virtual worlds and the best marketing approaches there. The article, based on real-life research, takes a look at "how the role of identity changes when people step into virtual spaces, and how marketers can learn to deal with the uncertainty inherent in marketing to consumers in virtual spaces."

Posted by Universal Ad

More Users Buying via Cell Phones

Universal Ad — Sat, 12 Jul 2008 09:16:04 GMT

A couple of studies about m-commerce have recently been published. First, Nielsen Mobile (covered in Chief Marketer and Promo) reports that:

More than 9 million U.S. mobile subscribers (3.6% of the total) used their mobile phones to make a purchase of some kind in Q1 2008.
About 50% of those who surf the Web over their handsets expect to use them to buy goods or services in the future.
Men are slightly more likely to have pursued mobile commerce than women (4.5% vs 3%).
The 25-34 age segment is the most active - 5.4% vs 4.5% of those 13-17, 3.6% of the 18-24 group, and 3% of those 35-54.
The 13-17 age group is the most active in using text messaging to buy - 3.7% vs 2.5% of total subscribers and 3% in the 18-24 and 25-34 groups.
Barriers include security worries (41%), airtime/data charges (23%) and lack of trust in the completion of mobile transactions (21%).

The Chief Marketer article also provides some case studies. Moosejaw Mountaineering, for example, has seen a positive response to the mobile channel. It both allows customers to purchase via their smartphones and uses text messaging to foster loyalty (for one text message, they got a 51% response rate!) 1-800-Flowers.com created a younger group of buyers by allowing Facebook and MySpace users to send virtual flowers to their friends' phones.

A recent Gartner report (covered in Information Week and eMarketer) shows that currently twice as many US consumers are likely to check item prices by mobile compared with those who said they would buy items from their mobile phone (24% vs 12%). Other popular activities include finding stores and receiving promotions (20%). The report also showed that younger consumers are more likely to use the mobile phone to conduct retail activities.

The report's bottom-line: "retailers planning to enter the area of mobile commerce should differentiate themselves by offering multichannel capabilities, such as the ability to order by phone and pick up the item at the store or to save a mobile-phone-created shopping session so it can be continued on a Web browser on a home PC. Also, because the survey points to a shopping preference, retailers should strive to have listings available on portals, price comparison engines and mobile maps."

Posted by Universal Ad

Discounts, Contests Drive Online Promos

Universal Ad — Sat, 12 Jul 2008 08:20:38 GMT

According to a Borrell report (covered in eMarketer, ClickZ and MediaWeek) spending on online promotions, inc. games, contests and coupons, is about to eclipse traditional banner- and paid-search advertising. This trend "is going to make advertising look considerably different in the next 10 years than it has in the last 100 years."

While non-ad online spending currently accounts for 22% of overall interactive marketing spending, it is expected to triple over the next five years to more than $22 billion. This will bring it more inline with total marketing expenditures, where 60% are allocated to non-ad spending and only 40% are allocated to traditional advertising.

Meanwhile, spending on online display ads, banners and pop-ups is expected to peak this year and then begin to decline to less than half over the next four years. Spending on paid search is expected to follow a similar pattern - peaking next year and then gradually declining.

The main reason for these shifts is that marketers are looking for measurable campaign results and newspapers, magazines, radio and TV are unable to prove return on advertising investment. This provides great opportunities for local media companies to collaborate with their advertisers, instead of just selling ads.

Posted by Universal Ad

The Delicate Privacy vs. Personalization/Targeting Balance

Universal Ad — Sat, 12 Jul 2008 07:41:12 GMT

As advocacy groups urge (and lawmakers consider) legislation aimed at regulating online tracking, here's a look at the balance between the use of online ad targeting (behavioral and otherwise) and consumer privacy concerns.

A recent TRUSTe/TNS survey (covered in eMarketer and MediaDaily) showed that there is significant discomfort with the idea of online activity tracking among US Internet users, although they still want to see more relevant ads:

71% were aware their online activities were being tracked for the purposes of advertising
57% were not comfortable with providing their browsing history in exchange for better ads, even if no personal information was given
42% would sign up to an online registry to prevent any of their online behavior from being tracked
72% find irrelevant ads intrusive and annoying
55% would take an anonymous survey in order to limit ads to the products, services or brands they use
37% would be willing to provide personal contact information with a survey
54% erase cookies two to three times a month

According to an eCommerceTimes article, while "behavioral targeting could revolutionize how marketers interact with their target audience in an online world...this level of granularity...can easily trigger privacy concerns if the issue is poorly handled." A ClickZ article notes that the privacy issue will continue to heat up in upcoming months - "it seems the more complex behavioral targeting solutions become, the more problematic they are. Once the ISPs got into the behavioral targeting equation, privacy concerns leaped to an all-time high."

Currently, the debate centers on "how advertisers use personal identifiers and whether behavioral targeting should be opt-in versus opt-out." Marketers, obviously, hope for the latter option (similar to anti-spam policies) while consumer groups press for the former option, including a "do-not-track" list (similar to the telemarketing "do-not-call" list) that will allow "consumers to opt out completely of all behavioral profiling and targeting."

One option marketers may want to consider are self-optimizing behavioral targeting and personalization products that generate "representations of visitors and products solely from current user interaction on the Web site." According to a Multi-Channel Merchant article, these systems are based on analyzing traffic patterns and on-site behavior, representing the visitors' real-time interests and needs, and require no personal information, third-party cookies or special interaction with visitors.

The article provides an example of a multi-channel retailer who implemented such a solution and saw the number of converted online visitors rise by 15% while revenues from automated product recommendations and merchandising rose by more than 18%. Other retailers have said that "the average order value from visitors who acted upon the platform’s automated personalized recommendations" was 60% greater than those who didn’t.

Posted by Universal Ad

Savvy Shoppers Up The Retail Ante

Universal Ad — Wed, 09 Jul 2008 02:30:16 GMT

The results of a Krillion/e-tailing group survey of online shoppers (covered by Internet Retailer, Online Media Daily, eMarketer) show that "manufacturers and e-tailers must be prepared for confident and educated buyers who has done his or her homework and who can now buy through any channel, at any time."

According to the report, 67% of surveyed online shoppers spend more than 30% of their total shopping time researching products on the Web. More sophisticated shoppers, dubbed web-informed buyers, spend more than 50% of their shopping time researching online. Consumers looking for more complex products are more likely to research online and offline, more likely to take their time researching and more likely to complete their purchases at a local store.

Taken together it seems that a large number of shoppers, regardless of where they end up buying the product, actively use Web sites to gather "detailed product information, insight from other shoppers, and third-party validation from multiple sources".

They also have high expectations regarding these info sources and the features they expect to find on the shopping site. Aside from current store promotions, logistics largely outweighed pricing, with in-store returns, detailed store information and product locators all ranking highly.

Other interesting factoids - 55% of have bought items online for in-store pick-up (for Web-informed buyers this number
is 60%). 72% rank manufacturers' sites as the most essential destination for big-ticket products (compared to 61% for all products) followed by 54% for online retail stores and 50% for comparison-shopping engines.

Two related surveys confirm these results. The first, from Jupiter (covered by Direct), reported that 95% of higher spenders (spending an average of $2,203 online in the last year) look to multiple sites when researching a product purchase. 87%
visited multiple Web sites before making their most recent purchase online. 36% of those influenced by social/community sites said they buy offline even though they use online social/community sites to make their decisions.

The second survey, from PriceGrabber (covered by Internet Retailer), also reports that while many consumers use the Internet to research major household purchases, less than a third of them will buy the products online. Also, 81% do their research online before purchasing furniture and appliances, for 53% the Internet is the top data source for such purchases, but just 31% who research online buy big-ticket household items online.

Posted by Universal Ad

Behavioral Targeting and Customer Segmentation

Universal Ad — Fri, 04 Jul 2008 05:23:00 GMT

Our focus today is on behavioral targeting and how to tie it into customer segmentation.

First, an academic study from the Stanford Graduate School of Business which shows that while exposure to certain ideas and concepts, whether verbal, visual, or cognitive, can significantly affect consumer behavior, one prime does not fit all.

Men versus women and introverts versus extroverts respond very differently to the same prime, including having different product-buying behavior. For example, if you tell men to shop for clothes, they'll "set out to get right to their goal of finding the needed item." Women, on the other hand, will "see a possibility-driven experience with lots of room for browsing."

For marketers, the main takeaway is the importance of segmentation - when you try to influence consumers, you must understand exactly how those subtle cues work on different groups and segment accordingly.

A recent Compete survey (covered by the Center for Media Research) found that while only 39% of US marketers believe segment-driven marketing is very important in their organization today, 84% indicate that it will be more important three years from now. 92% are using segments to manage their online advertising and/or search marketing, but 77% of them are having trouble demonstrating real business results from it and 27% said they see no improved business results from their efforts.

One promising example of behavior-based segmentation can be found in behavioral online ad targeting (as covered recently in eMarketer - once, twice, three times!) Nearly 10% of content-site ad dollars will come from behaviorally targeted advertising in 2008, rising to approximately 25% by the end of 2012.

The advertising method combines observed and measured data, such as the pages or sites users visit, content viewed, search queries entered, ads clicked, information share on social networks and products placed in online shopping carts, with the time, length and frequency of site visits.

Behavioral ad targeting is of great interest to most advertisers as so many people now feel that the advertising they see every day is irrelevant to their interests and needs. Behavioral targeting can also help with the most consistent obstacle to successful segment-driven marketing - segment identification - since "the right segments are created by the users and their actions, not imposed on them."

Finally, a ClickZ article which provides a few pointers to marketers trying to properly interpret consumer behavior in order to formulate the right messaging. The main problem is that "human behavior isn't always transparent and requires additional insight from the observer."

The article outlines five aspects that need to be considered when trying to interpret consumer behavior - the behavior pattern is essential (a single behavior taken alone is meaningless), get off their backs (maintain the communication or "retreat"), consumers are paranoid (provide value and be transparent), know your product and audience, and be flexible (offer unique offers and messaging to various consumer groups).

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Avoiding the Shopper-Marketing Pitfalls

Universal Ad — Thu, 03 Jul 2008 03:22:00 GMT

A PMA study (covered extensively in Promo, AdWeek and MarketingDaily) shows that more than 60% of those surveyed are currently practicing shopper marketing, focused solely on the point of purchase and its surrounding activities. While retailers are more focused on the consumer and manufacturers on their retail customers, both say that increasing sales is their #1 goal with these programs. Indeed, 69% of manufacturers and 87% of retailers achieved the sales growth they had hoped for.

BUT while 44% of retailers say they are more likely to support shopper marketing programs than standard initiatives, 78% say they do not see enough and are looking for more of them. Nearly 60% of manufacturers say retailers are giving more support to shopper marketing than they did just one year ago, although only one-third of retailers said they are seeing more support from manufacturers over this same period.

Still, they have a lot to learn about how to reach consumers when they are in "shopping mode". A large of the problem is that retailers and marketers do not collaborate enough (aligning objectives, joint planning and measurement, etc.) in order to maximize the program's potential. The reason for doing it is obvious - two-thirds of retailers and ALL of the vendors who said they collaborate very well with their vendors have seen improvements in sales. The manufacturers have also seen enhanced brand equity, stronger retailer relationships/greater cooperation and stronger consumer relationships.

Another problem is metrics. Only one third of retailers and manufacturers say they agree on program evaluation metrics most of the time. The rest answered occasionally or never. They also need to focus on understanding the differences between consumer insights and shopper insights: "The same consumer can be in multiple shopper mindsets even in a single week -- she shops differently when she's doing a major shopping trip on Saturday than she does when she's in a rush to pick up dinner after work."

The report also offers seven tips for achieving shopper marketing success:

* Get retailers and manufacturers to embrace the idea of joint planning.
* Set a date to evaluate the program in advance.
* Integrate consumer insights in your work (joint focus groups or research to validate those findings.)
* Use a common language that retailers and manufacturers, alike, can understand to achieve your goal.
* Find a common strategy for your objectives.
* Plan ahead (15 to 18 months out).
* Make a commitment and share the work equally.

For an intro to shopper marketing, you can read this AdAge article which focuses on how to make your "commercial and marketing efforts more segmented, synchronized and persuasive during the shopping process, thus becoming more effective overall." It quotes a GMA/Deloitte Consulting report which estimated that companies such as Kroger and Best Buy improved sales by 6.8% and 8.4%, respectively, by implementing effective shopper-marketing strategies.

The article also outlines the five major pitfalls that companies can run into when studying shopper marketing. These include letting the creative side of marketing drive the agenda, Focusing too much on programs and not enough on process, ignoring the little guy, not fully investing in capabilities and not turning shoppers' obstacles into purchasing opportunities.

Finally, this ClickZ article provides more information on shopper marketing in the context of online shopping.

Posted by Universal Ad

Retailers Try New Online Marketing Approaches

Universal Ad — Wed, 02 Jul 2008 03:16:00 GMT

A Shop.org/Forrester report (covered by AdAge, the Center for Media Research, StorefrontBacktalk and On Media) suggests that as the online channel matures and in order to stay viable during the difficult months ahead, retailers need to examine their strategic and tactical plans in order to make sure they support the most cost-effective ways of generating sales.

Specific suggestions include focusing on customer retention by mining data analytics for a deeper understanding of their customers, addressing shopping obstacles such as shipping fees (for example, by shifting funds from customer acquisition efforts to offset free shipping offers), adjusting SEM programs (for example, by tweaking landing page copy) and reconsidering the move to social networks (which may be effective for brand-building but less so at driving revenue or conversions.)

Currently, 53% of online retailers' marketing budgets are spent on customer acquisition compared to 21% spent on retention, 15% on non-online channels and 11% on brand awareness. The top acquisition tactic is paid search (53%), followed by organic web traffic (18%), affiliate programs (7%) and e-mail (7%).Overall, though, e-mail to house files is the top online marketing tactic with 92% of online retailers using it. Additional tactics include free shipping with conditions (85%), percent-off promotions (82%), dollar-off promotions (69%), gift with purchase (68%), and print catalogs (nearly 50%).

Leading edge tactics such as social networks and mobile shopping have yet to become a significant factor, although 65% indicated plans to give social networks an increased priority in 2008 (compared to 26% who already use them), and a similar percentage said the same about online video (compared to 21%). But these increases will happen only if marketers have metrics they can trust that show the sales impact of tactics such as social networking, recommendations, widgets and blogs.

Posted by Universal Ad

The New Conversion Tool: Triggered E-Mails

Universal Ad — Tue, 01 Jul 2008 02:46:00 GMT

A bunch of articles, all of them from the always dependable Multi-Channel Merchant site, have recently covered the Five Ws (and one H) of Triggered E-Mails - Why send them? Who to send them to? When to send them? What to send in them? Where to send them to? How to send them?

The New Conversion Tool: Triggered E-Mails - Triggered messages can help turn people who sign up for your e-mails into customers by engaging prospects with your brand, enticing them with offers and addressing the risks they face when placing an order. The article describes how to start a triggered conversion series.
How to Use Triggers in E-mail Marketing - Triggered event-based e-mail is a powerful marketing tool that can drive higher click-through and conversion rates. It puts the direction of the contact strategy design and content in the hands of the consumer. While this may sound scary at first, it is actually quite simple and very easy to execute. There are several types of trigger-based e-mail contacts that you can start with and many already may be happening.
Seal the Deal with Triggered E-mails - You send triggered e-mails to customers who experience a lifestyle change, but do you also send them when the person has abandoned a shopping cart or placed an order? The point in both cases is to capitalize on an event that is unique to the customer at a given moment. But many marketers ignore everyday activities—and that’s a mistake.
The If and Then of Automated E-Mail - If your customer does this… then you send that. The basic "If … then …" conditional statement we see in contracts and computer programming can be applied effectively to your benefit in triggered e-mail. The root of this idea is to identify actions your customers take and respond by presenting relevant offers that complement or support the first action they took. The key here is understanding your customer's mindset.
Adopt Automated E-mail Tactics for Follow-up Orders - Why not leverage your database and automated e-mail tactics to encourage new customers to make that second purchase right away? Your efforts can be a simple approach for getting a second sales or a more complicated effort tailored to each specific customers buying pattern. However in each case the idea is to use the inexpensive cost and programmability of automated e-mail to get in front of your customer at the right point in time with the right offer.

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Personalized Marketing Lags Potential

Universal Ad — Mon, 30 Jun 2008 08:08:00 GMT

The CMO Council recently issued a report called "The Power of Personalization" (covered by RetailWire, BrandWeek, Direct, MarketingDaily and the Center for Media Research).

The study showed that marketers are increasingly looking to create more personalized communications with consumers, although they are still far from taking full advantage of personalized communication. "Sixty-three percent of consumers prefer highly personalized and unique offers. More investment in personalized marketing is vital to the success of marketing campaigns and, to some extent, business results as a whole."

Surprisingly, only 56% of high-level marketing executives believe personalized communications outperform mass-marketing. Nearly 44% of are using a low level of personalized communication techniques, 39% use a moderate level and only 17% are using a high level of personalization. More than 55% said that they would spend more than 10% of their budgets on customized communications, and 25% would allocate more than 20%.

The types of personalization currently in use include customize e-mail and letters (65%), permission-based marketing (47%), personalized e-mail promotions and print-on-demand/variable digital printing collateral with personalized content (31%). The reasons for this situation - inadequate backend infrastructures, high complexity, lack of actionable customer data, inadequate analytics and lack of resources in terms of personnel and budget.

This leads us to the related trend of creating personalized shopping experiences:

Personalizing the Shopping Experience - Instead of a one-size fits all approach to web visitors, online merchants can benefit by using personalization techniques that deliver information based on user behavior, product relevance, product popularity and merchandising strategies. For example, if there is a promotion for a sweater on a web site’s home page and a shopper leaves and returns from a bicycle site, the home page offer could be changed to a bicycle-related product to increase the chances of piquing the shopper’s interest.
Telling Customers What They Really Want - Personalization is one way e-tailers hope to bolster their cross-selling and upselling efforts and increase customer loyalty. Online consumers are embracing the idea of having tailored suggestions served to them during various stages of their shopping experience.
Enthroning the E-Shoppers - Building brand loyalty has become a struggle for retailers; however, personalization has the potential to help them to enhance customer allegiance and differentiate their products in highly competitive markets. Though in an early stage of evolution at the moment, customized shopping experiences are expected to become more common as the e-commerce market's ongoing maturation continues.

Posted by Universal Ad

Retail AMP Word Cloud

Universal Ad — Sun, 29 Jun 2008 22:48:00 GMT

A special treat for today - Wordle is a cool little app that lets you generate "word clouds" from text that you provide. It creates an initial version based on word frequency which you can then tweak using different fonts, layouts and colors.

Here's the image I created from our blog content. Go ahead and try it yourselves!

Posted by Universal Ad

Marketing Storytelling Pays Dividends

Universal Ad — Fri, 27 Jun 2008 05:56:00 GMT

With consumers ignoring more and more sales messages, marketers must consider moving from interruption-based overt advertising to storytelling in order to differentiate themselves. The Chief Marketer article on this subject quotes Yankelovich research which found that 70% would pay money to block or skip advertising and marketing messages, and almost 60% go “out of their way” to avoid brands that overly market their products and services.

Storytelling (also called content marketing or custom media) delivers brand product message as relevant and compelling information using a mixture of rational and emotional messaging typically found in a newspaper article or TV drama. Unilever, for example, created a digital short series to engage male consumers. Based on a one-day MySpace promotion, it produced more than 1.5 million viewings and 61,000 sweepstakes entries.

“We are in the Post-Advertising Age where brands that tell the best stories win - and not just any stories, but stories that tie in to the brand's authority to publish." Other brands such as Stella Artois, Dove and Sprint are also moving towards creating "compelling, story-form content, reminiscent more of media companies than product-pitchers."

Posted by Universal Ad