Kevin Mathers: Connecting With Shoppers in the Digital Age

Connecting with Shoppers in the Digital Age
Kevin Mathers, Industry Leader, Technology UK
Date of the presentation

THE JOY OF DATA
MAKING IT UNIVERSALLY ACCESSIBLE AND USEFUL
COPY
COPY.

THE JOY OF DATA – REALTIME INSIGHTS

MOST ADVANCED ECOMMERCE MARKET IN THE WORLD
The largest per capita e-commerce market
Second largest online advertising market after the US
The UK has above average internet penetration within Europe
Average spend per internet shopper doubled between 2006 and 2010,
In 2009 the Internet economy was worth £100bn or 7.2% of GDP - larger than the UK's construction, transport and utilities industries, and slightly smaller than the finance industry (at 9% of GDP).
The UK internet economy is forecasted to grow at 10% y/y, and to constitute 10% of GDP by 2015

DATA DRIVEN DECISION MAKING
Website usability improves user experience
and therefore conversion rates
Before
After
20% reduction in bounce rate
Multi-variant test and learn, based on the DATA
7% increase in conversion rate

CONNECTING ONLINE DATA TO OFFLINE SALES
NUMBER OF PEOPLE MAKING DECISIONS IN STORE HAS HALVED
Source: Longitudinal Economic Study Series, IRI Attitude Link, n = 1,000+ shoppers. CPG Purchase Decisions. IRI, 2009.

CONNECTING ONLINE DATA TO OFFLINE SALES
The ZeroMoment of Truth
The FirstMoment of Truth

ONLINE ACTIVITY TO OFFLINE SALES CAN BE MODELED
DRIVERS OF SONY BRAVIA OFFLINE SALES
Offline Sales Volumes(Sony AU)
September 2009 – August 2010
TV, Print, Outdoor
Pricing
Paid Search
+3%
Seasonality
Base Sales 33%
August
June
July
May
January
March
April
November
December
February
October
2010
2009

CONNECTING ONLINE TO OFFLINE BY TESTING
GEO-TARGETED EXPERIMENTATION
“Vodafone’s additional investment in generic and upper funnel keywords was an effective way to drive incremental in-store sales. We now have a better understanding of the impact of online research on retail purchase behaviour and we’ll have to rethink the way our current attribution model works.”
-Mike Durbridge, Head of Direct Sales, Vodafone UK

WE HAVE DONE MANY EXPERIMENTS TO PROVE THE THEORY
Offline lift
Halo effect
Increase in store sales of non-tested categories from online advertising*
Up to 3.5%
Increase in store sales through online advertising*
1.5% – 4.4%
ROPO
ROAS
% of all retail sales researched Online prior to Offline purchase**
31% - 48%
Average offline gross margin driven by online advertising***
12.5 : 1
* Based on 40+ studiesconducted in the US and Europe in 2009 and 2010
** Consumer Commerce Baromerter Western Europe, Google/ IAN/ TNS 2010 (Multiple Retail categories in DE, Es, FR, IT, NL & UK)*** Based on 7x EMEA Retail studies covering Retail categories

BUT CLOSING THE LOOP ONLINE TO STOREHOW DO WE GET IT TO BE REALTIME?
MOBILE CAN START TO CLOSE THE LOOP
Google Wallet
South Korea Tesco Case Study

‘MOBILE FIRST’
THE LOOP WILL CLOSE
WHAT WILL YOU DO WITH ALL THE DATA?
“I keep saying the sexy job in the next ten years will be statisticians. People think I'm joking, but who would've guessed that computer engineers would've been the sexy job of the 1990s?” – Hal Varian
Chief Economist, Google

THANK YOU!

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