Google CH - Internet trends (daniel meyer)

Internet Trends Google Confidential and Proprietary 1

Quote “Deutschland 2010” (published 2001) „Einkaufen per Internet bleibt ein nettes, kleines Zusatzgeschäft.“ Horst W. Opaschowski “Deutschland 2010”, (2001) Google Confidential and Proprietary 2

Technology Drives Consumer Trends Google Confidential and Proprietary 3

Moore‟s Law Google Confidential and Proprietary 4

New Devices Google Confidential and Proprietary 5

Better Networks Google Confidential and Proprietary 6

Technology results in Consumer Trends Local Trends Social Mobile (3 C‘s) Google Confidential and Proprietary 7

Social Google Confidential and Proprietary 8

I. Connecting10080604020 0 Mai. 07 Mai. 08 Mai. 09 Mai. 10 Jan. 07 Jan. 08 Jan. 09 Jan. 10 Sep. 07 Sep. 08 Sep. 09 Sep. 10 Source: Google Insights for Search, Switzerland Google Confidential and Proprietary 9

Tuenti comScore / Nielsen Skyrock Facebook 280 229 Facebook 364 251 Windows Live 52 Millions of minutes (August 2008) Spaces 70 Tchatche 40 Hi5 Overblog 50 30 Badoo Myspace 45 Facebook Bebo 2407 413 320 Myspace 43 Friends Reunited 22 Windows Live Spaces StudiVZ sites Wer kennt wen Netlog Lokalisten Windows Live Spaces Kwick! 745 604 143 130 Facebook Jappy 105 Myspace 183 176 145 122 120 Badoo Vkontakte Odnoklassniki 4061 582 117Google Confidential and Proprietary Mail.ru MyWorld 12 Facebook10 6 Myspace

Tuenti comScore / Nielsen Skyrock Facebook 280 229 Facebook 364 251 Windows Live 52 Millions of minutes (August 2008) Spaces 70 Tchatche 40 Hi5 Overblog 50 30 Badoo Myspace 45 Facebook Bebo 2407 413 320 Myspace 43 Friends Reunited 22 Windows Live Spaces StudiVZ sites Wer kennt wen Netlog Lokalisten Windows Live Spaces Kwick! 745 604 143 130 Facebook Jappy 105 Myspace 183 176 145 122 120 Badoo Vkontakte Odnoklassniki 4061 582 117Google Confidential and Proprietary Mail.ru MyWorld 12 Facebook11 6 Myspace

The winner takes it all…? Unique User Germany (Ø net reach) 15.446k 4.607k 3.393k 3.393 2.548k 2.417k 1.332k 1.332 2.548 Aug 08 Aug 09 4.607 Aug 10 Aug 08 2.417 Aug 09 Aug 10source: Nielsen NetView Google Confidential and Proprietary 12

Google Confidential and Proprietary 13

II. Contribution10080604020 0 Mai. 07 Mai. 08 Mai. 09 Mai. 10 Jan. 07 Jan. 08 Jan. 09 Jan. 10 Sep. 07 Sep. 08 Sep. 09 Sep. 10 source: Google Insights for Search, Switzerland Google Confidential and Proprietary 14

What Twitter is not… Google Confidential and Proprietary 15

If the Twitter community would be 100 users…David McCandless // www.visualizedthebook.com //v1.2 Google Confidential and Proprietary 16

“Few” is enough… Google Confidential and Proprietary 17

III. Creation10080604020 0 Mai. 07 Mai. 08 Mai. 09 Mai. 10 Jan. 07 Jan. 08 Jan. 09 Jan. 10 Sep. 07 Sep. 08 Sep. 09 Sep. 10 source: Google Insights for Search, Switzerland Google Confidential and Proprietary 18

How much People create on YouTube Google Confidential and Proprietary 1 19 9

TV vs. Online Usage (Min. per Day - Index)• „TV light user“ use video websites more intense while social networking sites are frequently used by TV heavy users Index Social Networking: 78Index Index Video Websites: 121200% 187% TV usage180%160% Online usage140%120% 100% 100% 100%100% 80% 60% 43% 40% 23% 20% 0% TV light TV medium TV heavy 20source: GfK Media Efficiency Panel, Germany, TV light =lowest 25%, TV heavy= highest 25%, TV medium= 50% Google Confidential and Proprietary 2 20 0

YT vs. FB: Less Overlap than expected…? Total YouTube + Facebook= 2.506.000 = 65% of CH online population (exclusive) (exclusive) Unique User Overlap: Unique user Facebook: 1.207.000 YouTube: 767.000 532.000source: Nielsen NetView, Switzerland Google Confidential and Proprietary 21

The New Media Mix Paid Media (online & offline advertising...) Owned Media Earned Media (website, Facebook fan site...) (WOM, social media, tweets...) Google Confidential and Proprietary 22

Mobile Google Confidential and Proprietary 23

• xxx xxx Google Confidential and Proprietary 24 24

Smartphone= Short online sessions 82% of „Smart Natives“ use their Smartphone for amusement during a break Google Confidential and Proprietary 25

Usage Patterns will be very different 25% of all Android 2.0+ searches come from voice in the US - although voice search is less than 12 months old! Google Confidential and Proprietary 26

Local Google Confidential and Proprietary 27

Mobile Drives Local Google Confidential and Proprietary 28

Of all regular internet users in Switzerland… I find information I see a product via about a product on the mobile internet and buy it go and try to find out spontaneously in a store more directly via mobile nearby internet 18% 9%Question: Thinking about online shopping to what extent do you agree or disagree with the following statements?Source: TNS Infratest Consumer Commerce Barometer Switzerland 2010 Google Confidential and Proprietary 29

The Internet in the Decision Process Google Confidential and Proprietary 30

Multi Channel Online Research Offline Purchase Research Online, Purchase Offline (ROPO) / Online2Store (O2S) → Statistical Evidence…? Google Confidential and Proprietary 31

Level 1: Self-Reported Data Google Confidential and Proprietary 32

www.consumerbarometer.com Google Confidential and Proprietary 33

Hotels: Most Purchases Start in the Internet Out of 10 CH customers... Research online ? 78% 21% yes no ...8 search the internet before... Buy online ? 54% 23% yes no ... 5 buy onlineSource: TNS Infratest Consumer Commerce Barometer Switzerland 2010 Google Confidential and Proprietary 34

ROPO Effect – Online has more Value • In other words: Online Marketing influences 43% more Hotel bookings than the online conversion tracking will suggest 43% ROPO Online Booking 100% Research Online, Research Online, Total Online Purchase Online Purchase Offline Research Effect 35Source: TNS Infratest Consumer Commerce Barometer Switzerland 2010 Google Confidential and Proprietary 35

Online Conversion vs. ROPO Effect• Across all products a significant number of CH consumers research online before purchasing offline 80% 70% 60% 50% 12% 19% 40% 13% 30% 9% 20% 7% 32% 37% 35% 10% 26% 18% 2% 0% 3% Digital Computer Software / Package Holidays CDs / DVDs Health products Event tickets Camera/Camcorder Video games Purchase Online Research Online Purchase Offline (ROPO)Source: TNS Infratest Consumer Commerce Barometer Switzerland 2010 Google Confidential and Proprietary 36

Information Sources in Research Process• Search engines are the most commonly used type of website for online research, followed by manufacturer sites Websites Used for Online Research Base: Onliner Search Engines 71% Manufacturer 55% Retailer 47% Price Comparison 40% Online auction 33% Mapping 30% ConsumerReviews 12% Video Portals 8% Social Networking 7% Bulletin Boards 4% Financial 3% Blogs 2% Microblogs 1% 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%Question: Thinking in general, what sorts of websites do you use in researching purchases you make either online or elsewhere e.g. in a store / agency / showroom / phone, etc. 37Source: TNS Infratest Consumer Commerce Barometer Switzerland 2010 Google Confidential and Proprietary 37

Google Confidential and Proprietary 38

Level 2: Observational Data Google Confidential and Proprietary 39

Online Conversion vs. ROPO Effect • Key question: How much does online research process influence the offline purchase? 100% 90% 80% 70% 60% 50% 40% 48% 37% 38% 49% 29% 30% 29% 20% 10% 16% 20% 22% 11% 10% 15% 0% all products banking insurance fashion broadband mobile Purchase Online Research Online Purchase Offline (ROPO)Source: GfK MEP Germany; basis: product buyer Google Confidential and Proprietary 40

Monitor Online Behaviour Prior to Offline PurchaseKerstin*, female, 28 years, employed 19.10.2009 08.11.2009 15.11.2009*1. Google search „allianz 5. Visit on check24.de (time 6. Offline contract at R+V: versicherung“ spent: 13:55 min) Car insurance Reason: cheap tarif, well-2. Visit on allianz.de (time known and trusted insurance spent: 2:47 min) company3. Google search „r-v versicherung“4. Visit on ruv.de (time spent: 12:47 min) * not real nameKey metrics for Kerstin’s* research process- 2 Google queries- 3 (unique) domains, 18 sites in total, total time spent: 29:39 min.- ROPO Google Confidential and Proprietary 41

Media Efficiency Panel (MEP)1 2 3 Demographics: Media usage: Sales: • gender, age, income etc. • web usage measured • CPG purchases • mail address → website visits → ongoing → match with client database → ad impressions (display & AW) • other vertical purchases → ad clicks → quaterly • TV measured → Travel, Finance, Tech, Retail • media questionnaire → Print, Radio, (outdoor) Google Confidential and Proprietary 42

Duration of Online Research Process• Duration of online research process is similarly long for online and offline buyers days 40 37 days 37.2 35 35 days 35 30 25 20 15 10 5 0 Online-Käufer online buyer Offline-Käufer (ROPO) offline buyer 43 Google Confidential and Proprietary 43

Number of Unique Domains • Variety of websites visited during research process are directionally similar for online and offline buyers 5,0 4,0 3,0 5,2 4,8 2,0 4,0 4,2 3,6 3,5 3,7 3,6 3,0 2,3 2,5 1,0 1,8 0,0 all products banking insurance fashion broadband mobile online buyer offline buyerSsource: GfK MEP; basis: product buyer who researched online Google Confidential and Proprietary 44

Brand vs. Generic Terms• Share of brand/ generic keywords varies strongly between categories 69% 13% branded searches prior to fashion branded searches prior to mobile purchase contract 45 Google Confidential and Proprietary 45

Number of Search Queries • ROPO consumers enter a significant number of search queries prior to purchase 20,0 16,0 12,0 19,9 8,0 10,9 11,5 12,1 4,0 9,2 7,6 7,1 7,0 4,7 4,9 3,0 2,9 0,0 all products banking insurance fashion broadband mobile online buyer offline buyerSsource: GfK MEP; basis: product buyer who searched online Google Confidential and Proprietary 46

Got it, online research process of ROPO‟s is asimpactful as for online buyers BUT…… how many of my offline sales actually orginatefrom the web? Google Confidential and Proprietary 47

Level 3: Attribution Google Confidential and Proprietary 48

Call Tracking Google AdWords: Product website w/ number: Consumer searches for an A dedicated hotline number Inbound calls hotline: insurance product, e.g. appears for users who came Consumer sign contract on “health insurance” on the website via AdWords the phone or request contract proposal Google Confidential and Proprietary 49

Call Tracking: Example• Tracking via the “AdWords” Hotline number shows: With each 100 contracts online, AdWords generates another 18 offline contracts in the call centre. Contracts through AdWords (Online & Offline) Index contracts 140% 120% 18% 100% 80% 118% 60% 100% 40% 20% 0% Online Contracts AdWords Offline Contracts AdWords Total Contracts AdWords (ROPO)Source: KQV Google Confidential and Proprietary 50

Call Tracking: Benchmarking• Online2Store effect differs by advertiser (e.g. website quality), product (e.g. complexity of the offer) and -perhaps- by market Index ROPO Uplift: Online Conversions = 100%Index contracts 250% 200% 150% 254% 100% 50% 100% 40% 0% 11% 14% 18% Travel Finance Finance Telco Telco Finance Google Confidential and Proprietary 51

Google Tracking Solutions In Progress Call Metrics (coming soon) Click2Call (launched) Google Confidential and Proprietary 52

Level 4: Modeling Google Confidential and Proprietary 53

10 20 30 40 50 60 70 80 90 100 0 Jan. 04 Apr. 04 Jul. 04 Okt. 04 Jan. 05 Apr. 05 Jul. 05 Okt. 05 Jan. 06 Apr. 06 Jul. 06 Okt. 06 Jan. 07 Sales Apr. 07 Jul. 07 Modeling = Correlation over Time Medium x Okt. 07 Jan. 08 Apr. 08 Jul. 08 Okt. 08 Jan. 09 Apr. 09 Jul. 09 Okt. 09 Jan. 10 Medium y Apr. 10Google Confidential and Proprietary Jul. 1054 Okt. 10

Spain - PC City: Drivers of offline sales The Website is responsible for 11% of offline revenue 11% 62% of PC City sales are non 1% 1% 3% marketing drivers 15% 5% 12% 2% 8% 42% Base sales volumeincludes influence from existing store network, employee workforce, existing infrastructuredistribution, seasonality, 38% of PcCity sales are underlying consumer influenced by Marketing demand etc.. Base Seasonality Regular Price TV Radio & Other Web traffic to Sales price Catalogues Press OOH promotion Advertising pccity.es Google Confidential and Proprietary 55

Media Mix Optimization by PC CityWith the same budget a more optimal mix delivers an 6% revenue Last year 23 Aug – 11 Oct 2009 (8 weeks) Optimal Mix for 24th Aug – 12 Oct 2010 (8 weeks) Paid Paid Search Search 9% 1% Catalog TV ue 43% 32% TV Outdoo 64% r 1% Catalogu Press Press es 2% 3% Outdoor 42% 3% Marketing ROI €1.10 Marketing ROI €1.40 Google Confidential and Proprietary 56

France: Auchan Google Confidential and Proprietary 57

Level 5: Experiment Google Confidential and Proprietary 58

Experiment: Geo Test Test vs. control region: • Compare revenue development in test region (w/ [increased] AdWords spendings) vs. control region (w/ normal or lower spend level) • Requires control of other sales drivers and similar Test region buyer structure. Control region Google Confidential and Proprietary 59

Experiment: Home Improvement Store• Due to AdWords campaign revenue development in test markets was much better than in control markets Lawn mower Bicycle Index revenue Index revenue development development 120% Δ +11ppts 120% 100% 100% Δ +7ppts 80% 80% 60% 60% 100% 106% 100% 95% 96% 89% 40% 40% 20% 20% 0% 0% Index 2008 control markets test markets Index 2008 control markets test markets 2009 2009 2009 2009Source: hagebau April - June 2009 Google Confidential and Proprietary 60

Experiment UK: Vodafone Google Confidential and Proprietary 61

Experiment UK: Vodafone Google Confidential and Proprietary 62

Branding Google Confidential and Proprietary 63

User googles after being exposed to your TV Spot... Google Confidential and Proprietary 64

... will search impact user„s brand perception? Google Confidential and Proprietary 65

Research Project: Germany Agencies Brands Other partners Research vendors Google Confidential and Proprietary 66

Study Design: Task based Experiment 1 2 3 4 DIGITALCAMERA You would like to get more information about the newest digital camera. Please find a camera that is new on the market. Please do not use price comparison sites. Apart from this, search as you normally research onlineTV ad experiment: Online Task: Search Experiment Questionnaire:3.012 respondents had contact Following the panellists were of the SERP: Experimental Survey about the brand to six TV ads on their PC. The asked to research online for the control of the exposure of search perception commercial break was not advertised product category. The results. Random assignment of The effect of TV as well asintegrated in an editorial design respondent had the choice how to the respondents to the control/ SEM can be analysed through solve the given task – they were test cells the comparison of the test and not forced to use a search engine control group Google Confidential and Proprietary 67

52% used Google: Controlled SERPAdWords of testbrandAdWords of controlbrandOrganic result ofthe test brand Google Confidential and Proprietary 68

Brand funnel – Analysis of 4 parameters Brand Funnel Variable Brand Awareness → Unaided brand awareness Image → Image Relevance → Relevant Set Loyalty → Recommendation Google Confidential and Proprietary 69

Unaided brand awareness• SEM raises the effect of a TV campaign – the unaided brand awareness increases by 22%. Index Unaided brand awareness Aggregated result for 4 brands Source: TNS Infratest, eye square; Base: n=1,704 Google Confidential and Proprietary 70 Question: Which [brand] do you know,?

Unaided brand awareness• TV in combination with SEO and SEA increases the unaided brand awareness of a brand by 28% compared to „TV Only“. Index Unaided brand awareness Aggregated result for 4 brands Source: TNS Infratest, eye square; Base: n=1,704 Google Confidential and Proprietary 71 Question: Which [brand] do you know,?

Unaided brand awareness• The impression to AdWords only has also a significant effect Index Unaided brand awareness Aggregated result for 4 brands Source: TNS Infratest, eye square; Base: n=1,014 Google Confidential and Proprietary 72 Question: Which [brand] do you know,?

Competitor effect• A TV campaign that is not accompanied with a search campaign increases the awareness of the competitor. Index Unaided brand awareness (Base: Non user) Aggregated result for 4 brands 163 147 134 100Test brand Both brands do Test brand Only competitor Test brand also runs not advertise runs TV ad runs AdWords AdWords 139 120 100 97Competitor Source: TNS Infratest, eye square; Base: n=1,330 Google Confidential and Proprietary 73 Question: Which [brand] do you know,?

Relevance• The effect of AdWords increases in evidence after a contact in TV – 1+1=3! Index Relevance Aggregated result for 4 brands Δ36ppts Δ16ppts Source: TNS Infratest, eye square; Base: n=1.366; TV and AdWords Base: n=1.704 Google Confidential and Proprietary 74 Question: Which [brand] would you consider, when you would purchase [product]?

Conclusion by media agencies• Campaign keyword list should have been 10% longer 100% 27% other websites 80% 11% websites of other manufacturers 60% 9% direct URL of the company 2% usage of other search engines 8% other keywords, not in campaign 40% 4% relevant keywords, not in campaign 20% 40% campaign keywords 0% Total Source: TNS Infratest, eye square; Base: n=12.048 Google Confidential and Proprietary 75

Coming back to the example... Google Confidential and Proprietary 76

... have a look if your strategies are aligned! Google Confidential and Proprietary 77

Summary Google Confidential and Proprietary 78

Striking the balance 1. The internet is still growing and offers unique opportunities: It‟s not a case of online or offline 2. Internet is more than just the click: Stop thinking & measuring in silos 3. Test! Learn! Have fun!

www.full-value-of-search.de Google Confidential and Proprietary 80

Thank You!Q&A Google Confidential and Proprietary 81

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Google CH - Internet trends (daniel meyer)

by Luca Preto on Dec 02, 2010

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