The new pathways to purchase in the world of networked consumers

The new pathways to purchase in the world of networked consumers

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  The new pathwaysto purchase in the world of networked consumers Henry Assael - lecture at NYU October 6, 2011 Lee Rainie: Director, Pew Internet Project Email: [email_address] Twitter: @Lrainie
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  Implication: A NewConsumer Decision Journey to Manage INITIAL CONSIDERATION: PURCHASE: POST-PURCHASE EXPERIENCE: ACTIVE EVALUATION: Consumer starts with 1.5 brands in mind, influenced by previous trial and word of mouth At the moment of purchase, the consumer has evaluated only 3.2 brands, and makes decision based largely on information learned before shopping 66% of consumers engage with their brand after purchase (e.g., online research), and this engagement has a meaningful impact on the likelihood of repeat purchase The consumer adds 1.7 more brands to consideration, based on packaging and sampling Source : Pete Blackshaw: CMO, NM Incite, a Nielsen-McKinsey Company
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  Where Social MediaFits in to the Mix 3 22 Friending the Social Consumer Most influential touchpoints Company-driven marketing Traditional advertising Direct marketing Sponsorship In-store advertising Consumer-driven marketing Word of mouth Online research Offline/print reviews Prior brand/ product experience Store/agent/dealer interactions Moment of Purchase 22 5 43 Active Evaluation 26 26 Initial Consideration 39 12 Source : Pete Blackshaw: CMO, NM Incite, a Nielsen-McKinsey Company
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  Your experiences -1 Smaller scale / impulse buys Piece of music App Something off the shelf Pew Internet findings in 2007 among music buyers: 83% find out about music from the radio, TV, or in a movie; 64% find out about music from family, friends, or co-workers.
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  PIP Consumer choicesurvey (2007)
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  PIP Consumer choicesurvey (2007)
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  PIP Consumer choicesurvey (2007)
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  Your experiences -2 Mid-scale products Cell phone Clothes Pew Internet findings in 2007 among cell buyers: 59% ask an expert of salesperson for advice; 46% go to one or more cell phone stores.
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  PIP Consumer choicesurvey (2007)
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  Your experiences -3 Life-altering “investments” Real estate – apartment hunting College choice Car Pew Internet findings in 2007 among real estate shoppers (homes and apartments): 49% look at ads in the newspaper; 47% ask a real estate agent for advice
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  PIP Consumer choicesurvey (2007)
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  PIP Consumer choicesurvey (2007)
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  PIP Consumer choicesurvey (2007)
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  Digital Revolution 1Internet (78%) and Broadband at home (62%) 65% 62%
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  Networked creators amonginternet users 65% are social networking site users 55% share photos 37% contribute rankings and ratings 33% create content tags 30% share personal creations 26% post comments on sites and blogs 15% have personal website 15% are content remixers 14% are bloggers 13% use Twitter 6% location services – 9% allow location awareness from social media – 23% maps etc.
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  Impact on shopping Shopping is a “full contact” sport throughout its phases: Research phase 60% of all Americans do research online about products Purchase phase 55% of all Americans made e-purchases; 51% travel reservations After-purchase phase 37% rankings and ratings; another quarter describe their shopping experiences
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  So what forbrands? The Bermuda Triangle Markets are fractured Marketplace is roiled Metrics haven’t kept pace Too much noise Brands are co-owned by advocates /acolytes Best of times - sanctuaries Worst of times - #fail
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  Digital Revolution 2Mobile – 84%
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  Mobile internet connectors– 63% adults
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  35% own “smartphones”
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  The networked consumer:cell phones Interesting tidbit: 17% of American adult cell phones owners have bumped into another person or an object because they were distracted by talking or texting on their phones.
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  56% of adultsown laptops – up from 30% in 2006 44% of adults own MP3 players – up from 11% in 2005 52% of adults own DVRs – up from 3% in 2002 42% of adults own game consoles 12% of adults own e-book readers - Kindle 9% of adults own tablet computer - iPad
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  59% of Americansuse TV and the Internet Simultaneously Dramatically More Cross-Platform / Media-Mixing Source: Nielsen Three-Screen Report
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  Impact of mobileconnectivity on shopping Just in time information Where can I get a deal? Price comparisons “ Networked info” packed into the shopping experience QR (quick response) codes Announcement and validation of purchase Sharing the shopping story
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  So what forbrands? Attention zones Continuous partial attention Deep dives Info-snacking Media zones Social Immersive Streams Creative / participatory Study / work
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  Digital Revolution 3Social networking – 50% of all adults
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  What does thismean? Social networks are more influential and institutions less influential - 1 Sentries
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  What does thismean? Evaluators Social networks are more influential and institutions less influential - 2
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  What does thismean? Social networks are more influential and institutions less influential - 3 Audience = New media are the new neighborhood
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  Impact of SNSon shopping Purchasing can be group activity “ Consumer cartels” arise (Groupon, Living Social)
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  With Dramatically DifferentChannel Preferences Source: Nielsen Consumer Channel Preference Study ‘09   Question : Those who would contact the company to… Discuss New products Complain Get Advice Make a Reco. Crisis Email 96 97 94 96 76 Call a live representative 94 95 92 90 95 FAQ on company website 94 NA 92 NA 74 Post an opinion or question on company website 87 80 77 82 48 IM through the company's website 81 78 78 76 71 Posting on a company message board 77 69 71 74 47 Posting on a blog sponsored by that company 68 61 64 68 41 Telephone - automated response/recording 57 57 62 59 52 Reading company's Facebook page 55 NA 53 NA 36 Sending photo or video to company 53 48 48 51 41 Posting on the company's Facebook page 50 42 47 47 31 Texting the company via mobile device 36 34 40 37 41
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  24 Brand CredibilityMore Important Than Ever Source: Nielsen Consumer Channel Preference Study ‘09 Six Drivers of Brand Credibility Trust Authenticity Transparency Confidence Consistency Integrity Authority As Advertised Real & Sincere Real People Informal Let the Sun Shine In Easy to Learn Easy to Discover No Secrets Affirmation Listening Responsiveness Playback Reinforcement Search Results Accountability Empathy Welcome Mat Humility (we can learn) Absorbing Feedback Follow-Up Invitational Marketing Solidifying the Solution Dignifying Feedback
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  Implication: Bold NewQuestions for Companies Source: Nielsen Consumer Channel Preference Study ‘09 Issue The Big Question Credibility How to manage and protect credibility and trust in a highly transparent, 24/7 feedback environment? Influencer Management How to extend the notion of key influencer management to everyday consumers and even employees? Cultivating Earned Media How to generate earned media from customer service, and how service in general can be leveraged more strongly for brand and business-building via social media? Organization How to best manage day-to-day digital/social media operations, recognizing that social media breaks down geographic and organizational barriers. Listening & Measurement What are the right listening & measurement protocols to drive accountability, feed engagement strategy & investment?
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  Social Commerce Ecosystems Implication: Death (or erosion) of Web Sites
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  Consumer Relations BrandedMedia Channels Forum / Communities Consumer Outreach Influencer Outreach Brand Backyard Consumer Backyard Common Brand Site Contact Center E-mail Phone Web Site Engagement Blog Chat, SMS Phone Rate & Review Communities User-Contributions Ratings & Reviews Co-Creation Platforms Twitter Facebook YouTube Flickr, LinkedIn 3 rd Party Consumerist Edmunds WebMD TechCrunch 43 Implication: New and More Holistic Rules of Engagement
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  Implication: From Sellingto Service Pizza Hut Convenient pizza ordering experience Experience B& J through peace, love and ice cream Discover recipes for any occasion. Communicate with co-workers for coffee runs Simulate your favorite choc. milk experience at anytime Ben & Jerry’s Kraft Hershey’s Dunkin Donuts Source: Nielsen Consumer Channel Preference Study ‘09 Relevance to BP Price Finders Product Info Travel Services Environmental Info
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  Implication: Rise ofConsumer Cartels Source: Nielsen Consumer Channel Preference Study ‘09
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  Implication: Massive Levelsof Retailer Innovation Source: Company websites; Progressive Grocer & Pittsburgh Post-Gazette Can BP empower its franchises and/or products around innovation? Source: Nielsen Consumer Channel Preference Study ‘09
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  Implication: The Riseof Real-Time Source: Nielsen Consumer Channel Preference Study ‘09 24/7 Real-Time War Room 24/7 Engagement Listening Beyond Borders All aspects of integrated, brand-monitored social media Deliberate effort to shape and manage messaging Listening tools cover multiple languages & regions
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  Looking Ahead Source:Nielsen
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  What’s Ahead /Next? Near Term Trends for 2012 Trend What It Is, What It Means Mass Socialization Social “earned” media & paid media become more intertwined Platform Proliferation New devices and multi-tasking abound Mobile Comes of Age Extends mass socialization & extends media to point of sale Apps Everywhere Disruptive growth in apps, fueled by games and service utilities Dominance of Facebook A juggernaut, rewriting rules + shifting attention from websites Rise of Social Commerce Redefining consumer retailer interactions, powered by GPS, etc Relevance & Privacy Cautious advance to addressability; heightened scrutiny Infrastructure Growth Increased access and speed expand digital opportunities “ Heads Down” Generation Dramatic consumer habit change; all eyes to wireless devices Digital Downsizing More filtering/control of apps, friends, followers, choices
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  What’s Ahead /Next? Longer Term Trends & Disrupters Market Trends Description Digital & Social From separate roles to unified and integrated (now one & the same) Mobile Disruption Re-setting the entire landscape Activism & Social Media Smarter, Creative, More Empowered/Linked & More Sophisticated Payments and Fees Friction-free and seamless (already in play with iTunes) Globalization of Social Creating huge opportunities….and huge operational challenges Organizational Trends Description Media Blending Increasingly sophisticated: Paid, Owned, Earned Brand Managers Moving to “Community Manager” Roles & Responsibilities Enterprise SM Dramatic expansion beyond marketing innovations Marketing + Service New synergy between marketing & operations Agency Integration Social prompting greater integration from agencies & suppliers Speedbacking Practice of immediately responding to key issues, crises
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  Things to watchContent metering online – new media business models Enhanced tech – 3-D New attention research – Nielsen and Coalition for Innovative Media Measurement Privacy debates Net neutrality debates Spectrum allocation debates Rise of the “internet of things”
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  Thank you!