Get Connected: How to harness the power of digital media
Retail Research Get Connected: How to harness the power of digital media May 2010 2 On Point • Retail Research Paper • 2010 INTRODUCTION Why is a digital media program important? Technological advancement in the last decade has been so revolutionary – not to mention extensive – that it has changed forever the ways in which consumers behave: how they communicate, how they gather information, how they socialize and, naturally, how they shop. In such an ever-changing environment, we in the shopping center industry are compelled to adopt new strategies to harness the benefits of new technology, and evolve with consumers changing needs, on every front. Adopting an integrated digital media program is no longer merely important, it is essential. Changes in digital media infrastructure and capabilities have been paradigm-shifting not only for consumers, but for those of us who wish to engage them – and profit from them. The good news is that many of us have already adopted new tactics in using digital media and some tactics are very cost-effective. On the converse side, technology shifts and consumers’ use of them are not static phenomena; they are dynamic. As such, we must constantly evolve to stay relevant in the eyes of our target market. Shifts in consumer behavior have changed advertising & media strategy forever Consumers are more in control than ever before of the content and media to which they are exposed. Increasingly hectic lifestyles demand a new way of communicating. Consumers want to tailor the information that is delivered to them. They have an endless array of options for what they listen to, watch and read. According to a Pew study, 60% of consumers get news from the Internet and most have between 2 and 5 main news sources online. In fact, 74% of respondents hear of news via email or updates on social media sites. Consumers are also creating their own content. Marketing is no longer a one-way, interruption-based activity. In order to be effective, we must be interactive, dynamic and, most importantly, must provide unique value to the consumer. On Point • Retail Research Paper • 2010 3 What this means for the retail industry We must understand our target customers’ needs and wants before forming strategy. We need to answer the question, “How does it benefit customers to spend time with our brand?” With consumers in charge of their media experience, we must engage them rather than talk at them. Examples of how technology has changed how consumers use media Category Traditional Sources New Sources Trends/Implications News TV/Newspapers Online feeds, email alerts, online video Consumers shoose the topics they are interested in and ignore everything else Advertising Magazines, radio, newspaper, TV Internet banner ads, search-generated ads on Google Consumers avoid ads on TV and radio through DVR and satellite radio; online targeted ads often ignored Product Research Magazines,catalogs, in-store Search engines like Google, MSN & Yahoo! Research done online even when buying locally; catalog and in-store research still done Shopping In-store, catalogs Online, mobile, iPad Online shopping much more prevalent; local shopping driven by online research; catalogs drive online purchases Entertainment TV, radio, CDs,DVDs Internet sites like Hulu, Netflix, iTunes, Pandora, Sirius and XM radio Much greater consumer control of content, interrupted by very few targeted ads Socializing In-person, telephone Social networks like Facebook and MySpace texting, video conferencing Communication is viral, privacy is limited; consumers are sharing more details about themselves and their shopping habits than ever before Books In-store Amazon, audiobooks, ebooks through iPad, Kindle and Nook Traditional superstore bookstores need to rethink value proposition and offer consumers something special Report focus and objectives In this report, we focus on how changes in technology have impacted consumer expectations and buying behavior. We explore the different facets of digital media – which encompasses websites, email, mobile communication and social media – and how they can be utilized to engage consumers and improve profitability. Our objectives for the report are to: • Outline the different digital media tools and what their capabilities are • Provide relevant examples of how these tools are already being used • Weigh the pros and cons of various social media vehicles like Facebook • Explain why mobile marketing is so critical in today’s time-pressured environment • Outline the steps you need to take before adopting a digital media program • Explore the differences in adoption among generational cohorts and implications for marketing • Explain why an integrated approach is critical We hope you find this report practical and thought-provoking as you prepare to connect with consumers and strengthen your brand. 4 On Point • Retail Research Paper • 2010 THE DIGITAL MEDIA INDUSTRY What do consumers want? According to an IBM study involving 32,000 consumers in six countries, the overwhelming consensus is that technology in the retail marketplace is not a niche phenomenon. It is not specific to age group, market or product category. It is pervasive and unavoidable. As technology use spreads, consumers are becoming more sophisticated with the demands they place on retailers: • 79% want to use websites to access and print coupons • 75% want to use mobile phones to find out where the nearest store is located • 66% want to see what goods are in stock before going into the store. • 78% of consumers say they are willing to "co-create or collaborate with retailers" by offering feedback on product design, product selection and store layouts. That last point is especially significant. More than three-quarters of respondents want to work with retailers in product design and store layout. Consumers are ready to talk. Are you ready to listen? What tools are available? Websites While not exactly a new medium, a shopping center’s or retailer’s website is still central to consumers’ shopping decisions. Consumers rely on websites to conduct product research more than they do on other channels like stores, mobile phones and catalogs. However, showcasing products in a static way is not enough. It is important to engage consumers by offering them meaningful content that is relevant to their needs. One example is through the use of virtual catalogs that users can “flip through” online to get inspirations about new and innovative ways to use the product (e.g., Crate & Barrel). Or offering online ordering with in-store pick-up (e.g., Best Buy). Or allowing users to create personal shopping avatars that correspond to their height, weight and build which allows them to see how clothes would fit on their body (e.g., Land’s End). Where consumers research/browse products Channel % of respondents Web Stores Catalogs Mobile Phones Source: Art Technology Group 92% 84% 78% 27% On Point • Retail Research Paper • 2010 5 Email Email is already a popular way of engaging consumers through coupon offers, sales, loyalty programs and general eMarketing initiatives. It has not lost its relevance but should be closely integrated into a complete digital media plan. We have to also be mindful of spamming even “opt-in” consumers with too many offers. In this day of CRM, it is essential to match email offers with consumers who are likely to use them. In a recent study, asked about how they would respond to a retailer’s email promotion, 29% say they would redeem the discount, 15% ignore the offer, 54% consider whether the offer was relevant and, if not, browse the site for other products or services, 24% would think positively of the store even if not interested in the offer, and 5% would think negatively of the retailer sending the offer. Social media Social media completely revolutionizes the way people interact and process information. It differs from traditional media in that anyone can create, comment and add to online content. CGM, or consumer-generated media, as it is often called, consists of online channels such as blogs, message boards, social networks, wikis and ratings sites. This two-way, dynamic aspect of social media creates relationships between marketers and consumers. Examples of social media Social networking sites – e.g., Facebook, Twitter, LinkedIn and MySpace. These sites map relationships among users and allow for the sharing of information. Blogs – blogs allow content creation and sharing by both companies and consumers. Video and photo sharing sites – e.g., Youtube, Flickr and Vimeo. These sites greatly simplify video and photo sharing. Chat rooms and message boards – online meeting places where users discuss topics of interest. Wikis – e.g., Wikipedia. Websites built for easy creation and editing of content. Social bookmarking sites – e.g., Digg and Delicious. These sites allow users to suggest content to others and vote on the quality of content. 24% of respondents say they incorporate social networks into their purchasing behavior by notifying friends of items they have purchased. The important point about social media sites is the capacity for two-way interaction. Traditionally, marketers spoke “at” consumers rather than “with” them. With social media, the rules have changed. We can now solicit customer feedback and interact with them directly in a “real-time” setting. Social media also allows for “buzz” and viral growth. THE POWER OF SOCIAL MEDIA more Nowhere has the power of social media arguably been demonstrated than in the rise of teen sensation, Justin Bieber. Discovered on YouTube, this 16-yr old superstar racked up over 10 million views through word of mouth alone. Shortly after, he was signed by a label and his album, My World, sold 137,000 copies in the first week. His latest album, My World 2.0, debuted at #1 and sold 283,000 copies in the first week and 291,000 copies in the second week. It is estimated that the teen heartthrob has grossed $15 million in recorded music sales in the U.S. since the beginning of his career a year ago. 6 On Point • Retail Research Paper • 2010 Mobile applications Mobile phone use is on the rise and will become a dominant factor in consumer research and buying behavior in the next few years. We in the industry cannot afford to ignore it as an important channel in engaging consumers. Nearly 50 million people in the US access the web on a mobile device, and this figure will reach nearly 100 million unique users per month by the end of 2010, according to Millennial Media. Mobile technology offers a unique advantage over traditional Web usage: transportability. In an age where consumers are constantly busy, spending a great deal of their time away from their homes, the ability to reach buyers where they are is essential. Mobile phones also offer another important dynamic – location-specific interaction. Consumers are already using mobile phone apps on iPhone to scan bar codes of products and find out where it is cheapest to buy them. To take advantage of mobile technology’s potential, design mobile-specific websites that are pared down and easy for consumers to navigate on their phones. Also consider special promotions that play to mobile strengths such as offering scannable coupons, location-based discounts, and contests that require texting. Many of us already utilize one or more of the above channels, particularly websites and email marketing. However, consumers are using all channels. To fully engage them, you should consider an integrated marketing program that ties all the channels together to produce a unified marketing message. On Point • Retail Research Paper • 2010 7 Applying intelligence: how to use the data Social Media Success Story Mount Berry Square Mall combined texting with social media for its Daily Deals program, which highlighted special sales and discounts at retailers. Daily Deals was promoted through mall signage, floor clings, directory decals, website postings, eblasts, Facebook and Twitter. Result: Mount Berry Square secured 104 unique opt-ins (users) from its Daily Deals promotion How retailers are using it Engaging the customer – Starbucks The “My Starbucks Idea” program encourages customers to submit ideas for new products and services. They are also encouraged to vote on whether or not ideas are important to the community. The best part of the website is the Ideas in Action tab, where consumer can check where “things are at”. Starbucks also has a Facebook Fan Page, Twitter feed, and blog where company employees and experts share ideas and valuable content with consumers. Promoting recycling – Best Buy Best Buy uses Facebook to promote its “Recycle it On” efforts. The retailer reveals how many pounds of electronics it has recycled and invites fans to start a movement by recycling their electronics. Tapping into the need to make a difference while purchasing a product that truly is mostly a “luxury” item is an interesting marketing technique. Best Buy’s Facebook page also allows fans to share with friends products they bought at Best Buy and solicit advice, and also provides fans with gift ideas. Its Twitter account enables followers to ask any tech question of the TwelpForce, which is a great way to quickly answer FAQs by customers and share them among followers. New merchandise updates – Urban Outfitters Urban Outfitters uses Twitter to tell customers about new items via upload photos and videos, and to give them special deals and discounts. Both its Facebook and Twitter accounts encourage membership in the company’s Urban Shoe Club. The posts are the same as the tweets and focus on new items. Virtual catalog – The Gap The Gap is capitalizing on the Facebook phenomenon by incorporating a great interactive tool – The Lookbook. Fans can find their perfect denim match by rolling over the models and different denims options appear to help you visualize your perfect denim jeans. 8 On Point • Retail Research Paper • 2010 SOCIAL MEDIA Why it’s important With all social media, the essential point is to create content consumers want and to develop meaningful interaction between the company and users. Its interactive nature can be both a benefit and a hazard, as users are free to post any comment they choose. The consensus is that “social is the new search.” Consumers are increasingly reliant on trusted personal relationships to determine what is worthwhile to purchase, read, listen to and watch. Much like Amazon’s recommendations, social sites allow users to view what others in their networks consume, thereby discovering content through social browsing. Try it before you buy it: which tools fit your needs best Facebook The world’s largest online social network boasts over 350 million users. According to the survey, Social Media: An Inside Look at the People Who Use It, 7 out of 10 social media users between the ages of 18 and 34 regularly use Facebook more than other sites such as MySpace and Twitter. Facebook use is growing exponentially for users over 35 years of age. The social network is so prolific that users post over 55 million updates a day and share more than 3.5 billion pieces of content weekly. Social Media Success Story Having a healthy and active fan base for Facebook is critical to the success of a social media program. Growing that fan base with quality fans is an ongoing effort. The core of social media is to make things relevant and personal shopping centers are an integral part of the community in which they serve – providing opportunities to make things relevant and personal. In action: Bradley Square combined the power of social media with the festive excitement of Halloween to execute a successful contest for children at the trick-or-treat event. Children in their costumes were featured on the site where votes were cast and comments shared. Results: In just 14 days, Bradley Square acquired more than 650 new Fans and hundreds of Fan comments and interactions. On Point • Retail Research Paper • 2010 9 Where consumers research/browse products Traffic to Facebook has exceeded traffic to Google since the week ending March 13, 2010. Not only is it a tremendous social network engine, Facebook is growing in popularity as a means for consumers to receive valuable information and promotions from companies. Chadwik Martin Bailey, a market research firm, found that consumers’ primary reason for becoming a fan of a brand on social networking sites was to receive discounts. Other reasons were to gain access to exclusive content and show support of the brand. Facebook users, in particular, were likely to show support for companies they liked by becoming fans. The implications for retail are tremendous. The site offers many capabilities including discussion forums, sharing photos and videos, and testimonials. It is an inexpensive way for you to connect with your target audience, grow virally by gaining “fans” and derive important feedback from customers. Pros Cons Potential for viral growth Potential for unconstrained negative feedback Fairly easy to engage customers Growth can be so large, you lose ability to engage “true” fans Inexpensive way to promote business Twitter Twitter is essentially a broadcasting system that allows users to transmit small bits of information to a large audience. It is less relationshiporiented than Facebook and its greatest use is to convey valuable, time-sensitive information to many people at once. In fact, Twitter users typically “follow” a company specifically to get real-time information and exclusive offers. Consumers also use Twitter to ask questions about products or services and to post reviews. Pros Cons Potential for viral growth Potential for unconstrained negative feedback Effective way of quickly broadcasting promotions and new merchandise Necessary to continually update feeds to remain relevant Inexpensive Weblogs (or Blogs) An often overlooked vehicle, blogs help companies establish themselves as thought leaders. They are also an extremely useful way for you to find out what consumers think about your products or your market and respond to any negative reviews or comments. So, essentially, blogs can be excellent PR vehicles to monitor and manage a company’s reputation, if used wisely. McDonald’s uses their blog, Open for Discussion, to tackle issues of social responsibility at the company. Video blogs Influencers + social media = buzz Exposure to a small online shoe retailer went viral when the store, Shoes of Prey, enlisted 16-year old Blair Flower – by contacting her and sending her a free pair of shoes - to record a video blog encouraging viewers to visit the store’s site. The video became one of the top viewed on YouTube (450,000 views) and Shoes of Prey garnered over 200,000 visits in one day. 10 On Point • Retail Research Paper • 2010 Pros Cons Potential to position yourself as thought leader Requires more effort and time than other media Potential for viral growth Potential for negative feedback Effective way to offer meaningful content to audience Social Media Success Story Bradley Square Mall created a 2009 holiday field promotion that featured two of the top “Hot Items” for the season that participating centers would give away during the holidays. The items chosen were the Dell Mini laptop and the Wii DJ Hero. The center allowed shoppers to register to win these prizes two ways – by dropping off entry forms at drop of locations at select retailers and by mobile texting to a special code advertised throughout the mall. Bradley Square posted the texting code on Facebook and Twitter in addition to on-mall collateral. The Hot Item giveaway posting resulted in 412 unique opt-ins (users). On Point • Retail Research Paper • 2010 11 MOBILE MARKETING The rise of smartphones – why they cannot be ignored There are currently more than 270 million mobile phone users in the US and 82% never leave home without their devices, according to a study by Synovate. Moreover, 38% of youth claim that their mobile phones are more important to them than their wallet! The number of smartphone users is expected to reach 1 billion by 2014 - four times as many as 2009 (Park Associates) - and these users are using their phones to shop. Mobile commerce is expected to comprise 8% of the e-commerce market in the next 5 years, and shoppers are expected to spend approximately $119 billion on products and services purchased via mobile phones worldwide. Mobile marketing expenditures are expected to exceed $2 billion in 2010 and $3 - 5 billion by 2012. The implications for retail are staggering. With consumers becoming more dependent on their phones for researching, socializing, entertainment, and buying, it is imperative to engage them on this platform. Moreover, the simultaneous use of channels such as mobile technology and social media is increasingly blurring the line between different media, making a unified strategy even more crucial. According to a study by Retrevo, about 48% of those polled said they check or update Facebook or Twitter after they’ve gotten into bed at night and/or before they get out of bed in the morning. That number jumps to 76% for the 25-and-younger set, with a whopping 19% of those Millennials saying they also check in whenever they wake up during the night. 16% also rely on Facebook or Twitter as the sole delivery for their “morning news. Apps Rule! How they are changing the landscape of consumer behavior Mobile phone applications, or apps as they are popularly called, are the bread and butter of the mobile technology sphere. The allure of apps lies in their ability to transform the user experience and offer creative and valuable solutions to consumers needs, whether for entertainment, education, socializing, or productivity. In a world where electronics have become the new fashion, apps have become the accessories of choice. Nearly 1 in 3 US adult mobile phone subscribers now has either a smartphone or quick message device (QMD), up from 1 in 5 less than a year ago. 12 On Point • Retail Research Paper • 2010 It is estimated that in a few years the market for mobile phone applications will eclipse the market for CDs. The global app market is expected to catapult to US$17.5 billion by 2012. The iPhone App Store alone offers more than 25,000 apps, many of them free, and accounted for over 2 billion downloads in its first year. Retailers have taken the cue and are rushing to develop apps that bring them closer to their target market by offering useful tools that improve the quality of the shopping experience. It is predicted that by 2014, nearly 20 billion mobile apps will be downloaded yearly. Apps in action • Google’s new mobile app lets users search local inventory to see whether a particular stores have desired items in stock. • Apps such as RedLaser or ShopSavvy allow users to scan product barcodes to conduct a local price comparison and determine where it is cheapest to buy a product. • Apps like UrbanSpoon allow users to find local restaurants within a specified price range and read customer reviews before making a • • choice. Retailers and shopping center owners are using apps to empower consumers to give gifts, redeem coupons, buy movie tickets, make dinner reservations, and navigate local malls. Technology is already being put into place that will enable shoppers to wave their mobile phones to pay at the grocery checkout, department stores, restaurants and movie theaters. One size does not fit all – the importance of differentiating website and mobile site design Mobile phone technology is a completely separate phenomenon from the Web and should be treated as such. Because of the way in which consumers use their phones and their relatively small size, mobile sites must be designed differently from regular web sites. In most cases, functionality should be pared down to the essentials and it should be very easy for shoppers to navigate around the site. In addition to having a separate mobile site, there are other tactics that are considered effective in engaging customers: Mobile store locator – perhaps most key, it allows users to quickly find the nearest locations for a particular retailer. Syncing with Google maps is an added value to help shoppers easily navigate to the store. Mobile subscription list – allows you to send SMS messaging alerts to notify shoppers of special promotions, events, and giveaways. This can be coordinated with email marketing to strengthen the shopper connection. For instance, sending a special even invitation via email and allowing consumers to text in RSVPs Mobile coupons – already popular with consumers, mobile coupons have a 5 - 15% conversion rate compared to <1% for print coupons (Mobile Marketer). The ease of pulling up a coupon on a phone at the cash register versus remembering to carry coupons makes this a no-brainer. SMS ordering – allowing users to place pick-up orders via text message is an easy sell in a time-crunched environment. Quality trumps quantity When sending coupons via mobile make sure you make it worth it for the recipient. Avoid sending too many, as more is not better. It costs money to receive messages so consumers are not happy to get “junk” messages. On Point • Retail Research Paper • 2010 13 OPERATIONS So you’ve adopted – now what? Data, data everywhere With the viral nature of digital media, it is easy to become overwhelmed with all the data from Facebook and Twitter accounts to blogs and mobile campaigns. “Voice-ofthe-customer analytics” allow you to extract intelligence from large volumes of online information such as email surveys, blogs, product review sites, and social networking sites. Such programs comb through online content and look for spikes in negative or positive words associated with particular brands, products or services. Furthermore, much like traditional CRM transformed the ways in which companies tracked information on their clients, social CRM can do the same for social media. A comprehensive social CRM program can not only monitor your performance in the social stratosphere, it can also facilitate the development of relationships with your best customers and “influencers”, the key group of people who create “buzz” and spread adoption rates. It enables you to remain flexible in dealing with problems such as complaints, before they snowball and damage your reputation. Social CRM can also identify trends and engender creative ideas. Metrics you can track: • Monthly and yearly growth in traffic referred by social sites • Proportion of referrals from users sharing content from your site versus social site referrals • Specific site content and activities which drive the highest volume of views and sharing activity • Social conversation “buzz” about your brand • Conversion rates from promotions broadcasted through social media Constantly refresh Because digital media is so dynamic, you must continually find ways to present fresh content and meaningful value to consumers. Responding to queries and comments is key in developing a reputation for authenticity, which is so critical to consumers, especially Millennials. 14 On Point • Retail Research Paper • 2010 The dangers of “leaping without looking”: 10 essential steps to take before adoption 1. Set your objectives. Decide what you are trying to accomplish. Do you want to find out more about your customers, give them information, boost sales, or build your brand? 2. Research. Do your homework. Check out sites that are similar to your line of business as well as those that are in a completely different arena. Take note of what catches your attention and what you found distracting or unnecessary. 3. Enlist an expert. Do not go it alone. An expert can make a tremendous difference in transitioning your marketing goals into digital media action. 4. Assemble a team. Determine who is going to take the lead and assign responsibilities. Digital media requires constant updates and monitoring to remain relevant and responsive. 5. Set a timeline. Set dates and times to set up accounts and accomplish your marketing goals. 6. Set a plan for negative responses. With two-way media, this is inevitable. Make sure that you have a plan in place for dealing with them. 7. Develop content. Determine how you will position yourself within the digital stratosphere and build content to support your desired brand image. Are you the fashion expert or the bargain guru in your community? 8. Engage influencers. Anyone who has ever read Malcolm Blackwell’s book, The Tipping Point, knows the importance of finding and engaging influencers – trendsetters who are responsible for a disproportional number of product and idea adoptions. 9. Remember your infrastructure. Depending on your digital media goals, you will need to consider staffing, mobile sites, Wi-Fi, real-time inventory tracking and other capabilities. 10. Measure it. Social media, in particular, can act like be compared to a modern-day focus group with as much – or more! – information moving from customers to businesses. Be sure to establish benchmarks and put systems in place to gauge responses from consumers, and act on them. Remain flexible and agile and consumers will respond favorably. On Point • Retail Research Paper • 2010 15 GENERATIONAL COHORTS Social networking use by age Silent Generation Dec-08 Jan-10 2% 6% 13% Boomers 30% 38% Gen X 50% 71% 75% Millennials 27% All 0% Does age matter when it comes to digital media use? While Millennials are still the clear leaders in social networking, in the past year Boomers’ use of this medium is growing fastest, more than doubling from December 2008 to January 2010. Gen X use has also accelerated dramatically. The overwhelming reality is that social media use is increasing across all generations, albeit for different reasons. It is important to engage each generation based on what their particular needs are. 41% 10% 20% 30% 40% 50% 60% 70% 80% Source: Pew Internet Research Generational Differences in Online Activities Activity Online Teens (12-17) 93% Younger Boomers (45-54) 79% Older Boomers (55-63) 70% All Online Adults 74% 26 49 28 20 22 27 6 1 28 30 23 9 21 25 7 1 35 52 38 35 37 32 11 2 82 80 65 74 68 53 81 72 49 75 71 55 38 42 30 55 94 93 90 90 91 90 84 74 65 37 26 25 93 84 76 70 35 31 21 90 82 70 69 29 27 19 89 79 69 66 30 26 12 89 81 70 68 32 26 19 Gen Y (18-32) 87% Gen X (33-44) 82% Go Online Teens and Gen Y most likely to engage in social activities 78 50 38 Play games online 57 72 57 Watch videos online 68 59 38 Send instant messages 65 67 36 Use social network sites 59 58 46 Download music 49 43 34 Read blogs 28 20 10 Create a blog 10 2 3 Visit a virtual world Gen X leads in health info and online purchases 28 68 Get health info 38 71 Buy something online 57 Bank online 26 Get religious info 31 Almost uniform across cohorts 73 Use email Use search engines Research products 63 Get news Make travel reservations Rate a person or product Participate in an online auction 19 Download podcasts Pew Internet & American Life Project 2006-2008 16 On Point • Retail Research Paper • 2010 How to coordinate your digital media strategy – by age group As we see from the data above, all Generational Cohorts engage in digital media use, albeit in different ways. Older groups tend to be more utilitarian in their use: checking mail, researching products, shopping and banking online. Younger groups, on the other hand, use digital media primarily for entertainment and socializing and tend to use the different media simultaneously, seamlessly moving from one to the other. Millennials Cosmo Girl Magazine asked girls aged 13-24 if they considered a store a friend and 60% said yes. For teens and Millennials, being actively engaged by companies in giving feedback, helping create or update products and evangelizing the brand is extremely important. Companies that respond to this need by offering personalized, customizable products and listening to their young customers will profit. Thirty-eight percent of youth already claim that mobile is more important to them than their wallet. Key facts about Millennials: They want to be “in the know” – Share valuable content and give them the ability to pass along to others. Keep them updated on new trends, merchandise and specials. They want to participate – Central to engaging this generation is inviting their feedback and participation and responding to it by putting their suggestions into action. This builds authenticity. They crave authenticity – Millennials want to believe in the companies they patronize. Be accessible and transparent. Friends are a tremendous influence – Give them the ability to involve feedback form their friends before making a purchase. Encourage reviews and brand evangelizing. They use different types of media simultaneously – Moving from the website, to your store, to mobile should be a seamless process. Promote interconnectivity. Instant gratification is a priority – Make plans to refresh merchandise, content and promotions regularly. Stale content is a turnoff. They want to make a difference – This generation wants to be valued. They also prioritize environmental sustainability. Companies that promote sustainability will win their respect – and business. Boomers Women 55 and older are the fastest-growing demographic on Facebook according to the Pew Internet and American Life Project’s December 2008 survey. In fact, Facebook dominates social network use by older adults. According to comScore, roughly 60% of social networking Boomers – 22.6 million – used Facebook in October 2009. No other social network comes close. This is significant because Boomers who use social networks are twice as likely, according to Anderson Analytics, to buy products online than those who don’t use digital media. On Point • Retail Research Paper • 2010 17 Sharing worthy content is the key to attracting and keeping Boomers as they aren’t just lurking on social networks, they are sharing and recruiting. Boomers crave a story and a reason to align themselves with a brand. Social media should not replace traditional media yet for this age cohort. It is true that Boomers are embracing social networks, but they still spend significant amounts of time with traditional media – television, newspapers and magazines. The new “Social Media Maven” is a significant segment within the Boomer cross section. The profile of this group is one that is heavily connected, exploring and expanding their network. These Social Media Mavens have more frequent contact with individuals across all types of groups within their social network – not just family or neighbors, but issueoriented groups and co-workers as well. This new sub-segment has more face-to-face contact and uses smartphones more than the rest of this generation. Mavens are more likely to try new products and technologies and seek new experiences. They are recommenders who embrace the role of technology in their connected lives. The emergence of this group in the Boomer segment is further confirmation for companies targeting the mature consumer that online media should be at the core of an integrated marketing campaign. Ethnicity Another key factor in adoption of digital media spans the socioeconomic and cultural divides of the population. It is often assumed that blue collar workers or ethnically diverse groups are not engaged in digital media because of the costs associated with it. These groups actually are the leaders in many forms of digital media. Almost one-half of African-American and Hispanic consumers reported having accessed the Internet via a handheld device in contrast to only 28% of Caucasians. 18 On Point • Retail Research Paper • 2010 TYING IT ALL TOGETHER – NO MEDIUM STANDS ALONE Integration, integration, integration – a cross-channel approach is critical When integrating your digital media platform, be sure to look at how your various media channels work together to produce a unified brand image. While each channel should be uniquely tailored to correspond to how consumers will use it, the messages should not be contradictory. For instance, if you are positioning yourself as a green company, your Twitter messages, Facebook updates and website should all work together to present the same image, albeit in different ways. Assume your customers will be moving between the different channels and coordinate the unique messages and promotions on each to reinforce your brand while offering viewers something fresh and new on each medium. In conclusion, adopting a comprehensive digital media program is critical in connecting effectively with consumers. When formulating your plan, spend some time thinking about your customers and what their unique needs are, and then evaluate the tools available to determine which mix will best fulfill your objectives. One of the advantages of digital media program is that it is relatively inexpensive compared to traditional media and the reach is tremendous. However, on the converse side, it requires time and dedication to get right and adequate staffing resources must be dedicated to keeping your program agile and effective. 10 commandments of digital media 1. Thou shalt remember your customers. The whole point of digital media is to actively engage shoppers and give them what they need. 2. Thou shalt integrate. Coordinate your different media tools so consumers can move seamlessly from one to the other. 3. Thou shalt remain responsive. The two-way nature of today’s media requires a commitment to responding to consumers directly and in a timely manner. 4. Thou shalt not stagnate. Technology is a dynamic tool and, to remain relevant, it is necessary to continually evolve with new developments in order to stay relevant. 5. Thou shalt deliver value. Value takes the form of meaningful content, innovative ways to engage shoppers and promotions that really fulfill the needs of your target market. 6. Thou shalt remember Justin Bieber. The power of digital media is evidenced in the success of this new teen icon. Make your growth organic. 7. Thou shalt remain ethical. Do not post fake customer reviews or otherwise falsely misrepresent your brand. Consumers have a way of catching on. 8. Thou shalt not fight fire with fire. While negative comments and responses are inevitable and responses are necessary, it is important to not escalate conflicts. Everyone will be watching how you respond. 9. Thou shalt be smart. Smartphones are the immediate future. Engaging customers through this medium is essential for growth. Construct mobile sites and apps. Promote your local presence. Consumers will react. 10. Thou shalt not panic. It is easy to feel overwhelmed in this uncharted territory but, remember, everyone else is learning too. Hire an expert to navigate you through your choices and processes and keep on top of – inescapable – new trends. GOOD LUCK! On Point • Retail Research Paper • 2010 19 For more information on this report, contact Greg Maloney, President & CEO, Retail 404 995 6315. As the leading retail service provider, Jones Lang LaSalle Retail manages the largest third-party retail portfolio in the country. The firm’s 83 million-square-foot retail portfolio consists of more than 300 regional malls, strip centers, power centers, lifestyle centers, ground-up development projects, mixed-use centers, transportation terminals and over 6,000 retail ATM’s and bank branches across 49 states. Globally, Jones Lang LaSalle (NYSE: JLL) has a retail portfolio of 265 million square feet of property under management and leasing, including more than 9,500 retail locations on four continents. Jones Lang LaSalle is the only global real estate services firm with a team of dedicated, full-time experts who deliver comprehensive and globally integrated services in Energy and Sustainability under one umbrella. The firm offers leading-edge, industry-unique technology, training and tools in energy and sustainability to maximize the benefits for its clients and the greater community. For more information on Jones Lang LaSalle Retail, visit www.jllretail.com.
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