Friday, July 15, 2011 | Edited by Daniel Moores
||35 Percent of American Adults Own a Smartphone
In its first stand-alone measure of smartphone ownership, the Pew Internet Project finds that one third of American adults -- 35% -- own smartphones. The Project's May survey found that 83% of US adults have a cell phone of some kind, and that 42% of them own a smartphone. That translates into 35% of all adults.
Our definition of a smartphone owner includes anyone who falls into either of the following two categories:
Several groups have higher than average levels of smartphone adoption, including:
- One-third of cell owners (33%) say that their phone is a smartphone.
- Two in five cell owners (39%) say that their phone operates on a smartphone platform (these include iPhones and Blackberry devices, as well as phones running the Android, Windows or Palm operating systems).
Urban and suburban residents are roughly twice as likely to own a smartphone as those living in rural areas, and employment status is also strongly correlated with smartphone ownership.
- The financially well-off and well-educated -- 59% of adults living in a household earning income of $75,000 or more are smartphone owners; 48% of those with a college degree own smartphones.
- Those under the age of 45 -- 58% of Americans between the ages of 25 and 34 now own a smartphone as do 49% of those ages 18-24 and 44% of those ages 35-44. Even among those with a household income of $30,000 or less, smartphone ownership rates for those ages 18-29 are equal to the national average.
- African-Americans and Latinos -- 44% of blacks and Latinos are smartphone users.
Mobile phones are a main source of internet access for one-quarter of the smartphone population. Some 87% of smartphone owners access the internet or email on their handheld, including two-thirds (68%) who do so on a typical day. When asked what device they normally use to access the internet, 25% of smartphone owners say that they mostly go online using their phone, rather than with a computer. While many of these individuals have other sources of online access at home, roughly one third of these "cell mostly" internet users lack a high-speed home broadband connection.
Smartphone owners under the age of 30, non-white smartphone users, and smartphone owners with relatively low income and education levels are particularly likely to say that they mostly go online using their phones.
Phones operating on the Android platform are currently the most prevalent type of smartphone, followed by iPhones and Blackberry devices.
Demographically, Android phones are especially common among young adults and African-Americans, while iPhones and Blackberry devices are most prevalent among college graduates and the financially well-off.
(Source: Aaron Smith, Senior Research Specialist, Pew Research Center, 07/11/11. Complete report at http://www.pewinternet.org/~/media//Files/Reports/2011/PIP_Smartphones.pdf)
||Two-Thirds of Local Merchants Advertise on Social Network; One-Fifth Use Facebook
According to MerchantCircle, new local ad offerings from Facebook are making inroads with local merchants and may put increasing pressure on Google and pure-play deals companies such as Groupon for share of local marketing budgets. With its huge consumer adoption, ease-of-use and low barrier to entry, Facebook continues to be the most popular digital site for merchants to market their business, though, overall, 66% are using the social network for marketing.
The survey shows 22% of local merchants have used Facebook Ads, two-thirds would use them again and show increasing favorability towards group deals, with 77% now saying they would offer another daily deal.
Darren Waddell, vice president of marketing at MerchantCircle, says "Facebook...has established (itself) as an important marketing channel for local businesses... and is effectively parlaying this popularity into local ad sales..."
Key conclusions from the survey include:
1. Facebook continues to be the most popular way for merchants to market their business, with 66% overall using the social network for marketing. Facebook's targeted display ad offering boasts a remarkable 94% awareness rate among local merchants.
However, of the 35% of merchants who said they would not advertise with Facebook again, 69% said that the ads did not help them to acquire new customers, and 35% said the ads were too expensive.
- 22% of merchants report having used Facebook ads since its launch
- 65% of these merchants say that they would use the service again
- 67% say because of ease of use
- 65% say the top reason for continuing is the ability to start and stop campaigns
2. The study indicates that familiarity with Facebook and Google will make these well-known brands a strong alternative to Groupon and LivingSocial, with 52% saying that familiarity with these brands would lead them to choose Facebook Deals or Google Offers over competitive offerings. Other reasons for choosing:
- Bigger audience size (26%)
- Better local targeting (21%)
3. While three months ago, only 50% of merchants who had tried offering a group deal said they would do so again, 77% now say they would be willing to offer another daily deal, 58% citing effectiveness in customer acquisition, 30% favorable deal structure, and 24% profitability of the deal as their top three reasons.
- Bigger audience size (42%)
- Brand reputation (34%)
Among those who wouldn't offer another daily deal, 42% said that it was not effective in customer acquisition, 25% said it was too costly and 24% said they lost money.
Mixed opinions about the medium's effectiveness for customer acquisition may be contributing to its slow growth among local merchants. This is not for lack of aggressive sales and marketing efforts, notes the report. 34% of respondents who offered a daily deal did so after being contacted by a sales rep, or 31% seeing an ad for the service.
4. Investment in traditional offline marketing methods continues to decline among local merchants. Over the past three months:
The popularity of location-based marketing services has also dropped over the past quarter. Data shows that 22% of businesses are using Facebook Places to market their business, while just 7% are using Foursquare. This is trending downward from the last survey in January 2011, when 32% said they were using Facebook Places and 9% said they were using Foursquare.
- Use of print advertising dropped from 27% to 24%
- Use of print Yellow Pages declined from 37% to 29%
- Use of direct mail decreased from 28% to 26%
In spite of the hype around mobile marketing, just 18% of merchants report doing any sort of mobile marketing or advertising. Lack of understanding continues to be a major barrier to adoption: 71% of merchants state that they don't have a good idea of how to reach consumers via mobile marketing. Additionally, only nine% said they own a tablet, with 9% said they planned to buy one in the next six months.
5. Local merchants continue to have little time or money for marketing. 61% of local merchants are spending less than $2,500 a year on marketing, and 73% have no plans to raise their budgets this year. Time is also a critical issue for merchants, with 37% citing lack of time and resources as their top marketing challenge.
(Source: The Center for Media Research, 06/28/11)
||The Dark Matter of the Online Ad Universe
What Happens When Media Weight Does the Opposite of What We Expect?
Everyone is familiar with the ways that interactive ads annoy us. When challenged about this, creative people tend to respond by saying that an ad "got your attention" or "made you think." However, it's possible that online, these annoyances have real impact on brand perception, yet we know little about how online advertising can produce negative brand attitudes.
The domain of the "annoyance" dialog has historically been ad copy on TV, but compared to the internet, TV has a limited domain for intrusion. After all, a 15-second TV commercial, by virtue of being neatly placed in a pod, is subservient in its posture. It can't block your path toward a goal.
Opportunity to annoy
Enter the internet, where competition for attention on a cluttered screen makes for screamers in the ecosystem. The media itself, by virtue of rich-technology alternatives, becomes an active participant in the "Opportunity to Annoy."
Our generic pal, the media-consumer, is not always online to passively consume entertainment. They are most often there to accomplish something. We call it "lean forward," but that term hardly does justice to the emotional difference between being a spectator and an active player. Sometimes we say they are on a quest. This term is descriptive of goal seeking. From the consumer's point of view, if you get in my way when I'm goal seeking, you may have crossed the line. Even if the copy is benign, if it blocks progress toward a goal (e.g., finding a hotel, seeing a video), it does make me think. It makes me think this brand has decided to jump into the path of my progress with nary an apology -- this brand that desperately wants to acquire my devotion.
For those of you who are thinking this is rare, I just described a pre-roll. I also just described a pop-up, a "free" article that requires email registration, or any offer that gets me to click and then disappoints me due to, shall we say, an optimistic spin about what I would receive upon clicking. In all these cases, a brand intervenes in my quest, all the while declaring its identity. Does that hurt the brand? How would you know? The copy tested well. The media had weight. The audience was appropriate. What's not to like?
Measuring the madness
It's like dark matter. We can't detect it, but we think it's there. It might be enormous, but we can't count it. It's an online ad that did its job by all accounts, yet may have done precisely the opposite. In traditional online metrics we have ways of discovering whether an ad and its context caused my feeling for a brand to decline. In the ubiquitous Dynamic Logic model, it's called "Favorability": How do you like the brand? Most brand-effectiveness metrics have a similar question. Context-controlled measures can detect annoying copy but usually not the effects of that copy on an impatient surfer as presented by, for example, rollover text intercepts.
One might imagine that context-sensitive measures (like Dynamic Logic) could illuminate the dark matter, but perhaps they don't. Here's why: The survey itself was interruptive. Almost by definition the respondent was not hell-bent on achieving a goal. Also, the number of responses to such surveys is sometimes a fraction of the contexts in play. So you have, say, a billion opportunities to create ire in $2 million campaign, and the survey only checks with a few hundred of the seekers. The low response rate of such surveys just reinforces the idea that people don't like to be slowed down.
There is credible research regarding the question of how a brand's "prominent placement" (when the brand is the focus of attention) relates to both brand attitude and context quality in TV. Eva Van Reijmerdsal of the Amsterdam School of Communications Research has summed up several related studies in the Journal of Advertising Research: The studies show that the more prominent the placement, the better the audience's brand memory (as expected). However, one study showed that "prominent brand placement resulted in high memory scores, but negative brand attitudes for viewers who showed awareness of the deliberate brand placement and had low involvement with the program." The researchers explain this by pointing to a defense mechanism that kicks in when we think we are the subjects of persuasion. This suggests the advertiser can avoid that immune response by not being too "prominent."
The other night at dinner, a digital agency leader said that "most ads are direct response, and DR people won't care because they see what works and do more of it." Good point, but the best opportunity for new online ad revenue lies with brand advertising, and if web ads are suspected of damaging brand attitudes, industry growth will be dampened, possibly significantly. Even if ads were not suspected of causing bad feelings for a brand, Dark Matter, if real, would manifest as poor results, and ultimately, results will drive online budgets.
The move to examine annoying placement is growing: The call for entry for TED's "Ads worth spreading" competition stated, "We're seeking to reverse the trend of online ads being aggressively forced on users." Here at the Advertising Research Foundation we wonder about how to measure phenomena such as this. We wonder what to call it. (Badvertising?) Here is my challenge to the industry: Does Dark Matter exist? How would we know? Is it slowly eroding the credibility of the web, or brands, with consumers? Who wants to help us find out?
(Source: Ted McConnell, Executive VP-Digital, Advertising Research Foundation. Published in Advertising Age, 07/14/11)
Daily Sales Tip: Confidence Is Contagious
When you exude confidence in your recommendation of digital, on-air, and event ad opportunities, your clients sense it. They become more confident your proposal will satisfy their objectives and they will more likely say, "Yes."
For you to be confident you must know marketing, advertising, your products and how they benefit advertisers, and what the objectives and expectations are of the client.
The fundamental sales process of asking clients what they need and proposing a solution for that need helps you understand the client's objectives and expectations. The education in marketing, advertising and product knowledge requires more effort...especially in the fast-changing digital area.
To keep up with product knowledge, read the trades that report on digital marketing and advertising. Many are listed on rab.com's digital page (deep link: http://www.rab.com/secure/radiodigital/digitalHome.cfm). Talk to your Interactive manager to make sure you understand your digital products and creative capability to add new products should an advertiser need a custom solution. Talk to the early adopter in your office (every office has one) and ask about what is going on in digital today.
The more you know about digital, the more confident you will become in conducting a client needs analysis (CNA) and making recommendations. With competence comes confidence.
Source: John Potter, VP/Training, RAB
NOTE: RAB recently released its latest training and accreditation program for advanced digital sales, Certified Digital Marketing Consultant 2.0 (CDMC 2.0). For further information click here. From this page you can test your IQ (that's Interactive Quotient) and see the first class of the course. For further information, contact RAB Member Response, 800-232-3131 or firstname.lastname@example.org.