Facebook Commerce Holds Promise for Retailers

Emineo Media Facebook Commerce
Social networks don’t account for much ecommerce yet, but heavy Facebook users see it as a one-stop shop….   Emineo Media Facebook Commerce

Social media and ecommerce have evolved since 1-800-FLOWERS launched the first Facebook storefront in July 2009. Internet users have become more comfortable with online buying on Facebook as they spend more time on the site.

“It is not surprising that shopping and socializing—activities that complement each other in the real world—are beginning to converge online as well,” said Krista Garcia, eMarketer analyst and author of the new report, “Facebook Commerce: Reaching Shoppers Where They Socialize.” “As social media, and Facebook in particular, plays a larger role in consumers’ lives, people are becoming accustomed to performing routine tasks like reading news, watching videos and listening to music, as well as discovering products and shopping, all while staying logged in to a single site. Instead of compartmentalizing daily routines, social media users are treating Facebook as a one-stop platform.”

Retailers are still in the early stages of using social media as a sales vehicle, but the channel is poised for growth. Booz & Company estimated that $1 billion in goods would be sold through social media in the US in 2011. That figure is expected to triple in 2012 and reach $14 billion by 2015.

While social commerce still represents a tiny percentage of overall retail sales, and Facebook is just one social site, that site is the clear leader and already offers retailers a variety of options for converting users into consumers. Some of those consumers are warming to the idea of buying products and services while on the site.

In a Q4 2011 Oracle survey of North American internet users, nearly one in five respondents said they would buy through Facebook or had already done so, while 15% were not aware they had the option. Approximately a third said they would never purchase products via Facebook, however.

“Facebook’s role in ecommerce is currently in flux,” said Garcia. “Brands are beginning to realize its capabilities, while users are growing accustomed to mingling with companies online and sharing shopping activities with friends. Even though social media is still more of a marketing tool than a sales vehicle, Facebook’s influence on shopping behavior extends beyond triggering conversions on the spot.”

Source emarketer

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Brand Advertising Shines

Emineo Media Brand
Measuring brand advertising still poses a challenge… Emineo Media Brand

Direct-response marketing may soon be taking a backseat to online brand advertising initiatives. According to a DIGIDAY and Vizu “State of the Industry Survey,” more marketers plan to increase their online branding initiatives in 2012 than they do their direct response tactics.

The survey reveals that roughly half of marketers plan to increase direct-response spending, compared to 64% who plan to increase online brand ad spending.

Drilling down into how much marketers plan to increase their investments, 44% will increase online brand ads by more than 10%. Moreover, 22% will increase brand ads by at least 20%. Although marketers are in fact increasing direct-response spending, the survey indicates that they are doing so to a lesser degree than brand advertising—20% plan to increase online direct-response advertising by 10% or more, and only 13% plan to increase it by 20% or more.

Growing marketer interest in mobile advertising, social media and online video is contributing to the expansion of online brand advertising as a category. According to DIGIDAY, 69% of survey respondents plan to increase their mobile ad spending, 63% plan to increase social media and 57% plan to increase video advertising. For the majority of marketers, investments in rich media advertisements and standard display advertisements will stay the same.

Although the DIGIDAY/Vizu survey did not show a decrease in direct response to accommodate more brand advertising investments, another DIGIDAY survey with Adap.tv indicated that some advertisers may be dipping into display budgets in order to spend more in areas such as online video. According to the survey, 43% of agency advertisers and 24% of brand advertisers said they planned to shift funding away from display advertising to accommodate more spending for online video ads in particular. Broadcast TV and print advertising were the other channels advertisers planned to dip into most significantly.

While brand advertising is experiencing heavy interest and strong growth, marketers are still grappling with developing a set of metrics that prove the effectiveness of online brand advertising tactics. The DIGIDAY/Vizu survey asked marketers how they planned to calculate return on investment for brand advertising. Very few respondents said they used the same metrics as they do in offline categories. Instead, the majority (55%) have added metrics such as brand lift, sales and interaction rates to measure ROI. Clickthrough rates, shares/reports, and dwell time are less popular metrics, but are used by roughly a third of survey respondents.

Marketers told DIGIDAY that developing a set of standard brand advertising metrics would help further their online branding initiatives. The top three improvements respondents said would help them increase resources for online brand advertising were improved clarity around brand advertising ROI, the ability to verify brand advertising created the desired result and the ability to use the same metrics with online brand ads that are used in offline media.

Source emarketer

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Consumers Begin Scanning QR Codes

Top reason to scan was to find out what would happen…

Half of smartphone users have now scanned a QR code at least once, according to research from Chadwick Martin Bailey, but findings suggest marketers have still not proven their value to consumers.

As QR codes pop up in more places, awareness of them is growing, and many users seem to learn what they do before learning what they are called. Chadwick Martin Bailey found that while just 21% of internet users surveyed had heard of QR codes before, more than four in five knew one when they saw one.

QR codes are becoming hard to miss, even for those without a smartphone. Data from mobile marketing firm Nellymoser indicates that well over 90% of the top 100 magazines in the US have featured at least one mobile barcode since May 2011; as recently as November 2010, just 9% had. The proportion of ad pages in those magazines that now feature mobile barcodes hovers around 5%.

That doesn’t even touch on the presence of QR codes in outdoor advertising, in-store signage and packaging, or business cards—all among the top places smartphone users have scanned QR codes from, according to Chadwick Martin Bailey. With QR codes seemingly all around them, smartphone users’ top reason to scan one was out of simple curiosity (46%), followed by the hope for more information (41%).

These results may give marketers pause. As 2-D barcodes become ubiquitous, people are learning what they are: something to scan with a special app on a smartphone. But as awareness develops, the novelty factor may be in danger of wearing off. Marketers will have to prove there is valuable information in store for QR code scanners—perhaps a coupon or exclusive content—or those who scan a few times out of curiosity may not develop a scanning habit.

Source emarketer

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