Marketing in Ireland Usage by Irish Consumers and Marketers. April 2011

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1 Marketing in Ireland Usage by Irish Consumers and Marketers April Harcourt Street Dublin 2 Tel: Web:

2 Table of contents The aim of our research... 3 How we carried out the research... 3 Summary of findings... 4 Insights from industry... 6 Insights from consumers Insights from Circulator s technology platform Conclusion About Circulator Appendix 1 Industry sample structure Appendix 2 Consumer sample structure

3 The aim of our research Despite the emergence of new communication platforms such as Facebook, Twitter and Skype, marketing is still a growing medium used by companies in Ireland to communicate their corporate messages. Our aim in conducting this piece of research was to give valuable insight into marketing in Ireland from both a marketing and consumer point of view in the B2B and B2C sectors. We wanted to highlight the importance of a well-developed marketing campaign and analyse how this medium of communication is perceived by consumers. This report therefore provides marketers and senior executives with a fascinating snapshot of the attitudes of fellow marketers and consumers towards marketing in Ireland. How we carried out the research To gather insights from industry, we attended the National Digital Media and Marketing Summit, held on the 30 th of March, and surveyed 214 industry professionals. We also wanted to understand how Irish consumers received as a marketing medium. So, we took to the streets of Dublin, surveying 219 members of the Irish public who were all active users, and asked them key questions relating specifically to marketing. 1 We ve also analysed internal data on over 10 million s sent (between Jan Mar 2011), via our own, custom-built technology platform, providing a unique snapshot of when marketers send their B2B and B2C s, and of their customers propensity to interact with those communications. 1 A breakdown of our consumer sample by age, gender and employment status is provided in Appendix 2. We spoke to 230 consumers in total, but the 19 who said that they did not live in Ireland have been excluded from our analysis. 3

4 Summary of findings Important Nearly 80% of the industry professionals we spoke to use as a marketing medium. Of those, more than four-fifths see marketing as an important or very important part of their overall marketing mix. Over half rate the commercial effectiveness of as high or very high. Asked to rate the effectiveness of marketing from a commercial perspective, over 50% rated it as high or very high. Two-thirds of industry respondents 67% integrate their marketing campaigns with Facebook, and 45% with Twitter. Almost half of industry professionals 49% use some form of external or web-based system to deliver marketing communications. Nearly three quarters of the industry professionals we spoke to use marketing to promote brand awareness (73%) and customer retention (70%). Relatively small percentages use marketing as a means of increasing sales, either online (37%) or offline (16%). Among the industry professionals we spoke to, marketing seems to be used primarily as a tool for building loyalty and recognition among customers, rather than as a method for increasing sales directly. However, 35% of the consumers we spoke to said that they had made a purchase as a result of receiving an , almost half of these (16%) on more than one occasion. For more than three quarters of consumers, knowing and liking the company sending a marketing is the biggest factor determining whether they open that communication. Receiving s too frequently is the reason most likely to make consumers unsubscribe from an list. Almost a third regard s that come too often as spam. 4

5 Surprising Almost a quarter of the industry professionals we spoke to 22% have been using as a method of communication for less than two years, suggesting that marketing is still growing alongside the expansion of new technology platforms. Asked whether the decrease in spam globally had been reflected in their own inboxes, well over half of the consumers we spoke to 55% agreed that it had. Over a quarter of industry professionals 27% reported carrying out infrequent testing for marketing, while nearly a fifth (19%) owned up to not conducting any testing at all. It is clear that consumers do appreciate receiving communications from businesses in their inbox just as long as those businesses get the content, frequency and format of their s right. Over half of the consumers we spoke to would unsubscribe from an list if it contained irrelevant content. Unusual Analysis of data from Circulator s own, custom-built technology platform shows that midweek is the most popular time for both B2B and B2C clients to send their marketing s. Monday is the least popular weekday among both B2B and B2C marketers. Among both B2B and B2C clients, the period around noon (11am to 1pm) is by far the most popular time for sending marketing s, in both cases accounting for over a quarter of volumes. Fewer than one in seven B2B or B2C s are sent outside the hours of 9 to 5. 5

6 Insights from industry A cross-section section of digital marketing professionals By conducting our industry research at a digital marketing conference, we were able to access a good cross- section of relevant professionals. Unsurprisingly, the largest proportion of those who we spoke to (44%) told us that they worked in marketing or media, with a further 19% based in the technology industry. The remaining respondents represented a range of sectors, including non-profit or government (7%), manufacturing (4%), and hospitality and travel (4%). A full breakdown of the sample structure is provided in Appendix 1. Communication with consumers and businesses Base = 214 (all respondents) 6

7 We asked our interviewees whether they communicated mainly with businesses (i.e. B2B marketing), consumers (i.e. B2C marketing), or both. Nearly half 46% told us that they communicated with both consumers and businesses; a further 30% communicated just to businesses, and 18% just to consumers. Only a handful of respondents 5% communicated with neither audience. Widespread use of as a marketing medium The vast majority of industry professionals 79% told us that they used as a marketing medium, and nearly half of those (32%) had been doing so for five years or more. Only a fifth (20%) didn t use for marketing at all. Base = 214 (all respondents) Interestingly, despite the growth of other online and mobile communication platforms in recent years, nearly a quarter of those who we spoke to 22% said that they had been using as a method of communication for less than two years. 7

8 This suggests that instead of marketing being superseded by newer technologies, it is continuing to have an important or even a growing role as part of organisations overall marketing mix. The importance of within the marketing mix Among those industry professionals who told us that they did use for marketing, we were keen to understand more about the relative importance of , and about the approaches and systems that they used. 2 Base = 171 (all respondents who use marketing) Asked specifically about the importance of marketing within their overall marketing mix, more than four- fifths confirmed that was either very important (30%) or important (55%). 2 Understandably, it was not relevant to ask these questions to the 20% of respondents (43 people) who told us that they did not use marketing. For that reason, the graphs for this and subsequent questions are based on 171 respondents instead of

9 A method for building loyalty among customers Base = 171 (all respondents who use marketing); total of 301 responses 3 Asked to identify the purposes for which they used marketing, almost three quarters of respondents named brand awareness (73%) and customer retention (70%). Just over half (51%) cited generating new leads as important, while smaller proportions referred to using marketing for increasing website traffic (41%) or internal communication (36%). Interestingly, relatively small percentages claimed to use marketing as a means of increasing sales, either online (37%) or offline (16%). Overall, these figures point to marketing being used primarily as a tool for building loyalty and recognition among customers, rather than as a method for increasing sales directly. Of course, by nurturing that ongoing relationship with your customers, the expectation is that your business may well be top of mind next time they have a need to purchase the products or services that you offer. 3 Respondents were able to choose more than one answer (i.e. all that applied). 9

10 The growth of external solutions alongside traditional systems Base = 171 (all respondents who use marketing) Given the high importance of within most respondents marketing mix, a surprisingly large proportion 40% reported using a normal system, such as Outlook, to deliver communications. However, almost half 49% said that they used some form of external or web-based based system, such as an advanced web-based solution (20%) or a bolt-on on to their CRM or website (14%). Circulator s own experience suggests that the market is increasingly moving towards these types of external solution, as businesses recognise the benefits of systems that incorporate contact management systems and tracking, and that tend to result in higher than average open rates. 10

11 A focus on weekly and monthly campaigns Base = 171 (all respondents who use marketing) Asked about the frequency of their campaigns, the largest numbers of respondents reported ing customers either monthly (27%) or weekly (23%). Only a very small number 7% said that they sent out daily s. A reliance on compact databases Nearly two-fifths of respondents 38% told us that they had an database of between 1,000 and 5,000 records, with a further 21% having fewer than 1,000 contacts on their mailing list. As might be expected, only a handful of the industry professionals that we talked to had very large databases of 100,000 contacts or more. 11

12 Base = 171 (all respondents who use marketing) Small databases can be a limiting factor We asked respondents if the size of their database was a factor that limited their marketing activities, and a majority (54%) felt that it was. Of those, 14% described the size of their database as a very limiting factor. Of the remaining interviewees, a third (33%) felt that their marketing campaigns were not impeded by the size of their database, while 13% were unsure. 12

13 Base = 171 (all respondents who use marketing) Limited investment in testing At Circulator, our client strategy includes the implementation of a testing process, which is critical part of the success of an effective marketing campaign. Among those we spoke to, however, only 23% said that they carried out regular testing for marketing, with a further 26% describing their testing as occasional. At the other extreme, the largest proportion 27% reported carrying out infrequent testing, while nearly a fifth (19%) owned up to not conducting any testing at all. 13

14 Base = 171 (all respondents who use marketing) The growing importance of integrating and social media The continued importance of within the marketing mix was further demonstrated by respondents accounts of how they integrated their campaigns with other platforms, such as social media. Two-thirds 67% said that they had integrated their marketing campaigns with Facebook, a figure that likely reflects the growing number of people using that social network. According to Ipsos-MRBI figures released in February this year, 50% of the Irish population over the age of 15 around 1.75 million users is now on Facebook, while one in five year olds have a Facebook account. 4 Similarly, nearly half of the industry professionals we spoke to 45% had integrated marketing with Twitter, a proportion that seems likely to increase further as Twitter s meteoric growth in popularity continues. The same recent Ipsos-MRBI survey suggested that while the number of Twitter users in Ireland remains relatively small (at 7% of the population), the proportion of Twitter users who check their account 4 Source: [accessed 24 April 2011]. 14

15 daily has risen from 18% to 30% in six months, underlining the platform s increasing prominence as a means of regular communication between businesses and customers. 5 Base = 171 (all respondents who use marketing) Outside the main social media platforms, more than two fifths of respondents (44%) had integrated campaigns with Google Analytics, and 29% with YouTube or other video content. Less than a quarter (23%) had integrated with mobile or SMS campaigns. 5 Ibid. 15

16 as an effective part of the marketing mix Base = 171 (all respondents who use marketing) Asked to rate the effectiveness of marketing from a commercial perspective, nearly a fifth of respondents (19%) rated it as very high, with a further 34% rating it high. Only 8% described marketing as having a low commercial effectiveness. Again, these figures seem to reinforce the importance that industry professionals continue to attach to marketing, and its status as a key method within the overall marketing mix. 16

17 Insights from consumers s ability to stimulate online purchasing Base = 219 (all respondents who live in Ireland) Among the consumers we spoke to, the majority said that they had not made a purchase as a result of receiving an (46%) or could not recall an occasion where they had done (18%). However, demonstrating the potential of marketing to drive sales, a sizable number 35% said that they had made a purchase as a result of receiving an , almost half of these (16%) on more than one occasion. 17

18 Trust a key factor in getting consumers to open your s Asked about the factors that determine whether they even open a marketing , by far the largest proportion of respondents 76% chose If I know and like the company sending it. A sizable minority of consumers (18%) also cited The relevance or quality of previous s from that company as a factor that would influence them, further demonstrating the need for businesses to build a trusted relationship with their customers. Base = 219 (all respondents who live in Ireland); total of 250 responses Of the other factors suggested, over a quarter 26% flagged the s subject line as something that would influence their decision to open an , while only 7% indicated that the time it s sent would have an impact. The subject line finding highlights the importance of marketers getting their wording right, and the importance of coming up with a headline that is eye-catching yet relevant. 18

19 Even permission-based can be seen as spam Base = 219 (all respondents who live in Ireland) Asked what types of they would consider to be spam, the consumers we spoke to unsurprisingly focused on various types of unsolicited or malicious communication. The largest proportion (66%) agreed that any I receive that I did not ask for or subscribe to was spam, while nearly two-thirds thirds (53%) also cited s that try to trick me into opening them. Just under half of consumers (49%) also included s from senders who are unknown to me within their definition of spam. For a significant minority, however, even s that they had agreed to receive could sometimes be considered as spam. Almost a third (32%) complained about s from companies or organisations that come too frequently, while 30% argued that spam could include any I receive that I don t want, regardless of whether I subscribed. 19

20 Overall, the findings suggest that it s crucial for businesses not to bombard their customers with too many s, and, when they do, to make sure that those communications are targeted, relevant and interesting. but consumers agree that the volume of spam is decreasing After many years where spam s seemed to spiral out of control, recent intelligence has pointed to a significant decline in global spam volumes. In April this year, for example, MessageLabs claimed that worldwide spam had decreased by a third following the dismantling of one of the largest and most sophisticated botnets the groups of infected computers responsible for distributing spam s. 6 Base = 219 (all respondents who live in Ireland) 6 Source: [accessed 24 April 2011]. 20

21 Asked whether the decrease in spam globally had been reflected in their own inboxes, well over half of the consumers we spoke to 55% agreed that it had, with nearly half of these (26%) reporting that the amount of spam they received had definitely reduced. Of the remaining respondents, a third (34%) had not noticed a reduction in spam volumes, while 12% were unsure. Assuming that the apparent decrease in global spam continues, it has to be a positive thing for both consumers and businesses preventing ng being undermined as a communication medium, and reducing the risk of genuine business communications getting lost or overlooked among the junk. Too many s is the most common reason for unsubscribing Base = 219 (all respondents who live in Ireland) We asked the consumers we spoke to about what would make them most likely to unsubscribe from an list, and by far the largest proportion 71% cited receiving s too frequently. A majority (55%) also 21

22 indicated that irrelevant content would make them likely to reach for the unsubscribe link. Both figures reinforce some of the other findings from the survey, once again highlighting consumers low tolerance of s that either arrive too frequently or are not sufficiently tailored towards their own interests. Compared to their complaints about the frequency and relevance of marketing s, respondents seemed relatively unconcerned by issues of security or privacy. Less than a third of those surveyed cited think my address is being shared/sold, don t remember signing up or privacy concerns as reasons for unsubscribing from a mailing list. Consumers attracted by competitions and offers Base = 219 (all respondents who live in Ireland) Asked about the types of offers or information that they would find useful to be included in a permission- based , the largest proportion of respondents 52% cited competitions. This finding indicates that, 22

23 even today, people love to win things, and that the good old-fashioned competition can be a great way of exciting and engaging with your customers. Alongside competitions, between a quarter and a third of consumers also expressed interest in deals that encourage them to buy a business s products either through offers for regularly purchased products (34%), reward programme information (31%), or offers for related products (24%). In contrast, only a handful of the consumers surveyed 3% were attracted to offers to subscribe with partners, suggesting that businesses need to take care when using their marketing to promote partners services. Again, ensuring the relevance of any partner offers so as not to undermine customers trust in your own brand is likely to be key. Security and privacy are the biggest barriers to interaction Questioned about the barriers that prevent them interacting with offers sent by , the largest proportion of consumers we spoke to 60% cited issues related to security or privacy as the biggest issue. This finding seems to underline the importance of businesses testing their marketing campaigns, to make sure that consumers are actually able to view and engage with the communications that they receive. Of the remaining potential barriers, only one the being too long was flagged as an issue by more than a third of respondents (39%). Other options, such as offers not being attractive enough (23%), were each highlighted by fewer than one in four interviewees, suggesting that the number of significant barriers to interacting with an offers are relatively few a finding that has to be good news for marketers. 23

24 Base = 219 (all respondents who live in Ireland) The importance of imagery in s Our final question for consumers related to the fact that unless they click to download, 60% of people are reportedly unable to see any imagery within marketing s. We asked our interviewees whether they felt that this made any difference to the customer experience; nearly two thirds (62%) said that it did, with the remaining 38% unsure. 24

25 Base = 219 (all respondents who live in Ireland) Insights from Circulator s technology platform Overview Complementing the research that we carried out among industry professionals and consumers, we have also conducted an analysis of internal data relating to over 10 million s sent (between Jan Mar 2011), via Circulator s own, custom-built technology platform. This analysis provides a unique snapshot of: When marketers send their B2B and B2C 7 s, in terms of day of the week and time of the day. 7 We have categorised each of 158 clients as either B2B or B2C, based on their overall business model. 25

26 Customers propensity to engage with those communications, measured in terms of average open, clickthrough and forward rates. Midweek the most popular time to send marketing s Base: 5 million marketing s sent by Circulator s B2B clients between Jan Mar 2011 The analysis shows that midweek is the most popular time for both B2B and B2C clients to send their marketing s: Among B2B clients (above), Thursday is the most popular day to send marketing s (accounting for 24% of volume), followed by Wednesday (23%) and Tuesday (22%). Among B2C clients (below) the top three days are the same, but in a slightly different order: Tuesday (22%), followed by Wednesday (21%) and Thursday (20%). 26

27 Monday is the least popular weekday among both B2B and B2C marketers, accounting for just 14% and 13% of volumes respectively. Perhaps unsurprisingly, no B2B s at all were sent at the weekend. B2C clients, in contrast, are slightly more willing to send marketing s at the weekend, with Saturday and Sunday each accounting for 4% of B2C volumes. Base: 5 million marketing s sent by Circulator s B2C clients between Jan Mar

28 Around noon the most popular period for sending marketing s Base: 5 million marketing s sent by Circulator s B2B clients between Jan Mar 2011 Among both B2B and B2C clients, the period around noon (11am to 1pm) is by far the most popular time for sending marketing s, in both cases accounting for over a quarter of volumes: For B2B clients (above), the period 11am to 1pm accounts for almost a third (32%) of all s sent. As might be expected, only a small proportion of B2B s are sent outside the working day 9% from 5pm to 7pm, and a further 4% from 7pm to 9pm. None at all are sent between 9pm and 9am. Among B2C clients (below), the peak period for sending s (28% of volumes) is still 11am to 1pm. Overall, however, s are spread slightly more evenly across the working day than they are for B2B clients. 28

29 The proportion of B2C s sent after 5pm (12%) is almost identical to that for B2B clients. Again, no s are sent between 9pm and 9am. Base: 5 million marketing s sent by Circulator s B2C clients Customers propensity to engage with s Analysis of Circulator s internal data indicates that relevant, targeted s remain a highly effective way of engaging with customers: Of the 10 million s analysed, 29% were opened by the recipient. Of the s that were opened, 18% were forwarded by the recipient to another person. 29

30 Of the opened s, over a quarter (26%) resulted in a clickthrough either from the original recipient, the forwardee, or both. The unsubscribe rate among recipients was well below 1%. The overall rate of interaction taking into account s opened, forwarded and clicked through was 32%. Conclusion The research demonstrates the continued importance that industry professionals attach to marketing, even as alternative methods of online communication grow. In fact, high levels of integration between and other methods such as Facebook and Twitter appear to be cementing s status as a key part of businesses overall marketing mix. However, it s crucial for businesses not to bombard their customers with too many s, and, when they do, to make sure that those communications are targeted, relevant and interesting. Even when they ve agreed to receive your s, consumers won t hesitate to reach for the unsubscribe link if they feel that they re being spammed, hence the importance of developing an effective marketing strategy. Relevant, targeted s remain a highly effective and appreciated way of engaging with customers, with potential to generate high rates of opens, forwards and clickthroughs. Used well, it s clear that is a powerful tool for building brand loyalty and recognition, and with over a third of the consumers we spoke to having made a purchase as a result of receiving an boosting sales of products or services. 30

31 About Circulator Circulator is a full service marketing agency. Our in-house, custom-built platform is personalised for each client, allowing the platform to meet your needs whatever they may be. We offer design, content management, analytical reports and strategy consultancy as part of our service offering. Whether you want to increase sales, build customer loyalty or communicate with stakeholders, our comprehensive suite of online marketing tools and services will help your organisation build better and more profitable customer relationships keeping them engaged with your brand. By focusing on marketing services, we provide corporate clients with a high quality real-time customer intelligence platform, enabling our users to send the most personalised and relevant messages at the right time via the right medium, ensuring a maximum return on investment. Regardless of whether you're thinking of using this powerful medium for the first time or want to improve the way you do it, we know how to make marketing work for your brand. Get in touch with Aoife Ross for more information Appendix 1 Industry sample structure By industry Age % Marketing / Media 44% Technology 19% Non Profit / Gov 7% Manufacturing 4% Hospitality / Travel 4% Retail 3% Education-Training 2% Financial / Insurance 2% Online Business 2% Wholesale 2% Other 12% Total 100% 31

32 Appendix 2 Consumer sample structure By age Age % % % % % % 60+ 2% Total 100% By gender Gender % Male 56% Female 44% Total 100% By employment status Age % Employed 38% Unemployed 3% Student 55% Housewife 3% Retired 1% None of the above 1% Total 100% 32

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