2014 CONSUMER VIEWS OF MARKETING

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1 BLUEHORNET REPORT 2014 CONSUMER VIEWS OF MARKETING Executive Summary For the third consecutive year, BlueHornet surveyed over 1,000 consumers across the United States to better understand their behavior and sentiments about marketing. While still focused on , this year we delved deeper into consumer relationships with brands and expanded the survey to learn how consumers use social media and text messaging. In addition to providing our 2014 survey results and analysis, this report compares findings with past results to identify changes and trends in the marketing landscape Digital River, Inc. Contact BlueHornet: (866)

2 TABLE OF CONTENTS About the Study Habits Frequency and Relevancy Purchasing Behavior Mobile Devices Social Media and Text Messaging Year-Over-Year Trends Conclusion

3 ABOUT THE STUDY Methodology The questionnaire for this survey was developed by BlueHornet with assistance from Flagship Research. The survey was administered by Flagship to a national panel of 1,308 consumers between the ages of 18 and 75 distributed evenly between women and men across East, Midwest and Western regions of the United States; 64.5% of whom are employed and 72.3% with a household income over $35,000. What is your total annual household income? Which of the following best describes your current employment status? 3

4 Research Objectives The purpose of this survey was to gain first-hand responses from consumers about their understanding of and sentiments about marketing. While these views are self-reported and may not perfectly mirror consumer behavior reflected in marketing systems, personal consumer responses help paint a more complete picture of the individual relationships between consumers and the brands that them. Survey questions were categorized as follows: Habits The number of addresses consumers have; when, where, and how often they check them Frequency and Relevancy The reasons consumers subscribe to commercial s, the information they are willing to share, and how many marketing s they receive Purchasing Behavior Factors that inform a consumer s decision to purchase online Mobile Devices How consumers engage with mobile ; Passbook and geo-targeting adoption rates Social Media and Text Messaging Consumer views on the commercial uses of Facebook and text messages 4

5 HABITS How have consumers incorporated into their lives? When do they check ? What situations are they in when they stop to look at ? How often throughout the day do they look at their inbox? This information can help marketers more closely target consumers to ensure they are delivering the right message, to the right person, at the right time. How many personal addresses do you have? How many business addresses do you have? The average consumer has over 5 addresses. For marketers, it s not just about getting an address it s about getting the right address. When do you first check , text messages, social media, and voice mail? How often do you log into your personal accounts each day? Consumers check their accounts early and often, including 80.1% who check their before they start work. 5

6 What device do you use to first check your and social media each day? BREAKDOWN BY AGE GROUP: Percentage of those who use a smart phone first to check and social each day. The type of device a consumer reaches for when they start their day is heavily tied to their age group. About 60% of those 18 to 34 are checking on their smart phone, compared to only 4.6% of those 66 to 75. 6

7 When do you read ? (Check all that apply) With the rise of connected smart phones, consumers turn to throughout the day, whenever they have a few minutes of downtime. Keep this in mind as you craft your messages and calls to action. If you save an to read later, what do you do with it? (Check all that apply) Your might be sitting in the inbox for awhile, make sure to give consumers a reason to open it when they come back. Write descriptive and compelling subject lines, and take advantage of the text snippet at the top of your message which acts as a secondary subject line. 7

8 How comfortable are you providing each of these personal information elements to a company that has products or services you are considering purchasing? (On a scale of 1 to 7, where 1 is least and 7 is most comfortable) Consumers are most comfortable sharing their address and gender, and least comfortable sharing their phone number and credit card info. Try to only collect information that is relevant and actionable. 8

9 FREQUENCY AND RELEVANCY The inbox is a crowded space. We turned to consumers to find out just how crowded it really is. How many different companies do they get s from? How many s do those companies send? What does it take to add another company to the mix and what happens when they lose interest? And we know consumers love discounts, but this year we asked what type of discounts they want. Interestingly enough, age plays a factor. How many different brands do you subscribe to and receive from? Is this amount of promotional too little, too much, or about right for you? About how many promotional s do you receive each month from companies that you have subscribed to? The average consumer reports receiving about four marketing s each day that they opt-in to, which the majority thinks is about the right volume. 9

10 Which of the following is the most important reason for signing up to receive s from companies seeking your business? (Check all that apply) It s no surprise, for the third consecutive year, consumers report that discounts are the number one reason they sign up to receive s. If you re getting s from companies that you re no longer interested in, do you 22% of consumers will stay on your list even when they are no longer interested. This can affect list hygiene and deliverability. 10

11 What type of discount or offer do you find most attractive? What type of discount or offer do you find most attractive? (By age group, Percentage Discount vs. Free Shipping) A dollar off amount is the most attractive type of offer. The second most attractive? That depends on your age group. 18 to 45 year olds want to see a percentage discount, while 46 to 75 year olds are more interested in free shipping. 11

12 PURCHASING BEHAVIOR What factors do consumers consider in their decision to buy online? What influences them? Do they use mobile devices to complete purchases, use mobile coupons? We went straight to the source to ask consumers about their purchasing behavior. How important is each of these reasons to you when deciding to purchase online? (On a scale of 1 to 7, where 1 is least and 7 is most important) There are many reasons consumers decide to shop online, but the number one reason is lower prices. How much does each of the following influence your purchasing decisions? (On a scale of 1 to 7, where 1 is least and 7 is most influential) is more important than direct mail, Facebook or Twitter in influencing purchasing decisions. 12

13 When you are making purchasing decisions, do you? (Check all that apply) Consumers are trained to wait for discounts. Use coupon behavior to segment these users who need a coupon versus those who don t to drive purchases. Have you ever posted a product review? Why did you post a review? Roughly 39% of consumers have posted product reviews or comments about purchases, and they are nearly three times more likely to report good products or services rather than bad. Foster this community so your customers become brand advocates who help facilitate sales. 13

14 How often have you made a purchase as a result of a mobile in the last 12 months? How often have you used your mobile phone to redeem a discount or coupon in the last 12 months? 38.3% of consumers have made at least one purchase in the last year as a result of a mobile . Almost the exact same number, 38.2%, have used a mobile coupon. 14

15 MOBILE DEVICES Smart phones have fundamentally changed the way we interact with and each other. We wanted to learn how consumers use mobile , and what this means for marketers. As marketers embrace a mobile-first approach to messaging, we need to look beyond to see other ways this technology will affect marketing. With an eye towards the future, we asked consumers about some emerging mobile features, including Passbook and geo-targeting. Which type of smart phone(s) do you own? (Check all that apply) Which type of tablet(s) do you own? (Check all that apply) While Android-based phones and iphone are neck and neck, the ipad has the edge in the tablet market. It is on these devices that consumers will view your s, so take them into account in your rendering tests. Which of the following activities do you use your smart phone for? (Check all that apply) Consumers see usage on smart phones to be as essential a function as browsing the internet. 15

16 Do you use your mobile device to sort through your s before you read them on your desktop? 47.5% of consumers have used their mobile devices to sort through their before reading them on a desktop. If you get a mobile that doesn t look good, what do you do? (Check all that apply) Only 4.2% of consumers will try to read a mobile that doesn t look good. In last year s report, just 6.3% of those between 25 and 40 years of age would try to read it anyway. More than ever, designing messages with mobile in mind is critical to success. 16

17 Have you used Passbook in the past six months? (All respondents) Yes, I have used Passbook in the past six months. (By age group, all respondents) Passbook is most popular in the 25 to 45 age group. 17

18 What have you used Passbook for? (Check all that apply) While the most prevalent use is for mobile coupons, there are opportunities to use Passbook for other functions as well. Would you enable location targeting if phone applications request it? 52% of consumers are open to enabling location targeting. 18

19 SOCIAL MEDIA & TEXT MESSAGING As marketers look for additional avenues for communicating with consumers, two options that stand out are social media and short message service (SMS) text messages. We asked consumers how they use these mediums and how they feel about communicating with brands through them. Why do you connect with brands on Facebook? (Check all that apply) The main reason consumers like brands on Facebook is because they want deals. What is the main reason you would subscribe to a company s text messaging program? 49.9% of consumers would subscribe to a company s text messaging program. 19

20 What would be the right number of text messages per month that would keep you engaged and opted-in? 1 to 2 commercial text messages per week is the frequency consumers overwhelmingly want. If you could select a communication preference from a business, which would you choose? Given the choice, almost 70% of consumers want to communicate with businesses through rather than direct mail or text messages. 20

21 YEAR-OVER-YEAR TRENDS When analyzed alongside our results from 2012 and 2013, there have been no major swings in consumers views of marketing. Discounts continue to dominate decision making and remain the primary reason people subscribe to . Consumers biggest concern with marketing once again is frequency, with 44.1% of respondents reporting that they receive too much . Not surprisingly, mobile has proved to be more important than ever before. Almost 60% of consumers between 18 and 34 use a smart phone check their at the beginning of their day. Only 4.2% of those surveyed say they will try to read a mobile even if it doesn t look good. continues to be the most popular channel for brand communications, with consumers choosing it 3:1 over the next preferred channel direct mail. CONCLUSION After another year of evaluating consumer feedback, s future continues to look bright. Consumers love discounts. Experiment to find what types of offers best resonate with your audience. Be sure to take age into consideration, as it affects the types of coupons to which they respond and the type of offers they want. If your subscribers are generally between 25 and 45, now may be the time to start testing Passbook. To keep consumers from unsubscribing, marketers continue to need to find the right frequency of sends. Segmentation and targeting help keep content relevant, and ensure readers are engaged. There are also opportunities to leverage your consumer community by putting an emphasis on product reviews. Over 10% submitted their comments just because the retailer asked, and consumers are nearly three times more likely to post a positive review than a negative one. The proliferation of smart phones has made more accessible than ever before, and consumers see it as a core function of the device, along with making calls, text messaging, and accessing the internet. You only get one shot for someone to read your , and it s more likely than ever before that the opportunity will take place on a smart phone. For marketers, this means that if you aren t taking a mobile-first approach, you are missing and possibly losing a large percentage of your audience. Always remember your subscriber list is filled with people, not just addresses. Treat them with respect, listen to their wants, provide content that meets their needs, and you will enjoy a mutually beneficial relationship. 21

22 BlueHornet 2355 Northside Drive Suite B250 San Diego, CA (866)

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