While our behavior is clearly influenced by our surroundings - most of us act differently in a church vs. a nightclub - new research shows that very subtle differences can have a significant behavioral impact. Specifically, new research shows that environments with “disorder” cues cause people to be less likely to conform to social norms.
Tag: consumer behavior
At the height of the Great Recession we set off across America in search of stories of hope. We were armed with data from Young & Rubicam's BrandAsset Valuator that showed how most people were thinking, feeling and spending in new ways. We traveled through nine red and blue states, talking with people across kitchen counters, in restaurants, supermarkets, factory floors and boardrooms. In the hipster enclaves of Brooklyn and the techno hubs on the West Coast we found ample evidence that economic pain had moved vast numbers of people to reconsider their values and priorities. In these places, thoughtful spending and a commitment to sustainability, environmentalism and community had replaced consumerism. In fact, in 2007 -- even before the crisis -- our data showed Americans were becoming uneasy with debt and excess spending, distrustful of leaders and skeptical of materialist values.
When consumers are overwhelmed with options, marketers should give them what they really want: ways of shopping that lower the cognitive demands of choosing.
Some speculated that Google Instant would drastically change the way people search by letting users see results for their queries as they typed. That shift hasn't happened yet, according to an analyst at Conductor, a company that provides search engine optimization tools to marketers. "It doesn't appear to be having a significant impact on how users search," Conductor concluded. But that's not quite what the data show.
As the busiest time of the year is about to kick in for many of you, we thought we’d keep things lighthearted this month. Check out the rise in 'mature materialism': experienced, less-easily shocked, outspoken consumers who appreciate brands that are more daring, outspoken, even a bit more risqué.
With the insane amount of data out there, it's tempting to skip the human element altogether and rely solely on statistics. But performance metrics alone can't tell you what motivates your audience to start a blog, share a video or post about their breakfast on Facebook. And it can't tell you the exact point when first-time moms realize their new little bundle of joy means a 54% increase in laundry, leaving them running to the appliance store. These are the types of insights that result from a consistent two-way dialogue with an audience over a long period of time.
At the heart of the intersection of brain science and marketing lie customers’ needs and motivations, right? After all, the customer experience is essentially the laboratory where companies’ theories about consumer psychology are tested. If a company understands what motivates customer behavior, it has a better shot at influencing that behavior by meeting their customers’ needs. This became clear to me as I navigated through three different reads about customer service in the past few weeks.
The content creation business is thriving these days, especially now that the Conventional Wisdom has all but freed it from having any direct connection or relevance to actually selling anything. Instead, one of the new deliverables of today's marketing is often a contest of some sort, which I think is even worse than not saying anything meaningful about a brand.
It’s like the most persistent sales clerk you’ve ever encountered. Major retailers are working with a new smartphone application that tracks and offers promotions to shoppers as they move from outside the store, to counters, to cash registers — even inside the dressing room (now that’s persistence). The app, called Shopkick, will be available on Tuesday for the iPhone and in the fall for Android phones. And with five major companies supporting it — Macy’s, Best Buy, Sports Authority and American Eagle Outfitters, along with the Simon Property Group, the prominent mall operator — it is getting a big introduction.
Last October, media marketing firm Greystripe released a study of working moms who use their iPhones for everything from banking to social networking to making purchases. Dubbed the "iPhone Mom," this audience segment depends on the iPhone for managing their lives to entertaining their children. Just over half use their iPhones at the supermarket, according to the study.
When marketers use terms like brand "personality," "character" and "manner," they're more accurate than they know. New research into consumer brand purchase and loyalty behavior has revealed that the way humans respond to brands is simply an extension of the way they instinctively perceive, judge and behave toward one another. In short, people were the first brands; faces were the first logos. That insight could revolutionize brand and social-media strategies.
K-Mart and Marc Jacobs have something in common: low- and high-end fashion products tend to have less conspicuous brand markers than midprice goods, according to a paper soon to be published in The Journal of Consumer Research. Rather than rely on obvious logos, expensive products use more discreet markers, such as distinctive design or detailing. High-end consumers prefer markers of status that are not decipherable by the mainstream. These signal group identity only to others with the connoisseurship to recognize their insider standing.
In all my years in online analytics, I have been waiting to see an online media placement that is so strong, the consumer converts directly from one exposure (either click or view), without a path of influence. I think most people reading this would agree that it's nearly impossible (because if we all knew the secret formula, wouldn't we all be using it?!). But why then is the last click/view attribution the standard model?
Kicking off Nielsen’s Consumer 360 conference in Las Vegas, Irene Rosenfeld, Chairman and CEO of Kraft Foods addressed the ways reaching consumers have changed significantly over the last twenty years and how the Internet and social media are increasingly important components of overall marketing strategies. Previously, brands acted as teachers, according to Rosenfeld. Marketing was designed to build an image around a brand with the expectation that consumers would be attracted to it; they would aspire to the brand. Today, that “paradigm is upside down,” as brands want to learn from consumers and find ways to connect with them.
For decades, shoppers have taken advantage of coupons. Now, the coupons are taking advantage of the shoppers. A new breed of coupon, printed from the Internet or sent to mobile phones, is packed with information about the customer who uses it. While the coupons look standard, their bar codes can be loaded with a startling amount of data, including identification about the customer, Internet address, Facebook page information and even the search terms the customer used to find the coupon in the first place.
The age of austerity is over, as the well-heeled splash out on Porsches and Dom Pérignon champagne, according to retailers of luxury goods. The wealthy are more prepared to open their wallets than at any time in the past two years, suggesting they have put the financial crisis behind them. But they are still looking for value for money and craftsmanship, says a study published today. Flashy labels and glitz have yet to make a comeback.
PSFK attended the recent Search Engine Strategies Conference in New York for an opportunity to catch a panel on the development of trends in Internet search behavior and product development. Panelists included Stefan Weitz, the Director of Bing, Larry Cornett, VP of Consumer Products at Yahoo! Search, Brett Tabke, CEO of WebmasterWorld.com, and Robert Murray, CEO of iProspect. The panel was moderated by Graham Mudd, VP of Search & Media at ComScore.
Right out of the gate, let's assume that we all agree consumer behavior is in the throes of its biggest shift in history. And the cause is generally attributed to the Internet. While I don't disagree with this assessment, I believe there may be some misattribution when it comes to cause and effect. Did the Internet cause our consumer behavior to change? Or did it enable it to change? The distinction may seem like mere semantics, but there's a fundamental difference here.
When Apple announced its much-anticipated iPad last month, one of the resounding complaints was "What, no Netflix?" While that's not surprising given Apple's penchant for keeping users locked into its iTunes ecosystem, it does say a lot about Netflix's proliferation on tech devices over the past two years. Now, the content-streaming brand that remade the DVD rental model is poised to be a major disrupter in the entertainment landscape. Netflix is forcing movie studios, which are wary of digital distribution, to make deals. Netflix insists it's not trying to harm the studios, but rather offering them an opportunity, yet it is still handling them carefully. For instance, via its recent renegotiated deal with Warner Bros., Netflix gets access to more Warner content to stream; in return the studio gets a 28-day blackout period on rentals of new DVD releases.
What does your search engine say about you? Well, if it's Bing, you're probably an early adopter, but you also visit, shop and ultimately make purchases from Walmart more than other search-engine users. Google searchers, on the other hand, are partial to Target and Amazon, and Yahoo searchers have a strong preference for wireless service from AT&T and Sprint.
Those entering the workforce now will likely make less and save more—not just in the short term but for the rest of their lives.
While the holidays are already ancient history to most marketers, the art of interpreting consumer spending patterns is just beginning, and a new study indicates that the relationship between online and in-store shopping is more closely connected than many retailers realize. While people want to buy online, they still want to shop in person, reports marketing agency Allen & Gerritsen, which polled 400 consumers during the week after Christmas. "Despite the increased usage of online retail sites during the holiday season, most people are still visiting actual stores for inspiration," Catherine Kolodij, VP/Audience Intelligence for A&G, tells tells Marketing Daily.
Call it 2010. Call it twenty-ten, or even 2K10. No matter how you refer to the last year of the first decade of the 21st Century, everyone in the marketing is wondering what the past few sobering years will mean for brands and consumer behavior. It doesn't take a seer, or even a branding professional, to declare that consumers will continue to demand value, no matter which direction the economy goes. Consumers have learned--some the hard way--that financial discipline is a must. They will also demand that the values practiced by the companies with which they choose to do business are good and honest and trustworthy. And lest any company thinks it can put one over on anyone, a text, a blog, a YouTube video or a Tweet will quickly prove otherwise.
How designers can influence behavior—and why they should.
As we’re learning, many updates on Twitter, Facebook and other social networks are actually invitations for answers regarding brands. We’ve also discovered that 44% of users readily share brand-related information with others. And, as action speaks louder than words, 48% of those who came into contact with a brand name on Twitter and 34% on other social networks went on to search for additional information on search engines. Does this information in and of itself serve as an invitation for brands to engage? Most likely not. The invitation is delivered in the monitoring dashboards of those actively monitoring relevant conversations. Opportunities reveal themselves and also introduce a point of entry.
Digital is so yesterday. It will soon be 20 years since the advent of commercially available digital services such as America Online, multimedia, mobile phones and widespread use of personal computers. The American household went digital long before marketers embraced technology and the Internet. Now, as companies struggle to get their "digital strategies" in order, they will be surprised to discover consumers have moved on to the "post-digital" age.
Women ages 20 to 30 represent a $54 billion marketing opportunity for packaged goods companies, but their needs and values are vastly different from the generation before them, a new report from Information Resources found. “Winning with Millennial Women Shoppers” outlines this growing consumer demographic’s key behaviors. Compared to the preceding generation, women born between 1979 and 1989 tend to shop less, buy more during each trip, and frequent supercenters and Walmart more. The economy has also forced these shoppers to cut back on indulgent food categories like frozen poultry, chewing gum, salty snacks and frozen pizza, the report said.
Fascinating, counterintuitive data coming out of a year-long consumer behavior study finds that Kraft, Coca-Cola and Tide are the three brands least likely to be traded for store brands. The study should worry name brand owners, since "only 37% of consumers say name brands are more reliable, and 39% believe name brands are better quality products." The data are edifying. Age breakdowns show consumers growing less brand loyal (and more price-conscious) as they get older. The huge numbers who are turning to private labels find Wal-Mart, Kroger, and Target to be the stores with the best selections.
Halloween may conjure up visions of shrieking kids in princess and skeleton costumes trick-or-treating door to door. But this popular holiday increasingly has morphed into a celebration by adults who buy a Dracula or sexy showgirl outfit and head to a party or club. The shift has accelerated over the past five to 10 years, ushering in a transformation in the Halloween industry, according to retail industry analysts and executives. More costume sales are going to adults, with some retailers saying the percentage of adult sales exceeds 50 percent. Nightclubs, restaurants and bars are throwing more Halloween parties and events.
I am a proud, flag-waving member of Generation X, the latchkey kids born between the early 1960s and late 1970s who listened to grunge music while worrying that we'd never make as much money as our parents. My children, 4 and 6, are part of the emerging Generation Z, a demographic too young to be stereotyped. In between are the mysterious creatures known as Generation Y. Born between the late 1970s and late 1990s, these so-called "millenials" intrigue me. As the first generation raised on the Internet, I suspect that they offer a glimpse into our future. They are more comfortable with technology than any other generation, they live at a faster pace, and yet they are more distracted. They mature slower, marry later, but use social networks to build large groups of friends. They have more choice and opportunity, and also more stress and anxiety as a result.
John Gerzema says there's an upside to the recent financial crisis -- the opportunity for positive change. Speaking at TEDxKC, he identifies four major cultural shifts driving new consumer behavior and shows how businesses are evolving to connect with thoughtful spending.
Disney will give free admission to its parks to 1 million people who complete a day of volunteer work. It's an amazingly smart marketing tactic, and it has strategic implications for every business should consider. In many ways, Disney is a unique case. Babies are born with the brand identity pre-programmed in their brains, which means that every human being walking the planet is likely to be aware of the brand and, unless they're active evildoers or otherwise twisted, associate it with at least the appearance of wholesome goodness. Disney has branding problems like the Earth has issues with rotation. The challenge is to get people to do something with all that awareness.
Given that innovation is the only sustainable advantage these days, advertisers need to allocate at least 10% of their marketing budget to foster it, even in these economically challenged times, said former eBay and Best Buy CMO Mike Linton, who spoke to an audience at the Aberdeen Group's Chief Marketing Officer Summit here yesterday. Innovation, by Mr. Linton's definition, is any action taken by the brand that changes consumer behavior in favor of the company, and that can range from a new product to a new way to service customers.
Karl and Dorsey Gude of East Lansing, Mich., can remember simpler mornings, not too long ago. They sat together and chatted as they ate breakfast. They read the newspaper and competed only with the television for the attention of their two teenage sons. That was so last century. Today, Mr. Gude wakes at around 6 a.m. to check his work e-mail and his Facebook and Twitter accounts. The two boys, Cole and Erik, start each morning with text messages, video games and Facebook.
If you are like many people, you enjoy chocolate and eat it frequently. That’s okay, you might think. After all, chocolate has antioxidants and it boosts your mood. Although this may be true, it is not the real reason why you eat chocolate: it is just a line of reasoning you follow to feel less guilty about eating something high in fat and sugar. People often rationalize in this way, telling themselves stories of sometimes dubious merit to justify their behavior. New work by Timothy Feddersen (Professor of Managerial Economics and Decision Sciences at the Kellogg School of Management) shows how rationalization—once studied mainly in psychology—impacts choices and can help economists understand why people make decisions that violate standard economic theories.
Imagine for a moment that you're standing on an overpass high above a busy L.A. freeway like the 405 or the 5. It doesn't really matter which. Pick one. In a span of a few minutes literally thousands of cars will speed buy. Some will be loud. Others quiet. Some will be notable, but most won't.
We frequently confuse internal biochemistry (caused by habits and genetics) with external events. If we didn't, marketing wouldn't work nearly as well. Our brains are busy processing chemicals that internally change our moods, but find a way to rationalize those mood changes based on events and purchases in the outside world. We often act as though money can buy joy, but of course, it works better when we're joyful in the first place.
Let’s face it: Your regular customers are on autopilot. When a purchase is repeated enough times, it becomes habit. However, market shifts can disrupt even the most powerful habits, and the current financial meltdown is the single biggest market disruption we’ve ever lived through. Customers are altering their behavior because of uncertainty about the future: laying off employees (maybe even your contacts), hoarding cash and postponing routine purchases. All purchase decisions are now up for conscious review. This is a daunting challenge, but it also creates opportunities.
While one in five American adults already has a smartphone, a new survey from Best Buy Mobile reports that everyone else is befuddled by all the choices.
As the worst downturn in decades drags on, penny-pinching Americans are drinking less in bars and restaurants and more at home. This presents a challenge for Diageo (DEO), the world's largest purveyor of spirits. When Americans kick back in the family room, they typically imbibe beer and wine, not the rum, vodka, whiskey, and gin that Diageo specializes in.
Sometimes people ask me why, say, McDonald’s or Coca-Cola or Nike bother to advertise at all. We’ve all heard of them, right? We’ve all decided whether or not we like them. So why waste the money? Here is my answer: Because the simple-sounding issue of salience is very important. And as backup I offer the abrupt return to popularity of Michael Jackson’s music.
Customer databases, which cull years of spending and behavioral information to try to boost conversion and revenue, have long been a staple for marketers in industries such as travel, hospitality, retail and financial. But what happens when a massive disruption -- say, a meltdown of the economy -- alters consumer behavior so dramatically that it renders historical data useless?
That's THE question to ask: Will our advertising effect consumer actions, and not simply awareness, perceptions and attitudes? But, there's a follow on question to ask: Once advertising has moved someone to experience our brand, will said experience cause them to change their habits? To become a "customer?"
The biggest challenge confronting marketers is how to deal with the Meineke mind-set consumers have adopted as a result of the recession.
Why does a diploma from Harvard cost $100,000 more than a similar piece of paper from City College? Why might a BMW cost $25,000 more than a Subaru WRX with equally fast acceleration? Why do “sophisticated” consumers demand 16-gigabyte iPhones and “fair trade” coffee from Starbucks? If you ask market researchers or advertising executives, you might hear about the difference between “rational” and “emotional” buying decisions, or about products falling into categories like “hedonic” or “utilitarian” or “positional.” But Geoffrey Miller, an evolutionary psychologist at the University of New Mexico, says that even the slickest minds on Madison Avenue are still in the prescientific dark ages.
Recent news coverage of the cosmetic name change from AIG to AIU at the failed company's New York headquarters reminds us that a brand is a precious asset. The value of any brand asset depends upon whether it has delivered on its past promises and is believed likely to do so in the future. It takes years of effort to build brand trust but only a few months—or minutes—to squander it. A brand that has lost consumer trust is no longer a brand; it is merely a name.
A few months ago, a friend sent me an otter. It was a birthday gift, and it arrived via Facebook: a tiny digital representation labeled “Lonely Otter.” The person who sent it to me is someone I’ve never met or spoken to, a friend only in the Facebook sense of the term. The otter cost her a dollar. The dollar was filtered through the popular social network’s “gift points” setup, but ultimately it wasn’t a representation, the way the Lonely Otter is. It was an actual dollar.
Two months into 2009 we're learning the first things about marketing strategies this year. And while there might be one global reason for a crisis it becomes more and more obvious that what's going on differs a lot from country to country, market to market. In Germany the first statistics on consumer and marketing behavior have been published. What is most striking is that current marketing thinking is not driven by consumer behavior but rather by internal company factors -- and marketers might be unwillingly firing up consumer crisis behavior.
If marketers and retailers are feeling at loose ends about how to adapt to consumer behavior, there's very good reason. Consumer attitudes are shifting noticeably within short time frames, heavily influenced by key events such as the financial meltdown of early October and the presidential election.