Less than 1% of online purchases come from social channels

The people of media world are still living the hype of social media. But research shows that social media and tactics is a barely negligible source of sails for either new or repeat customers. Fewer than 1% of transactions could be traced to trackable social links.

Thirty-nine percent of online retail transactions by new customers start with clicks from paid or organic search results and less than 1% come from social channels according to a new Forrester report. "In spite of changes to the interactive marketing landscape and the growing number of shoppers using mobile and tablet devices to access content, core elements of web marketing continue to be effective," writes Forrester Analyst Sucharita Mulpuru.

In order to determine how and when shoppers touch various platforms when completing a transaction online, Forrester partnered with GSI Commerce to examine 77,000 consumer orders made over a period of 14 days in April 2012. Findings in the report include:

Multiple platforms influence many buyers. While 33% of transactions by new customers involve more than one trackable touchpoint, 48% of repeat customers visit multiple trackable touchpoints. The most popular platforms include organic search, paid search, and email.

Email and direct traffic matter for frequent customers. Thirty percent of transactions by repeat customers start with an email from the retailer, and an additional 30% type the retailer's URL directly into a browser.

Social tactics are not meaningful sales drivers. Forty-eight percent of consumers reported that social media posts are a great way to discover new products, brands, trends, or retailers, but less than 1% of transactions could be traced back to trackable social links.

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Less than 1% of online purchases come from social channels

When Do Consumers Make Different Conclusions about the Same Product?

Depending on which naive theory consumers use, a low price can indicate either good value or low quality, whereas a high price may imply either poor value or high quality, according to a new study in the Journal of Consumer Research.

“Consumers rarely have complete information and use various strategies to fill the gaps in their knowledge as they consider and choose products. One of these strategies involves using naive theories: informal, common sense, explanations that consumers use to make sense of their environment. For example, consumers may believe that popular products are high in quality while also believing that scarce products are high in quality,” write authors Hélène Deval (Dalhousie University), Susan P. Mantel (Ball State University), Frank R. Kardes (University of Cincinnati), and Steven S. Posavac (Vanderbilt University).

In one study, consumers were shown an ad for a bottle of wine with either a high or low price. When subtly reminded of quality, consumers evaluated the expensive wine more favorably than the cheap wine. However, when subtly reminded of value, they rated the cheap wine more favorably.

Sales promotions succeed when consumers perceive that they are getting a good deal, but they can also backfire if consumers perceive that lower prices indicate poor quality. Or, as J.C. Penney recently discovered, a company may implement an everyday low-pricing strategy that manages to reduce brand value and alienate consumers if many of them believe that low prices equal low quality. Over the years, J.C. Penney customers had become so used to sales that they no longer believed they were getting a good deal.

“Using subtle tactics, companies can bring a pre-existing naive theory to the consumer’s mind in order to guide favorable interpretation of their message. Yet, these tactics can backfire dramatically if they design a strategy by assuming that a certain naive theory is going to drive consumer evaluation and choice when, in fact, several naive theories are available to the consumer,” the authors conclude. 

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When Do Consumers Make Different Conclusions about the Same Product?

When Do Consumers Compare Experience over Value?

Consumers are often less satisfied when they buy or receive products that are easily counted because this makes them focus on value instead of experience, according to a new study in the Journal of Consumer Research.
“Numbers make us feel more certain of what is in front of us. When we count, we understand exactly how big, expensive, heavy, or old something is. But when we buy or receive products that are easily counted, we may be less satisfied,” write authors Jingjing Ma and Neal J. Roese (both Kellogg School of Management, Northwestern University).
What happens when consumers are compensated with gifts such as a toaster or a winter coat instead of cash? If two consumers receive the same dollar value, it shouldn’t matter if it comes in the form of gifts or cash. But it does matter.
In one study, the authors rewarded consumers with either cash or slices of cake. Predictably, consumers who received more cash were happy with the outcome while those getting less cash were upset. But whether people received more or less cake didn’t affect their satisfaction nearly as much. Because the cake slices were less easily counted, people were just as happy with less as with more. When consumers received a slice of cake, they were more likely to focus on how delicious their cake is and ignore how much cake others received.
Another study showed that when people miss out on a deal, they are more upset when that deal was countable (buy one, get one free) rather than uncountable (get a larger bottle at the regular price). This suggests that programs offering rewards that can be easily counted such as airline frequent flyer miles may be less satisfying to consumers than less easily counted reward programs such as those offering free products or vacation packages.
“Countability drives comparisons. When rewards are easily counted, people are more likely to compare themselves with others. But when rewards are less easily counted, people focus mostly on the unique aspects of their own experience,” the authors conclude. 

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When Do Consumers Compare Experience over Value?

Reminders of Money Impact Consumer Decision- Making

When reminded of money (not cost), consumers are more likely to evaluate a new product based on its primary features or brand name, according to a new study in the Journal of Consumer Research.
“Money and symbols of money are ubiquitous in our daily consumer environment, and money is linked to social resources such as security, status, power, confidence, and freedom. Mere reminders of money have the potential to signal confidence and strength and thereby impact consumers when making decisions,” write authors Jochim Hansen (University of Salzburg), Florian Kutzner (University of Heidelberg), and Michaela Wänke (University of Mannheim).
Consumers encounter money or symbols of money all the time. We earn, save, spend, or possibly lose money. We physically handle bills and coins. We are reminded of money by proverbs (e.g., A penny saved is a penny earned), songs (e.g., Money, Money, Money), and movie titles (e.g., The Color of Money). Given the importance of money in our lives, it is important to understand the psychological implications of such frequent reminders of money.
In a series of studies, the authors found that reminders of money caused consumers to think more abstractly and focus on the primary features of a product instead of its secondary features. For example, we might wonder if a television has great picture or sound quality and not pay any attention to the warranty. Or we might think about whether a yogurt is healthy or tasty but ignore the package design. Additionally, consumers reminded of money are more likely to evaluate a new product based on its brand name instead of its individual features. For example, we might think that a new bike by Mercedes must be good because Mercedes is a good brand and ignore its actual features.
“Our studies show that reminders of money influence consumer decision-making. Consumers should keep this in mind when choosing products, because they may overlook certain features when reminded of money,” the authors conclude. 

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Reminders of Money Impact Consumer Decision- Making

In the Blink of an Eye: Distracted Consumers Are Most Likely to Remember Ads with Subtle Variations

Consumers are more likely to remember an ad they’ve seen repeatedly if one element in the ad changes location from one exposure to the next, according to a new study in the Journal of Consumer Research.
“Consumers are bombarded with thousands of advertisements daily, are increasingly multitasking, and are preoccupied with everyday activities. The likelihood that they will devote their full attention to any one specific message is getting smaller every day. What impact can an ad have if consumers pay virtually no attention to it?” write authors Stewart Shapiro (University of Delaware) and Jesper H. Nielsen (University of Arizona).
Even when consumers pay very limited attention, advertising can succeed through repetition. When consumers are exposed to a print ad, an image of the ad is stored in their memory and this image becomes clearer with each exposure to the ad. As this memory becomes clearer, preference for the ad increases. Notably, this occurs even if prior exposures to the ad are extremely brief and a consumer devotes much of their attention to something other than the ad.
In a series of experiments, the authors found that this effect may actually be enhanced if one ad element such as the brand logo or product depiction changes location within an ad from one exposure to the next. Under conditions of limited attention, making subtle changes to an ad over repeated exposures may in fact be better than repeating the exact same ad or altering more ad elements from one exposure to the next. For instance, a company could create a more effective ad by placing their brand logo in the bottom left corner the first time it is shown, and then placing it in the bottom right corner of the otherwise unchanged ad the next time it is shown.
“Companies are still learning how to make the most of advertisements that are viewed quickly as a consumer searches for something else on a web page or in a magazine. Subtle changes to ads viewed repeatedly can boost advertising effectiveness in increasingly cluttered environments visited by increasingly unfocused consumers,” the authors conclude. 

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In the Blink of an Eye: Distracted Consumers Are Most Likely to Remember Ads with Subtle Variations

The Mobile Imperative

Key insight report - More than a marketing channel from TNS

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The Mobile Imperative

The end of stock market crashes?

A 72-year study of the Dow Jones could help avoid the kind of stock market crash that struck the world economy in 2008.

Professor Tobias Preis has led a study of the second oldest US market index and discovered that a portfolio of shares, far from being diverse and spreading risk during a time of stock market slump, start behaving the same.

This new study has been carried out in collaboration with Dr. Dror Y. Kenett (Boston University, USA), Prof. H. Eugene Stanley (Boston University, USA), Prof. Dirk Helbing (ETH Zurich, Switzerland), and Prof. Eshel Ben-Jacob (Tel-Aviv University, Israel).

In their paper entitled Quantifying the Behaviour of Stock Correlations Under Market Stress, Professor Preis reveals that the 'diversification effect' that protects a portfolio of shares through the vagaries of the stock market disappears when there is a general slump in the market.

Professor Preis believes this pattern can be used to anticipate 'diversification breakdown' in share portfolios and allow investors to steer away from a major crash by spreading their investments elsewhere or 'hedge' their money.

It could help traders avoid the major crashes that hit stock markets in 2008. Between September and December four of the five biggest daily falls in the Dow Jones hit the US stock exchange. It was part of one of the biggest stock market crashes and led to the economic recession most of the world is still suffering.

Professor Preis, who is associate professor of behavioural science and finance at Warwick Business School, which is part of The University of Warwick, said: "We analysed the daily closing prices of the 30 stocks forming the Dow Jones Industrial Average from March 15, 1939, to December 31, 2010. Our results also shed light on why correlation risks in mortgage bundles were underestimated at the beginning of the recent financial crisis."

The results of this study, published in Scientific Reports, provide crucial information on the behaviour of markets in times of stress.

"We found a striking result," said Dr Kenett. "The average correlation between these stocks increases at the same rate as market stress. Consequently the diversification effect, which should protect a portfolio, melts away in times of market losses, just when it would be needed most."

Their research has important applicative implications.

"We could use this to anticipate diversification breakdowns, which could guide the design of portfolios and contribute to the increased stability of the financial markets." says Professor Preis.

The German physicist, who founded Artemis Capital Asset Management, believes the data he has collected from 72 years of Dow Jones closing prices can be used to help portfolios steer clear of stock market crashes.

Professor Preis said: "When financial markets are suffering significant losses our findings could be used to anticipate the increasing lack of diversification in portfolios. This would enable a more accurate assessment of the risk of making losses."

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The end of stock market crashes?

Do Attractive People Have Attractive Traits and Values?

We’ve all been warned not to “judge a book by its cover,” but inevitably we do it anyway. It’s difficult to resist the temptation of assuming that a person’s outward appearance reflects something meaningful about his or her inner personality.

Indeed, research shows that people tend to perceive attractive adults as more social, successful, and well-adjusted than less attractive adults, a phenomenon that’s been termed the “what is beautiful is good” stereotype.

But could that really be true? Are physically attractive people really just as attractive on the inside as they are on the outside?

In a new article published in Psychological Science, a journal of the Association for Psychological Science, Lihi Segal-Caspi and Sonia Roccas of the Open University and Lilach Sagiv of The Hebrew University of Jerusalem investigated whether the “what is beautiful is good” stereotype holds up in the real world.

The researchers examined how traits, which describe what people are like, and values, which describe what people consider important, might be related to physical attractiveness.

Segal-Caspi and colleagues hypothesized that outside observers would perceive attractive women as more likely to have socially desirable personality traits than less attractive women. Specifically, they hypothesized that observers would judge attractive women to be more agreeable, extraverted, conscientious, open to experiences, and emotionally stable than less attractive women. They hypothesized that no such correlation would be found between women’s attractiveness and their perceived values, since judgments about what constitutes a “good” value are likely to vary from observer to observer.

The researchers recruited 118 university students to serve as “targets” or “judges.” The targets completed surveys about their values and their traits. They were then videotaped entering a room, walking around a table looking at the camera, reading a weather forecast, and leaving the room. Each judge saw a videotape of a different target, chosen at random, and evaluated the target’s values and traits and then her attractiveness, along with other physical attributes.

Women who were rated as attractive were perceived as having more socially desirable personality traits, such as extraversion, openness to experience, and conscientiousness, just as the researchers hypothesized. Out of the ten types of values, however, only one was thought to be associated with attractiveness: Attractive women were perceived as more likely to value achievement than less attractive women.

But when the researchers looked at the targets’ actual self-reported traits and values, they found the opposite relationships. Targets’ attractiveness, as rated by the judges, was associated with with their self-reported values and not with their personality traits. Women who were rated as attractive were more likely to endorse values focused on conformity and submission to social expectations and self-promotion.

Segal-Caspi and colleagues conclude that although some people may think beauty and goodness go together, the results from this study indicate that beautiful people may tend to focus more on conformity and self-promotion than independence and tolerance.

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Do Attractive People Have Attractive Traits and Values?

Pushing Buttons & Pulling Triggers: Using Psychology to Connect with People and Create Value

Pushing Buttons & Pulling Triggers: Using Psychology to Connect with People and Create Value from Kelsey Ruger

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Pushing Buttons & Pulling Triggers: Using Psychology to Connect with People and Create Value

Accenture: Six ways to make volatility your friend.

Special Report
Corporate agility
Six ways to make
volatility your friend

Among the highlights:

"Twelve-point agility checklist

1. Does your organization have at least three scenarios for how your industry is most likely to evolve over the next 36 months? Does it have good options for responding?
   
2. What three big opportunities would your company be pursuing if it were more agile?
   
3. Imagine three possible sources of competition that you haven’t thought would be likely until now. How will you respond to them?
   
4. Put yourself in your top competitors’ shoes. What could they do to disrupt the market in the next year, and what are your plans for outsmarting them?
   
5. How is your company augmenting its ability to quickly sense new market anomalies? Are you taking full advantage of the new capabilities of today’s analytics tools?
   
6. What are the three biggest factors preventing your organization from being more agile? How do you plan to overcome them?
   
7. Did you make such big cuts during the recession (particularly in terms of talent) that your agility and ability to grow have been damaged? If so, how are you compensating now for those cuts?
   
8. In what areas should you be collaborating with your competitors to drive changes in the market?
   
9. Who among your organization’s new leaders will be most effective at taking advantage of volatility? What makes them different from your longtime leaders?
   
10. Which of your customers are the best leading indicators of future market opportunities?
    
11. Where would faster decision making be of most benefit to your company?
    
12. Have you been able to cut your company’s fixed costs in the past few years to improve its agility?"

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Accenture: Six ways to make volatility your friend.

Empower your fans to take over your advertising

How to empower your fans to take over your advertising from iMedia Connection on Vimeo.o

Empower your fans to take over your advertising

Retail Trends For 2013 And Beyond

Retail trends 2013 from MAgnus Ohlsson

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Retail Trends For 2013 And Beyond

Retail's High Tech Future

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Retail's High Tech Future

Untapped Potential: Advertising in Mobile Publications

Untapped Potential: Advertising in Mobile... by advertisingweeko

Untapped Potential: Advertising in Mobile Publications

Our Preferences Change to Reflect the Choices We Make, Even Three Years Later

You’re in a store, trying to choose between similar shirts, one blue and one green. You don’t feel strongly about one over the other, but eventually you decide to buy the green one. You leave the store and a market researcher asks you about your purchase and which shirt you prefer. Chances are that you’d say you prefer the green one, the shirt you actually chose. As it turns out, this choice-induced preference isn’t limited to shirts. Whether we’re choosing between presidential candidates or household objects, research shows that we come to place more value on the options we chose and less value on the options we rejected.

One way of explaining this effect is through the idea of cognitive dissonance. Making a selection between two options that we feel pretty much the same about creates a sense of dissonance – after all, how can we choose if we don’t really prefer one option over the other? Re-evaluating the options after we’ve made our choice may be a way of resolving this dissonance.

This phenomenon has been demonstrated in numerous studies, but the studies have only examined preference change shortly after participants make their decision. Existing research doesn’t address whether these changes in preference are actually stable over time.

In a new article published in Psychological Science, researcher Tali Sharot of University College London and her colleagues examine whether choice-induced changes in preference are fleeting or long-lasting.

The researchers asked 39 undergraduate participants to rate the desirability of 80 different vacation destinations, rating how happy they think they would be if they were to vacation at that location. They were then presented with pairs of similar vacation destinations and asked to choose which destination they would prefer. The participants rated the destinations again immediately after making their choices and once more three years later.

To test whether a sense of agency over the decision makes a difference for choice-induced changes in preference, the researchers looked at participants’ preferences when the participants made the choices themselves and when a computer instructed the participants’ choices.

The results suggest that the act of choosing between two similar options can lead to enduring changes in preference. Participants rated vacation destinations as more desirable both immediately after choosing them and again three years later. This change only occurred, however, if they had made the original choice themselves. The researchers observed no change in participants’ preferences when the computer instructed their choices.

Sharot and her colleagues argue that fact that this effect is robust and enduring has implications for a diverse array of fields, including economics, marketing, and even interpersonal relationships. As Sharot points out, for example, repeatedly endorsing a particular political party may entrench this preference for a long period of time.

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Our Preferences Change to Reflect the Choices We Make, Even Three Years Later

Special K Tweet Shop

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Special K Tweet Shop