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Online Research Drives Offline Sales

Dawn Anfuso
Online Research Drives Offline Sales Dawn Anfuso
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Online product research conducted by consumers the past year drove $180.7 billion in offline spending, compared to $106.5 billion in direct online consumer spending, according to new research findings from The American Interactive Consumer Survey, conducted by The Dieringer Research Group [http://www.thedrg.com/].


The survey of 3,000 U.S. adults covered online and offline purchasing behaviors and impacts during the 12-month period ending the second quarter this year.


"The new annual spending data indicate that at least $1.70 is spent offline after doing online research for every consumer dollar spent directly online," says Thomas E. Miller, senior consultant at The Dieringer Research Group.


According to the research, nearly 15 percent of total U.S. retail spending (excluding gasoline, food services and inventories) is currently influenced altogether by the Internet, a much higher ratio than is commonly cited.


The study reinforces other findings released at the iMedia Brand Summit last month in Deer Valley, Utah. The MSN Media Accountability Study, conducted by MSN in conjunction with Rex Briggs of Marketing Evolution, analyzed the online component of ad campaigns conducted by Nestlé’s Coffee-Mate and Kraft’s Jell-o brands and found that online does indeed increase offline sales.


Dieringer's study also found that Internet-influenced offline spending is now growing faster than direct online spending. Internet-influenced offline sales grew 31 percent last year and direct online sales grew 14 percent, while total U.S. retail spending grew only 5 percent during the comparable period.


"The data confirm that the Internet's role as a consumer product information utility is much larger than its role as a direct selling medium," Miller says.


And retail numbers don't paint the full picture.


Technically, retail spending data does not capture all the ways in which the Internet impacts the U.S. consumer economy, according to The Dieringer Research Group research. For example, the survey also found that 17 percent of all U.S. consumers who opened new financial service accounts or took out new insurance policies the past year used the Internet in their product decision-making process.


"Those decisions by online consumers affected literally billions of dollars in financial services revenues, making the total dollar impact of online information far greater than anyone is talking about," says Miller.


The study findings have far reaching implications, from emphasizing the growing power of online advertising to drive offline traffic, to the importance of integrating branding, marketing as well as customer service messages across media channels.


The American Interactive Consumer Survey covers multi-channel consumer shopping and personal finance behaviors. The Dieringer Research Group has been conducting this annual survey since 1995.

At this stage of development, social media advertising lacks the standard metrics that have served as a primary advantage for online advertising. Online advertising as a form of direct-response advertising has measurability built into its very existence. Advertisers can measure reach (the number of people exposed to the message) and frequency (the average number of times someone is exposed), and analyze site stickiness (the ability of a site to draw repeat visits and to keep people on a site) and the relative pull of creative presentations (a comparison of the ability for different creative executions to generate response). They can also monitor click-throughs (the number of people exposed who click on an online ad or link), sales conversions (the number of people who click through who then purchase product), and view-throughs (the number of people who are exposed and do not click through but later visit the brand's website). These metrics are applicable to the use of display advertising in social spaces. If L'Oreal buys display ads on Facebook, all of these metrics are available to gauge effectiveness.


However, for the more innovative approaches available, metrics like number of unique visitors, page views, frequency of visits, average visit length, and click-through rates are either totally inappropriate or irrelevant, or simply fail to capture information about the objectives of a social media advertising campaign. Our tendency is to count -- count impressions, visitors, friends, posts, players. There is still a place for numbers in the social media arena, but the numbers may be different from the ones marketers have traditionally used -- and they may not be effective if not combined with more qualitative data.

Knowing the number of community members involved in brand-related conversations can serve as an indicator of exposure, and the number of message threads and lines of text within a thread can serve as proxies of conversation depth. However, counting does not capture the essence of the interaction consumers had with the brand, the degree of engagement felt during and after the interaction, or the effects of the interaction, exposure to brand messages, and brand engagement on measures like brand likability, brand image, brand awareness, brand loyalty, brand affiliation, congruency, and purchase intent. Jeep may have 8,500 MySpace friends, but the number does nothing to tell us how the friends feel about Jeep. An ARG may boast millions of players, but the sheer quantity of players does not reveal the success of the strategy.


To measure outcomes of social advertising, organizations must balance quantitative metrics with qualitative insights. Here's how to go about doing this.


1. Reviewing objectives
Step 1, reviewing the campaign objectives, assumes that the objectives were set prior to pursuing advertising opportunities in social media. Not all brands set formal objectives. Some are simply experimenting with social media, and for them, the experience of executing a campaign using emerging platforms is sufficient.


For most brands, though, failing to set clear objectives is a mistake. When it comes to assessing success, if there are no objectives, how do you know if where you ended up is where you wanted to be? The specific objectives identified can vary dramatically from brand to brand but usually encompass three overarching issues:



  1. Motivating some action like visits to a website or sales

  2. Affecting brand knowledge and attitudes

  3. Accomplishing the first two objectives with fewer resources than might be required with other advertising and promotional methods

2. Mapping the campaign
Step 2 calls for mapping all of the social media aspects of the advertising campaign. This activity results in a visual representation of the tactics used and how they may interact. Maps can be crude, simple drawings, but even a rough sketch can be valuable as brands seek to measure accomplishments in the social media space.


An effective map would display the types of branded messages produced and distributed (e.g., written vehicles like blog posts and white papers, ads in the form of display ads or rich-media video, and podcasts), invitations for consumer engagement with the brand (e.g., games, consumer-generated advertising contests and promotions, and interactive brand experiences), and the online location for these materials. It should also include online locations where others can go to distribute content relating to the brand. For instance, are there viral videos on YouTube that highlight the brand? Are there product reviews on sites like Epinions.com? Are there MySpace pages with brand icons and information posted? Are there bloggers writing about the brand? Are members of Delicious tagging the brand's website, and are Digg members voting for branded content?


Once all the sources of brand information are identified, the map should sketch out the chain of all possible touchpoints. A touchpoint is simply a contact point between the brand and the consumer.


MINI Cooper "touches" a consumer when someone visits the dealer showroom, visits the MINI website or one of its microsites, receives brochures and other promotional materials from the company, or brings a car in for service. These are all brand-controlled touchpoints, but many touchpoints that the brand does not control do exist, especially online.


In addition to the consumer-generated content that relates to the brand, there may be conversational touchpoints going on. Are people reading the blog postings (or even responding to blog posts) that mention the brand? Are people watching videos posted on sites like YouTube? Are they voting for content on Digg? In other words, is the media (whether brand-generated or consumer-generated) being consumed by those it reaches and is it being "fortified"? Ultimately, the map should show four levels of contact:



  1. Brand-generated content

  2. Consumer-generated content

  3. Consumer-fortified content

  4. Exposures to content consumers

3. Choosing criteria and tools of measurement
In step 3, the criteria for assessing effectiveness are determined, and the tools necessary for measurement are selected. The objectives and the map should direct both the identification of criteria and the best tools for measurement.


For example, imagine that you seek to develop brand awareness for a new product. You also want to drive traffic to the product website and reinforce the brand's image. The brand enters the social media space with an advertising campaign, which also includes traditional media components. The brand website and its microsites would be sketched on a social media map, along with other tactics, like a celebrity MySpace profile (featuring your brand as a sponsor).


What criteria and tools then should you use to evaluate success of these techniques? Your campaign objectives emphasized a desire to:



  1. Build awareness of the new product

  2. Drive visits to the websites

  3. Strengthen the brand image

Objective 2 is easily addressed with traditional website metrics and measurement tools. The brand site and microsites can track hits, page views, and unique visitors; if the sites enable registration, then registrants can also be tracked. Organic search engine rankings can also be assessed for the brand name and its slogans.


Awareness (objective 1) can be suggested with website traffic and traffic to other branded components. For instance, your celebrity endorser's MySpace profile will have friends, some of whom will fortify the profile with comments. Awareness can also be suggested with brand mentions in other online spaces. You might ask, "Is the brand being talked about? If so, how much, and where?"


The criteria for answering these questions are straightforward. One simply needs to identify evidence of the brand in online conversations and publications, get a count of those occurrences, and note the source of the material. The tools necessary for this could include a virtual version of a clipping service to determine what is being said about the brand and the brand's competition online. This can be an in-house project, or outsourced to companies like CyberAlert, which can then monitor specific publications or the entire internet for brand mentions. Collecting brand mentions in-house can be accomplished with tools like Google Alerts. These tools can provide a count of mentions, and the sources, but they should be combined with other tools to determine whether the communication was positive, negative, or neutral for the brand.


Next you might ask, "How many people are exposed to these third-party messages?" To assess the impact of these brand mentions across the web, one can turn to companies that measure the size of a site's audience. Media Metrix, Nielsen NetRatings, and comScore offer measurement services that include hits, unique visitors, and page views for sites. Such assessments will need to consider all the locations of postings mentioning the brand and the audiences for each location.


In our example, you also set out to strengthen your brand's image (objective 3). This can be influenced by what the target audience thinks and feels about the branding for the campaign. Is the audience engaged with the interactive games you are using? Is your association strategy using celebrity endorsers effectively? Does the audience feel that the quiz and the recommendations included in the quiz's answers enable your brand to symbolize their own self images? The campaign itself will influence the brand's image. You could use primary research in the form of surveys and focus groups to answer these questions.

4. Establishing a benchmark
For all of the criteria and measurement tools you have chosen in step 3, to apply them effectively to your brand, you need to move to step 4 and set benchmarks, which will give you goals to reach so you can determine if your campaign is on the right track or if changes are necessary.


Assuming you are employing a combination of quantitative and qualitative measurement tools, your benchmarks will most likely consist of not only traditional quantitative measures -- such as a set number of unique visitors -- but also more qualitative metrics -- such as positive focus group feedback indicating heightened brand awareness. Then you can use the data you collect from the measurement tools to observe as you get closer and closer to reaching those benchmarks.


5. Analyzing the outcomes and proposing changes
After selecting your measurement tools and the benchmarks you are striving for, step 5 is to analyze the data you collect using your measurement tools, compare the data versus your benchmark, and, if you determine that your campaign is falling short of reaching your goals, propose active changes that might help you attain those goals.


6. Continuing to measure
While it may seem like your job is done once you've measured your success versus your benchmark, the work is far from over. Measuring should be a regular, continual part of your social media campaign -- so really, step 6 never ends.


Setting regular intervals of measurement (daily, weekly, monthly, quarterly, or annually, depending on the type of metrics chosen and the campaign's needs) can help maintain discipline in this regard, and continuous measurement can also help you assess consumer reaction to any changes that are instituted mid-campaign.


Daz Connell is CEO of DAZMedia, and Cheryl Dandrea is senior scientific editor for DAZ's healthcare agency division.


On Twitter? Follow iMedia Connection at @iMediaTweet.

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