Category market research

Allocating Marketing and Communications Spend Using the 70|20|10 Approach

Photo credit: Daniel Spiess on Flickr.

Nearly every week it seems like there is either a new hot social networking site or an existing one changes the way that it does business in an effort to get more users to spend more time on the site.

With all the buzz that these sites get, it would be easy for some brands to get caught up in all the hype and invest precious resources to chase the next shiny object.

Other brands may fear change and opt to take a wait and see approach.

However, if they wait too long before they decide to invest in the newest ways to reach potential customers, they will be left behind.

While the smartest experts do suggest trying new things, the best advice that they can give is to take a disciplined approach.

This involves allocating some of a brand’s marketing and communications budget to new things, while constantly monitoring the effectiveness of all their marketing and communications spend in an effort to maximize their return on investment.

The 70|20|10 Approach

In Changing Channels with Confidence: A Structure for Innovation, a Millward Brown white paper written a few years ago, Duncan Southgate, Global Brand Director, Digital, and John Svendsen, Global Brand Director, Media, suggest that brands should take an approach similar to the one that Coca-Cola implemented in 2011.

In the white paper, Jonathon Mildenhall, Vice President of Global Advertising Strategy and Content Excellence at the Coca-Cola Company explains that Coca-Cola planned to apportion 70% of its communication spend to support low-risk, “bread-and-butter” content, 20% to innovate based on what worked in the past, and 10% to experiment with brand-new ideas.

According to the white paper, Millward Brown thinks that this is a winning strategy and started recommending it to its clients.

However, they also emphasize the importance of measuring and optimizing based on the data collected.

In other words, what is considered the “bread-and-butter” content will change as time goes by.

“But to say that 70% of the budget should fund communications in channels that are considered to be safe, familiar, and effective is not to say that 70% of a media budget should remain static from year to year,” the authors of the white paper write. “Based on ongoing learning and evolving brand objectives, channel composition within the 70% could vary significantly over time and from campaign to campaign.”

Final Thoughts

The media landscape is rapidly changing.

Brands that don’t adapt to these changes will get left behind.

However, constantly moving all of their marketing and communications dollars into what is next isn’t the correct approach, either.

As the white paper from Millward Brown suggests, the 70 | 20 | 10 approach is probably the best way to keep up with these changes in a way that will help the brand succeed in the future, while continuing to be successful today.

It is also important to remember that some of the things that are experimental today will become the “bread-and-butter” content in the future.

It is therefore important to monitor and measure what is working and optimize based on what the data is telling you.

Photo credit: Daniel Spiess on Flickr.

Chad Thiele

Marketing analyst and strategist, content curator, applied sociologist, proud UW-Madison alumnus, and an Auburn-trained mobile marketer. My goal is to help businesses identify trends that will help them achieve their marketing objectives and business goals. I'm currently looking for my next career challenge. Please feel free to contact me anytime at: chadjthiele@gmail.com.

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Your Customers Want a Better Mobile Shopping Experience

Photo credit: gail on Flickr.

It should now be clear that mobile devices are going to play a huge role in how customers research, search for, and buy products for the foreseeable future. This is a fact that we have known for a few years now.

However, while more businesses are starting to make investments in mobile, several studies have made it abundantly clear that we are a long way from getting it right.

Part of the issue is the complexity of the shopping experience and the role that mobile devices currently play.

In order to get mobile marketing right you need to think about a lot of things, many that extend beyond the mobile device itself.

Many marketers are still trying to use their traditional ways of advertising to people without taking into account what is happening all around consumers as they interact with the brand on their mobile devices while out and about in the offline world.

Therefore, it’s not surprising that many businesses haven’t had much luck with their mobile marketing efforts.

In fact, according to the recent “CMO Survey Report” sponsored by Deloitte, the American Marketing Association, and The Fuqua School of Business at Duke University, most responding CMOs do not feel that mobile marketing currently makes a substantial contribution to their company’s bottom line. In fact, 40% said that mobile marketing makes no contribution at all. (Note: I would argue that measurement is partially to blame for these responses.)

As time goes on, brands and retailers will start to listen to customers and give them more of what they want and need. When this happens, we will not only see more happy customers, but a better return on investment for the businesses that use mobile devices to properly communicate with their customers and prospects while they are interacting with the brand in other ways.

Why Customers Don’t Shop on Mobile Devices

As I have pointed out in the last few posts, most retail transactions still take place in a brick-and-mortar store and about two-thirds of e-commerce transactions still take place on a desktop.

A recent GfK study that was commissioned by Facebook IQ has some insights into why omni-channel shoppers (those that research and bought items via a variety of channels including smartphones, tablets, desktop computers, and in brick-and-mortar stores) aren’t currently shopping on their mobile devices.

When omni-channel shoppers were asked why they shopped on a desktop vs. a mobile device, 56% said that it is easier to see all the available products on a desktop, 55% find it easier to use devices with bigger screens, 27% said that they find it difficult to compare products and retailers via a smartphone or tablet, and 26% said entering personal data is not very user friendly on a smartphone or tablet.

All these responses indicate that brands and retailers need to improve the User Experience (UX) of their mobile apps and websites. Even the responses that have to do with the size of the screen can be improved with better design.

When looking at why omni-channel shoppers chose to shop in a brick-and-mortar store vs. mobile, 47% said they like to touch and feel the products, 46% said that they don’t want to wait, 41% said that the shipping costs too much, and 25% said that in-store shopping is relaxing/enjoyable.

Two of the issues here can be fixed with shortening the time it takes to ship the product and by offering reduced-priced or free shipping to customers.

However, the other two issues really aren’t issues at all. They are actually opportunities that brands and retailers can take advantage of.

Thinking About the Whole Customer Shopping Experience—Both Online and Offline

As mentioned in the past, Forrester Research estimates that 49 percent of total sales in 2016 will be influenced by online interactions.

Many of these interactions will happen on a mobile device when a customer is in your store.

Brands and retailers need to be thinking about everything that a consumer wants and needs when they are making a decision to buy a product or service. This includes the interactions that consumers are having with your brand offline and via a mobile device. Each of these can reinforce the other and make them more effective than they would be alone.

In a recent post on the iMedia Connections blog, Jeff Hasen, Mobile Strategist and Founder of Gotta Mobilize, highlights the fact that businesses haven’t caught up with the times.

In the post, Jeff Hasen quotes Martin Sorrell, chief executive of the advertising group WPP.

“The essential problem is that big companies are not thinking about mobile in the right way,” Sorrell is quoted as saying. “They’re thinking of it as an extension of digital, just a way to reach consumers. They’re not thinking of it in a way that changes their businesses or adds values in a way they weren’t able to do previously.”

Final Thoughts

Mobile devices are changing the way that consumers live their lives. This includes the way that they shop for products and services.

This is something that experts will be talking about for a long time. And, for good reason.

Businesses need to adapt to these changes. Those that do it first will succeed. Those that don’t will be forced to follow, because their customers and prospects will demand it.

Photo credit: gail on Flickr.

Chad Thiele

Marketing analyst and strategist, content curator, applied sociologist, proud UW-Madison alumnus, and an Auburn-trained mobile marketer. My goal is to help businesses identify trends that will help them achieve their marketing objectives and business goals. I'm currently looking for my next career challenge. Please feel free to contact me anytime at: chadjthiele@gmail.com.

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More Evidence That Smartphones Are Key to Success in an Omnichannel Retail World

Photo credit: Sharon Hahn Darlin on Flickr.The role that mobile devices play in retail continues to grow. Not only are consumers using mobile devices to research products and get recommendations, a growing number of transactions are being completed on mobile.

According to a recent press release, Criteo’s “Q4 2015 State of Mobile Commerce Report” found that about four in 10 online transactions in the United States occur across multiple devices or channels. Furthermore, close to one-third of e-commerce transactions actually are completed on a mobile device.

This is particularly important given the fact that according to the U.S. Census Bureau, “E-commerce sales in the fourth quarter of 2015 accounted for 7.5 percent of total sales.” And, as I pointed out in the last post, Forrester Research predicts that within the next 10 to 15 years, e-commerce could account for as much as 25 percent of total sales.

Moreover, as alluded to above, mobile devices are impacting offline sales as well, as consumers use their smartphones and tablets to research and get recommendations about products online before or even during a shopping trip at a brick-and-mortar store.

Mobile Influences the Offline Transaction

As a recent article on the Mobile Commerce Daily website points out, “More than $1 trillion of total retail sales in 2015 were influenced by mobile phones, with most of this coming from in-store transactions and further growth expected, according to a new report from Forrester Research.”

The article goes on to point out that Forrester Research expects web-influenced sales with grow to $1.3 trillion in 2016 and reach $1.6 trillion by 2020. To put it a different way, web-influenced sales will account for 49 percent of the total sales in 2016 and reach 55 percent of total sales by 2020.

The article also points out that this trend is being fueled by larger smartphones and faster wireless networks. Furthermore, the fact that search engines are providing ways for consumers to find the information that they need quickly via their smartphones is also a factor.

It’s not surprising that more retailers and brands are looking for ways to advertise and engage with consumers on their mobile devices. Those that don’t are going to be left behind.

A Majority of Mobile Transactions Are Conducted Via a Smartphone

As I already pointed out, most retail sales still take place offline.

However, the percentage of sales conducted online continues to grow, with nearly a third of these online transactions actually taking place via a mobile device.

According to the Criteo report mentioned earlier, 60 percent of sales that take place on mobile devices are completed via a smartphone.

It is important to note that tablets drove higher value sales than smartphones.

However, 43 percent of tablet shoppers used multiple devices in their shopping journey. This means that in addition to the desktop, smartphones are important even when the final sale is conducted via a tablet.

Final Thoughts

In an omnichannel retail world, the path to purchase can take many twists and turns along the way.

A consumer could research, check for product reviews and recommendations, and purchase a product after interacting with the brand and/or retailer online via a desktop computer, tablet, smartphone, and/or offline at a brick-and-mortar store or kiosk.

Therefore, it is important to give consumers the information that they need when and how they want it and allow them to purchase from you when and how they want to.

As mentioned, the offline store is still going to be the most common way for consumers to purchase products for the foreseeable future. However, as this post points out, the smartphone is going to play an ever-increasing role in determining what will be purchased and where that sale will take place.

Photo credit: Sharon Hahn Darlin on Flickr.

Chad Thiele

Marketing analyst and strategist, content curator, applied sociologist, proud UW-Madison alumnus, and an Auburn-trained mobile marketer. My goal is to help businesses identify trends that will help them achieve their marketing objectives and business goals. I'm currently looking for my next career challenge. Please feel free to contact me anytime at: chadjthiele@gmail.com.

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Why Brands Shouldn’t Wait to Invest in Mobile Marketing

Photo credit: Audio-Technica on Flickr.If your brand hasn’t allocated at least some of its marketing budget to mobile, it is missing out on a huge opportunity.

Even brands that have taken a wait and see approach to mobile marketing are starting to see the value that mobile brings to the table.

In fact, according to a recent eMarketer article, this year more businesses are planning to invest in mobile advertising than ever before.

However, it’s not that businesses will be spending significantly less to reach consumers on their desktops. In fact, while the amount spent this year on ads targeting users on desktops is projected to be slightly less than it was in 2015, eMarketer is reporting that this number should rebound in the next few years.

That said, the amount of money budgeted for mobile advertising is projected to skyrocket.

And, it’s not surprising given the fact that according to an article published on Forbes.com in August of 2015, a majority of online content is now consumed on mobile devices.

This same article also pointed out that mobile ads have reach, as most U.S. adults currently have mobile phones and/or tablets.

Not only that, people are three times more likely to open a mobile ad than a desktop ad.

Furthermore, mobile ads are “ridiculously cheap.”

According to the Forbes.com article, “Mobile brands have underinvested in this area, and prices haven’t caught up yet. Compared to the cost of traditional advertising streams, mobile ads are a bargain. TV and print ads’ CPM is $100, while online CPM hovers around $3.50. Mobile CPM, on the other hand, can be as low as 75 cents.”

Final Thoughts

Mobile ads are currently more likely to be opened than ads targeting consumers on their desktops.

And, mobile ads are currently relatively inexpensive, when compared to ads targeting consumers via other marketing channels (e.g., television, print, desktop, etc.)

That said, this is likely to change as more businesses start to target consumers on their mobile devices.

The increased competition is likely to drive the costs up. And, if consumers get bombarded with ads on mobile devices, the open rates are probably going to decrease somewhat.

This is not to say that mobile will lose its value—the fact that so many people consume content on mobile devices, combined with the added ability to target customers and prospects when they are most likely to purchase your product or service is what makes mobile advertising so desirable.

With the right planning, mobile advertising is going to continue to be a very effective way to reach consumers.

However, it doesn’t pay to wait.

Brands that are currently using mobile are not only benefiting from less competition, they are also learning what works and what doesn’t.

This will give these brands the knowledge to succeed when the level of competition increases.

Photo credit: Audio-Technica on Flickr.

Chad Thiele

Marketing analyst and strategist, content curator, applied sociologist, proud UW-Madison alumnus, and an Auburn-trained mobile marketer. My goal is to help businesses identify trends that will help them achieve their marketing objectives and business goals. I'm currently looking for my next career challenge. Please feel free to contact me anytime at: chadjthiele@gmail.com.

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Six More Things That Will Influence Business in 2016

Photo credit: Vestman on Flickr.From the buzz on the Internet, it would be easy to guess that 2016 will be the year of mobile or the year of the Internet of Things.

I’d argue that it is going to be the decade of mobile or the decade of the Internet of Things. I’d even venture a guess that it might be the millennium of mobile or the millennium of the Internet of Things. But, who knows what cool stuff will be invented a few decades from now.

With this in mind, I am not going to say that this is the year of anything.

However, I do think that there are several things that are worthy of watching in 2016.

The List of Things That Will Influence Business

I’ve been updating this list for a few years.

Most of the items on my past lists are still worthy of keeping an eye on.

Here is a list of some of the things I have been watching in the last few years with the year they were added to the list:

1) Rapid Advancements in Technology [2013]

2) Mobile (User Experience and Marketing) [2013]

3) Mobile Payments [2013]

4) Mobile-Influenced Merchandising [2013]

5) Privacy Issues [2013]

6) The Evolution of Marketing and Public Relations [2013]

7) Emerging Markets [2013]

8) The Internet of Things [2014]

9) The Evolution of Retail [2014]

10) Omni-Channel Retail [2014]

11) A Global Marketplace [2014]

12) 3D Printing [2014]

13) Cyberattacks [2014]

14) Ethics [2014]

Additional Things That I Will Be Watching in 2016

As I mentioned in past years, this isn’t a comprehensive list. Rather, these are some of the things that I feel will have the largest impact on business in the upcoming years.

Here are the items that I have added to the list this year:

15) Online Video

This one should have been on my list when I first started it. In my defense, I did write about the importance of online video marketing in 2014.

Online video is only going to become more relevant as Internet speeds increase and the costs to upload and consume video content decreases globally.

Furthermore, not only are people consuming a lot of online video content because they found it on social networks, videos can also show up in search engine results pages (SERPs).

16) RFID, NFC, and Beacons

These can be classified as a subset of several of the items already on my list, including mobile (user experience and marketing), mobile payments, omni-channel retailing, and the Internet of Things.

Any business looking to increase efficiencies or leverage some of the cool new ways to interact with consumers on their mobile devices needs to be looking into these technologies.

17) Augmented Reality (AR) and Virtual Reality (VR)

I am reluctantly putting these on my list, mostly because I haven’t had any firsthand experience with them that has blown my mind. However, enough people are talking about these technologies to add them. I need to learn more about the ways that they can be used before I can write anything further. Stay tuned.

18) SEO for the Internet of Things

Not many experts are talking about it yet. But, I think that they should.

The Internet of Things is going to influence every aspect of our life, including using sensors to give us the information needed to make decisions that will simplify our life and make it more enjoyable.

As time goes on, I predict that Google and some of the other search engines will want to use this data to include it in their SERPs.

Google has already started to do something like this by showing when some businesses are the busiest in its search results. From articles that I have read, Google is obtaining this information by collecting anonymous information from the users of the Google Maps app.

I think it is inevitable that Google will start to expand and include data from other sources. However, this is going to require some sort of standardization of input data before Google could use it to provide information in its SERPs. This is what I am currently calling SEO for the Internet of Things.

19) Experiential Marketing

I have heard a lot of experts using the word “experiential” a lot.

According to Wikipedia.com, “Engagement marketing, sometimes called “experiential marketing,” “event marketing,” “on-ground marketing,” “live marketing,” or “participation marketing,” is a marketing strategy that directly engages consumers and invites and encourages consumers to participate in the evolution of a brand. Rather than looking at consumers as passive receivers of messages, engagement marketers believe that consumers should be actively involved in the production and co-creation of marketing programs, developing a relationship with the brand.”

This is an area that I plan to learn a lot more about in 2016.

As an added bonus, if documented correctly, an experiential marketing campaign can be shared on social media sites to make the investment more attractive for business leaders.

20) Wearables

By now, everyone has heard about fitness trackers helping people get healthier.

And, although Google Glass has failed so far, there is talk that they are trying to bring it back in a form that will be accepted by consumers.

If wearables do continue to take off, there are countless ways that businesses can benefit, including finding ways to use the data to better consumers’ lives. As always, it would require consumers to opt-in. But, when they do, a lot of cool things can be done.

Bonus: Implantables

I’m not ready to add this to my list, because I think that we are at least a decade from mass adoption of implantable technology for nonmedical purposes. However, like wearables, implantable technology can be used to make consumers’ lives better.

Final Thoughts

These are some of the things that I plan to continue to watch in 2016 and beyond.

And, as I have mentioned in the past, a new technology that we don’t know about could change everything.

So, you have my list. What’s on your watch list for 2016?

Photo credit: Vestman on Flickr.

Chad Thiele

Marketing analyst and strategist, content curator, applied sociologist, proud UW-Madison alumnus, and an Auburn-trained mobile marketer. My goal is to help businesses identify trends that will help them achieve their marketing objectives and business goals. I'm currently looking for my next career challenge. Please feel free to contact me anytime at: chadjthiele@gmail.com.

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‘Tis the Season for Giving Gift Cards – The Gift of Drinking, Dining, or Shopping

Photo credit: tales of a wandering youkai on Flickr.According to a survey conducted by the National Retail Federation (NRF) in the first week of December of 2015, at the time the data was collected over nine in 10 consumers had yet to complete their holiday gift shopping. In fact, about eight percent said that they would not purchase their final gift until Christmas Eve, with another six percent waiting to purchase their final holiday gifts on or after Christmas.

For many consumers, this means stopping in at a favorite restaurant or store to pick up a gift card for someone on their shopping list.

With this in mind, many experts offer suggestions for consumers and retailers alike.

“After years of exchanging gift cards over the holiday season, consumers may want to try to avoid the potential awkward exchange when the card they’ve given their loved ones are worth less or more than the one they’ve received,” says Pam Goodfellow, Principal Analyst at Prosper Insights and Analytics, in an article on the NRF website. “However, there will always be an appetite for gift cards, especially with procrastinators who will wrap up their shopping in the final hours.”

Why This Is Important to Retailers

As we enter the last few days before Christmas, many shoppers will be heading to stores to make their final purchases. However, there inevitably will be some people on the consumer’s shopping list who are particularly hard to buy for.

This makes for the perfect opportunity for stores and restaurants to suggestive sell gift cards.

Not only do gift cards keep the retailer top-of-mind when consumers open their gifts on Christmas morning, it also gives them a reason to visit the store the week after Christmas.

“For retailers and consumers alike, the holiday season doesn’t end on December 25,” reports Kathy Grannis Allen in an article on the NRF website. “In fact, for many consumers the week after Christmas is more than just an opportunity to exchange that sweater from grandma. According to the survey, two-thirds (65.9%) of holiday shoppers said they are planning to shop – both browsing and buying – retailers’ after-Christmas sales. Specifically, 47.2 percent of shoppers said they would shop at a store and 43.1 percent will shop online that week. Nearly six in 10 millennials (18-24 year olds) will shop that week, both in stores (59.2%) and online (59.3%).”

According to the NRF, when consumers were asked when they would use the gift cards that they receive during the holidays, about one in five said that they would use it as quickly as they could. Another 42% said that they would watch for really good sales or promotions to maximize the value of the gift card. That means that if the after-Christmas sales are good enough, it could temp consumers into stores to use their gift cards.

The Gift of Shopping

Many retail experts are pointing out that experiential gifts (e.g., tickets to sporting events, concert tickets, a weekend getaway, etc.) are very popular this year. It could be argued that gift cards fit into this category.

If you think about it, a gift card to a restaurant or movie theatre is the same as buying actual tickets to an event. And, for people who love to shop, a gift card to a store could also be valued for the experience as much as the actual product that the consumer buys with it.

In their book, “Gen Buy: How Tweens, Teens, and Twenty-Somethings are Revolutionizing Retail,” Dr. Kit Yarrow and Jayne O’Donnell write, “As we’ve noted before, gift cards not only guarantee that just the right gift will ultimately be acquired, but they also provide the “gift of shopping.” Shopping with permission to buy in the form of prepayment is way more fun than shopping just to see what’s out there and to socialize.”

Therefore, it is no surprise that gift cards still remain the most requested holiday gift this year.

Counterpoint: Gift Cards Lack Personalization and Surprise

It needs to be noted that retailers might want to try to help the consumer pick out the perfect gift for their loved ones before suggesting the purchase of a gift card.

As Dr. Kit Yarrow points out in an article on Time.com, “While gift cards and wish list picks are never going to land in the worst gift ever category, there’s something missing in the transaction: relationship-fortifying thoughtfulness and the emotional boost that accompanies surprise.”

Final Thoughts

With only a few shopping days left before Christmas, many shoppers are going to be out and about looking to purchase the final items on their holiday shopping lists.

While helping the consumer find the perfect gift should be the first priority, suggestive selling gift cards is an excellent way to get consumers back into stores in the weeks following Christmas.

Furthermore, with experiential gifts becoming more popular, a gift card can actually be the perfect gift if the recipient is a movie lover or a huge fan of a particular bar or restaurant. And, if the person who the gift is for loves to shop, the “gift of shopping” might actually be the best gift that they could receive this year.

Photo credit: tales of a wandering youkai on Flickr.

Chad Thiele

Marketing analyst and strategist, content curator, applied sociologist, proud UW-Madison alumnus, and an Auburn-trained mobile marketer. My goal is to help businesses identify trends that will help them achieve their marketing objectives and business goals. I'm currently looking for my next career challenge. Please feel free to contact me anytime at: chadjthiele@gmail.com.

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The Internet of Things and the Future of Digital Marketing and Public Relations

Photo credit: NYC Media Lab on Flickr.Technology is changing the world that we live in.

In fact, with the rapid increases in computer processing power and the decreases in the costs-of-production, the world that we live in is changing at a mind-blowing rate.

When looking at marketing and public relations, many businesses are currently still trying to figure out how to properly integrate social media, SEO, content, and mobile into the marketing mix. This leaves very little time to think about what is going to be influencing business in the upcoming years.

However, given the rapid speed of change, companies that don’t adapt in all areas of business, including the way that they market their products and services to customers, will be left behind.

Therefore, keeping an eye on what technology advancements experts feel will impact our world in five, 10, or 20 years is a must when businesses develop their long-term business strategies.

This includes, but is not limited to, something that will have an effect on everything.

The Internet of Things (IoT)

In the near future, many of the “things” that we interact with on a daily basis will have a sensor embedded in them and will be connected to the Internet, allowing them to exchange data with computers, mobile phones, and other “things.”

The possibilities for making our lives better are limitless, as are the opportunities that will be created for marketers to get their messages out to consumers in a more effective and efficient way.

Some of the most interesting things that I have heard about lately involve helping make consumers’ lives better by the use of the data collected from these sensors.

However, the Internet of Things is still in the nascent stage of development and many issues need to be worked out. This includes privacy issues, as well as making sure that the data collected is used in an ethical way.

From a marketing and public relations standpoint, this is of the utmost importance.

If the results of a recent survey conducted by Google Consumers Surveys for Auth0 is really an indication of the public’s current level of trust with the Internet of Things, marketers and public relations professionals have their work cut out for them, as many respondents who are aware of the Internet of Things have concerns with security and personal data collection.

The Age of Context

In their book, “Age of Context: Mobile, Sensors, Data and the Future of Privacy,” Robert Scoble and Shel Israel highlight some of the ways that technology is already being used to make the world a better place.

They also make predictions as to how technology might evolve in the near future.

The authors of the book are very optimistic about the future uses of technology.

In particular they are excited about how businesses can use technology to better the lives of consumers, and in the process, increase sales by helping target the right person at the right time in the right place.

As they mention, “Context will allow us to receive messages based on location, time of day, and what we intend to do next. We believe this will dramatically boost response rates because customized messages will be more relevant to the recipients. An ad for a discount at a nearby restaurant when we are hungry is pretty likely to get us to act immediately.”

However, while Scoble and Israel are optimistic about the possibilities that these new technologies will bring, they are not naïve.

In fact, they point out some of the problems that have already arisen, as well as some of issues that businesses need to consider in the future, particularly regarding privacy and the use of the data collected.

Final Thoughts

Advancements in technology are going to bring about some very exciting changes in the near future.

However, as the study conducted by Google Consumer Surveys mentioned earlier points out, when asked about the Internet of Things respondents said that they are concerned about security and personal data collection issues.

What this means is that businesses are going to need to find ways to use these new technologies to better the lives of their customers, while making sure that everything they do is transparent, ethical, and protects the customer’s privacy.

They are then going to have to make sure that consumers feel comfortable with what the business is doing and are aware of all the benefits that these new technologies will bring.

Photo credit: NYC Media Lab on Flickr.

Chad Thiele

Marketing analyst and strategist, content curator, applied sociologist, proud UW-Madison alumnus, and an Auburn-trained mobile marketer. My goal is to help businesses identify trends that will help them achieve their marketing objectives and business goals. I'm currently looking for my next career challenge. Please feel free to contact me anytime at: chadjthiele@gmail.com.

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Machine Learning and the Future of SEO

Photo credit: Sam Greenhalgh on Flickr.Many of your current and future customers have found or will find your business by doing a search on Google or some other search engine. This is true whether you work for a Fortune 500 company or the mom-and-pop store down the street.

While many factors influence whether or not a searcher clicks on your website when it is listed on a search engine results page (SERP), studies have found that the higher the website ranks on a SERP, the more likely it is that a searcher will click.

It is for this reason that many companies, both large and small, are investing in search engine optimization (SEO).

The different factors that influence your ranking on a SERP are always changing. In fact, if the recent announcement from Google is an indication of the future, the way businesses optimize their websites for search may soon be completely different than it is today.

Hummingbird: Google’s Search Algorithm

According to a recent post on Search Engine Land, there are many factors or “signals” that determine where a webpage ranks on a Google SERP. The article on Search Engine Land was written as a follow-up to an article on Bloomberg.com that discusses a new signal Google is using in its search algorithm.

“Signals are things Google uses to help determine how to rank Web pages,” writes Danny Sullivan, Founding Editor of Search Engine Land. “For example, it will read the words on a Web page, so words are a signal. If some words are in bold, that might be another signal noted. The calculations used as part of PageRank give a page a PageRank score that’s used as a signal. If a page is noted as being mobile-friendly, that’s another signal that’s registered.”

“Google has fairly consistently spoken of having more than 200 major ranking signals that are evaluated that, in turn, might have up to 10,000 variations or sub-signals,” Sullivan continues. “It typically just says “hundreds” of factors, as it did in yesterday’s Bloomberg article.”

SEO experts use these known signals as a guide to tweak websites so that they are Google friendly and hopefully rank higher on a Google SERP.

Introducing RankBrain

Google recently announced that they have added a machine-learning artificial intelligence system into the mix to help assist in determining where a site displays on a Google SERP. Google is calling this new machine-learning artificial intelligence system “RankBrain.”

“The problem is that Google processes three billion searches per day,” writes Sullivan. “In 2007, Google said that 20 percent to 25 percent of those queries had never been seen before. In 2013, it brought that number down to 15 percent, which was used again in yesterday’s Bloomberg article and which Google reconfirmed to us. But 15 percent of three billion is still a huge number of queries never entered by any human searcher – 450 million per day.”

“Among those can be complex, multi-word queries, also call “long-tail” queries,” Sullivan writes. “RankBrain is designed to help better interpret those queries and effectively translate them, behind the scenes in a way, to find the best pages for the searcher.”

With RankBrain, Google is using the information and knowledge gained from some past searches to better understand future complex searches. In other words, Google’s algorithm is learning from past searches and using that knowledge to help rank pages to deliver results that it feels searchers are actually looking for.

RankBrain Is a Very Important Signal

As the article on Search Engine Land points out, RankBrain is not replacing the Google algorithm. Currently, RankBrain is only one of the many signals Google uses to determine where a website shows up on a Google SERP.

That said, it has been less than a year since it was first used and RankBrain has already become the third-most important signal in the Google Hummingbird algorithm.

It is unclear exactly how many search results are impacted. However, what we do know is that “a very large fraction” of the search queries on Google are being processed by RankBrain.

And, while I haven’t heard Google confirm this, it is entirely possible that RankBrain could play a larger role in the future.

What Does This Mean for Business?

While Bloomberg did break the story of RankBrain in the media, SEO experts were already aware that something strange was happening with SEO that they were having difficulty explaining.

In fact, Market Motive had a webinar a couple of weeks earlier, titled “SEO Webinar: Rise Of The Machines: What Artificial Intelligence Could Mean For SEO.”

In the webinar, Danny Dover explained how Artificial Intelligence is being used to help determine where pages rank on Google SERPs. However, I don’t think he mentioned RankBrain by name.

After the webinar, I sent a tweet asking Mr. Dover if he thought there would be a day when SEO would not be possible because of AI and personalized results.

“Interesting question. I think SEO as we know it today will disappear rapidly but SEO as in marketing online content will stay,” Mr. Dover responded.

He then clarified by tweeting, “Rapidly might not be the best word, perhaps disappear (but with no specified timeframe.)”

After Bloomberg broke the story in the mainstream media, Tim Wang asked Mr. Dover whether it would affect link building strategies and/or content creation. Mr. Dover responded by tweeting, “Yup. Machine Learning (one technique used in AI research) relies on training data not factors (a small but important diff)”.

If Mr. Dover is correct, in the future businesses will need to adapt and develop new ways of making sure that their website is found when a user does a search on Google or any of the other search engines. (As the Search Engine Land article points out, Bing has been incorporating its own machine-learning system into its algorithm it uses to rank pages since 2005.)

Final Thoughts

The goal of most search engines is to provide the most useful results for searchers. In an effort to accomplish this goal, the search engines are constantly updating their algorithms that determine where a website shows up on a SERP.

What this means for business is that whoever is in charge of making sure that the business’s website is optimized for search, whether it be a person on staff or an agency that specializes in SEO, needs to stay current on the best practices and trends in SEO.

While machine-learning is currently only a part of Google’s algorithm it uses to determine where a website appears on a SERP, it is already the third most important signal. And, it is entirely possible that it could play a larger role in the future.

This means that, in the future, businesses might need to use different tactics to optimize the business’s websites for search.

 

Note: While I have completed Market Motive’s SEO Foundations training as part of the Digital Marketing Foundations Practitioner Certification, I am not an SEO expert. I wrote this post to help make business leaders aware of some of the changes that could have an effect on their SEO efforts. I am relying on information from trusted experts. As just mentioned, it is important that the person who is leading the business’s SEO efforts be trained in the most current SEO strategies and best practices for optimizing a website for search.

These are the series of tweets that I cited in the post:

Photo credit: Sam Greenhalgh on Flickr.

Chad Thiele

Marketing analyst and strategist, content curator, applied sociologist, proud UW-Madison alumnus, and an Auburn-trained mobile marketer. My goal is to help businesses identify trends that will help them achieve their marketing objectives and business goals. I'm currently looking for my next career challenge. Please feel free to contact me anytime at: chadjthiele@gmail.com.

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Is SMS Marketing Still Effective? The Answer Is YES!

Photo credit: Patrik Nygren on Flickr.In March of 2015, an eMarketer article asked, “Are we watching the death of SMS?”

The author’s case is based on the fact that while the total number of SMS messages worldwide is projected to decrease in the near future, the total number of messages in over-the-top (OTT) mobile-messaging services such as WeChat is projected to skyrocket.

In the past, other experts have also suggested that SMS has peaked and will decrease in value as a marketing vehicle as time goes on.

However, others have made a case that the shear increase in messaging volume does not mean that consumers are getting more value from OTT mobile-messaging services than from SMS.

In fact, Michael Becker, Co-Founder and Managing Partner at mCordis, makes the case that consumers may be more concise in getting their point across when using SMS. He also points out that SMS has no fragmentation, it has reach, it can be used for a wide variety of purposes, and marketers can control the timing and content of interactions when they get their customers to opt-in to receive SMS messages from the business.

Jeff Hasen, founder and president of the mobile consultancy Gotta Mobilize, is also an advocate of SMS marketing.

In a Mobile Commerce Daily article, Mr. Hasen is quoted as saying, “The most savvy marketers have decided this is a quality game and not a quantity game.”

The article goes on to point out that SMS is proven to drive business results.

The article also points to the fact that the average texter is older than 40 years old and 80 percent of consumers who have a mobile phone text on a regular basis.

Furthermore, one of the most interesting stats out there comes from the recently released Modern Marketing Essentials Guide to Mobile Marketing. It states that, “90% of SMS messages are opened and read within the first 90 seconds of receipt.”

The Modern Marketing Essentials Guide to Mobile Marketing also states, “In recent years, mobile SMS marketing has pushed forward to become one of the most desirable forms of marketing available. The number of people with cell phones capable of texting has grown rapidly in the past few years and so it makes sense that texting is swiftly becoming the best way to reach a customer. The low cost and flexibility make it great for businesses, while its ability to deliver offers instantly leaves customers wanting more.”

Research sponsored by SAP confirms these findings.

Their report, titled “The SMS Advantage: How enterprises can leverage the power of SMS,” is based on a survey that looks at how consumers respond to mobile engagement and explores which mobile technologies are most effective.

According to this report, “Three-quarters of respondents state that SMS serves to improve the overall brand experience when communicating with businesses.”

The report also finds that “64% of consumers believe that businesses should use SMS to interact with customers more often than they do currently.”

Final Thoughts

There are many ways that consumers can communicate today.

While the projected volume of SMS messages is not has high as the projections for OTT mobile-messaging services, it doesn’t mean that SMS has lost its value.

In fact, SMS traffic is still at near record highs and most likely will continue to be used on a regular basis by many consumers in the years to come.

Furthermore, not only are many consumers still using it, but many think of it as a great way for businesses to communicate with them.

If businesses deliver quality and offer value to customers via text messages, SMS will continue to drive business results, now and in the foreseeable future.

Photo credit: Patrik Nygren on Flickr.

Chad Thiele

Marketing analyst and strategist, content curator, applied sociologist, proud UW-Madison alumnus, and an Auburn-trained mobile marketer. My goal is to help businesses identify trends that will help them achieve their marketing objectives and business goals. I'm currently looking for my next career challenge. Please feel free to contact me anytime at: chadjthiele@gmail.com.

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Why Proximity Mobile Payments Are Good for Business (Part One)

For a few years now there have been experts recommending that businesses invest in the equipment that allows customers to use their smartphones to make point-of-sale payments for goods and services at restaurants and brick-and-mortar retail stores.

However, given the many potential roadblocks, it is not surprising that many businesses took a wait-and-see approach before making any investments in this type of technology.

That was, until last month.

When Apple announced that the new iPhone 6 would include near-field communication (NFC) and Apple Pay, in my opinion, one of the biggest obstacles to proximity mobile payment adoption was eliminated.

This doesn’t mean that it is a given that proximity mobile payments will be embraced by a majority of consumers right away. But, there are several reasons why now might be the time to make the investment, particularly if the business is located in an urban or suburban area. These reasons include:

The number of smartphones with NFC is increasing.

According to comScore, 174 million people in the U.S. owned smartphones (72 percent mobile market penetration) during the three months ending in August 2014.

What is of particular interest is that at the end of August, 42 percent of the U.S. smartphone subscribers used a device that was made by Apple. That means that at the end of August at least 42 percent of smartphone users in the U.S. couldn’t make NFC enabled proximity mobile payments, even if they wanted to.

Last month’s announcement doesn’t mean that all 42 percent of Apple smartphone users will now have access to NFC technology. It is going to take some time for customers to make the transition to the iPhone 6 or iPhone 6 Plus. However, according to Forbes.com, Apple has sold over 21 million new phones in the first two weeks, 10 million of those in the first three days alone. And, with the holiday season just around the corner, that number is bound to increase sharply by the end of the year.

When combined with the fact that many of the other smartphone manufacturers offer some NFC-enabled smartphones, the percentage of consumers who will be able to take advantage of proximity mobile payment options is much higher today than it was not too long ago, and that percentage will only continue to increase.

The number of mobile wallet options is increasing.

There are several Android mobile wallets (e.g., Softcard, Google Wallet, etc.) out there. Now that Apple has introduced Apple Pay, consumers will have more opportunities than ever to take advantage of proximity mobile payments when a restaurant or retailer makes the option available to them.

Major brands are working together to increase awareness.

As usual, Apple has done a great job introducing Apple Pay to consumers.

But, they are not the only brand trying to create awareness of proximity mobile payments.

In a recent article on eMarketer.com, Matthew de Ganon, Senior Vice President, Product and Commerce at Softcard, reports that Softcard currently has about 20,000 activations per day. This success is due in part to the fact that Softcard was created under a partnership with AT&T, Verizon Wireless and T-Mobile.

“We’ve had great success with consumer education through our partner stores, the carriers: Verizon, AT&T and T-Mobile,” states Mr. de Ganon. “They educate consumers on the mobile wallet, what it means and how they can tap to pay.”

“A majority of consumers assume at some point they’re going to have a mobile wallet that will allow them to pay for goods and services, but only a very small percentage actually knew that it was already here,” Mr. de Ganon continues.

More consumers are moving to 4G smartphones.

Having access to high speed wireless data is very important to the adoption of proximity mobile payments.

If it takes too long for a transaction to process, there is a good chance that the customer will abandon the transaction or choose an alternative payment option. If this happens with frequency, the consumer will most likely lose interest in using proximity mobile payments altogether. That is why having access to 4G is going to be crucial to the success of this emerging technology.

The good news is that according to Ovum research, 4G connections in North America are quickly rising.

Citing the Ovum research data, an article on cellular-news.com reports, “With 127 million LTE connections, of which 15 million LTE connections were added in the second quarter alone, North America leads the world’s regions in the number of connections, market share and penetration of LTE, with a 33 percent market share of all 391 million mobile connections.”

Again, with the holiday season right around the corner, this number should increase even higher by the end of the year.

Final Thoughts

As shown, there are many factors that are coming together to make proximity mobile payments a viable and smart business decision.

Just the fact that Apple has entered the market is a great signal that now is the time to look into this technology. As Lance Whitney points out in a February 2014 article on CNET.com about NFC-enabled cell phones, “…Apple typically likes all of the pieces to be in place before it dives into a burgeoning technology.”

Still not convinced? In a future post I will explore how offering proximity mobile payments can benefit your business beyond the obvious convenience of offering an additional payment option.

Photo credit: Omar Jordan Fawahl on Flickr on Flickr.

Chad Thiele

Marketing analyst and strategist, content curator, applied sociologist, proud UW-Madison alumnus, and an Auburn-trained mobile marketer. My goal is to help businesses identify trends that will help them achieve their marketing objectives and business goals. I'm currently looking for my next career challenge. Please feel free to contact me anytime at: chadjthiele@gmail.com.

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