Tag market research

New Research Reveals How Many U.S. Adults Currently Own Smart Speakers

Two smart speakers on a tableAccording to the Smart Audio Report Spring 2019 that was conducted by NPR and Edison Research, only 21 percent of Americans age 18 or older own a smart speaker. This translates to roughly 53 million people.

Interestingly, about half of American adults who own smart speakers report that they own more than one, with 30% reporting that they own three or more.

According to the report there was a 78% increase in the number of smart speakers in U.S. households, increasing from 66.7 million in December 2017 to 118.5 million in December 2018.

The fact that many people own more than one smart speaker partially explains how we can have such a dramatic increase in the number of smart speakers in U.S. households and still find that only about one in five American adults own them.

Interest in Smart Speakers Among Those Who Don’t Own One

When the researchers asked people who don’t own a smart speaker whether or not they are interested in owning one, 11% said that that they were very interested and another 9% show some interest. In contrast, 43% said that they were not at all interested in smart speakers.

The report also points out that adults age 18 to 54 show more interest in smart speakers than their older counterparts.

Reasons Why Interested U.S. Adults Who Don’t Own Smart Speakers Haven’t Purchased One Yet

The report also asked U.S. adults who said that they are interested in owning a smart speaker but haven’t purchased one yet the reason for not owning one.

The most common response was that they worry hackers could use the smart speakers to get access to their home or personal information. In total 63% gave this response in 2019 compared to 41% in 2017.

Other common responses included the fact that it bothered them that smart speakers are always listening (55%), voice-enabled speakers are too expensive (53%), and that they worry that smart speakers could allow the government to listen to their private conversations (40%).

As the report points out, people who currently own smart speakers share some of these same concerns, but choose to use the technology anyway.

The Smart Audio Report 2019 Webinar

What follows is a webinar that was created by Edison Research and NPR and was posted on YouTube in June of 2019.

In the webinar, they summarize the report and provide a lot of other interesting information about the ways people use smart speakers.

Additional Resources

I plan to write more about this topic in future blog posts. When I do, I will update this post and include links below.

 

Photo credit: BestAI Assistant on Flickr.

Video credit: edisonsurvey on YouTube.

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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Voice Search Is Gaining Popularity, but Not as Quickly as Some People Think

Voice assistantThere are a lot of people still spreading the news that comScore predicted that by 2020, 50% of all searches will be done via voice search.

Marketers who have yet to consider voice in their marketing efforts might panic after hearing that statistic. After all, comScore is a reputable media measurement and analytics company. If they are predicting this, there must be some reason for it.

The problem is that it doesn’t look like comScore ever made that prediction. I searched several times and couldn’t find a comScore article reporting this stat.

It appears that as often happens, people are not checking with the original source. In their defense, people often link back to a trusted media website that focuses on marketing, advertising, and media when citing this statistic. However, while it is generally okay to cite a trusted source, often going back to the original source is advisable.

Furthermore, it looks like even after someone highlighted the error online, people either aren’t aware of it or ignore it and continue to share the erroneous statistic anyway. This happens a lot on social media and the Internet, in general.

Econsultancy Uncovers the Erroneous Statistic

In an article on the Econsultancy blog published in July of 2018, Rebecca Sentance wrote about several errors that she found regarding this statistic. The rest of the post that you are currently reading highlights some of the findings that she uncovered. If you get a chance, the whole series of articles that she wrote on voice search is worth reading.

The first thing that she found was that the statistic was actually based on something that Andrew Ng, then Chief Scientist at Baidu said in an interview with Fast Company. Again, in reality, it appears that comScore was not involved at all.

In the Fast Company article, Ng is cited as saying that “in five years time at least 50% of all searches are going to be either through images or speech.” The quote was then cited by Mary Meeker in her KPCB Internet Trends 2016 report and the “In five years time” got changed to “2020.”

As Sentance points out in the Econsultancy article, Ng’s estimate not only includes voice, but image search and voice search. This is the second error with the original statistic.

Sentance then goes on to make a back-of-the-envelope calculation that at the time her article was published only 13% of Google searches were made by voice queries.

That means that there is a wide gap to be filled in just a couple of years.

The Econsultancy article does give some insight into what Andrew Ng might have been thinking by highlighting a tweet that he wrote that stated, “As speech-recognition accuracy goes from 95% to 99%, we’ll go from barely using it to using all the time!”

“So, Andrew Ng believes that sheer accuracy of recognition is what will take voice search into the mainstream,” writes Sentance. “95% word recognition is actually the same threshold of accuracy as human speech (Google officially reached this threshold last year, to great excitement), so Ng is holding machines to a higher standard than humans—which is fair enough, since we tend to approach new technology and machine interfaces with a higher degree of skepticism, and are less forgiving of errors. In order to win us over, they have to really wow us.”

She then goes on to point out some other potential barriers to voice search adoption. However, that is something that I plan to take up in another post.

The Timeline Might Need to Be Adjusted

Voice search will be more important as time goes on. That is a bet that I’d be willing to make.

It’s just that 50% of all searches by 2020 is a prediction that probably won’t come to fruition. However, as we’ve learned, it doesn’t look like we can’t blame comScore for this one.

There is a prediction made by Gartner in 2016 that can be documented that says, “By 2020, 30% of web browsing sessions will be done without a screen.”

If Rebecca Sentance’s assumptions are correct, then even this number is a little optimistic.

However, only time will tell.

Photo credit: iphonedigital 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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ICYMI: Google Updated the Test My Site Tool to Help Businesses Provide a Faster Mobile Experience

For quite some time, we have known that Internet users want websites to load quickly. In fact, in many cases, if the website loads too slowly, users won’t stick around.

Since Google constantly strives to improve user experience, it is not surprising that website speed influences how Google ranks your site. This is now true when users access your site from a desktop computer or a mobile device.

In order to make improvements to meet Internet users’ expectations when they are using a mobile device, and therefore improve your mobile search rankings, you need to know how well your mobile website is performing.

To assist in this effort, Google has updated a tool that measures the performance of your mobile website and then recommends how to make improvements.

Speed as a Ranking Factor

Back in 2010, Google announced it would use site speed as a ranking factor.

At the time, Google stated, “Speeding up websites is important – not just to site owners, but to all Internet users. Faster sites create happy users and we’ve seen in our internal studies that when a site responds slowly, visitors spend less time there.”

However, until July of 2018, Google did not include speed as a ranking factor on mobile searches.

With the Speed Update, businesses now need to ensure that their mobile websites are fast as well.

According to an article on Search Engine Journal, “Now the speed at which a piece of content loads is a consideration when ranking mobile pages. Obviously the faster the better.”

The article states that this is the most important thing for SEOs and site owners to know about the update. However, the article also points out that the update will only affect really slow websites (i.e., those that take several seconds to load on a mobile device.)

The article also points out, “Relevancy is key, as Google always says. So if a slow loading page happens to contain the most relevant content, according to a user’s query, then it may still rank favourably in search results.”

The New and Improved Test My Site

In February of 2019, Jerry Dischler, Google’s VP of Product Development, announced the update to Test My Site on one of Google’s blogs.

“Because mobile is where most people turn when they want to know, go, do or buy, it’s important to deliver the kind of mobile experience that people expect today: one that’s fast, engaging and doesn’t get in the way of what they want to accomplish,” writes Dischler. “And because Google is deeply invested in the success of marketers and brands, we never stop looking for ways to develop and support new tools and innovations than can move the industry forward.”

“One of the mobile era’s clearest lessons has been that the foundation for any great mobile experience is a fast mobile experience,” Dischler continues.

To help businesses deliver a better and faster mobile experience, Google updated Test My Site to report the speed of both the entire site and individual pages, whether their site speed ranks Fast, Average, or Slow, and the potential impact of site speed on revenue.

Other key updates include a detailed list of recommendations to increase speed on up to five pages and a sharable report.

While Test My Site isn’t the only product out there to help businesses improve their mobile website speed, it is one that businesses should consider looking into.

After all, if you want to reach customers by ranking higher when they search for relevant topics on Google via their mobile devices, doing what Google suggests is a pretty good place to start.

Test My Site TWG

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 Rise of Podcast Consumption and Why It’s Important for Your Business

PodcastsSteve Jobs was extremely adept at predicting what consumers would want even before they knew they wanted it.

It’s therefore not surprising that Jobs was bullish on the future of podcasting early on.

According to a Forbes article, “Back in the summer of 2005, Steve Jobs and Apple announced they would support podcasts on iTunes. At the time, podcasts were considered somewhat niche, but Jobs was adamant they were important.”

“Apple is taking Podcasting mainstream by building it right into iTunes,” said Jobs in a 2005 press release. “Podcasting is the next generation of radio, and users can now subscribe to over 3,000 free Podcasts and have each new episode automatically delivered over the Internet to their computer and iPod.”

Research published by Edison Research in 2018 indicates that, once again, Jobs was correct.

The Podcast Consumer 2018 – Research from Edison Research

Each year, Edison Research publishes a study on the current trends in podcasting in the United States.

In 2018, the study included findings from the Infinite Dial 2018 study (conducted in partnership with Triton Digital), The Smart Audio Report from NPR and Edison Research, and the latest findings from Edison’s Share of Ear Research.

Because the 2019 version of the report should be released soon, I don’t want to spend too much time on the specific findings from 2018.

That said, because it is the latest data currently available, there are some interesting trends that they uncovered that are worth pointing out.

The video embedded at the end of this post is also definitely worth watching if you are interested in this medium.

More People Are Listening to Podcasts and They’re Spending More Time Doing So

As I mentioned in the beginning of the post, Steve Jobs and Apple recognized the potential of podcasting in 2005.

With this in mind, it is interesting to note that according to Edison Research, in 2006 only 11% of Americans ages 12 and older had ever listened to a podcast. This percentage has slowly increased to 44% in 2018.

The more interesting number, however, might be the percentage of Americans age 12 and older who had listened to a podcast in the last month. This percentage increased from only 9% in 2008 to 26% in 2018.

Furthermore, when the research was conducted in 2018, 17% of the population of Americans age 12 and older had listened to a podcast in the last week. This is an estimated 48 million Americans.

Among those weekly podcast listeners, when compared to earlier years, the average time listening to podcasts increased in 2018.

Overall, weekly podcast listeners listened to an average of seven podcasts per week in 2018.

Infographic: The Steady Rise of Podcasts | Statista You will find more infographics at Statista.

Why Podcasts Are Important for Business

As with any medium, podcasting might not be a good fit for your brand.

However, because more people are listening podcasts, the likelihood that your customers and potential customers are among those consuming podcast content has increased.

It is interesting to note that current podcast listeners make more money than the general population, tend to be more educated, and are more likely to have a full-time job. This makes podcast listeners very attractive to marketers.

It is also noteworthy that Americans currently listen to podcasts most often on their smartphones, tablets, or other portable devices.

As smart speakers become more common, it only makes sense that more people will start listening to podcasts on these devices.

And, as Edison Research pointed out, “In-car listening is growing, and represents a major potential source of new listening.”

All this data indicates that podcasts might be a great way for some brands to connect to consumers.

At the very least, it is something that your brand should consider.

 

Photo credit: Casey Fiesler on Flickr.

Infographic credit: Statista.com.

Video credit: edisonsurvey on YouTube.

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 Technology Is Now Available, but Should Your Business Use It?

Business EthicsWe are currently witnessing advancements in technology that are improving the way that we understand the human race and the world that we live in.

This new technology brings with it ethical dilemmas that we need to grapple with.

Specifically, we need to decide where the line should be drawn to distinguish what is ethical and what is not ethical.

For example, although one company’s use of neuromarketing was very successful, it pushed the boundaries of business ethics. The way another business might use biometric feedback could possibly cross the line into unethical behavior.

Keep in mind, these examples are taken from the business world. However, ethics need to be considered in all areas life.

Business Ethics Defined

There are many definitions of business ethics.

In fact, entire business/philosophy classes are offered to help people understand this subject.

For the sake of this post, ethical behavior is defined as making sure that the business is doing what it thinks is the right thing and, more importantly, not doing harm to the business, its employees, its customers, or anyone else in the world. (This would exclude, of course, taking customers away from the competition. This would harm the other business, but that’s just business.)

It is important to keep in mind that what the business thinks is ethical and what the rest of the world thinks is ethical might not always be the same thing. That is why public discussion and complete transparency are highly suggested and often required.

It is also important to point out that if customers think something is unethical, then doing it could actually decrease sales and, thus, harm the business.

Frito-Lay Pushes the Ethical Boundaries and Wins Big

For many years, companies have been using various market research techniques (e.g., surveys, focus groups, etc.) to gather insights as to what customers want and why in an effort to create better products or services and better marketing campaigns to sell those products or services.

Beginning in the 1990s companies started to employ neuropsychology techniques to their market research in an effort to find out what their customers really want, sometimes even if they don’t know it.

According to Wikipedia, Dutch marketing professor Ale Smidts introduced the term “neuromarketing” in 2002 to describe this “emerging disciplinary field in marketing.”

As a Fast Company article written in 2011 points out, many companies are using these techniques to help increase sales.

Frito-Lay is one of these companies.

According to the article, “In 2008, Frito-Lay hired NeuroFocus to look into Cheetos, the junk-food staple. After scanning the brains of a carefully chosen group of consumers, the NeuroFocus team discovered that the icky coating triggers an unusually powerful response in the brain: a sense of giddy subversion that consumers enjoy over the messiness of the product. In other words, the sticky stuff is what makes those snacks such a sticky brand.”

According to a Gizmodo article, Frito-Lay did not stop there.

“Frito-Lay tested out a commercial that emphasized this subversive glee that Cheetos dust apparently gave people,” the author of the article writes. “The commercial shows a woman (played by the indelible Felicia Day) who pranks another woman in a laundromat by putting Cheetos in her white clothes, as Chester the Cheeto [sic] eggs her bad behavior on.”

“Focus groups hated it, saying it was mean-spirited,” the Gizmoto article continues. “But NeuroFocus revealed that people who watched it had EEG results that showed positive feedback. Just like most people don’t admit or even know that they like getting artificial cheese dust all over the place when they eat Cheetos, people didn’t want to admit that they liked a commercial about an asshole who flouts social norms. But the ad tapped into the pop neuroscience that linked Cheetos with deviant thrills.”

This commercial and the advertising campaign it was a part of were so effective that according to the Fast Company article, “NeuroFocus earned a Grand Ogilvy award for advertising research, given out by the Advertising Research Foundation, for ‘demonstrating the most successful use of research in the creation of superior advertising that achieves a critical business objective.’”

Ethical Concerns with Collecting Biometric Feedback on Shopping Carts

According to SIS International Research, “Biometrics is an emerging research field of neuromarketing market research. This form of marketing relies on various biometric technologies and applications to help understand a participant’s cognitive and emotional responses toward certain stimuli. The stimuli can be anything ranging from TV ads to online advertisements.”

The company’s website states that biometric market research uses fMRI, EEG, observational analytics, heart rate monitoring, and facial coding.

We already know how an EEG can be used to create better advertising campaigns.

If other ways of gathering biometric feedback are half as effective, many more companies will start to use these market research techniques in the future.

It is therefore not surprising that Walmart filed for a patent that would allow the retailer to collect biometric feedback on shopping cart handles.

People are already tracking a lot of this information on their fitbits and other smartwatches.

If that data could be accessed in real time and combined with location data, a lot of experiments could be conducted without the person even knowing it. (Note: As far as I know, Walmart has not announced that it would use the technology this way. However, it would be possible.)

While articles talking about this Walmart patent downplay the privacy issues, there certainly are a few.

Although we might make some real gains in knowledge, we need to ask ourselves whether the tradeoff in privacy is worth it.

In the End, Either Customers or the Legal System Will to Draw the Line

In the first example, NeuroFocus used willing participants to gathered biometric data that allowed Frito-Lay and its advertising agency to create an ad campaign that was effective even when focus group respondents said that they hated it.

If companies start to collect physiological responses to different stimuli, whether it be ads, physical retail environments, or anything else without customers knowing it pushes the ethical boundaries even further. Maybe too far.

To determine where to draw the line, the business community should create ethical standards and follow them.

If they don’t, laws will need to be created.

Either way, it is important that people have discussions about what it going on so that we can ask ourselves whether or not what can be done should be done.

Photo credit: Pamela Carls on Flickr. (Creative Commons Attribution 2.0 Generic license – CC BY 2.0.)

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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Think About What You’re Sharing Online: Is That Statistic Really Accurate?

Fake StatsThere is a lot of information being shared on the Internet.

This is great if it is used to entertain, mobilize people to action, or help people make educated decisions.

The problem is that people often share things online without really thinking about what they’re sharing. This leads to the spread of misinformation, rumors, or even the dreaded fake news.

When evaluating the validity of the information that we share, we need to look at the words that are used and the statistics that are provided as supporting evidence.

This post focuses on the latter—the statistics.

This is a topic that I have written about a few times in the past.

In fact, each of the subheadings listed below is a headline or title of a former blog post.

I feel it’s time to revisit these posts, because the lessons that can be learned are of the utmost importance.

The Importance of Reliable Sources

Maybe the most important thing to do when evaluating the data that you see online is to ask yourself whether or not the source providing the information is credible.

If the source is unknown to you, be skeptical.

If the information is coming from a reliable news outlet, chances are the information was fact-checked.

However, with the increased emphasis to be the first one to report the news, even the experts make mistakes. Typos are inevitable. After all, the writers are human—at least they are most of the time.

Therefore, it is often a good idea to check with the original source before making any major business decisions based on data you find on the Internet.

Mind Your Bases When Analyzing Data

Checking with the original source is also a good idea because percentages can be misleading.

In fact, if we don’t know what population the percentages are based on, then the percentages are virtually useless.

Furthermore, if only part of the data gets shared or data tables get recreated, an incorrect population or subpopulation is often assumed. In this case, the percentages can be extremely misleading.

A similar thing can occur if quotes are taken out of context.

If you have the time, I strongly recommend that you read my original blog post on this topic, as it goes into further detail about the importance of knowing what population or subpopulation percentages are based on.

A Lesson Worth Remembering: Correlation Doesn’t Imply Causation

This one is pretty self-explanatory, but it is also one of the things that we’re all guilty of forgetting from time-to-time.

It is therefore not surprising that many college professors try to drive this lesson into the minds of their students.

The key thing to think about here is that when analyzing data, you can’t always assume that just because there is a positive or negative correlation between two variables, that one is causing the other to occur.

In some cases, it might be a third unknown variable that is influencing the change in one or possibly both of the original variables.

Weight – Are Your Survey Results Biased?

This topic might be getting into the weeds a bit, but I feel it is important enough to bring up.

If the data that is being reported is not based on a complete census of a population, then there is inevitably going to be a disproportionate number of respondents from a demographic group that can lead to biased data.

Weighting is basically a way to be sure that the data that you are using to make population estimates actually reflects the true population distribution.

For example, according to the United States Census Bureau, 50.8 percent of the 2010 Census population were female, while 49.2 percent were male.

Now, assume that we conducted a research project in 2010 where two-thirds of the respondents were female. If female respondents are also more likely to respond one way or the other on a particular question, then the estimate for the overall percentage of United States citizens who feel one way or the other for that topic would be biased.

This is something that I think many people who are conducting survey research today often overlook.

While weighting your data might not seem like a big deal, it can potentially have a huge impact on the overall estimates of the averages, ratios, proportions, or percentages for a given population.

Again, if you want to learn more, check out the original blog post that I wrote in 2011.

Final Thoughts

If you spend any time reading information shared on social media, you know that there are a lot of statistics being cited to support opinions about all sorts of topics.

Sometimes the statistics are coming from a reliable source. On the other hand, sometimes it seems like the numbers were just made up. In other words, they are fake statistics.

As I have pointed out in this post, even if the data is coming from a reliable source, it is often a good idea to check with the original source before making any business decision that will have a big impact on your company.

A lot of things can happen when data is passed on from one person to another online.

As I have said before, it is ultimately the responsibility of the consumer to make sure that the information is factual before making decisions based on what he or she read, hears, or sees on the Internet.

Hopefully, this post will help give people some idea of what to look for when deciding what statistics to believe and what ones to dismiss.

Photo credit: craftivist collective on Flickr. (Creative Commons Attribution 2.0 Generic license – CC BY 2.0.)

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 Future of the Retail Sales Associate—Another Reason Why Retailers Need to Provide More Mobile-Optimized Content Online

The Future of Retail Sales AssociatesThe way customers shop, in general, is changing with more and more customers going online to research and buy products. Furthermore, smartphones have also modified the way customers shop in brick-and-mortar stores.

This means that retailers are going to need to rethink everything. And, that means everything.

For store employees, this means that their world is going to be altered dramatically.

In 2014, Doug Stephens, one of the world’s foremost retail industry futurists, wrote a very informative blog post that predicts what a “typical” retail sales associate’s job will look like in the near future.

In the post, he predicts that in the near future there will be fewer humans working in brick-and-mortar retail stores, with technology there to fill in the gap.

In the post, he cites a study from Oxford University that estimates that there is a 92 percent chance that retail sales associates will be replaced by technology in the next decade. (Keep in mind, this was over four years ago. Therefore, if the predictions are accurate, retail sales associates should be retraining for other positions now! Even if it takes a little longer than experts think it will, the world that they are predicting will arrive someday… soon.)

While this is an alarming figure, people who want to work in retail stores should be heartened by the other prediction that Doug Stephens makes—that those employees who do survive will be paid much higher than they currently are. But this is going to mean that they also are going to need to get a lot more training.

Other sources again support his position.

Some of the recent articles that discuss retail trends point to the fact that there will always be a need for some human salespeople at most brick-and mortar stores. However, they will have a slightly different background.

As far as I can tell, four types of non-management employees will emerge to replace the generally unskilled workforce that currently fills many of these low-paying retail sales associate jobs.

Professional Salespeople—The Customer Service and Product Experts

In the blog post mentioned earlier, Doug Stephens writes, “Although retailers will point the finger at price as the smoking gun behind showrooming, research shows that in fact, it’s more often the pursuit of adequate and accurate information that drives customers online.”

Therefore, in order to compete with online retailers, brick-and-mortar stores are going to have to hire a core group of employees who really know their stuff.

These employees won’t be the ones who check people out at the cash register.

They will be like the salespeople of old who thought of their position at the store as a career, not just a place to work until they find other jobs. These employees will be experts in customer service and they will know everything about what they are selling.

The stores that realize that there is a need for this type of employee and hire and train people who really want to excel at their job will be the stores that will succeed.

As Doug Stephens also points out, the people who fill these positions will be paid more than the average salary of a retail sales associate today.

This probably means that stores won’t hire many of these employees, if they still want to keep their costs down. But, the employees who are hired to fill this type of role will be an invaluable resource to customers and the store.

To be qualified for this role, the employee will also have to invest in additional training.

Organizations like the National Retail Federation (NRF) are already recognizing that this type of training is needed and have begun offering it at a reasonable price.

Part-Time Associates—Knowledgeable Salespeople Augmented With Technology

This group of employees will most resemble the current retail sales associate.

They will be the young adults who are working their way through high school or college. They will have some basic product knowledge and business acumen. And, they will have grown up using technology, therefore they will be very comfortable assisting less tech-savvy customers with the technology that the store will use to assist in the sales process.

They will also use technology (e.g., smartphones, tablets, etc.) to access mobile-optimized content that will answer the product-related questions that customers have.

Because these employees will be in the process of completing their training, these positions will probably still be on the lower-end of the pay scale. However, to attract the best employees, retailers will still have to pay more than minimum wage.

With technology to augment the sales process, fewer of these associates will be needed on the sales floor of tomorrow.

Temporary Workers—The On-Demand Workforce

The gig economy is here, with some employees being hired to work for only a short duration of time to fill a specific business need.

As a Washington Post article points out, it is already changing the workforce in many mainstream restaurants (e.g., Five Guys, McDonald’s, Papa John’s Pizza, etc.)

Will brick-and-mortar retail stores be next?

Retailers have always hired temporary workers around the holidays. This would just take this concept to the extreme.

It is entirely possible that stores could hire employees for one or two days to staff a large sale similar to those on Black Friday.

And, again, if stores bring in the right technological solutions to assist with the sales process, these temporary workers could be quickly trained to work the cash register or again help the less tech-savvy customer in the shopping process.

Some retail experts say using temporary workers is a bad idea. But, the reality is that only time will tell.

Non-Human Employees—Mobile-Optimized Online Content and Other Technological Solutions

The fourth type of employee that will replace the current retail sales associate is not a human at all. However, in many cases technological solutions will be able to do the same job… maybe even better than the current retail sales associate can.

As mentioned above, customers are already reaching for their smartphones to get product information while shopping in brick-and-mortar stores. In fact, some customers would rather use their smartphones to find product information than talk to the retail sales associate on the sales floor.

This might be because they often get incorrect or incomplete information from improperly trained retail sales associates. Therefore, we might have a chicken and the egg situation at play.

Either way, the one thing we do know for certain is that customers want to be able to quickly and efficiently find product information either online via their smartphone or by talking to a retail sales associate.

Having the right information available online is going to be a must for the retailer of tomorrow. And, as mentioned above, it will also help human salespeople do their jobs better.

As Doug Stephens points out in his post, there are companies like Hointer that are working to bring additional technological solutions to market to help automate the retail sales process even further.

However, I will leave that topic for future blog posts.

Final Thoughts

In order to compete, brick-and-mortar stores will need to be able to provide customers with the same accurate and complete product information that they can find on Amazon or other online retailers.

If the brick-and-mortar store provides the information first, customers will have one less reason to visit another store’s website or mobile app, and therefore will be less likely to use the store as a showroom only to buy the product elsewhere.

This can be accomplished by having better trained retail sales associates and by creating the right mobile-optimized content that customers can search for on their smartphones and tablets. Furthermore, other technological solutions like “smart mirrors” in fitting rooms will also be used to deliver product information to customers.

Given the changes in the marketplace, it’s not a question of whether to invest in employees or in technology.

Successful stores will do both.

In fact, technology will help less knowledgeable retail sales associates meet the needs of the store’s customers more efficiently and effectively. In other words, in many cases technology and humans will work together to provide a better shopping experience.

Note: This is a very general prediction of what the “average” retail store of the future will need to do in order to meet the needs of its customers. There will be variation based on the products and services sold, who shops at the store, the store’s location, etc.

Photo credit: Zepfanman.com on Flickr. (Creative Commons Attribution 2.0 Generic license – CC BY 2.0.)

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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Fashion Retailers Could Benefit by Providing Basic Fashion Tips Online

Fashion TipsIt has been well documented that consumers often turn to their smartphones while shopping.

In fact, according to a study conducted by Salsify in September of 2016, 77% of all shoppers report using mobile devices while shopping in a brick-and-mortar store. In comparison, only 35% say that they would turn to a salesperson to obtain similar information.

As a Salsify press release published in April of 2017 states, “With so many turning to mobile while shopping in-store as well, the need for strategic and informed product content has never been more essential. In fact, 87 percent of consumers say accurate, rich, and complete product content is very important when deciding what to buy.”

A study conducted by Retail Dive examined how consumers use smartphones while shopping in a brick-and-mortar store. The most common response to the question was to research products and/or look up product information (58%), followed by checking or comparing prices (54%), accessing or downloading digital coupons (40%), accessing a specific retailer’s mobile app (33%), and scanning a QR code (22%).

The type of product information that retailers will want to provide will vary from store to store based on the products and services sold, the customers it serves, the time of year, where the store is located, etc.

While some content could be expensive to create, sometimes providing basic information could be enough to help convince the customer to make a purchase.

For fashion retailers it could be as simple as providing basic fashion tips to customers.

Insight From the Sales Floor

Recently, I have spent some time selling men’s clothing at a department store just outside of Saint Paul, Minnesota. In that time, I have witnessed many customers using mobile devices while shopping in-store.

While it appears that many of these customers are taking photos to send to another person to see if they approve of a purchase, I would venture a guess that other times customers are using their smartphones in the ways reported in the studies that I wrote about earlier in this post.

If the questions that customers ask associates is any indication of the information customers are searching for on their smartphones, then providing basic style advice should be something that fashion retailers would want to provide on their mobile websites and apps.

Suit photoIn particular, online fashion tips could be extremely useful to customers who are purchasing clothing that they don’t often purchase (e.g., suits, ties, dress shirts, etc.) This would include explaining the correct fit, as well as letting customers know what articles of clothing compliment each other.

And, if the information provided online is optimized for search, customers might find it while shopping in a competitor’s store. While this might seem like you are helping the competition, just think about where the customer will turn to if your competitor can’t deliver the goods. My guess is that those customers would at least consider shopping at the store that just provided the information that they were looking for.

Providing this type of basic information wouldn’t cost the company that much.

However, a quick search on Google brings up a lot of information from fashion bloggers and websites like Esquire and GQ, but not much from major department stores, fashion retailers, or even the top designer labels.

Either they are not providing this information or they are not doing a good job of optimizing their content for search engines. In their defense, I did find some information from Macy’s and Nordstrom. However, they didn’t show up in all searches that I did. Furthermore, I think that additional information might be useful.

Keep in mind that I only searched for information on men’s suits. It’s possible that they provide more information for other types of clothing. Additional research would be required to get a more accurate picture of what information fashion retailers are providing their customers online.

Final Thoughts

Studies show that finding the right online content is very important to consumers who are looking for product information when they are deciding what to buy.

Because consumers are now searching for that information while shopping in-store, a time when they are actually going to make a purchase decision, providing the right information is now even more important than ever before.

If the questions that customers ask sales associates is any indication of what information customers are looking for, then fashion retailers and department stores should be providing basic style advice and fashion tips to customers. This is particularly useful for products that customers don’t buy often and are being purchased for specific important occasions (e.g., weddings, school dances, graduations, etc.)

Since department stores can’t control how customers search, this information should be available to customers in as many ways as possible. This would include on mobile apps and on the mobile web. Letting customers know that it is available through notifications on in-store signs might also help increase conversions.

Sales associates could also help get the word out that this type of information is available to customers who don’t want to engage in a conversation. This information could also be used as a visual aid when associates are helping customers.

Finally, don’t forget to optimize your content for search. Because if customers can’t find it, then it doesn’t exist.

Photo credit: Angelbattle bros (Creative Commons Attribution-NoDerivs 2.0 Generic license – CC BY-ND 2.0.) and Banalities on Flickr. (Creative Commons Attribution 2.0 Generic license – CC BY 2.0.)

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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A New Study Finds That Improving Customer Satisfaction Really Is Good for Business

Photo credit: Iman Mosaad on Flickr.For years, marketing consultants have said that improving customer satisfaction is the key to success.

However, while most business leaders would agree that customer satisfaction should be a top priority, many executives have only given it lip service.

A new study from researchers from Michigan might change this, as they found that purchasing stock from companies with high customer satisfaction levels proves to be a good investment strategy.

These findings should be good news for everyone involved.

But, in the long run, the most notable winners could be consumers.

Higher Customer Satisfaction Indirectly Leads to Higher Stock Prices

As reported in a Science Daily article, a group of researchers from Michigan have found a link between customer satisfaction levels and higher stock prices.

According to the article, “Using 15 years of audited returns, researchers from Michigan State University and University of Michigan found creating a stock portfolio based on customer satisfaction data achieves cumulative returns of 518 percent.”

“This compares with a 31 percent increase for the commonly used Standard & Poor’s 500 Index in the same time period,” the article continues. “On an annual basis, the customer satisfaction portfolio outperformed the S&P 500 in 14 out of 15 years.”

The findings suggest that customer satisfaction is more important than many people think it is.

The researchers also warn, however, that there no direct correlation between customer satisfaction and stock prices.

According to an article published in the Journal of Marketing, “We also find that the effect of customer satisfaction on stock price is, at least in part, channeled via earnings surprises. Consistent with theory, customer satisfaction also has an effect on earnings themselves.”

In other words, increased customer satisfaction levels help businesses earn more money and higher than expected revenues help boost stock prices. Thus, customer satisfaction indirectly influences stock prices.

Final Thoughts

The reality of today’s world is that businesses often try to meet short-term goals in order to please investors.

In recent years, marketing consultants have been beating the drum for the idea that providing a great customer experience is key to a company’s long-term success.

What this research proves is that all the talk of pleasing the customer is more than high-minded rhetoric.

It is one of the keys to success.

Now that we have the research to show that improving customer satisfaction can help companies outperform their earnings estimates and thus help improve the stock valuation, the job of convincing top executives might have just gotten a little easier.

And, this is good news for everyone involved.

Photo credit: Iman Mosaad 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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In Retail, the Best Price Is Not Always the Lowest

Photo credit: William Murphy on Flickr.Whether in a brick-and-mortar retail store or on a retailer’s website, the price charged for the products or services sold will have an effect on sales.

However, sometimes the retailer with the lowest price around won’t have the highest conversion rates.

This post is intended to highlight some of the ways that price influences purchase decisions in the real world.

Prospect Theory

If you took an introduction to economics class in college, you are probably familiar with the law of supply and demand. It basically asserts that, if everything else remains the same, as the price of a product decreases, the demand for the product will generally increase.

However, in the real world, this relationship does not always prove to be true.

The reason for this can be explained by a theory developed by Dr. Daniel Kahneman and Dr. Amos Tversky.

According to Wikipedia, “Prospect Theory is a behavioral economic theory that describes the way people choose between probabilistic alternatives that involve risk, where the probabilities of outcomes are known. The theory states that people make decisions based on the potential value of losses and gains rather than the final outcome, and that people evaluate these losses and gains using certain heuristics. The model is descriptive: it tries to model real-life choices, rather than optimal decisions, as normative models do.”

As several experts have pointed out, this plays out each and every day in the retail world.

Consumers Will Pay Full Price for Some Brands

As you know, there are a few brands that have established enough brand equity that people are willing to pay higher prices for the products and services that they sell.

Often this means that retailers can sell these products to customers at full price.

And, in some cases, even the sale prices for these items are higher than the full price of some of the less expensive alternatives.

As I will explain later in the post, these products are extremely important to retailers for many reasons.

The Power of a Sale

In his New York Times bestselling book, titled “Contagious: Why Things Catch On,” Dr. Jonah Berger mentions an experiment conducted by Dr. Eric Anderson and Dr. Duncan Simister.

As explained in the book, Dr. Anderson and Dr. Simister partnered with a company that sends clothing catalogs to people all over the United States.

To test the power of a sale, they send two versions of the catalog to people all over the country.

In one version, they listed a specific product at full price and in the other they said the product was part of the “Pre-Season SALE.”

However, in reality, the price was exactly same in both versions of the catalog.

The only difference was that in one version it was listed as a sale price and in the other it was not.

In the end, they found that just by saying the product was on sale increased sales by more than 50 percent!

The Size of the Discount Matters

In “Contagious: Why Things Catch On,” Dr. Berger uses an example of two stores selling the same grill to illustrate how the size of the discount can be more important than the final price that the item is sold for.

As he explains, the store in scenario A lists the original price of the grill as $350, but sells it at a sale price of $250.

On the other hand, the store in scenario B lists the same grill at an original price of $255, but sells it at a sale price of $240.

When Dr. Berger asked 100 different people to evaluate each scenario, he found that 75 percent of people who were given scenario A said that they would purchase the grill, but only 22 percent of people given scenario B would make the purchase.

In scenario A, the sale price is $100 less than the original price. In scenario B, the sale price is only $15 less than the original.

However, remember that in each case the grill is exactly the same, but the final price in the second scenario is actually less than the first.

In this case, it was the size of the discount, not the actual final price that got people to say that they would make a purchase!

How the Discount Is Stated Matters (The Rule of 100)

In the book, Dr. Berger also highlights the fact that the original price will determine whether to list a sale in terms of a percentage off or an actual dollar value.

“Researchers find that whether a discount seems larger as money or percentage off depends on the original price,” writes Dr. Berger. “For low-priced products, like books or groceries, price reductions seem more significant when they are framed in percentage terms. Twenty percent off that $25 shirt seems like a better deal than $5 off. For high-priced products, however, the opposite is true. For things like laptops or other big-ticket items, framing price reductions in dollar terms (rather than percentage terms) makes them seem like a better offer. The laptop seems like a better deal when it is $200 off rather than 10 percent off.”

Dr. Berger goes on to explain that a good rule to follow is that if the product’s price is less than $100, then a percentage discount seems like a better deal. On the other hand, if the price of the product is more than $100, a discount expressed in the number of dollars off is a better way to go.

Full-Priced Items Can Make Other Products Sell Faster

Remember those full-priced items that I mentioned earlier in the post.

The fact that a store sells them can actually help increase the sales of the mid-range items that it sells.

In “Brainfluence: 100 Ways to Persuade and Convince Consumers with Neuromarketing,” Roger Dooley highlights the fact that selling high-end items increases the likelihood that people will buy products that are considered the next best option.

As Dooley points out, “A Standford University experiment had a group of consumers choose between two cameras, one more full-featured than the other. A second group chose from a selection of three cameras, which had the other two cameras plus one even higher-end model.”

“The first group split their purchase about 50/50 between the two models,” writes Dooley. “But, in the second group, fewer of the cheapest unit sold while more of the second camera sold. Adding the very expensive model made the second camera look like a reasonable compromise.”

Therefore, adding high-end items that sell at full-price can be a good choice for retailers. If the full-price items sell… great. But, if not, they might help increase the sales of the mid-level products sold at the retail store.

Keep in mind, this only works if customers see all the options available to them.

Therefore, it is not surprising that in many brick-and-mortar retail stores, people have to walk past the really high-priced items to get to the other options available to them. This makes the other items seem like a bargain in comparison.

A similar thing could be done on a website by listing other options available when customers search for specific products. The great part of an online store is that retailers can easily do A/B tests to see what website design converts the best.

Final Thoughts

In his book, Dr. Berger explains how the price of products and services influence sales. His book includes an explanation of Prospect Theory and how it can be used to explain why the store that sells a product at the lowest price doesn’t always sell it at a higher rate than other retailers in the area.

Roger Dooley’s book also highlights how price can influence sales in several different ways.

Both books offer lessons that retailers can use both in their brick-and-mortar stores and online.

In the end, it is important to keep in mind that people don’t always act the way that we would predict that they would.

Therefore, we need to test different options in an effort to find the underlying reasons why people do or do not buy products.

This will allow retailers to modify the shopping environment in an effort to increase the number of conversions and ultimately improve the bottom line.

Photo credit: William Murphy 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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