Senator Jay Rockefeller finally introduced the long-awaited Do Not Track bill that is likely to wreak havoc on data-driven design strategy. The bill restricts the ability of companies to collect information on consumers who have indicated they want to opt out. The bill creates a universal legal obligation for companies to allow customers to opt out of being tracked on web sites and mobile devices, and authorizes the FTC to punish companies who don’t abide by the regulations.

For retailers, the bill could have significant consequences, especially if it functions like the “Do not call” legislation of a few years ago, with one call covering all the possible companies involved. It’s not clear what the final bill will allow and disallow. I agree with the need for privacy, but I think retailers should be able to track people anonymously without restriction, meaning that all personal identifiers are left out of the record.

We’ve conducted quite a few interviews with millennial females about privacy (see video about location tracking at: http://www.youtube.com/watch?v=e_1kOFVY3Bw).

We’ve found that, once people understand the benefits of being identified, they are usually in favor of surrendering a limited amount of personal information. Retailers will have to find a formula that incentivizes the opted in customer in order to be granted permission to track them. I think the best way to do this is also the best way to gain long term relevance: Provide value-add content that engages customers on a topic of common interest related to the product or service offering of the company. This path not only supports various programs like opt-ins and social media campaigns, but also helps SEO/SEM and long-term loyalty in the Attention Economy.

“Recent reports of privacy invasions have made it imperative that we do more to put consumers in the driver’s seat when it comes to their personal information,” Rockefeller said in a statement. “I believe consumers have a right to decide whether their information can be collected and used online. This bill offers a simple, straightforward way for people to stop companies from tracking their movements online.”

After a user makes a request to stop being tracked, the companies in question would only be able to continue collecting certain information on customers if it’s absolutely necessary in order for the site or service to function. That information must still be anonymized or destroyed after its usefulness expires, and the user must still give explicit consent for the information to be used that way.

For more info about the bill, see: http://tinyurl.com/5u8kxp2.

A study on mobile search and digital commerce by Performics showed that 49% of mobile searchers made a mobile purchase in the past six months. Furthermore, 84% of respondents who use mobile web say they use search to find retailers. These data points indicate that paid mobile search and mobile SEO should be a major component of retailers’ mobile strategy, and not just an extension of the approach used in other digital channels.

Performics conducted the 2011 Mobile Search Insights Study with ROI Research. The study, which focused on people who use a web browser on a mobile device, also concluded:

- 57% use the mobile web more than once per day

- 77% have used mobile search more than five times in the last month

- 75% said that mobile search makes their lives easier

- 63% said access to mobile search has changed the way they gather information

- 32% said they use mobile search more than search engines on their computers

The study found the following usage patterns of mobile usage:

- 74% while running errands

- 56% while attending social events

- 47% while commuting

The prevalence of mobile usage during these types of activities underline the importance to retailers of reaching customers through a mobile search experience. Statistics about mobile tasks emphasize this point further:

- 84% look for local retailer information (phone, address, hours)

- 82% find online retailers

- 73% find a specific manufacturer or product Website

- 71% learn about a product or service after seeing an ad

- 68% find the best price for a product or service

- 63% search before purchasing offline in a store or from a catalog

To read the Performics press release, see: http://tinyurl.com/5vajkhm

Chompon measured the value of the most common social commerce interactions and produced a report with the findings. Their original research question was: “What is the value of a social action in online commerce?”

The values (in gross revenue per action) from different social commerce actions were:

*Chompon believes the true value for likes and follows to be much higher due to creation of long-term loyalty, which were not measured in this exercise.

For Shares and Tweets, Chompon was able to directly attribute sales to the original action, so they took the total revenue attributed to each action and divided it by the total number of shares/tweets. For Likes and Follows, they had to estimate attribution by looking at their traffic references and subtracting out purchases made through shares/tweets as well as purchases made through direct traffic.

Chompon intends to broaden the research by evaluating the following factors and actions:

- Pricing perception when bundling products/services according to social/demographic data

- Incentivizing social actions with discounts

- Showing friend purchases and analyzing effects on conversion rates

- Product/service conversations’ effects on sales (e.g. experimenting with Facebook’s new commenting widget)

- Scarcitymanipulation through limited/blackoutdates

- Credits’ conversion rates and ROI

To obtain a copy of the original prez, go to:  http://tinyurl.com/4s7h552

IBM jumped into the Social Commerce fray on Monday with both feet, announcing the formation of a new division called “Smarter Commerce.” Smarter Commerce offers real-time marketing analytics and brand assessment tools for Facebook and Twitter, as well as other marketing programs, such as advertising, marketing campaigns and catalogs.

The division will provide real-time analysis of online consumer behaviors in response to marketing campaigns, ads, social networks and catalogs. It will also offer insights related to campaign budgets and objectives. IBM will help its customers compare the effectiveness of different kinds of campaigns, in different channels. Customers will be able to see how its brands are being talked about in social media venues, and help them to influence those views by targeting key sources across social networks. Having a direct read across all digital media will obviously impact the digital design strategy that ties together and creates a unified brand and customer experience.

The move is interesting to me for two reasons. One, because IBM is acknowledging, in a big infrastructure kind of way, that social commerce is real and it’s here to stay. (See Usography’sRetailer Social Commerce Scorecard to see how retailers stack up on social commerce features). It’s also interesting because IBM is placing such a high value on understanding consumer behavior, emotive decision-making beyond aggregated analytics, which has been the focus of Usography’s consulting practice since its inception 9 years ago.

IBM’s pitch is founded on the evolution of consumer behavior due to the widespread adoption of social commerce tools:

“These customers are empowered by technology, transparency, and an abundance of information. They expect to engage with companieswhen and how they want, through physical, digital and mobile means.They want a consistent experience across all channels. They comparenotes. And they can champion a brand or sully a reputation with the click of a mouse.

Nowhere is this shift more visible than in the retail industry, where companies are rapidly adapting to this new reality, integrating their marketing efforts and using analytics to better understand their new, more fickle customers. But retail is only the beginning. It is merely the front line of a customer revolution that will eventually reshape the entire value chain, from the way raw materials are sourced to the way they are manufactured, distributed and serviced. Because keeping up with today’s customer will take more than an email marketing campaign and a Facebook page. It’s going to take a better system of doing business. It’s going to take Smarter Commerce.”

In 2010, IBM spent $2.5 billion acquiring several companies that are expected to form the systems end of the package: Unica (analyzing and predicting customer preferences in marketing campaigns); Coremetrics (capturing and analyzing web analytics); and Sterling Commerce (connecting online and offline networks of suppliers and customers).

The investment is significant, even for a behemoth like IBM. IBM has said it will deploy over 1000 salespeople, developers and consultants in this new division. IBM estimates the Smarter Commerce business will have revenues of $10 billion by 2015.

IBM already has several customers signed up for the new service, including 1-800-FLOWERS, Staples, Danone, and some financial services firms.

IBM realizes that customers are puzzled about social commerce. To help educate its customers, IBM is starting a “Smarter Commerce University.”

The survey of 3001 U.S. adults indicated:

- 85% own a mobile phone

- 59% own a desktop

- 52% own a laptop

- 47% own an iPod or other MP3 player

- 42% a game console

- 5% own an e-book reader, and

- 4% own an iPad or other tablet computer

The infographic below breaks down the data by generation. Millennials are ahead in mobile phones, laptops, mp3 players, and iPads, but X-ers are keeping up in terms of game consoles and iPads. Millennials own relatively fewer desktop computers, which isnt surprising.

Since iPads and tablets have a higher conversion rate than other mobile devices (I’ll post the data another time), then retailers need to start researching Millennials and their mobile usage, a process Usography has already begun (see sample video at: http://www.youtube.com/watch?v=HFdo1jKphSQ).

The full Pew Research report can be downloaded at:

http://pewinternet.org/Reports/2011/Generations-and-gadgets/Overview.aspx

]]> http://www.digitaldesignstrategy.net/device-stats-how-many-people-use-each-type/feed/ 0 http://www.digitaldesignstrategy.net/jcpenney-rises-to-google-1-then-drops-precipitously/ http://www.digitaldesignstrategy.net/jcpenney-rises-to-google-1-then-drops-precipitously/#comments Wed, 16 Feb 2011 06:43:34 +0000 Virtual Floorspace http://www.digitaldesignstrategy.net/?p=66 [/caption] Google wasn't especially upset about the discovery. Why should they be? It places Google in the referee role in an extremely high-stakes game. JCP fired their SEO agency, while denying any guilt or complicity in the scheme. But the holiday season results that were impacted by the results can't be taken back, can they? My overall impression from the article is that  JCP is smiling like the cat that ate the canary. So is anyone really unhappy about this? I'm not. I think it's an amusing side show to the digital design strategy stage.]]> http://www.digitaldesignstrategy.net/jcpenney-rises-to-google-1-then-drops-precipitously/feed/ 0 http://www.uxstrategy.net/2010/12/mobile-commerce-should-retailers-focus-on-app-or-mobile-site/ http://www.uxstrategy.net/2010/12/mobile-commerce-should-retailers-focus-on-app-or-mobile-site/#comments Mon, 20 Dec 2010 16:29:44 +0000 Paul Bryan http://www.virtualfloorspace.com/?p=610 Retailers are moving quickly to capitalize on the growing number of smartphone users. A major decision that retailers need to make is whether they will invest in producing a branded mobile app, or whether they will focus those resources on the mobile version of their primary e-commerce web site. This decision is different for each retailer, based on category assortment, customer demographics, dev resources, etc.

In general, I think retailers should focus resources on their mobile web site rather than apps, unless they are number 1 or number 2 in their category. There are a number of reasons for this. One is the limited range of activities for which users prefer apps over mobile web sites. initiatives.

In a recent eMarketer survey, participants indicated they prefer a mobile app in only three categories: social networking, music and games. Otherwise, they prefer to use mobile websites.

The top one or two brands will capture enough attention to make it into the app lineup, while the rest will fight for awareness. This sounds, perhaps, like forfeiting or giving up the fight competitive advantage, but it’s really deciding how to use scarce resources to meet the greatest number of customers’ needs. For an app to get noticed, downloaded, and used will cost a significant amount of marketing resources, while mobile SEO follows similar principles to standard e-commerce SEO. “App fatigue” will quash the aspirations of the second-movers.

Mobile web sites can leverage patterns and standards used in the primary e-commerce site, while apps require special development. The capabilities of the different platforms are becoming less distinct with HTML 5. Also, mobile web sites can be viewed on all devices, but apps must be developed specifically for different platforms, i.e. one for iPhone, one for Android, etc. Very costly, particularly when integrated with real-time location-based inventory.

In a recent Mobile App Check survey (3,500 males and 3,500 females, 18 years and older), the top apps were discovered in terms of usage. Only 10 apps are used per person on a regular basis. Only 30 apps on average are on a device. The top apps are Facebook, Google Maps, Weather, Pandora, Twitter, and some entertainment apps. Retailers have not yet penetrated the top levels in the app-osphere.

Instead of using resources to develop an app that only can be used on certain devices, and which is in danger of not being used at all, I recommend that retailers focus on creating a mobile web site that is specifically designed to accommodate customers in the way they shop that particular retailer, taking into account channel-switching behaviors for added convenience. They should also focus on SEO to ensure the site is found. Paid search and affiliate shopping placement should ensure that when customers are driving around, or better, are standing in the aisles of competitors, that the retailer’s offering can easily be accessed with little effort. Location-based services like check-in for deals and QR codes for added in-store information will boost mobile-enabled in-store conversion rates.

Of course, the above considerations pertain to “either – or” optimization of resource decisions. Having a branded app is also a vehicle for brand voice (and self-respect?) that could outweigh pedestrian concerns like traffic and conversion. How could a retailer at our stature and history NOT be worthy of an iPad app? What customer utility is served by Pottery Barn’s catalog viewer app, or Gap’s 1969 Stream? Only later will executives question the business owner and design lead, asking: “Why is our app performing so poorly? It’s a beautiful design but customers have not adopted it.” Kind of like e-commerce sites in the 1990′s. Well, there’s something to be said for consistency.

The subject matter of the tests is meeting events rather than consumer products, so retailers will need to interpret and apply the results to their respective categories as they see fit. However, the model for determining value is interesting because it captures ROI in a channel that is, for many retailers, speculative at best.

To conduct the studies, Eventbrite developed their own social analytics tools that were able to link sharing from specific user events, such as a Facebook “like”, to conversion. With the sophisticated analytics tools that large retailers typically invest in (Omniture, Coremetrics, BazaarVoice, etc.), arriving at such metrics should be a straightforward exercise of tracking link traffic into the site and analyzing subsequent clickpaths and conversion.

Conclusions of the report were:

1) Dollar value of share events:

• Facebook value of a single sharing event: $2.52
• Twitter value of a single sharing event: $0.43
• LinkedIn value of a single sharing event: $0.90
• Aggregated value of a single sharing event: $1.78

2) Facebook traffic exceeded Google traffic for the first time for Eventbrite.

3) Each Facebook share drives 11 visits back to Eventbrite.com

For example, in a resort web site or kiosk, guests may be looking for leisure activities, finding products they forgot, reading about the history of the area, etc. Each of these modes should be simple and straightforward to find in terms of access points, make it easy to achieve the most common and most valuable goals, and represent the task using design components that appear especially suited to the activity (i.e. high affordance). The modes should not be cluttered with lots of options that are unrelated to the mode customers have indicated they want to work in. Marketers often want to surround and interject this experience with lots of selling options, but many times this is interpreted by users as visual noise that damages the perception of the experience and isn’t effective. Looking at the analytics for such off-task design elements, I’ve nearly always found clicktrhroughs to be near zero. If they have to be there, make sure they are not obstructing progress in the primary activity. Billboards are okay, but on the side of the road, not in the middle of the road. And spaced apart so that the visual signal to noise ratio is at a reasonable level.

Copyright 2009, Paul Bryan, Usography Corporation (http://www.usography.com)

Linked In: http://www.linkedin.com/in/uxexperts

What does that mean for UX designers, marketing managers, and e-commerce strategists? Probably a broader range of tools to measure engagement and conversion in rich media. But Adobe has some pretty thick garden walls. I wonder if the other major analytics players and rich media platforms will experience a strange discontinuity in tracking and reporting capabilities?

The tagging scenarios could be a source of serious headaches. You get a standard set of analytics behavior tracking widgets when you have the right combination of front end and analytics technologies. But when you want to change either, you lose the widgets and integration with historical data.

Then again, it might be fine.

Copyright 2009, Paul Bryan, Usography Corporation (www.usography.com)

Linked In: http://www.linkedin.com/in/uxexperts