Monthly Archives: June 2014

Mobile pushes young adults to shop at the mall. But why?

mobile samsung tabwatch

 

Well, this is interesting. A recent survey found that mobile devices make young adults 2x more likely to buy something at a physical retail store — but only young adults. Why?

In May Gallup asked 1,505 U.S. adults if mobile devices such as smartphones had boosted their in-person retail store shopping. Most adults over age 30 were ambivalent, with about 20% saying they shopped more as a result of iPhones and tablets, a similar 20% saying less, and the remainder saying no change at all.

But young adults were different. 29% of adults 18-29 years old said mobile had increased their in-store shopping, while only 15% said mobile had decreased it. That’s nearly a 2-to-1 edge for mobile pushing youth to the mall, a whopping finding. What gives? Why would mobile communications push young people to stores to buy, while most other adults ignore them?

Here are four possibilities:

1. Younger adults might have less access to credit cards, so mobile necessarily pushes them to physical stores. Gallup floated this idea in explaining its study, but it’s unlikely — since 60% of college seniors now have a credit card vs. the 70% U.S. adult average, the slight difference would not account for the 2x response in youth to mobile influence.

2. Younger adults spend more time at the mall, so mobile is more likely to increase their shopping while there. Hm. Possible. A recent tracking study of malls around the United States found that 34% of visitors were adults age 18-24, while that same demo makes up only 15% of the U.S. population. If young people are already there, mobile would be likely to get them to spend in stores.

3. The primary use of mobile is to enable social behavior, and young adults are more likely to think of shopping as a social experience. Teens, for instance, go shopping 75% of the time with friends, and 64% of adults age 18-24 go to the mall with someone else vs. being alone (vs. 55% among all adults), according to a 2009 Arbitron study. This confluence of mobile-social-shopping behavior among youth and young adults would make mobile communications more likely to drive retail purchases.

4. Youth are more open to mobile or social communications related to commerce. This conjecture is hard to prove, but another recent Gallup study did find that young adults were more open to social media influencing their purchase decisions. 43% of Millennials said social networks spurred their commerce, vs. only 34% of Gen Xers, 26% of Baby Boomers, and 16% of the oldest adult demo that Gallup kindly calls Traditionalists. Social media is not exactly mobile, but it’s close enough we can surmise youth are also more open to mobile messaging that drives shopping.

We suggest the correct answers are 2, 3 and 4 above. Youth go to the mall. Mobile is social. And social influences young adult shopping. This is important news for marketers who are struggling to reach the future generation of shoppers, since humans tend to take their media habits with them as they age.

If you’re wondering why Amazon went to the trouble of launching its own smartphone, or Facebook is so interested in pushing ads into the main mobile Newsfeed, Gallup tells you why.

Google patent pulls personal data up from the crowd

dance club dancers

At SXSW this spring, Robert Scoble said the big news about wearable technology isn’t what it allows you to do (capture video via glasses or monitor health stats on your wrist) but rather the data it captures about you. Wearable tech is filled with sensors that watch what you do, where you go, and what you like. Google Glass, for instance, has a gyroscope, accelerometer, magnetic field detector, light sensor, location sensors, touchpad, camera/video input, sound input, and sensor tracking your eye movements so you can wink to take a picture. Privacy advocates freak out over what large data companies could do with all of this information, since your hand motions, heartbeats and eye movements can signal, for instance, whether you are lying.

But what happens when all that new data helps companies monitor groups in a room?

Google has received a patent that would upload preference data from mobile devices to allow environments to personalize the media played for crowds in a given venue. The patent, titled sexily “Collaborative Rejection of Media for Physical Establishments,” would pull wireless signals from a group of people in a setting, such as a film screening, concert theater, or disco, and use either direct input from individuals or the history of user preferences to modify the media presented. If a group of country music fans from Tennessee walk into a New York City bar, the tunes could flip automatically to Blake Shelton and Dierks Bentley. While the obvious use would be to customize music playlists in stores, restaurants or bars, this system could also tap the collective preferences of the group in a facility to tailor video content, ad messaging, even film plot lines. 

And not all votes would count. The most intriguing aspect of the Google patent is it recognizes that not all customers are created equal. In one scenario, “a customer having the premium status is afforded superior media file rejection.” If you’re walking next to an affluent businesswoman at an airport, a digital screen could size up both of you and flip to the ad message she is interested in, if she had greater financial value to the company pushing the message.

It’s an elegant concept, because it solves the problem of personalization in public spaces. When 20 people are in a room, it’s hard to know what image to push onto a screen or over the audio. If 3,000 people are at a concert, it’s cumbersome to interrupt them all to ask for feedback on the music set list. Now, Google can sort the media via monitoring signals from mobile gadgets (perhaps eye dilation or heart rhythms in the near future) to please the statistically most relevant people in the audience. And because all of this will be based on an invisible signal from all of your pockets, the implementation would not be as freaky as a large-screen ad retargeting only you, so consumers will be unlikely to rebel.

Cheers, mobile-device carriers. Soon at the bar, marketers will know all of your names.

 

Amazon’s product recognition kicks Apple’s glass

amazon fire phone

 

What are we to make of the Amazon Fire Phone? Forget the design. It holds the killer marketing app — impulse-tapping product recognition.

The constant story of invention is when the Big New Idea comes along, at first nobody knows what to do with it. When Lord Kelvin heard of Guglielmo Marconi’s wireless telegraphy, a device to send signals magically through the “ether” via “waves,” he said, “wireless is all very well but I’d rather send a message by a boy on a pony.” Second, once the invention is established as useful, people invest wildly in the inventors. Third, and finally, the invention becomes a platform that morphs into a commodity that induces yawns.

Nobody today is rushing out to invest in radio towers.

Which brings us to modern mobile phones and tablets. Apple made us gaze in wonder at the first iPhone in 2007, when Robert Scoble emerged from the store with two (the limit then!) boxes in his hands. Now, shiny pretty screens are commodities, and soon will be ubiquitous. The new Amazon phone has a 13 megapixel camera and hi-def screen, but who cares? So does every other phone. Frankly, Amazon, your phone design is a yawn.

But. Oh, man. Amazon’s phone has a killer feature — product recognition. Wisely, the retailer giant is betting far beyond a  hardware design to a new, revolutionary system that connects you instantly to any product you capture via the phone’s camera or audio. The Amazon Fire phone uses a “Firefly” app that can recognize in a second more than 70 million products, or listen in on audio to pick out 240,000 movies or 160 television shows. Whatever is around you, if you like it, you can instantly bookmark it or buy it.

Miss, I like your dress. Snap. I just bought it for my wife.

Dude, great shoes! Snap. Now on order to my home.

That YouTube trailer looks like a great flick! Snap. Downloading to watch this weekend.

More than a simple dongle tying you to Amazon’s ginormous product ecosystem, this Fire phone is a new way to tap the Holy Grail of marketing, influencing consumers at the impulsive point of purchase. Amazon could seriously cannibalize other retailers — say, Walmart or Target or Macy’s or Nordstrom — by allowing you to quickly and easily price-shop by snapping a picture of any product on any shelf. Amazon, which has learned to thrive on razor-thin product margins, will undercut other retailers too keen on inflating price with rapid delivery of the same product.

Meanwhile, as Amazon makes purchasing easier than ever, it will collect an entire new ecosystem of data about you. It already knows your shopping habits and can infer from them deep data on your personal psychographics and behavior. But an Amazon phone will collect your location as you search for items, and can pinpoint how consumers are changing gears while at competitor locations. Imagine a heat-map of every consumer ordering shoes from inside every shoe store in the world, and then parsing which stores have the highest conversion rates or shopping-cart abandonments so Amazon marketers could adjust  pricing and product selection accordingly to compete more deeply with Dick’s Sporting Goods. As the data accumulates from consumer real-time, location-based, in-competitor-store transactions, Amazon will gain a data edge that no other retailer could match.

Or a final idea — we’ll give this one to you for free, Amazon marketers — is tying location to variable pricing. If Amazon were really clever/evil, it could adjust pricing from any phone inquiry to nudge you to buy from Amazon instead of the store you’re walking in, by slightly undercutting any store’s individual product price and using higher margins elsewhere to offset it. Say, you find shoes you like at Dick’s for $95, so Amazon could offer them to you as you check on your Fire phone for $90 instantly — and only you — while charging  other consumers who blindly click to the main Amazon.com website $97. If only 1 in 5 shoppers needs the price break, Amazon would still come out ahead.

It feels like a chess move that Garry Kasparov might make. Well, at least Amazon can’t get products to you in just a few hours. Something that crazy might require shipment by drones.