High Street Cluedo

Every couple of months I come across an article about the receding British high street. Each article briefly touches upon various factors contributing to the decline of the high street. The usual reasons are; supressed consumer spending, competition from multi-channel retailers such as Tesco, high business rates and there is the odd mention of the internet. Throughout this blog I will investigate some of the reasons why I think the high street isn’t as successful as what it once was.

If you Google something along the lines of ‘fall of the UK high street’ you will be greeted with endless pages of articles and statistics for the last few years. If you don’t have time to rake through the plethora of results don’t worry because I have. Essentially the recession has not been kind to the British high street, not only SME’s but also larger chains of retailers. In the first 6 months of 2012, the high street saw 35 failed retailers, it doesn’t sound like a huge number but those 35 retailers had 3053 stores between them. Some of the stores we have lost so far in 2012 are Peacocks, Past Times and Julian Graves.

The number of retailers that went into administration peaked in 2008 and has fallen significantly since. The peak in 2008 coincides with when the UK went into recession, consumer confidence was low, banks started to tighten their lending criteria and redundancies followed. I’ve already talked about consumer spending in another blog: To spend or not to spend, that is the question? It goes without saying that the recession has impacted consumer spending, but they are still spending. Many would consider it foolish to think that the recession hasn’t had a negative impact on the high street, and I agree but I think there is more to it.

Another threat for the high street is the expanding portfolio of multi-channel retailer’s such as Tesco, Asda and Sainsbury’s to name a few. Not only were they responsible for endless closures of local convenience stores, butchers and grocers but over recent years they have continued to diversify their product offering. Who would have thought twenty years ago you would be able to book a holiday, buy a mobile phone, buy clothes or a car insurance policy through your local supermarket? A number of major supermarkets even have their own bank and one has recently announced they now offer mortgages. Not only have they extended their product ranges but also increased the number of stores in their portfolio.

Online shopping is having a major impact on the high street, and I think this is set to continue. Even the way in which we can buy online is evolving on almost a daily basis, gone are the days waiting for the dial up connection, to then lose the connection at the checkout stage. Now we can access our favorite stores on a multitude of devices such as mobiles and tablets, more importantly 24 hours a day, 7 days a week.

  • In 2011 online sales in the UK were £50.34 billion which accounted for 12% of UK retail trade.
  • 87% of internet users have brought something on line in the last 12 months (from February 2011)
  • Online spending exceeds that of any other European country.
  • Ofcom estimates that average online consumer spend is £1031

The internet hasn’t only increased the products we have access too but more importantly how consumers make their purchases. A company at the forefront of this change is Tesco. They have recently opened the UK’s first interactive virtual store at Gatwick. The virtual store will allow passengers to browse as they would in a physical store. Shoppers are able to order goods from the virtual store using barcode scanners on their smartphones, their shopping will then be delivered when they return from holiday. This may be new concept for the UK but it’s been in place in Korea for a year now, allowing commuters to shop in subways and at bus stops.

Amazon is another online retailer which is constantly revolutionising online shopping. You can buy practically anything on Amazon now. When they first started they connected retailers to buyers, but they encountered a few fulfillment problems. Back then if you purchased something through Amazon and the retailer failed to send the goods the consumer blamed Amazon for the missing items, even though the liability fell with the retailer and not Amazon. In order to protect their reputation Amazon opened their own fulfillment centres (they have 8 throughout the UK). Now if you order something via Amazon it is likely that the item has been dispatched from their fulfillment center and not directly from the retailer. It has also allowed Amazon to offer a same day delivery.

Most of us will be aware that a large proportion of consumers research items online prior to purchasing them in store. One retailer to take advantage of this is Argos with their click and collect service, you can browse and order products online and then pick them up in your chosen store.

In summary, there are a number of issues contributing to the failing British high and I don’t think we can pin point one particular reason. One thing is clear; in order for high street retailers to survive they need to develop their online presence/strategy. Companies such as Amazon and Tesco have set the bar so high in terms of their online services; other retailers need to attempt to catch up.

Do you have any examples of developing retailers? If so please leave a comment below or email me jodi.stuart@realradio.co.uk or tweet me @realradiojodi

It’s not what you view, but how you view it!

When I started writing this blog I researched the topic and found a number of interesting statistics. It’s not a form of media that my colleagues come up against very often, other than the facts and figures I didn’t know an awful lot about it. By chance (thanks to LinkedIn) I came across a man that does know about the industry, so we met up for a coffee and he was kind enough to let me pick his brain. So I would like to thank Jason Gill from Peter Gill and Associates for educating me on TV advertising.

Of all the media available in the market, TV is more often than not the most expensive platform to advertise on. There are two main expenses when it comes to running TV campaigns, airtime and creating the advert. Due to the costs involved it is often perceived to be exclusively for larger brands. However, this is no longer the case…..

Not so long ago a huge production crew was required to create the advert, it was the number of crew members that made it expensive. Developments in technology have changed (for the better) how visual adverts are created and recorded. Now you don’t need as many people to make the adverts, which have reduced the production costs. Jason mentioned he was recently involved in creating an advert that only cost a few hundred pounds, so spending thousands of pounds on an advert isn’t always necessary.

The cost involved when buying TV airtime will vary depending on what you require (it’s no different from any other media in that respect). Things that affect the price are, seasonality, the duration of the advert, the time of day it is aired and the channel that you want to advertise on.

Here are a few reasons why advertisers use TV.

  • In 2011 the average individual daily hours of TV viewing were 4 hours 3 mins (9 minute increase from 2002) (this equalled the record set in 2010)
  • The average weekly reach (based on at least 3 mins consecutive viewing) was 94.8%
  • 40% of primetime tweets are about TV
  • Total TV revenue (linear and sponsorship) reached a new record high in 2011

When it comes to advertising revenue market share, TV really blows every other media out the water. According to Nielsen, in 2011 TV accounted for 38% of all advertising revenue throughout the UK.

The advancement in technology has changed how consumers interact with adverts, running a successful television campaign now requires more than an engaging, emotional or educational visual content.  Joint research from Thinkbox (TV marketing body) and the IAB shows that as a result of seeing an ad:

  • 57% of people agreed that they have conducted online research.
  • 36% had visited a brands website to find out more.
  • 28% had searched the web to find out where to buy the brand.
  • 21% had purchased online.

The increase in broadband, laptop and smart phone ownership has essentially brought the high-street into the living room and TV is the point of sale medium.

A TV campaign is no longer restricted to only airing the advert on TV, now you can up-weight the campaign to include mobile marketing and an online presence with the broadcaster. Did you know that 57% of TV viewers view the web simultaneously? Companies aren’t limited to only using broadcasters other services. Now they can run online campaigns in conjunction with their TV commercials, mainly through social media sites such as YouTube, Facebook and Twitter. It’s all about engaging with the audience and building the company or brands profile. One brand to do this incredibly well was Old Spice; do you remember the hunk on the horse?

This advert was fantastic for a few reasons; Old Spice had managed to create an advert that was not associated with the perceived ‘granddad’ Old Spice customers. They went on to create one of the most memorable social media campaigns, a two day marathon of personalised video responses to questions asked by fans on Twitter and YouTube. I found a few statistics for the social media campaign:

  • 80,000 Twitter followers in 2 days
  • Facebook interaction increased 800% with personalised videos
  • Sales figures increased by 107%

I can’t really write about TV advertising without mentioning ad-avoidance. I’m sure at some point we have all fast-forwarded through adverts. According to Thinkbox, 2.5 billion ads are seen every day. As long as we have seen the advert once, 65% of us would be able to recall the advert as if it had been played at the normal speed. Thinkbox also say that “Of all the TV watched in the UK, 93% is viewed live, so only 7% of ads are even capable of being skipped. In fact we are watching more TV ads at normal speed than ever, 41% higher than in 1999.”In fact, Digital Television Recorders (DTR’s) are allowing consumers to rewind their favourite adverts and watch them again. (Note: Thinkbox’s figures are in relation to the % of adverts skipped, not avoided. According to the Radio Advertising Bureau, 44% of TV adverts are avoided).

In summary, consumers are watching more TV than ever before. It’s no longer solely about the content or idea behind the advert but also how they interact with you online. If you still think TV advertising doesn’t work or is no longer successful then I’ll leave you with this: TV’s profit return on investment has increased by 22% in the last 5 years.

The Nuggets – I was challenged by Jason to find this information!

  • 97% (25.2m) of UK households are digital
  • 10.853m have Freeview
  • 10.253m have Sky
  • 3.763m have Virgin
  • 1.4m have Freesat
  • 575,000 have BT Vision
  • 460,000 have analogue

(Source: BARB and BT Vision, Sky and Virgin)

Please leave a comment below, email me at the station Jodi.stuart@realradio.co.uk or tweet me @realradiojodi

Social Media – It’s not about the size of your boat, it’s how you row it!

Disclaimer: I’m not a social media expert (well not yet, but I’m working on it!)

When I was asked if I wanted to turn the reports and presentations I was writing into a blog format, I jumped at the chance. Other than Facebook I had no experience of social media, so I started spending a lot of time on Google to learn about the subject. Having learned lots I want to run through some of the things I picked up, not from an ‘experts’ perspective but as someone who has put ‘social media’ into practise.

Should I adopt a social media strategy? Well do you have customers? Of course you do otherwise you wouldn’t have a business/job. Social media is a form of communicating with your clients in a more personal way, it’s on their terms and they choose whether to engage with you or not. In my opinion, it doesn’t matter if you work/own a small or large company; every business should have a social media presence to communicate with existing and prospective customers.

Content is a huge topic with many different aspects to consider, it really deserves a separate blog to cover it. As there are so many good blogs out there that cover content, I’ll keep my thoughts brief and talk only about blogs and micro blogs.

Not posting content would be like picking up an incoming call and not saying anything, the person on the end would hang up and probably seek out your competitors. Recently I have spoken to a few people about digital content; the biggest issues seem to be….

  • What would I write about?
  • Why would people be interested in what I have to say?

So here are some simple ideas for content

  • Think about conversations you have with customers and suppliers.
  • Do they ask for advice or questions?
  • So many of my blogs have started from a conversation or question, even this blog was initiated from a chat.
  • The internet makes it easy to research products online, think about the last time you brought a car; I bet you checked out the performance, economy and safety features etc online before parting with your cash.
  • Write product reviews, testimonials or even case studies of the good, the bad and the ugly.
  • If your ideas come from your customers then I bet other people will be interested too.

The next step is to decide which social media platforms to use. This will depend on your business and whether you are targeting B2B or B2C.

The are three main platforms to consider:

(Yes there are endless platforms to choose from, but I’m looking at what I consider to be the three most popular sites)

  • Facebook,
  • LinkedIn
  • Twitter

I chose to go with Twitter and Linkedin simply because this is where my audience ‘hang out’. If you deal with businesses then you definitely need to be on Linkedin and Twitter, if you target consumers then Facebook is without question the platform for you.

At this point I bet many of you are thinking that you don’t have the time to invest in maintaining multiple platforms, thinking about and writing content in addition to your day to day job. Don’t worry; there are a number of good social media management platforms available such as Hootsuite and Social Bro to name a few. These sites allow you to keep an eye on your chosen social media platforms, so you don’t need to keep logging into your different social sites and you can view comments, reply to posts and messages. Another benefit of using a management suite is the function to schedule your posts/tweets, this ensures that your posts are consistent and you can manage your time effectively.

The next step is to build a ‘tribe’, whether it is through Facebook, Linkedin or Twitter, there is no point in creating or curating fantastic content if no-one reads it. It was something I struggled with at first, but here are some great ways to build an audience.

  • Join in with conversations around you; if you can contribute to a discussion then others will want to know more about you.
  • Find a brand advocate for your company, preferably a customer (your mum won’t have the same impact!) and connect with them.
  • Depending on the field you are in, real world networking may be the way forward. Acquiring contacts and inviting them to connect online.
  • Don’t forget to listen to what people are saying about you on social sites, this can be a valuable insight into how your business is perceived, you may even unearth some potential opportunities.

And finally, the myth that social media is free. Yes it’s free to create a profile, blog or sign up to a management suite. However you need to invest time into managing your social media platforms, creating and or curating content. Unless the person/s responsible for the social media function in your business is a volunteer, then you are paying someone to look after it. I’m sure you’re familiar with the phrase ‘time is money’; well this is a perfect way to sum up the cost of social media.

Worried about the cost of your time? Well sometimes you have to speculate to accumulate!

Still not convinced on utilising social media? Well how about these nuggets!

(All figures relate to the Welsh average)

  • 37% thoroughly research products before they buy them
  • 50% check a number of sources before making a significant purchase
  • 23% say if they trust a brand, they buy it without looking at the price

Source: GB TGI Radio+ 2012 Quarter 2, Kantar Media, Wales BARB region

This is a very basic insight into corporate social media! I may even revisit this blog and look at each stage in further detail, in the meantime please leave a comment below or email me jodi.stuart@realradio.co.uk or via Twitter @realradiojodi

Advertisers: Are they dropping like flies?

Let’s set the scene, you can’t go a day at the moment without hearing or reading about companies going into administration or unemployment rates or whatever else the tabloids want to depress us all with. I spent 10 minutes on a social media site the other day, in that time I learnt that we are officially back in recession, inflation has risen 3.5% and average pay rises have fallen by 1.1%, needless to say I wasn’t left with a warm and fuzzy feeling!

Such stories lead to panic in all sorts of markets but I’m looking particularly at the advertising industry. It seems to be that if a company wants to save money, the first thing they do is cut or reduce their marketing budget. After all it’s the most painless way to save money.

The reduction in adverting budgets sends media companies into frenzy, in attempt to adapt to the changing market they drop their rates to remain competitive.

However, they probably shouldn’t panic so readily. Advertisers, despite appearances, aren’t dropping like flies and here’s what I mean.

There were 1146 local companies that advertised in June 2011 and 1619 that advertised in June 2007, so a loss of 473 advertisers. I suppose it sounds bad but I am looking at the whole of Wales, it’s possible that some of the 473 have gone into administration, some will simply not have advertised in that month but continued to advertise in other months and of course there are those that cut their marketing budgets.

The really interesting thing is that 889 local companies did advertise in June 2011 who didn’t advertise in June 2007.

So whilst the market didn’t grow in terms of the number of companies advertising, there was still a huge amount of new advertisers in that month. In fact almost double the number that didn’t advertise in that month.

In conclusion….. When one door closes another one opens! Consumers still want to buy your product and advertisers still need to talk to those consumers, you just need to identify who they are and where they’re hiding.

Source: Nielsen

Please leave a comment below, or get in touch with me directly on, jodi.stuart@realradio.co.uk or tweet me @realradiojodi

New consumer profiling data – Environmental Engagement

It’s not very often that research falls into my lap, but that’s exactly what happened with the background information for this blog. First of all I was sent some fantastic new information from TGI; it looks at engaging consumers through their environmental attitudes and behaviours. Then a few moments later, I was on Twitter and saw this tweet ‘Researchers confirm link between the economy and ‘green advertising’.

Green advertising has evolved over time, both in the types of adverts being run and the message in the adverts. Only in recent years have all things environmental been brought to the attention of consumers. It seems that for almost every product available on the market there is an environmentally friendly version on offer from washing up liquid to cars and the sources of energy.

There are two main purposes of green advertising.

•             Companies promoting their green credentials.

•             Promoting green or environmentally friendly products.

Researchers in America looked into 30 years of environmental advertising in the National Geographic Magazine. They compared the advertising to what was happening with the gross domestic product and established that when the economy was doing well, it was reflected in the level of green advertising.

As time progresses so does the focus on ‘being green’ whether it be companies, consumers or products. So the new TGI Greenscape Clusters enable advertisers to target consumers by the extent and ways in which they are environmentally engaged through their attitude and behaviours.

They came up with six specific Greenscape Clusters:

  1. Keen – Strongly committed to the environmental cause in both thought and deed. Particularly likely to buy green, be intellectually engaged with environmental issues, recycle and avoid waste.
  2. Carefree – Not engaged with environmental issues, more focussed on their own lives. Unlikely to recycle compared to the average adult or to make an effort to minimise waste.
  3. Pic’n’mix – Some engagement with the environment but only where it suits them. EG. Far more likely to consume relatively large amounts of energy though travel.
  4. Sceptic – Educated individuals well informed of environmental challenges. However, tend not to identify personally with the need to be environmentally friendly and less likely to buy green.
  5. Incidental – Unlikely to be environmentally friendly through choice, as little engagement with the cause. However, how they live their lives means in some ways they are inadvertently environmentally friendly (eg. not wasting energy).
  6. Resigned – Very little engagement with environmental issues and not very well informed about them. Nevertheless, they are particularly likely to buy green and avoid waste, possibly because other people do so.

This new insight will allow brands to improve their campaign efficiency by targeting their audience through their green credentials. In addition it opens up the opportunity to target those that aren’t as environmentally friendly and change the advertising message accordingly in attempt to convert/educate them. There is also a benefit for media companies to demonstrate themselves as the most suitable way to reach the nominated audience.

TGI also discovered that those in the keen cluster are three more times likely than the average household shopper to buy Ecover liquid detergent. Further analysis reveals that the most efficient media for reaching the keen cluster are cinema, internet and radio.

The Nuggets

(Welsh Averages)

  • 18% Keen
  • 8% Carefree
  • 19% Pic’n’mix
  • 11% Sceptic
  • 27% Incidental
  • 12% Resigned

(Source: GB TGI 2012 Q2 (January 2011-December 2011), Copyright Kantar Media UK Ltd 2012, Wales)

If you would like further information on the best media to target your cluster, then please get in touch below or jodi.stuart@realradio.co.uk or tweet me @realradiojodi

Marketers – What are your customers thinking?

Recently I came across an interesting blog on the Freakonomics website. If you’re not familiar with their blog then it’s worth checking out, they explore the hidden side of everything. This particular blog looked at consumer buying behaviours, in particular the role of projection bias. So I thought I would look into a rational decision process vs. projection bias. (I’m not an economist specialist, so I will keep it simple)

A common decision making process is the ‘classical utility theory’. The theory focuses on instrumental rationality; every alternative has a consequence, the decision is made based on the alternative with the best outcome.

The decision process starts with three conditions:

  1. Certainty – the outcome of the action (or purchase in this case) is certain.
  2. Risk – the outcome is not certain but the probabilities are known.
  3. Uncertainty – the probability of the outcome is unknown.

Here’s a very simple example of the classical utility theory in action. James is currently renting a property; he wants to get on the property ladder and has found his perfect flat. He’s not sure whether to put an offer on the flat because there is a possibility that he may be relocating with work.  He is concerned that if he is relocated he would be forced to sell the flat and potentially at a reduced price for a quick sale.

  1. Action – Buy the flat or don’t buy
  2. Condition – Will he be relocated or not
  3. Outcome – Own his dream flat or not

For most of us a property is the biggest ticket item we will purchase. The classical utility theory is a reasonable decision making process for James to follow. Researchers have found evidence of projection bias when choosing a new car or house.  For those that have not come across the term projection bias, it’s the tendency to unknowingly overestimate the degree to which your future taste will resemble your current taste.

Most people know that if you go food shopping when hungry, you will end up buying more food than what you intended. This is because projection bias has kicked in; when you’re hungry you predict that your future taste for food will reflect your current hunger.

The research explores if the weather impacts buying behaviours. The evidence demonstrated that people over value specific features of a car or property depending on the weather. Most of us would agree that the weather does impact our buying behaviour, but for most people these are financially the two most expensive items they will purchase and keep for a number of years.

Using data from forty million US vehicle sales they established that sales of 4×4’s increased when there was snow fall of 10 inches or more. Black cars are less likely to be sold when it’s warm, a 20 degree increase in temperature leads to a 2.1% reduction in black vehicle sales. It’s not just the heat that affects black cars, if it’s overcast or completely clear then sales of black vehicles reduced by 5.6%. When it’s warm and the skies are clear common sense suggests that convertible sales will increase, which is correct. That said if there is a 20 degree increase in temperature this also drives convertible sales regardless of the season.  However, unusually warm weather does not impact convertible sales if it is already warm (where the average daily temperature is over 80 degrees).

The vehicle data was collated over a seven year period, so they were able to track the cars and establish if they were re-sold. Analysis suggests cars purchased on a day with abnormal weather conditions were more likely to be owned for a shorter period of time, – evidence in favour of projection bias.

Buying a certain type of car based on the weather is one thing, but purchasing a house based on the forecast is quite another. Generally speaking mortgages are taken out over a number of years, and unlike a car it’s not as easy to ‘trade in’. Wales isn’t known for its hot summers, but like with the vehicle data this research was carried out in America, so please excuse the reference to swimming pools!

They studied houses with swimming pools and air conditioning; they found that the house value increased when it was sold in the summer compared to the winter. Again this may sound like common sense, but buying a house isn’t an instant purchase. As is often the case its a few months before the person can move in, so if an offer on the house is accepted in August they may not move in until November. It’s unlikely that they would be able to utilise the pool until the following summer – projection bias. There wasn’t any evidence to suggest that weather influences the hedonic value of a fireplace or the plot size.

Before I started writing this blog, I set up a poll to find out if you thought that the weather influenced consumer purchasing decisions. As I anticipated the general consensus was yes, which I believe to be the common sense answer.  Purchasing a car or house is a low-frequency high ticket price decision, a decision that should really be made using the ‘rational’ classical utility theory. Yet something as simple as the weather can throw many consumers decision process, they are caught up in the here and now. These findings are significant for marketers, they need to identify and correct these systematic errors (or if you’re a rogue marketer capitalise on them). It is thought that projection bias maybe prevalent in other important decisions. Is your product one of them?

Please leave a comment below or email me at jodi.stuart@realradio.co.uk or tweet me @realradiojodi

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