Digital CPG Blog

Mobile is now driving an average of 10% of visits to e-commerce sites, but doesn’t convert as well, according to a new study:

The study by e-commerce agency Screen Pages looked at more than 1.5m visitors to 30 non-optimised websites, and found that conversion rates were an average of 41% lower on mobile.

Whether retailers are prepared or not, mobile users are accessing their sites, and this study gives some idea of how mobile users interact with standard sites on mobiles.

A few highlights from the study

• 10% of visits are from mobile devices, although for premium brands targeting a more affluent demographic, there is evidence that this figure can approach 15%.
• 81% of all mobile visits are from Apple devices (47% are iPad & 35% are from the iPhone). Again, this may be a function of demographics, but clearly shows the popularity of Apple products.
• Average bounce rates are lower by 5% (40% vs 35%). Bounce rates are a measure of engagement and show the % of visitors who arrive on a page and leave. Driven by smaller screens and possibly the more demanding mobile user, websites must work harder to engage.
• In terms of sales, e-commerce conversion ratios were 41% lower overall, ranging from 13% to 73% lower. However, one luxury brand showed an increase of 30%.
• Average order values (AOV) were slightly higher on average, with half the sample showing an increase (10 of the sites showing an increase in AOV of 10% or more). Those showing a decrease posted in the range 10-30% less.

We talked about UGC (user generated content) earlier this week… so just how powerful is it?

Well, the potential for content monetization on UGC is stupendous. Starting with revenue estimates, Twitter made $45 million, followed by LinkedIn at $243 million, MySpace at $288 million and YouTube made $945 million in 2010. If you are wondering why Facebook was left out, well, it is because the figures for Facebook need their own line! Ladies and gentlemen, we learn from Facebook who made a whopping $1.860 BILLION in 2010.

All this makes one wonder if users should own their content. Where would social media sites stand then, if they can’t monetize on UGC?

via.

Have you tried consumer-generated media (CGM) or user-generated content (UGC)? Does it provide value?

Major consumer product brands think they do, and among them is Procter & Gamble who is putting so much stock in the word-of-mouth approach that it’s relying on it to promote a new mouth-themed campaign.

The “Life Opens Up” Project – and related “Life opens up when you do” tag line – launched in recent weeks with the objective of creating a correlation between maintaining a healthy mouth and “living life to the fullest.” Developed to promote P&G’s Crest and Oral-B brands, the campaign revolves around a contest that invites consumers to share their stories of how “a healthy mouth has played a role in opening up to life and the world.” To participate, consumers must submit a two-minute video of themselves describing their experience to LifeOpensUpProject.com. They can view and vote on the user submissions – including one made by spokesperson and host of NBC’s “The Biggest Loser” Alison Sweeney – on the P&G campaign microsite, as well as on the Crest, Crest Whitestrips, and Oral-B Facebook pages.

A CGM contest and CGM marketing content are a natural fit, but more than that, P&G’s digital marketing strategy demonstrates an understanding of the web 2.0 media that’s so effectively connecting consumers with brands. With this campaign, the advertiser does a number of things right: it leverages authenticity while maintaining relevance, employs social media to promote the contest, and rewards consumers for their participation, and eschews traditional digital advertising for more personal messaging (while the Glam Media buy does include rich media ad units, it’s the personal stories from bloggers that represent the bulk of the campaign).

Some great insights from Shopper Tech. Here are our favorites:

While online grocery shopping accounts for just 2% of total domestic consumer packaged goods sales, it is expected to more than double in the next few years.  A study from the Nielsen Company and MyWebGrocer predicts an increase to $25 billion by 2014 from $12 billion today. The study also found that 25% of CPG purchases are researched online where consumers look at retailer ads, search for deals, and find recommendations on social media sites. A whopping 97% of the time, the researched product is purchased online or in-store.

Yet online grocery shopping has remained a niche market, compared to many other categories like clothing, entertainment and home electronics. Can more CPG manufacturers and retailers take advantage of this emerging channel?

Scott Welty, vice president, retail industry strategy at JDA Software in Scottsdale, Ariz., sees challenges and opportunities on the road to growth in grocery ecommerce. He offers these signposts:

Social Media
Procter & Gamble’s recent reentry into ecommerce via Facebook is a new example of how important social media is becoming to CPG companies. Consider the continued growth of the prosumer — a recently coined word combining “professional” and “consumer.” They want to be able to produce, leverage and consume content. They don’t want to listen to the retailer or to the manufacturer, but to their friends or peers online.

Additionally, marketers need to look at the teenagers of today to get insight into the potential customer of tomorrow. Within 10 years, they will become mass market shoppers. Those people want one portal. The retail giants of the world will need to adjust because the trend in many industries is consumers getting in closer relationships directly with manufacturers.

Segmentation
Despite the vastness of the online opportunity, companies are going to have to tailor that shopping experience because the number of SKUs. The number of purchases of fast-moving consumer goods will dictate the need to have to segment programs, customers and promotions. There’s too much information and there are way too many products.