Socialogue: My Friend 'Likes' a Brand. Hmmm...

Nearly One in Four People Say they Would Buy a Brand Because a Friend "Likes" or Follows the Brand on a Social Network

Ipsos Open Thinking Exchange (Ipsos OTX)  recently released the latest global infographic and commentary on the trends and behaviors that define people's lives in today's social media age.

Twenty-two percent of people say they bought a brand because a friend follows or "likes" the brand on a social network. In the BRIC countries, that number rises to 39%, about four in ten people. It follows, then, that the better able a brand is to influence people to "like" it, the more sales it has the potential to drive. Now that's a piece of information brands that are socially active online should really like!

(Source: Ipsos, 06/26/12)

Sales Tip: Educate Your Clients

Your prospects/clients/customers will not know all they need to know about your solution. To help them understand your solution, you must ask good questions and then listen carefully. You have to first understand their needs before you can educate them on the benefits you can offer.

Although for many sales professionals it's difficult to be quiet, great sales professionals are great listeners. When you listen to clients' needs more than you're thinking about what you want to sell, they will see that you care.

You want to build trust and to be seen as a consultant -- this approach gains the respect of your client. They value what you have to say because you cared enough to ask the right questions.

For Marketers, Lead Gen Focus Is Trained on Digital

The web has provided marketers with an opportunity to develop leads early in a consumer's purchase process, and marketers are turning to hard numbers to measure the success of their efforts.

According to a January 2012 survey of marketing professionals worldwide conducted by research company MarketingSherpa, 52% of marketers said their top lead gen strategy for the next year was to meet or exceed quantifiable return on investment goals. That was followed by optimizing the marketing/sales funnel (51%), gleaning more audience insight (51%) and maximizing the lifetime value of customers (47%).

Marketers are looking for quality in their leads, but not ones that come burdened with a hefty price tag. More than half of respondents said their organizations invested $50 or less per lead, with the largest group of respondents (36%) saying they spent less than $20. This indicates that, for the time being, marketers are valuing quantity over quality in terms of lead gen, although this could change as ROI measurements improve.

Marketers also expected increases in lead generation budgets over the next year to focus largely on three areas: website optimization, social media and search engine optimization, underscoring just how important online tactics have become in recent years. In fact, the three lead gen techniques listed for the smallest budgetary bumps were all offline -- direct mail, tradeshows and print ads.

Two-thirds of marketers didn't make a huge distinction between business-to-business and business-to-consumer lead gen efforts, concluding that the techniques in both spaces were more similar than different.
(Source: eMarketer, 07/25/12) 

Subprime Car Loans Return to Favor Among Auto Lenders

Consumers without top-tier credit are finding it easier to get new car loans, as banks and other lenders are lowering the scores needed to qualify. 

While that means additional sales for automakers, and enables more motorists to get into new cars and trucks, it raises questions as to whether lenders are falling into the same risky lending practices they followed before the recession.

"There's a lot of lenders now that are into the subprime business," said Jody Lee, sales manager at Taylor Chevrolet in suburban Detroit. "What used to be a good score at a 650 or 700, now 550 is a good score."

During the first quarter of this year, total U.S. car loans totaled $52.5 billion. That's 49 percent higher than the same period in 2009 -- the recession's low point -- according to Equifax's National Consumer Credit Trends Report.

Also during the first quarter, the average amount financed on new vehicles rose by $589, to $25,995, and for used cars by $411, to $17,050.

Furthermore, buyers are stretching out payments for longer terms: The average length of new- and used-vehicle loans jumped a full month during the first three months of this year, to 64 and 59 months, respectively.

More loans and looser lending restrictions have helped boost new car and truck sales to levels not seen in four years. Estimates call for 14 million to 15 million vehicles to be sold in the U.S. this year, about 30 percent higher than in 2009.

"We've certainly seen the market loosen up for subprime," said Melinda Zabritski, director of Automotive Credit at Experian, a consumer and business credit reporting firm. "We're seeing it very close to what it was in pre-recession levels, but those days we probably will not return to. I think you'll still see the loans themselves a little more conservative."

Bank risk professionals expect a lending increase to borrowers with less desirable credit. The analytics company FICO polled 192 risk managers at banks throughout the U.S. last month and found that half predict growth in subprime auto loans will lead all other sectors for 2012.

It's easier for banks to loan money when interest rates are low and the rate at which banks loan money to one another is close to zero percent. That's one reason subprime auto lending is already on the rise.

Room for subprime to grow
Subprime consumers generally have credit scores of 640 and below, though cutoffs vary by lender. Scores range from 300 to 850; people with scores above 720 are generally given favorable interest rates, because they are seen as more likely to pay their bills.

The average credit score for people financing a new vehicle remained substantially higher than subprime during the first quarter, but it dropped six points, to 760; for used vehicles, the average credit score dropped four points, to 659, according to Experian Automotive's analysis.

Experian -- one of the major credit reporting firms -- expects the average credit score for new-car buyers could fall as low as 750. That estimate is comparable to credit scores during the first quarter of 2008 -- just before the collapse of the economy and auto industry -- when credit scores averaged 753 for new-car buyers and 653 for used-car buyers.

The subprime category typically comprises about one-quarter of the new-vehicle finance market, Zabritski said. That explains why the average credit score for new car loans is still higher than the subprime average. But there's still room for the subprime category to grow.

The number of vehicle loans made to people with less-than-desirable credit jumped 11.4 percent this year.

Lenders are not only loosening their leashes, but more subprime customers are also seeking out auto loans. Those subprime customers, however, aren't getting the rates they could, said Hank Hubbard, president of the nonprofit Communicating Arts Credit Union in Detroit, which helps those with poor credit refinance loans at better rates. Many, he said, are paying 25 percent a year.

"You could argue from a social perspective that disadvantaged people paying 20 percent interest rates is not such a good thing," said Edmunds.com CEO Jeremy Anwyl, "but from a credit perspective, it's not a bad practice."

Consumers 'have a choice'
Hubbard said for the past few years, many of the credit union's customers who have credit scores below 640 had the impression they would not be approved for an auto loan -- or would be approved, but only with a sky-high interest rate.

"People don't realize they have a choice," Hubbard said. "(The lenders) are taking people with decent credit and charging them high amounts." He points to a story of Aaron McIver of Hazel Park, MI, who was saddled with a six-year used-car loan with a 24.95 percent annual percentage rate. He had a monthly payment of $619 and was on track to pay as much in interest as he would for his 2005 GMC Yukon. CACU refinanced him twice and lowered the monthly payments to $386.

(Source: The Detroit News, 07/23/12) 

MARKETERS USE DIGITAL BUT WARILY

John Wanamaker famously said “Half of the money I spend on advertising is wasted; the trouble is, I don’t know which half.”  That is apparently even more true when you are talking about digital/social media marketing.  A new survey by the Association of National Advertisers finds that 70% of national advertisers are using digital media for marketing but 62% of them are concerned about the inability to prove return on investment.


The ANA also found that 53% of the survey respondents said there was a lack of understanding about digital media among key people in their organization. That is likely because of the breadth and complexity of the medium.


The members of the ANA are generally sticking with the big names in the social media industry.  Ninety-six percent of those who market with digital media use Facebook; 89% use Twitter; 49% LinkedIn; and 33% Pinterest.


Seventy-five percent are using branded mobile apps, 67% QR codes; 53% text ads; 41% video ads; and 25% video advertising.


The ANA report mirrors another recent study from Advertising Age, conducted in conjunction with Citigroup, which found that almost 86% of the marketers/agency execs and media execs surveyed had a presence on Facebook, but only 55% advertise on the site.


The biggest problems, says AdAge, is determining whether Facebook is actually working for the advertiser.  A majority of those using the site said clicks and “likes” were the most important metric.  But, says the magazine, “when it came to driving purchase intent just over 19% said they ‘don't know’ if Facebook is useful and more than 13% said it's ‘not useful.’ Just 55% said Facebook is ‘somewhat useful,’ indicating a high level of ambivalence on a key branding metric.”  One ad exec told AdAge that "I do not believe that Facebook is an advertising platform. We need to explore other possibilities."

Mobile Clicks with Music Fans

Brands such as Coca-Cola, Hertz and Starwood are increasingly turning to mobile as a way to reach consumers at live events. The medium's portability makes it a natural fit for connecting with fans during live shows and serving as a real-time link with other digital marketing platforms. 

In a recent presentation at the IAB's Mobile Ad Marketplace conference, Russell Wallach, president of Live Nation Network, discussed the close link between mobile and concert enthusiasts. Based on a new study of some 2,000 Live Nation customers, he noted that almost two-thirds own a smartphone and a third (34%) have a tablet -- both figures far higher than the average. 

Since last year, the company's mobile traffic has jumped from 9% of all traffic to 23% as of May, while ticket purchases via mobile have risen from 0.3% to 5.9% in the same period. "Smartphones and tablets are creating more buying opportunities for our product," said Wallach, calling them "the driver of our business long-term." He added that Live Nation launched its first app about 18 months ago. 

While its mobile users tend to have somewhat lower household incomes than its overall users ($85,000 versus $94,000), he said they are more active customers. Mobile users buy 24% more tickets per year, spend 16% more on tickets a year and go to 29% more events annually. They are also slightly more male and younger, with an average age of 36 compared with the overall ticket buyer's average of 42. They tend to be iPhone and iPad users. 

Search plays a key role in driving business in mobile for Live Nation. In that regard, more than a quarter (27%) of people who attend live events search for related information on their smartphones, with 7% regularly using their phones to purchase to buy tickets. 

Wallach stressed that mobile has become a key part of sharing the live concert experience, with 42% of smartphone owners using their devices to do things like sharing photos (75%), texting (63%), 40% connecting with friends on Facebook, and one-third calling friends from shows. That activity in turn opens up additional marketing opportunities tied to events. 

Plus, mobile can help a brand like Coca-Cola drive on-site promotions at concession stands or other venue locations, he said. Wallach pointed out that a number of companies employ simple marketing programs using location-based services. Coca-Cola brand VitaminWater, for instance, has run a campaign that offers the chance to win upgraded concert seats in return for checking in at a venue via foursquare. 

But he also suggested that creating a one-time app that integrates different screens -- including those at an event location -- is more effective than creating a traditional integrated promotion. "What years ago may have cost three or four times more to figure out the activation" can now be done with few additional resources, according to Wallach. 

Looking ahead, he said Live Nation aims to broaden its use of emerging mobile technologies, including near field communication and augmented reality to power m-commerce. The entertainment company is also exploring the use of geo-fencing at venues to be able to deliver targeted messages and offers on behalf of advertisers.

(Source: Online Media Daily, 07/16/12)

Seven Tips for Maximizing Engagement with Online Video Ads

Online video has grown massively in the past two years to the point where it is no longer just "nice to have," and is instead a vital part of many brands' marketing strategies.

As people are becoming more comfortable watching video online, the power of video advertising is also growing.

To help brands take advantage of this opportunity, social web video platform Ebuzzing has put together seven tips for maximizing engagement with premium video advertising...

1. Keep branding discreet

People have an unconscious aversion to being persuaded, so they are more likely to be turned off by video content that includes huge corporate logos.

Rather than immediately going in for the hard sell and shouting the name of your brand, include logos discreetly.

2. Story matters most

With video advertising, engagement is key. You need your audience to feel involved enough with the content to keep them watching for the entire ad.

Therefore, marketers need to think more about the enjoyment a video offers to a viewer instead of how well it serves the brand.

While product managers may not agree, with online video the story matters more than the product.

3. Kick off with a bang

The window of opportunity for grabbing the consumer's attention is small, so video ads need to hook people within the first five seconds.

The best way to do this is by creating an emotional connection, so give them either joy or surprise. People get bored easily and long drawn-out stories can cause people to stop watching.

4. Build an emotional rollercoaster

Even if your video is quite short, your audience will quickly lose interest if the emotion is constant throughout the ad.

To maintain engagement, the video must briefly remove viewers' feelings of joy and surprise and then quickly restore them again.

5. Have multiple scenes

Having multiple scenes/mini stories is more effective than only having one or two.

Each scene should have its own dose of emotion -- great examples in practice are VW's The Force and Evian's Roller Babies.

6. Surprise but don't shock

While surprising the viewer will help keep them engaged with the ad, people won't share something that is too shocking or crude.

To give your content the best chance of gaining shares online, it needs to be something that people will be willing to have their name associated with.

7. Target people that are prone to sharing and have a voice

Social influencers are often the best people to target when it comes to distribution, as these people have extroverted and egocentric personalities on the social web and are most likely to share content.

(Source: David Moth, Econsultancy, 07/09/12)