In this Word on the Street Assignment, we had to answer the  Question:  “In what ways do you feel that companies are using mobile technologies to target you regarding their products and services?”

A great article on this subject is in the New York Times.  Written by Stephanie Clifford, it was published on April 16, 2010 and is titled “Web Coupons Know Lots About You, and They Tell” [http://www.nytimes.com/2010/04/17/business/media/17coupon.html].

Companies who use mobile advertising target potential customers by:

• Geographical information contained in the phone (local targeting)
• Interests
• Specific Social Media Pages (YouTube, Facebook, Twitter, etc)
• Sex (M/F),
• Age
• Search queries
• The customer’s IP Address
• Prior shopping habits (loyalty programs)
• Ethnicity

All of this is invisible to the customer.  It’s not ‘general’ information either.  These coupons can get eerily specific, virtually following you to bed where it knows what kind of sheets you have!

Some merchandisers use a company called RevTraxx who has no privacy policy.  They get around the privacy policies of Google and can even trend your IP address – if you have a proclivity for downloading pizza coupons on Friday afternoons – you may soon find one already there!

In a worst case scenario, as the article points out, companies with this kind of personal information can offer you substandard products than they might offer another person; or the same product but at a higher price than the next person.  Privacy advocates are very much alarmed by this activity and the article quotes Ed Mierzwinski, the Consumer program Director for USPIRG as saying “There really have been no rules set up for this ecosystem”.  Now, USPIRG is asking the FTC to tighten up online advertising privacy rules.

The FTC took it’s first action in March when it sought input about whether to revamp the COPPA (Child Online Privacy Protection Act) regulations, which were last updated in 2000. Among other questions, the FTC asked whether it should expand the definition of personal information to include “persistent IP addresses, mobile geolocation information or information collected in connection with online behavioral advertising.”

[http://www.mediapost.com/publications/index.cfm?fa=Articles.showArticle&art_aid=124908]

The deadline for comments on this, originally scheduled for June 30, 2010 has been extended by the FTC to July 20, 2010

[http://www.mediapost.com/publications/?fa=Articles.showArticle&art_aid=131185&nid=116157]

In the meantime the “word on the street” is for advertisers to police themselves when dealing with kids 12 and under.  As stated in the article “Why Marketers Must Keep Kids’ Safety In Mind”, “Marketers will have to tread lightly when dealing with minors, both because of existing regulations and the possibility of new ones. As newer channels like mobile and social networking become increasingly important destinations for kids and teens, effective self-regulation could head off some of the possible restrictions strict legislation or rule-making could bring.”

Our last Assignment in Week 1 of Mobile Advertising and Design was to answer this question:

“In what ways do you feel that companies are using mobile technologies to target you regarding their products and services?”

A great article on this subject is in the New York Times.  Written by Stephanie Clifford, it was published on April 16, 2010 and is titled “Web Coupons Know Lots About You, and They Tell” [http://www.nytimes.com/2010/04/17/business/media/17coupon.html].

Companies who use mobile advertising target potential customers by:

• Geographical information contained in the phone
• Interests
• Specific Social Media Pages (YouTube, Facebook, Twitter, etc) that can also bleed Sex (M/F), Age and other “private” information
• Search queries
• The customer’s IP Address

All of this is invisible to the customer.  It’s not ‘general’ information either.  These coupons can get eerily specific, virtually following you to bed where it knows what kind of sheets you have!

These merchandisers use a company called RevTraxx who has no privacy policy.  They get around the privacy policies of Google and can even trend your IP address – if you have a proclivity for downloading pizza coupons on Friday afternoons – you may soon find one already there!

In a worst case scenario, as the article points out, companies with this kind of personal information can offer you substandard products than they might offer another person; or the same product but at a higher price than the next person.

Privacy advocates are very much alarmed by this activity and the article quotes Ed Mierzwinski, the Consumer program Director for USPIRG as saying “There really have been no rules set up for this ecosystem”.  Now, USPIRG is asking the FTC to tighten up online advertising privacy rules.

This week in my Mobile Advertising and Design course, we are studying digital coupons.

This assignment is based on an article dated November 11, 2009, titled,  “Coupon Clippers Drive Incremental Sales”.

The article cites that digital couponing is on the rise and 1 out of 3 consumers report using more coupons than at the same time a year before, and that males age 18 to 34 were doing more comparison shopping and actively searching for coupons.  Further, as much as 59% of consumers will forsake name brands for generic brands based on price.

The next question raised by the article is whether the coupons drive incremental sales or cannibalize existing sales.  The study found that coupons do, indeed, drive incremental sales by as much as 40% and those customers are either new or lapsed buyers.  The study also cites that 63% of the redemptions drove incremental volume and did not cannibalize existing sales.

Our instructor then posed the question:

Does “digital couponing” cause consumers to forsake brand name products over cheaper products or services?

To that question I would have to say no.  I believe that digital coupons help drive the sales of name brands over generics when the coupon brings the price inline with the price range of the generic.  If I am shopping and I prefer the name brand product, but buy the generic to save money, I will use a coupon and purchase the name brand.  For example, the price difference is 50 cents and the name brand gives a coupon for 35 cents, I will choose the name brand.  That confirms the findings of the study, as I would have been considered a “lapsed” buyer.

There are some items I simply will not buy generic replacements for.  Instead I will shop the ads and when there is a really good sale, I will pick up a couple of the same item, saving me money in the long run.  A good example of this is Heintz Ketchup.  I grew up on it, it’s the only kind I like, and yes it’s more expensive but I will not buy any other brand – it’s the taste and the consistency.  Now, if I get my hands on a coupon, it’s a happy day, and just like the others cited in the article, I will look for a coupon.  I am not loyal to Heintz per se, I will buy generic brand relish, mustard and other products that Heintz sells in order to save money, but I will not scrimp on my ketchup!  This sale would have been categorized as a “cannibalized” sale.

I really do not think Consumer behavior can be so easily categorized in those terms.  We live in interesting times right now.  Things have changed drastically with the steep recession we are in, and everyone is doing the best they can to get by.  What I find interesting was stores like Publix who would run their ad specials in conjunction with manufacturer’s coupons so if they were selling something 2/$4 this week, you could also use a manufacturer coupon to bring the price even lower.  I am sure that is why Publix is gaining market share and increasing revenues.

Digital Coupons vs. Newspaper Coupons:

Another article titled “Gens X/Y, Rich Households Hike Private-Label Sales, written May 6, 2010, affirms my shopping habits since the recession.  In this article it cites a Nielsen report that National brands still drive the vast majority of sales (82.7%) as well as units (78.1%).  During the period of time of the study, store brand sales grew by 2.5%, while National Brands were able to stabilize declines and achieve a growth of 0.4%, due to increased promotional spending.  The study showed that categories with the strongest brand marketing support (Beer, Candy) or those achieving the biggest innovations (deodorants, detergents) were the strongest of the national brand sales.

According to a Research Brief titled “Digital Coupon Redemption Value Beats Newspapers”, dated March 1, 2010, use of digital coupons outpaced newspaper coupons 10 to 1.

This study also cites a Nielsen Online Metrics report stating that coupons/rewards was the fifth fastest growing Internet category in 2008.  Google reported that searches for the terms “printable coupons” and “online printable coupons” grew 186% and 178% respectively during the year.  Yahoo reported searches for “coupons” were #1 on their list of economy-related search queries during the same period.  Futher, the 2009 Savings Index found that Atlanta residents were heavy users of Coupons.com offers in 2009, followed by Tampa, Cincinnati, St. Louis and Minneapolis.

Digital Coupons expected to continue growth in 2010:

In conclusion, I agree with Coupons.com CEO Steven Boal when he said “we expect the adoption of digital coupons will continue to accelerate in 2010”.  We are far from being “in the clear” with respect to this economic situation.  Smart manufacturers will continue to use digital coupons to invite consumers to save on their products.  Digital wins hands down – they are easy to locate, easy to print and while the coupons from yesterday’s newspaper are still sitting on your coffee table at home, the ditigal ones can be retrieved right before you leave work to purchase dinner on the way home!

Sources:

http://www.mediapost.com/publications/?fa=Articles.showArticle&art_aid=117207

http://www.mediapost.com/publications/?fa=Articles.showArticle&art_aid=127527

http://www.mediapost.com/publications/?fa=Articles.showArticle&art_aid=123365

http://promomagazine.com/incentives/news/0224-digital-coupons-beat-newspapers

This is a video assignment in our Viral Marketing Class for my Internet Marketing Degree.

Week 1: We were assigned a fictitious company. I chose GIft Baskets for All.
We created a Discovery Brief on that business in week 1.

Week 2: We the had to develop a Creative Concept Brief, describing the outreach concept of our Viral Marketing Plan.

The goal of the marketing plan was to reach new market segments and increase sales/revenues throughout the year, trying to level the peaks and valleys of the prime selling season that evolved mostly around the holidays and purchases for Women (birthdays, Mother’s Day, Easter, etc).

Week 3: Where we had to create a movie as the outreach product of the Marketing Plan.  The goal of the movie was to speak to the new market segments we wanted to reach.

I decided to target two verticle segments: College Students and Men – neither of whom receive many gift baskets, but both of which would benefit from them.

The emotional hook I tried for was that men were suffering the lack of gift baskets, and knew that certain favorite items would be easy to put in along side other premium items that would surprise them. The gift baskets for college students evolved around “care baskets” – students cannot survive on pizza and cafeteria food entirely – they need fruit and – well yes, even candy!

I admit, I am NOT a movie producer, but I did my best -with the help of my friends (whose names I promised to keep to myself) to get the point I needed to make across to the audience. LOL