It’s Official: Cyber Monday 2014 was the Biggest e-Commerce Day in U.S. History

Cyber Monday ShoppingIn the days following Black Friday this year, we heard reports that consumer purchase volumes at stores were down more than 10% compared to 2013.

A number of explanations for the decline were given, among them the notion that Black Friday sales are less of a draw this year, since merchandise sales now begin before Thanksgiving and tend to run the entire month of December.

But some observers speculated as to whether soft Black Friday revenue figures presage an equally soft holiday shopping season overall.

Well … now that we have sales figures from Cyber Monday (the Monday following Black Friday weekend), I think it’s safe to say that any concerns about a tepid holiday buying season are unfounded.

Custora E-Commerce Pulse, a customer relationship management firm which tracked more than 100 million online shoppers and over $40 billion in e-commerce revenue over the full Thanksgiving Holiday weekend, has just reported that Cyber Monday e-commerce revenues were up over 15% compared with Cyber Monday 2013.

That makes Cyber Monday 2014 the single biggest day in U.S. online shopping ever in history.

Other days of the Thanksgiving weekend also showed robust gains in online shopping:  Black Friday online sales were up ~21% over 2013, and online shopping on Thanksgiving Day itself were up nearly 18% over Thanksgiving Day in 2013.

The strong growth was fueled by mobile shopping, e-mail marketing, plus online product searches on Google and other search engines.

In particular, mobile shopping accounted for ~22% of orders on Cyber Monday, significantly higher than the ~16% of orders recorded last year.

On Black Friday itself, mobile shopping accounted for around 30% of all orders — yet another dramatic increase over 2013 when mobile shopping account for just shy of 23% of orders.

This year’s Cyber Monday stats put the lie to the notion that e-mail marketing is losing its luster.  In fact, e-mail marketing drove nearly one in four online shopping orders, outstripping natural search (at ~19% of all orders) and paid search (~16% of orders).

Much ado about (practically) nothing: Social media and Cyber Monday.

Much ado about (practically) nothing: Social media and Cyber Monday.

And guess which channels weren’t a meaningful part of the holiday shopping experience this year?

If you guessed social media … you’re absolutely correct.

Taken together, Facebook, Twitter, Pinterest and Instagram accounted for only about 1.5% of online e-commerce orders on Cyber Monday.  (For the weekend as a whole, it was only slightly better at ~1.7%.)

This year’s statistics just add more confirmation of several truisms about online consumer marketing:

  • Targeted e-mail still works the best.
  • Online search is important.
  • Social media is like Lucy and the football.

Google Comes Clean on Ad Viewability (or Non-Viewability?)

clear view or no clear viewThere have been quite a few reports in recent times pointing to the lack of viewability of online display advertising, and I’ve blogged about this topic before.

And now, we have the $55-billion “advertising vacuum-cleaner company” Google itself admitting as much.

It comes in a study that Google has just released.  The report presents findings from its analysis of display ad programs using its “active view” technology (like DoubleClick) to determine which factors are affecting the viewability of ads.

The results aren’t pretty; more on that below.

But first … why is Google doing this?

I suspect it’s because more advertisers are now insisting on paying only for their ads that have been actually viewed, as compared to those simply served.

Now, to what Google is reporting.  It turns out that fewer than half of all ad impressions served on Google’s display platforms are ever seen, because they’re served outside of the viewer’s browser window.

That is correct:  A huge chunk of Google’s billions in ad revenues that it collects come from ads that no one ever saw.

What digital advertising platforms love to remind us is that their programs are superior to “bad old television and radio advertising” because of their sophisticated targeting capabilities and their superior measurement metrics.

That may be.  But how is it all that different for TV viewers to miss an ad because they took a kitchen or bathroom break, compared to people who never even had the opportunity to see an ad that was “served” in a dead zone?

The next question is, “What can advertisers do to help minimize the incidence of phantom online advertising?”

Helpfully, Google provides some clues in its report.  For instance, the highest viewability for ads is immediately above the “fold” – in other words, at the point where the viewer must begin to scroll down to see the rest of the page.

Surprisingly, viewability right above the fold is slightly higher than at the very top of the page.  But it’s massively less so just below that magic spot.  Google pressented five charts in its report to illustrate this drop-off phenomenon; the one reproduced below shows viewability of vertical position ads sized 728 x 90 pixels:

Average viewability by vertical position on online ads

 

Less surprising, perhaps, is the fact that vertical ads have higher viewability than horizontal or block ads, for the simple reason that they stay on the page longer:

Most viewable online display ad sizes

 

By publishing this data, Google purports to want to help their advertisers understand high- and low-value inventory better so they can target their campaigns more appropriately and effectively.

Google is also encouraging publishers to strive for delivering viewability rates in excess of 50% by offering ad inventory that will perform more effectively in its respective positions.

My only question is … why has it taken Google so long to set these standards and to publicize them in the first instance?

Sure, Google’s only the middleman between publishers and their viewers.  But it’s a pivotally important one.

America’s Smallest Businesses Get Hands-On with Digital Marketing

DIYAs more MarComm activities increasingly migrate to the web and to social media platforms, small businesses are increasingly taking a DIY approach in their marketing programs.

That’s the major takeaway from a survey of nearly 2,600 small business owners conducted by Insight By Design for Webs, a subsidiary of Vistaprint.

For purposes of the study, small businesses were defined as those having 10 or fewer employees.  The results of the field survey, which was conducted in the spring of 2014, were published in Vistaprint’s 2014 Digital Usage Study.

vistaprint-logoTwo-thirds of the small business respondents reported that they are actively using digital products to market their businesses.  Of those who have websites for their business, nearly 60% of them created their own websites using DIY tools.

An even larger proportion — 80% — act as their own webmasters.

Small businesses consider customer acquisition and generating new customer leads as the most important reasons for maintaining a web presence.

In the social media realm, Facebook is the most popular platform for promoting small businesses — so said nearly 90% of the survey respondents who are active in social media marketing.

Facebook is viewed as not only a vehicle for building brand awareness and acquiring new customers, but also for building a network of followers and engaging with them over time.

The survey’s respondents reported that all of the other major social platforms lag far behind Facebook in importance:

  • Facebook: ~88% consider it to be a highly important social media channel for their business
  • LinkedIn: ~39%
  • Twitter: ~31%
  • Google+: ~22%
  • Pinterest: ~20%
  • YouTube: ~17%

In line with its perceived importance as a marketing channel, about two-thirds of businesses that have Facebook business profiles are also engaged with paid advertising campaigns on the social platform — or are considering doing so.

No question, small businesses have concluded that social media marketing is the best way for them to create brand awareness and expand their reach in a very low-cost yet effective manner.  So don’t look for any slowdown in the adoption of social strategies going forward.

Many online banner ads are “invisible” — just like all the other kinds of advertising.

poor online display ad clickthrough ratesI’ve blogged before about the dismal performance of web banner ads, with their miniscule clickthrough rates resulting from “banner blindness.”

The situation has caused more than a few marketers to shy away from engaging in any sort of banner advertising online — and it’s not hard to understand why.

But as Ben Kunz, a vice president at media buying and planning agency Mediassociates likes to point out, other forms of display advertising have similar challenges.

The fact that omnibus marketing information resource eMarketer has predicted that digital ad spending will increase to ~$132 billion this year is proof that many advertisers continue to see the value in online display advertising.

So what is Kunz’s major argument? Simply this:  Digital ads have the same challenges that television, radio and print advertising have as well.  In Kunz’s view, there’s huge waste in advertising because of advertising’s very nature.

He is correct. The vast majority of ad impressions that are “served” are never really seen or heard — regardless of the ad medium.

Ad visibility online is an issue for sure. Proving the point, internet analytics company comScore evaluated some 290 billion ad impressions on thousands of web sites … and found that ~54% of them weren’t visible.

There was some differentiation the comScore detected between different types of sites. Ads served up on “Ppemium” web publisher sites performed better (only ~39% of theirs weren’t visible).

Ads that aren’t visible occur for a variety of reasons, one of which is fraud (fake web traffic). But more often, it’s because of slow load times on digital devices or because the ads fall outside a viewable browser window or further down that page, necessitating scrolling that many viewers simply don’t do.

The Swedish firm Sticky has investigated banner blindness from another angle — studying the eyeball movements of ~500 subjects. Its research found that of the digital ads that do appear within a viewable window, only ~51% of them are actually “seen” by the viewer.

Mashing it all up, it means that roughly three out of four online ads are “invisible” to viewers. It’s a lot of waste for sure.

But then … what’s the alternative? Do other advertising tactics and channels actually do better?

Nope. According to Kunz, at least three out of four newspaper ads aren’t seen, either.

Ben Kunz

Ben Kunz

Here’s how he arrives at that conclusion. The average U.S. newspaper has ~60 pages, with an average number of ads per page of around 20 (this includes large ads and smaller classifieds).  Around half of the pages are unopened when someone reads the paper, meaning that those ads are “unviewable.”  If half of the remaining ads are ignored as well, the viewability stats are effectively tied.

Kunz also contends that ~30% of radio advertising is “invisible,” citing an Arbitron study that quantified the extent to which listeners switch stations when advertising came on, then flip back later.

The findings were such that Arbitron started recommending that media planners change their measurement from 100 GRPs to 70 GRPs, reflecting the fact that ~30% of radio ads paid for never make it human ears.

TV advertising? It’s the same phenomenon.

Trips to the refrigerator or the bathroom abound during commercial breaks — not to mention channel flipping or TiVo-ing.  Kunz contends that such ad-dodging techniques reduce TV ad viewability by as much as 75%.

The bottom line on all of this: Waste in digital advertising is a significant issue … but it’s a similar issue with other ad vehicles as well.

Add to this the fact that digital advertising offers the best metrics (accountability for every click and conversion action), and it should come as little surprise that digital ad spending continues to grow (and why eMarketer expects it to reach about a quarter of all ad spending this year).

Does Kunz have a point about offline and online advertising sharing similar “blindness” characteristics? What are your thoughts?  Please share your perspectives with other readers.

Online Marketplaces: The Brightest Stars in the e-Commerce Galaxy?

online commerceGiven a choice between buying a branded product from Amazon and a similarly priced one from an e-commerce store on the brand’s own website, which purchase option do most people choose?

In most cases, people opt for Amazon.

And why wouldn’t they? Online marketplaces like Amazon devote the vast bulk of their energies to removing the obstacles to purchasing products and improving the overall buyer experience.

The e-commerce stores on most company or brand websites don’t get nearly the same degree of laser-focused attention.

So it comes as little surprise that as online e-commerce continues to evolve, marketplaces like Amazon, eBay and Grainger are outpacing general e-commerce websites in terms of their growth and popularity.

Let’s face it, compared to most standard e-commerce sites, e-marketplace sites do a superior job dealing with the four major customer drivers:  selection, value, convenience and user confidence.

It shows in the growth statistics. Looking back over the past decade, Amazon’s yearly growth has averaged around 32%.  Compare those stats to standard sites … and there isn’t much of a comparison.

If anything, the future looks even brighter for marketplaces. With the increased adoption of mobile devices for online shopping, dedicated mobile apps from marketplaces like eBay and Amazon are making buying by phone easier and more convenient than ever.

Their mobile apps iron out the “payment kinks and concerns” that have bothered some mobile purchasers. These apps solve the potential security problem of having to input payment or address/shipping information into the phone when the purchase is made.

The rise of online marketplaces isn’t limited to just Amazon and eBay, either. Numerous other robust e-commerce marketplaces in both the B-to-C and B-to-B realm are thriving, too – not just in the United States but in the developing world also.

The global aspect is quite important, actually. Marketplace e-commerce may represent only about one-third of total online sales in the U.S. … but in China, such marketplaces are capturing closer to 80% of the online business.

It helps that these marketplaces offer many PayPal-like payment options. This solves the problems of payment when fewer people overseas use credit cards for purchases. (In China, less than 5% of online customers pay via credit card.)

These developments don’t presage the end of “conventional” e-commerce sites, of course. But they do suggest that companies should seriously consider online marketplaces as a prime channel for getting their products into the hands of end-users.

After all, it’s only natural that customers are going to take the “path of least resistance” – making the buying process as effortless as possible.

Online marketplaces have that game down to a science. No one does it better.

Fast Fade: Unpaid brand posts on Facebook are getting rarer by the day.

Lower ReachIt was just a matter of time.

Once Facebook ramped up its advertising program in order to monetize its platform and mollify its investors, unpaid posts by companies and brands were sure to be the collateral damage.

Sure enough, the recent monthly stats show that the “organic reach” of unpaid content published on company and brand pages on Facebook has been cut in half from where it was just a short time ago.

To illustrate, look at these stark figures gathered in an analysis by Ogilvy of 100+ country-level brand pages measuring the average reach of unpaid posts:

  • October 2013: 12.2%
  • November 2013: 11.6%
  • December 2013: 8.8%
  • January 2014: 7.7%
  • February 2014: 6.2%

What these stats show is that within the span of less than six months, the average reach of unpaid brand posts dropped by nearly 50%

To go even further, an anonymous source familiar with Facebook’s long-term strategy is claiming that its new algorithm could ultimately reduce the reach of organic posts to 2% or less.

Actually, the reason for the squeeze is more than just Facebook’s desire to increase advertising revenue.

Here’s a dynamic that’s also significant:  A Pew Research study conducted in mid-2013 found that the typical adult American Facebook user has around 340 friends.

That average is up nearly 50% from approximately 230 friends in 2010.

Of course, more friends mean more status updates eligible for feeds … and Facebook’s not going to display them all to everyone — even if it wanted to.

Also, Facebook users “like” an average of 40 company, brand, group or celebrity pages each, according to a 2013 analysis done by Socialbakers, a social media analytics firm.  That translates into an average of ~1,440 updates every month.

Compare those figures to five years ago, when the average number of page “likes” was fewer than five … yielding fewer than 25 monthly updates on average.

Clearly, there’s no way Facebook is going to to be able to display all of these updates to followers.  So … the content is squeezed some more.

The final nail in the coffin is the rise in “promoted” posts – the ones that brands pay dollars to promote. It’s only natural that Facebook is going to give those posts priority treatment.

Thus, the hat-trick combination of more friends, more likes and more promoted posts is what’s causing “organic” brand posts to go the way of the dodo bird.

In retrospect, it was only a matter of time before a major social platform like Facebook would seek to monetize its program in a big way.

In some respects, it’s amazing that the free ride lasted as long as it actually did …

The [dis]connect between content “quality” and online advertising.

Jack Marshall

Digiday’s Jack Marshall

I really appreciate the work of Jack Marshall, a reporter at marketing e-zine Digiday, who is helping to expose and explain the “brave new world” of online display advertising and how it has evolved into something that’s rife with problems.

ad exchangesConsider a recent column of Marshall’s titled “Is this the worst site on the Internet?”

In it, he notes that for “legitimate” online publishers that rely on advertising as their revenue model, that model is becoming a more daunting proposition with each passing day.

And a big reason is the emergence of other websites that are “gaming” the online system – not to mention the ad tech middlemen that are their willing accomplices.

Essentially, what’s happening is that ad dollars are being siphoned away from websites that provide professionally produced content and are going to sites that are explicitly constructed to serve up as many ad impressions as possible.

These sites contain little or no original content.

Marshall’s “Exhibit A” is Georgia Daily News, a website which purports to cover “news, traffic, sports, politics, entertainment, gossip and local events in Atlanta.”

As Marshall contends, “What it actually features is content ‘curated’ from elsewhere on the web, and some it has simply stolen from other major news sites” such as the Daily Mail.

Sizable chunks of the website’s content have nothing to do with Atlanta.

GADailyNews home pageConsidering the type of general news site it purports to be, GADailyNews.com doesn’t attract very much traffic at all.  And why would it? — since it contains precious little information of value or interest to anyone who is actually “seeking news about Atlanta.”

But it sure does generate a lot of ad impressions.  According to Marshall, each article page on the site features seven display ad units – all of which refresh every 20 seconds or so.

In the two-minute span of time it took him to read an article about Katy Perry and John Mayer (content copied from an Australian news site), Marshall was served more than 40 ad impressions.

Marshall continues:

“One page has served me nearly 500 ads in just 20 minutes – and I couldn’t stop refreshing them even if I wanted to.”

[And these ads aren’t for B-list advertisers, either.  They’re for brands like American Airlines, Hilton Hotels, Charles Schwaab and others.]

What’s happening here, of course, is that websites and ad tech middlemen have figured out that the algorithms of even the “quality” ad vendors like Google, AdRoll, and Bizo can be gamed pretty easily to serve ads on a low-quality site like Georgia Daily News, which is owned by a single-person entity called Integrated News Media Corporation.

It’s hardly the type of media vehicle that big-brand advertisers would normally wish to use for advertising.  But thanks to the vagaries and complexity of the ad exchange landscape, they are.

For every Georgia Daily News site, there are hundreds of others like it that cobble together seemingly valuable content with a passably convincing set of audience characteristics.

Put it together, and it adds up to problems on two levels.

First, advertisers are paying for impressions that are near-worthless.

Second, since there are finite ad dollars available, legitimate online publishers are losing out on those funds, which are far more important to their well-being than they are for sites that don’t engage in any true journalism at all.

As Jack Marshall concludes:

“Thanks to fraudulent traffic, dubious sites and middlemen with low quality standards, life is only getting harder for those publishers with expensive content teams to support.”

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