From a demand standpoint, the first generation of ‘digital natives’ are forming households. To these tech-savvy media mavens, online is a way of life for convenient, on-demand and personalized attention. Plus, broadband penetration and mobile adoption rates continue to increase. The “what I want, when I want it and where I want it” trifecta will be complete for the majority.

On the supply side, the economies of scale for retailers are building as the online channel provides a greater awareness and availability of distribution opportunities. For manufacturers, online enables a deeper, more personalized relationship with the shopper – delivering on the full promise of category management.

Five things to know about online grocery shopping:

1. Consumers love online grocery shopping, but it takes time getting used to. You can simply the process by improving the online experience with navigation, search, online help and porting over shopping lists. Deliver a better time-saving experience and consumers will hang on.
2. Online baskets are different than offline baskets. The average transaction size is much larger for food and beverages ($80 online / $30 offline) and health and beauty purchase ($30 online / $10 offline). And online shopping offers a greater mix of pack sizes and categories.
3. Consumer perceptions and purchase behaviors are affected in important ways. The interactions with the online ‘store’ environment are fundamentally different than an in-store experience. The online experience is fueled by a needs-driven experience as a greater variety of options are made available on screen.
4. Online shopping “levels the playing field”. Big brand ‘physical’ advantages do not translate online. With universal distribution and search functionality an inherent bias toward niche players is created. Ultimately, price transparency, connectivity and open content favor a purely ‘rational’ market.
5. Large and small brands can win online by combining marketing savvy with digital capabilities to add value. With interactive websites, smartphone applications and social media connections, expanding your brands in new and innovative directions is virtually limitless.

Online grocery shopping is no longer coming – it has arrived. Now is the time to get in the game and determine how your brand can add value in new ways across consumer touch points. It is not only a shopper’s market, but a marketer’s market. The rate of change is accelerating and so it the rate of opportunity for creative marketers who embrace the digital revolution.

These and other insights were highlighted in a Nielsen webinar held May 24. Click here to download the webinar, Balancing Act: Aligning E-Commerce with Today’s CPG Shopper.

For years, Nielsen has been refining and expanding its online tools that enable clients to put actionable context behind conversations about their brand. As “brand listening” on the web has now become standard practice, it’s time to go deeper to unlock the value, passion and insight hidden inside the everyday chatter happening outside the context of your brand. As social media usage and time spent on these sites grows globally, the need for this deep social listening, with the proper approach and analysis, is more important than ever.

In a recent webinar, The Power of Listening: How KRAFT Leverages Social Media Insights for New Product Development, I hosted with Paul Banas of Kraft Foods, we examined how Nielsen’s social listening frameworks could provide valuable dimension and feedback for Kraft’s potential entry into the burger or mini-burger market. Kraft knows the cheese part of cheeseburger better than anyone, but what could social listening tell them about product trends, emerging flavors and consumer profiles?

Beyond Brand
When we talk about food online, we see that maybe 10% of conversations mention brands specifically, while the rest focus on passionate likes and dislikes, chatter about daily routines and more.

But where to start?
Listening to the entire web to get new product ideas is a bit like boiling the ocean. This is why building a listening framework around themes is key. For example, we could focus in on themes like health and wellness, sustainability, and even an occasion like getting out of the house in the morning. From there we can map those themes, look for trends over time, find intersections and conversation drivers across different segments. Then, it’s onto a deep dive of that information blending search trends and offline data among other tactics.

It’s also important to build a framework around audience types. Kraft knows that moms talk about food differently than food aficionados, dieters or those big on entertaining at home. Understanding who is providing feedback, where they are commenting and even what time of day helps put their passions and preferences in the proper context.

Understanding the Situational Context

Lifestyle personas of at-home burger eaters

Results of the Deep Dive
When Kraft focused in on conversations specifically around “sliders” or mini burgers, they found some common themes and “Positive Triggers” across audiences to help focus their thinking.

• Sharability: Social networking helped highlight the fact that sliders are themselves social and are a food that is rarely consumed alone. They are more likely to be enjoyed at a social function, a happy hour or events.
• Kids Love ‘Em: Parents of picky eaters found it a fun dinner option and could make an activity out preparation with their children.
• Multiple Meal Satisfier: Sliders can be consumed as an appetizer, snack or light dinner. Its value as a late-night junk-food fix among students was also a factor.

The Value of Social Listening
While both Paul and I agree that social listening is not a full replacement for traditional focus groups, surveys or “ask-based” research, social listening is vital to understanding the passion of consumer sentiment online. Listening vs. Asking provides a powerful complement with the potential to increase the depth, speed and even the affordability of large-scale customer research.

• Listen to the full webinar: The Power of Listening: How KRAFT Leverages Social Media Insights for New Product Development

Is the Super Bowl the ultimate marketing ecosystem of paid and earned media? 2010 will be a huge test, as the new reality of consumer expression and cross-platform integration create a powerful new dynamic hovering over the largest single-spot ad spend on record.

What marketers urgently need to understand is not only total ROI on that mega-media buy, but the full return on all the other activities triggered or reinforced by this paid media stimulus. How does paid media drive earned media? And to what degree does earned media halo future paid media efforts? These are critical questions that Marketers need answers to – along with a metric or common yardstick that quantifies the blending of the two.

Getting Real about Real-Time
In a more agile and flexible marketing environment, where there’s actually a chance of making real-time changes based on available data, marketers need to understand the real-time role they can play in making tactical interventions to grow earned media impressions and ultimately, increase odds of success.

Twitter brings a fresh dynamic and promise to Super Bowl media efficiency. The platform reached a reach tipping point in 2009 – so much so that marketers increasingly use it to fan the flames for events, interact with brand mavens or enthusiasts, and, in a growing number of cases, manage or sandbag tension points like customer disappointment or service shortfalls.

Tweets are also increasingly embedding themselves in Facebook feeds, blog entries, and Google search results, magnifying their long-term value. Translated to the Super Bowl, positive playback about Super Bowl ads can have a “latency” effect and provide brands with an almost endless annuity of “earned media.” The same dynamic will be at work with Facebook brand fan pages, which can see massive growth – hundreds of thousands – following a major ad campaign, offline or online.

Quantifying the Big Picture
In the end, Super Bowl spots today need to meet two distinct “torture” tests – one measurable based on traditional TV scoring, and another based on unique dynamics of cross-platform engagement, most notably word-of-mouth and conversation. On a pure TV-impression alone, one can argue that the Super Bowl has become such an unusual magnet for consumer attention and recall – the one day of the year that we “celebrate” advertising – that it is worth every penny. Indeed, curiosity, anticipation, guessing, nostalgia come into play big time before this festival of brand persuasion. Consumers, after all, want to see the ads, almost akin to seeing a movie.

The entertainment halo certainly matters. Over the last three years, Nielsen IAG research found Super Bowl spots achieved a 31% higher break-through and 93% higher likability than the typical ad on television. But it’s not that simple. Timing is also a factor. First and second quarter spots yield more yardage than second half spots, and 4th quarter spots are about comparable to a “normal” TV buy in terms of generating ad recall. The viewer’s ability to associate the correct brand with the ad, and reported likability levels similarly wane over the course of the game. Surprisingly, branded integration effectiveness shows an opposite trend. Recall and brand opinion are lowest pre-game, moderate during the game, and big gainers post game. For Marketers, the mix is clear: focus on ads early and branded integration efforts late. Lastly, the SuperBowl is a touchdown for brands generally: purchase consideration for the average ad the week after increases +13% versus the week prior.

So that’s the foundation of pure “paid” measurements. What about the “earned” side of the equation, which factors in free media, consumer conversation, participation, and the like? Clearly, the Super Bowl in particular shines light across a far more complicated mix of marketing activity and user-engagement. Great copy finds life in other places.

An engaging, even participatory Pepsi game spot, for instance, might trigger a site visit, a Google search, a tweet, retweet, fan-page sign-up, or DVR rewind. It might trigger a desire to share, forward, discuss, critique, rate, or review. It might bleed over into the social media stream of a New York Times or any media reporter (a growing number of whom leverage social media across all platforms.)

The good news is that this digital trail can be quantified with high levels of precision – by volume, reach, tone, source, or even depth of brand advocacy. And much of this can be delivered in real-time, empowering today’s brand manager to make real-time changes or adjustments to the site. Last year, for instance, a large percentage of brands buying spots on the Super Bowl made real-time adjustments to their websites or social media efforts based on pre-game variables.

This year, Frito-Lay’s Doritos brand sits on the extreme of early-adjustments, as the four spots they are running are sourced from user-participation events and contests. In this case, the “earned media” is stimulating the paid side of the equation. Then again, this can work in reverse. When P&G’s Tide brand ran a highly engaging “Talking Stain” spot two years ago, it triggered a user-generated contest that created an impressive annuity of online video that quickly reshaped the brand’s search results for the better. Three years ago, Nationwide insurance estimated that the “earned media” dividend from their Kevin Federline spot totaled over $20 million dollars.

So in the end, it’s just not as simple as “buying” high-reach media. The broader ecosystems truly matter. This year, Nielsen is putting its biggest effort into measuring and quantifying the full return of Super Bowl advertising, combining a comprehensive suite of paid media and earned media metrics into a total “engagement” score. And we don’t intend to stop at the Super Bowl. Over the course of 2010, we’ll be applying our new cross-platform engagement metrics across our work on the Winter Olympics, Academy Awards, and the World Cup.

Webinar: Learn more about Nielsen’s comprehensive approach to the Super Bowl. Join Pete Blackshaw and Randall Beard for a webinar Maximizing Advertising ROI in a Paid vs. Earned Media Environment on December 8 at 2:00PM EST.

Frugal consumers continue to look for deals both in-store and online. At grocery, almost one-third of purchases are bought on deal and online visits to coupon and reward web sites are surging. It’s important to take note of the demographics behind the growing numbers of online deal hunters:  Consumers visiting couponing and rewards sites tend to be women, over the age of 55, residing in smaller households, without children and their household income skews toward the affluent ($100K+).

While beleaguered shoppers will be looking for ways to make the season bright, retailers can do their part by bringing some much needed holiday cheer to the shopping experience:

1. Tempt taste buds with in-store tasting and cooking demos.
2. Savor the smells of the season with aroma therapy.
3. Lighten moods with music from local school bands or choirs.
4. Touch the lives of others by collecting food bank donations.
5. Switch out in-store TV ads with broadcasts of holiday classics.
6. Reward frequent shoppers with holiday prize drawings.
7. Partner with manufacturers on donations to local charities.
8. Enhance the décor with holiday decorations.
9. Serve up a smile and an appreciative attitude.
10. Respect staff workers with reduced holiday hours.

As the Internet and social media continue to play a critical role in how consumer make purchase decisions, tune into the webinar, 2009 Holiday Season: What Consumers Have In Store for Retailers This Season on November 16 to learn more.

In the beginning there were ISPs, which then gave way to portals ― aggregators of content and links ― which then led to the rise of “search” as the dominant form of Internet navigation or, how we get to where we we’re going on the web. However, as with most forms of evolution, change is constant, and over the past two years search navigation has appeared to shift to social media.

We continue to see that social media has not only changed the way consumers communicate and gather on the Web, but also impacted content discovery and navigation in a big way. But how? Is social media taking the place of portals and search as the hub of online navigation?

These questions led to some in-depth research – including an online panel survey of 1,800 participants fielded in August 2009 – in which we looked at three main consumer segments using search (Searchers), portals (Portalists) or social media (Socializers) as their primary vehicle for content discovery.

What We Found
In a nutshell, there is a segment of the online population that uses social media as a core navigation and information discovery tool — roughly 18 percent of users see it as core to finding new information. While still a smaller percentage than those who use search engines or portals like Yahoo! or MSN, it is a significant figure. And as social media usage continues to increase (unique visitors to Twitter.com increased 959% YOY in August) I can only expect this figure to grow.

The appeal of Social Media
At the root of the changing nature of content discovery is the sheer amount of information that is available on the Web. If you want to learn more about the latest smartphone released into the market, your favorite search engine is sure to provide you with hundreds, if not thousands, of articles about the device. But with the increasing number of resources available, it’s difficult to know what you should believe or take at face value. Socializers – those who spend 10 percent or more of their online time on social media – feel this effect more than others do. When asked, 26 percent feel that there is too much information available on the Internet, compared to 18 percent of people who predominantly use portals and just 5 percent of people who primarily use search engines.

But why does too much information lead one to use social media as a navigation tool? The short answer: Socializers trust what their friends have to say and social media acts as an information filtration tool. This is key because Socializers gravitate towards and believe what is shared with friends and family. If your friend creates or links to the content, then you are more likely to believe it and like it. And this thought plays out in the data.

We saw the power of opinions posted online in our global study earlier this year about trust in advertising, and the point came up again in our recent findings. Social media is becoming a core product research channel. Almost 15 percent of Socializers most trusted information they found on blogs when researching new purchases online, while nearly 20 percent trusted most the information they found on message boards.

So are social networks replacing portals or search engines? Perhaps. Regardless, if we don’t understand and address people feeling increasingly alienated by the amount of information on the Internet, and the need for a human guide, yes, your favorite social network (or something like it) will become the next great content gateway.

For more, join me for our webinar The Evolution of Content Discovery on Tuesday, October 6 (2PM ET)

We have seen that the mobile industry is on a fast-track, with massive growth in mobile marketing, advertising and paid-content for users. But what is really leading this growth is the increase in quality devices and fast, affordable data. While smartphone ownership was once just a business tool, more consumers than ever are using smartphones in their everyday lives. In the past year alone, the total number of smartphone subscribers increased 72% quarter-over-quarter, growing from 15 million subscribers in Q2 2008 to 26 million in Q2 2009. While the penetration level of smartphone users is still fairly low – nearly 17% in Q2 2009 – they make up half of the mobile Web audience.

Italy Leads in Smartphone Adoption

Despite America’s reputation as a nation of big talkers — the U.S. is not setting the pace in smartphone adoption — ranking third when ranked by penetration. Italy has the largest percentage of smartphone owners at 28%, while Spain is not far behind with 23%. France has the most room to grow, with an 11% penetration level.

Smartphone Gender Gap Continues

With the continued expansion of smartphone ownership in the U.S. and the availability of more affordable devices, the market is opening up to a wider range of consumers. However, we continue to see similar demographic profiles for smartphone owners as we did a year ago. While smartphone usage is shifting from purely business use to both personal and business use, owners are still more than two times as likely to own a smartphone for business usage only. Smartphone owners continue to be predominantly male, are 65% more likely than the average mobile subscriber to be between the ages of 25 and 34, and nearly two times as likely to make more than $100,000 a year.

What’s Next?

So while more people are buying smartphones and penetration levels are increasing, the demographics are not significantly changing yet. There is a lot of untapped potential available to marketers to reach a whole new generation of smartphone users. Is your mobile marketing strategy as smart as your phone?

What’s driving all the excitement and energy around “listening?” After all, the basic notion of “listening” – observing and interpreting naturally occurring consumer behavior – is not new. In fact, when the first professional market researchers sat in consumers’ living rooms and talked with them about their lives and their needs, they were engaging in “listening” as much as they were asking questions. These pioneers were literally the eyes and ears of their organizations. They brought consumers to life in ways that inspired a host of innovations, improving consumers’ lives and their businesses in the process.

Market research evolved to become a valuable source of information to drive decisions, even as the connection between researchers and consumers became more distant. In a slightly ironic twist, the social media revolution and 21st century technology afford modern-day practitioners the opportunity to routinely engage in “old school” hands-on research – or at least a form of it- by listening to consumers online.

P&G and Nielsen conducted a series of parallel studies to understand how learning gleaned from “listening” to online consumer conversations compares to survey-based findings (”asking”), and how to best use these techniques going forward.

What We Heard

Findings from “listening” and “asking” were largely consistent. Most importantly, in every case, “listening” added to our understanding in important ways, meaningfully enhancing insights, and sometimes suggesting a different course of action. For example, a survey on cloth diapering identified cost savings and sustainability as key reasons for using cloth diapers. Listening took this further, revealing the passion cloth-diapering moms have for “CD’ing,” and connecting it to core values around parenting. This led to a fundamentally different, more holistic understanding of cloth diapering than was available from survey results alone.

Listening consistently provided valuable depth and context… adding listening to the picture was a little like going from an X-ray to a CAT scan. Furthermore, listening revealed the level of consumer passion or intensity associated with a specific topic. Understanding “intensity” can be just as important to winning in the marketplace as understanding size or “magnitude,” suggesting the need to pursue survey-based and listening-based approaches (or hybrid methods) going forward.

To learn more about the findings from this joint study and how to use listening to enhance your understanding of the marketplace and bring consumers to life in your organization, please join us for a complimentary webinar on Friday, June 26, at 2:00 p.m. EDT.

Register for the Listening Vs. Asking webinar.

For today’s webinar, “All Brand Advertisers Are Not Created Equal: Attracting and Retaining Brand Advertisers to the Web” Nielsen Online CEO, John Burbank and I will talk about the changing nature of online advertising, a new way to look at advertisers, and the attributes of the sites that are doing the best job of attracting long-term partners. As a bit of a preview, I wanted to briefly discuss the subject of long-term partners. When we take a look at Fortune 1000 advertisers and their advertising habits online, it seems like we have two groups: periodic advertisers and long-term advertisers. The good news is that we appear to have a pretty consistent bunch of advertisers overall. About 57% of Fortune 1,000 advertisers have advertised online in at least half of the quarters from the past 3 years.

Percent of Fortune 1,000 Companies, Quarters of Consecutive Online Advertising

While this number could certainly be better, it could also be much worse – particularly given the fact that a good number of the Fortune 1,000 (33%) have advertised online consecutively for the past 12 quarters (though clearly their dollars have not been at the levels we’d like).

But there is a downside. When we take a look at the Q4 distribution of the number of sites that the Fortune 1,000 advertised on, 20% are advertising on more than 32 sites.

Number of Sites that Fortune 1,000 Companies Advertised on, Q4 2008

You may well say, “But Jon, 38% are only advertising on one or two sites. That’s good news. Why do you always have to be such a cynic?” There are two answers to that, first, I’m a professional analyst, my job is to be a cynic. Second, and much more importantly, most of those advertisers that are only on 1 or 2 sites tend to have fairly small spends. Also, the 20% is increasing, and has been for the past two years and finally, the “up” part of the 32 and up goes well into the 1,000s.

So if you’re a publisher, what are you to do? We’ll it’s a good thing we’re having a webinar on Friday that will answer just that question. Please listen in. It looks like we’re going to have a good lively audience with plenty of time for questions. And who doesn’t love playing stump the analyst?

Register Now For The Free Webinar

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