JULY 23, 2012

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Mobile's Influence on Shopping
Deloitte recently published an analysis that found mobile's influence on retail stretches far beyond just purchases made on the phone. Deloitte estimates that 5.1% of all current in-store purchases made in the US are influenced by mobile -- that means mobile is already influencing $159 billion in sales. As smartphones continue to proliferate, Deloitte expects their influence to continue to grow. The firm forecasts that mobile behaviors will influence 17-20% of all in-store purchases by 2016. Deloitte recommends that retailers develop strategy around mobile influence, as 61% of smartphone users are already using their devices for information within stores. The attached report includes metrics on mobile influence in specific retail categories.
So what? Condé Nast has been far ahead of the curve on this trend. CN identified mobile influence early on and built apps like the Vogue Stylist and Lucky Shopper that help users form opinions on retail products. Retailers will continue to build mobile apps themselves or look to third parties to help drive conversions in stores.
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New Views On Value
A recent seminar from Kantar Retail examined shoppers and their changing approach in the current economy. Kantar reported that economic pressure has kept the focus on value for the majority of consumers. The firm also reported: • The most common coping tendency for higher apparel prices is for consumers to trade out of a category. • Store trips driven by coupons are growing across all retail channels. • Spending intentions are slightly rebounding and Generation Y’s (10-28 year olds) spending intentions are growing the most of all age breaks.
So what? American consumers are still looking for the best ways to cope in this new economy and that has changed the path to purchase for many. Perceived value and actual discounts (through coupons), are more important than at any point in recent history. With that said, consumers aren't completely putting away their wallets -- they are just using them in a different way.
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Industry Viewpoints
Harvard Business School: Celebrity Endorsements Work
A study out of the Harvard Business School, and later published in the Journal of Advertising Research, set to find out if there is a pay-off for using celebrity endorsements. Marketers in the United States use celebrities to endorse products more than most other countries, and celebrity endorsements represent nearly one in five ads by some accounts. In order to determine the effect of celebrity endorsement, the researchers studied athletes and how their achievements impacted sales and stock returns for brands they were promoting. What they found was that a firm's decision to hire an endorser generally has a positive impact on sales and an even greater impact when the athlete wins a championship. The endorsement was also found to increase stock returns and increase a business' valuation.
So what? The researchers conclude that celebrity endorsements make business sense on a number of levels. Condé Nast might look to share this piece of research with advertisers unsure of their strategy and those wondering if a celebrity endorser is right for them. The celebrity endorser can be an effective way to promote a brand, and their effects multiply if they experience success during the endorsement period.
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Marketers Not Sure What to Make of Facebook
While 86% of marketers use Facebook as a marketing tactic, far less are confident that the social media site is driving purchase intent and are willing to advertise on it, according to a recent study of social media decision makers conducted by Advertising Age. The 658 Ad Age subscribers who completed the survey were comprised of 34% marketers, 34% agency executives, 13% media executives and various other consultants and members of the marketing community. The study found that one out of three marketers are unwilling to say Facebook is useful to drive purchase intent. And some marketers are voicing frustration in dealing with Facebook -- only 7% of respondents said the site's advertising customer support was superior to other digital platforms; 24% said it was inferior to other platforms.
So what? While marketers feel a need to be on Facebook, they're not as sure they need to buy on Facebook. Social media may have solidified its place in the brand awareness/building tool kit, but does not hold the position print does within the advertising mix. While social media may grow to own a more important share of ad budgets someday, there continue to be more questions than answers about its effectiveness in the present.
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Quick Takes
The Lion's Share of Political Ad Spending Remains on Broadcast Networks and their Local Affiliates
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Online Banking Now More Prevalent than Physical Banking in Asia & North America
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Mercedes-Benz is America's Favorite Luxury Auto Brand
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Brazilians, Chinese are Most Confident About their Financial Direction
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Condé Nast
Feedback, questions, ideas for future issues? Please contact:

Phil Paparella
Condé Nast Research & Insights | Associate Director
1166 6th Avenue, 14th fl. | NY, NY 10036 | office 212.790.6044 | philip_paparella@condenast.com

Tamar Rimmon | Senior Manager, Digital Analytics
Robyn Hightower | Manager, Research & Insights