Hopes were high when Microsoft introduced the Zune in 2006. As the first MP3 player to feature Wifi and an FM radio, the Zune stood out by allowing owners to share music wirelessly with other Zuners. The concept never took off; Zune adoption was limited, while Apple’s iPod line continued to dominate the media player space.

In late September Microsoft launched its new Zune HD media player.  Rather than simply upgrade and refine the original Zune concept, Microsoft seemingly followed the lead of the iPod Touch, building the device around a 3.3 inch touchscreen, internet browsing capability and games/application downloads via the Zune Marketplace. 

Continue reading “Can Microsoft’s Zune HD challenge the iPod?” »

According to the Google Keyword Tool,there were 7.5 million broad match searches on the term ‘soap’ in September.  Granted that some of the searches are related to “soap operas” rather than cleansing soaps, there are still quite a few people searching for the term.  CPG companies are fueling this growth in search with increased investment in online advertising.  In fact, according to TNS, one of the leading soap brands Dove spent nearly $5MM on online display advertising during the first half of this year.  This investment is significantly greater than that of rival brands Softsoap and Olay.  Due in part to their investment in online advertising, Compete’s data shows that site traffic to Dove.com are multiples greater than its competitors.

Over one million consumers visited Dove’s website in August.  This volume is comparable to the number of consumers visiting sites like Bravo TV, The New Yorker and Morningstar.  So how does Dove maintain its online visitor volume using display advertising?  Many of you have probably seen a Dove ad online recently.  We went back a few months and examined two campaigns that Dove ran on both Yahoo! and AOL in late July.  We isolated exposed consumers who saw the Dove ad and compared their behavior to a group of control consumers who did not see the ad but were otherwise similar in behavior and composition.  Take a look at the search results below.

On Yahoo!, exposed consumers were nearly twice as likely to search for the Dove brand as control consumers who did not see the ad up to a week after the campaign ended.  The ad on AOL resulted in an even greater shift in consumer behavior prompting exposed consumers to search at nearly twice the rate than those on Yahoo.  The incremental search activity for Dove is not just a sign of online success, it is also a sign of brand strength and consumer recollection. So it is no wonder that according to the Google Keyword Tool, there were 2.2 MM searches for Dove in September compared to 823K searches for Olay and 60K searches for Softsoap.  The ads did drive direct traffic to Dove’s site, but Dove got even greater value from the incremental searches and the resulting “indirect” traffic.  Here is another great example that shows that online advertising indeed works!

2009 is BIG for Back to School: Staples and Office Depot See YOY Growth in Q3

September marked the beginning of the school year and the end of the Back to School Season for office supply retailers. Q3 sales figures have yet to be released, but if site volume is any indicator, online office supply retailers saw a year over year boom. Industry leaders, staples.com and officedepot.com, each saw huge gains – staples.com up 59% YOY to 23.7MM unique visitors (UVs) and officedepot.com up 21% YOY to 13.3MM UVs in Q3.

Traffic from the search engines contributed greatly to these gains – staples.com up 45% YOY and officedepot.com up 22% YOY in total search referrals.

Continue reading “Sept Data is Live: 2009 is BIG for Back to School” »

Last week we looked at how retail king Walmart has used online display advertising to drive growth in site visitors at a faster rate than its rivals. So far this year, Walmart has run several prominent display campaigns on high reach placements like the homepages of AOL and Yahoo!. Of course the marketing team at Walmart is savvy enough to test and vary the creative, messaging and the format of these expensive ad placements.

We took a look at two executions that Walmart used for two different one-day homepage takeovers on AOL. The first one pictured below is a non-interactive ad unit that ran in late May. A few months later in early August, Walmart ran an interactive ad also on the AOL homepage (pictured on the right below). We define an interactive ad as an ad that shows more information within the unit when a consumer clicks on it rather than immediately directing the consumer to a landing page or a website. Note that in the case of the Walmart interactive ad, it is essentially a mini circular within the ad unit. Shoppers can click on a section (i.e. Girls’ Apparel) which takes you to a different department and they can then scroll through the products. What better way to really engage shoppers in the shopping process as well as accommodate a broader spectrum of audience? So what were the results of these two campaigns?

Using the Compete Ad Impact product, we measured the online behavior of consumers exposed to the Walmart ads compared to a control group of consumers who were not exposed but were otherwise similar in behavior and composition. The comparison of the exposed behavior against a control group allows us to measure the true lift of the campaign on online behavior. For site visitation, both campaigns saw a significant increase in visits to Walmart by the exposed group compared to the control group. For the non-interactive campaign, exposed consumers were 54% more likely to visit Walmart.com compared to the control. However, the interactive unit saw a larger lift of 69%. How about the quality of traffic that these campaigns drove?

We went deeper and looked at consumers who started the online checkout process on Walmart.com. Both campaigns saw double-digit lifts for this behavior as well. However, the interactive unit resulted in 3.5x greater lift for the checkout process. It drove 82% more consumers to start the checkout process than the 24% lift for the standard non-interactive ad.

So what can we learn from this? Like Walmart, advertisers can make calculated marketing investments to drive their revenue. The interactive unit which is almost comparable to an entire circular within the space of a 300×250 ad unit was probably more expensive for Walmart than the standard ad. However, we can see that it delivered better results because it also drove a significantly greater volume of quality traffic that engaged in the checkout process. Depending on how good Walmart is at negotiating with their interactive agency, perhaps they even got an attractive return on their investment.

In July, BarnesandNoble.com launched the e-books section of their online bookstore with the intention of capitalizing on the growing market. Consumers have increasingly been turning to e-books that equip a reader with added conveniences and often a chic electronic device. Although Barnes & Noble lacks, at least for the time being, an e-reader similar to Sony’s e-reader or Kindle, Amazon.com’s industry leading e-reader, digital bookworms welcomed the new e-bookstore with open arms.

The e-books section of BarnesandNoble.com was visited by more than four times as many people as Amazon.com’s Kindle Store (and over 75x Sony’s eBookstore) in its first week. However, their successful launch cooled rather quickly after a few weeks.

One possible reason why BarnesandNoble.com’s e-books section couldn’t maintain their initial momentum was due to the lack of an official e-reader. Unlike Sony and Amazon, BarnesandNoble.com presently only offers an application a person can download to their PC, Mac, iPhone/iTouch, or Blackberry. While the free download is nice, the e-book experience isn’t the same without an e-reader like Kindle. Given this shortcoming, how was BarnesandNoble.com able to entice so many shoppers to visit their e-books section?

A highly effective email campaign helped to lure book lovers to BarnesandNoble.com’s new e-books department. When looking at the role of Webmail in driving traffic to the various e-books stores last month, BarnesandNoble.com stood out with 17% of its traffic coming from webmail.

Who did BarnesandNoble.com target when marketing their new e-books: consumers of rival e-bookstores or the untapped market of paper-book readers? An important commonality among the three e-book competitors to keep in mind is the lack of cross-platform compatibility. Since an e-book purchased from one retailer will not read on an e-reader associated with a different retailer, cross-shopping becomes a strong indicator of consumer churn.

BarnesandNoble.com’s e-book shoppers were the least likely to cross-shop at one of its two main rivals. Since their e-book section was just launched, this indicates that their customers are new to the market rather than converts from either Sony or Kindle.

BarnesandNoble.com’s appeal to the common reader will gain even more traction when the Plastic Logic Reader hits the market sometime early 2010. The Plastic Logic Reader will be exclusive to BarnesandNoble.com’s e-books and will turn the battle against Kindle into a fair fight. A large part of Kindle’s appeal is the convenience and function of the e-reader itself. Although still in Kindle’s giant shadow, BarnesandNoble.com’s e-books may be poised to rise out of it soon. Having already proven the ability to draw interest from consumers new to the market, Barnes & Noble needs to sustain and further develop that interest. The Plastic Logic Reader may be the final piece to the puzzle in BarnesandNoble.com’s efforts towards supplanting Kindle from the top of e-books industry.

When it comes to brick and mortar retailers, Walmart is clearly the market leader just by its sheer size. In fact, Walmart’s dominance transfers online where it received 33M visitors in August which was 10% more than the next closest brick and mortar rival, Target. Not only does Walmart attract more consumers but it is also growing at a faster rate than Target. For the past 6 months Walmart.com has seen double digit year-over-year growth in site visitors, outpacing the growth rate for Target.com.

One might wonder how a giant like Walmart continues to maintain such strong growth. One reason is their aggressive online advertising campaigns. In the past six months, Walmart has run several prominent display ad placements on the front pages of large portals like Yahoo! and AOL.

But just how effective are these six-figure investments?

We took a look at a one-day homepage campaign that Walmart ran on the AOL homepage on August 6th. We compared consumers who were exposed to this ad against a control group of consumers who were not exposed but were otherwise similar in behavior and composition. The comparison of the exposed behavior against a control group allows us to measure the true lift of the campaign on online behavior.

Our data below show that the Walmart campaign had an immediate impact on the exposed consumers, driving an 81% greater rate of visitation to the site just within the first week after exposure. More interestingly, the impact of this campaign carried through to four weeks post exposure. With each passing week after August 6th, exposed consumers visited Walmart.com at a higher rate than the control group. By the fourth week, 27% of exposed consumers had visited Walmart.com which is 52% greater than the control group.

This was only one of multiple homepage campaigns that Walmart has run so far this year. Imagine the compound impact of all these campaigns on site visitation to Walmart.com. Clearly, powerful online advertising is one factor driving this retailer’s online growth.

In addition to running prominent online display advertising, Walmart has also been testing various ad formats, from clickable video to more involved interactive ad units. So in part 2 of this blog series, we will investigate differences in the impact on online behavior for these various ad formats. Stay tuned!