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Back to School 2014 is on Fire (So Don’t Be Too Cool for School)

August 4, 2014 justin mobile, search

The Back to School season is one of the biggest periods for retail, second only to the holiday season in terms of sales. With holiday 2014 around the corner (115 days until Black Friday 2014!), it’s not a huge leap to assume that some of the “B2S” trends we’re seeing now will play out even further in the coming months.

Whether or not you’re buried in B2S now or planning Holiday 2014, read on for some B2S findings from Deloitte, the NRF, and AOL pulled from just-released B2S consumer surveys!

B2S Spending is Up! No it’s Down!

Deloitte, AOL/InternetRetailer, and the NRF all have updated surveys around the 2014 Back to School/College season. As far as spend expectations, there’s not much of a consensus:

Deloitte says that average B2S spending is expected to be down 19.2% from $672 to $543.
The NRF says that average B2S spending is expected to be up 5% from $635 to $669

Who is to believe? It may not really matter — what matters is that you get as much of that spend as possible. And to do that, what may matter most is where the spend is happening.

Both the NRF and Deloitte found that nearly 2 out of 5 (38%) will be shopping online. What more, Deloitte found that 57% say they’ll do research online first before purchasing B2S products in the physical store.

Below is Deloitte’s 2011-2014 trended data on where the shopping is happening — note that Deloitte pegged online shopping as just ever-so-much higher than office supply/technology store shopping (The NRF, on the other hand, has office supply stores higher in their survey at 42%).

While there are a few trends in play above, it’s worth calling out that in four years (2011-2014), Online sites have gone from last place in this list to second, doubling in popularity as a B2S destination.

Why online? Because it’s magically convenient.

AOL’s B2S survey found that the top reasons customers are going to shop online in 2014 are for better prices, quicker shopping, and avoiding crowds. I have two princesses at home—that is, one (The 5 year old) fancies herself Ninjago and will be starting Kindergarten in about a week. (The other—the 2.5 year old—she’s just a ham.)

As you might guess, these girls are a handful. Sure enough, I just talked to my exasperated wife and found that her plans to grab my up-and-coming Kindergartner’s school supplies today were thwarted. Apparently, my kids had other things in mind than taking advantage of the tax free weekend in Georgia to score 20 glue sticks (yes, the list requests twenty) and a host of other supplies.

So why are parents flocking to the online channel? AOL’s survey found 72% said online resources made shopping faster and another 72% of respondents said they gave them more choice. A further 1 out of 2 said they made it more fun.

As a parent, I see shopping online as the path of least resistance. No kids climbing on the shopping cart or playing with fragile items within reach. No arguing about toys or candy they want but can’t have. For parents of kids — at least young kids — stores are a lot of work.

Shopping online is just … easier.

And by online, I mean mobile.

Mobile is on everyone’s mind this B2S season. 84% of Deloitte’s survey respondents have smartphones and a full 3 out of 4 of these people (62% of the population) plan to use their smartphone to assist with back-to-school shopping.

As for what they’ll be doing with their devices, the NRF says about 37% will be researching products, 25% will find info about a physical store, and 22% will actually make a purchase (up 18% year over year).

As for when smartphone shoppers are actually in a store, AOL found they plan to do more product research (73%), find coupons (66%), look up customer reviews (61%), and compare prices (55%). Sounds about right.

When is all this B2S shopping going down?

Now, yes. But also there’s still more to come. As luck would have it, the two ways to answer this question were provided one each from Deloitte and the NRF.

The NRF’s answer focuses on when shoppers start. And on that front, they found about 1 in 4 will take advantage of late summer deals and shop one to two weeks before school. This compares to about 1 in 5 shopping at least two months before school starts. However, the sweet spot for when to start seems to be about three weeks to a month before school starts—grabbing about 45% of B2S shoppers.

But when will they be done? Deloitte has the answer! Here, only about 16% expect to be done with B2S shopping a month before the school year. Meanwhile, over half—54%—expect to complete B2S shopping inside the month before school begins. Another 26% will finish shopping after school begins.

Here the big takeaway is simple: back to school shopping is happening now but it won’t be over for many weeks yet. If I had to pick a date, I’d say September 15th.

(As you might have noticed, none of the above gets at Back to College. For that, just hop over to the NRF and Deloitte reports!)

So there you have it! Back to School Season is ON!

tumblr_m9gdexrcca1qgvs9u — (Now go stock up on glue sticks and Trapper Keepers!)

Millennials/Gen Y All Over Online Retail, Less so Trips to the Mall

July 10, 2014 justin demographics

Let me share a study from around a year ago that highlights shopping behavioral trends of Generation Y (Millennials defined as those 18-35/born from ~1978 to 1995). The study, put together by the Urban Land Institute, finds that 91% of Gen Y made online purchases over the last six months.

Meanwhile, some 45% spend more than an hour per day looking at retail-oriented websites! And you thought those guys were working.

man_playing_galaga — As a Millennial, I swear I’m working!

This is interesting by itself, but it’s all the more interesting in light of the study’s findings around where Gen Y lives and where they shop. Seems that some 90% of Gen Y visits stores like Walmart and Target as well as Costco, BJ’s, and Sam’s Club at least once a month, no matter where these Millennials live (e.g. from living rural to downtown). Nearly 70% of Gen Y visit these places 2 or more times a month. Take a gander at the data (added highlighting, mark-up, and logos per me — logo’s were pulled from the report’s cited definitions of these categories):

Great news for your discount stores.

By comparison, when it comes to shopping at malls, only about 64% of Gen Y frequents stores like Sears, Macy’s, JCPenney, Kohl’s, Dillard’s, and Bloomies. Worse, nearly 35% of Gen Y/Millennials never or rarely go to these department stores.

When it comes to how Gen Y prefers to shop — at least when it comes to buying clothes — the ULI study found that 20% of Gen Yers/MMs like to order online or research online and then go in-store (12%). And there’s a decent showing here for branded and department stores, too, so while the mall may not be an exciting place to visit in total there’s still interest from Gen Y in buying clothes at department stores:

What to do about Gen Y?

Seems the takeaway is fairly obvious: Millennials/Gen Yers like to shop online. They outright enjoy it and it’s now normal behavior (91% in the past six months!). That said, they aren’t as likely to frequent department stores with a whopping third rarely or never going to stores typically found in malls. While that could be scary for department stores, their way “in” to this younger generation is the Internet. Show’em your moves!

minivan-mom-moves — I own this minivan. And I’m a Millennial. Wha-what? Honda Odyssey FTW!

Why Apps Get the Most of Our Time

July 10, 2014 justin meta

comscore_mobile_time_app_time

ComScore shared a “major mobile milestone” in May — time spent in apps is now making up the bulk of time spent with digital media. The breakdown is that some 60% of total digital media time is being spent on smartphones and tablets with about 85% of that time being spent on apps (so 51% of total digital media time is spent in apps).

That’s a lot of time in apps.

This makes a lot of sense when you think about it. If you think about your own use of digital, there are a few activities that likely comprise the bulk of your time. Things like email, Facebook, Google Maps, chat, Amazon, music, YouTube, etc. — these activities are probably 80% of your digital time.

If you listed your top 10 Internet-activities, I’d guess nine of them are tied to a specific brand or experience.

And it’s these nine that you’re going to want an app for. Why? Because the app is going to make your experience substantially faster and more efficient (or fun) when you’re on your mobile device — be it a tablet or a smartphone.

This seamless experience is about the constraints of mobile (short bursts of interaction) and intolerance for slow loading web pages or hard to navigate websites.

We seek out and need apps for the stuff that consumes our mobile time. That mobile time is, otherwise, too inefficient and frustrating.

Isn’t it that simple?

Snack Shopping in the Mobile Margins

July 10, 2014 justin email, mobile

Two recent reports — one from LiveIntent and the other from Custora — look at emerging trends in mobile shopping behavior. LiveIntent’s report is email-focused (e.g. 14 minutes of every hour on mobile is spent with email) but, I believe, still illuminates mobile behavior in general. Take a look at this shot from their report:

clicks_and_conversions

As Cynthia pointed out, and what’s interesting about the data above, is that while smartphone and tablets have the highest conversions during the middle of the day (similar to desktops), clicks on these devices are happening the most in the evening, boosting conversions via the mobile channel at a time when desktop conversions are on a steady decline.

What’s going on in the evening that’s driving this behavior?

Separately, we’ve got data from Custora that indicates almost 37% of e-commerce visits are coming from smartphones (24.5%) and tablets (12.4%). However, only about 23% of orders are coming in via this channel, and even less revenue (18.2%), proportionately:

custora_mobile_orders

What’s the takeaway? I think it has to do with how mobile devices are most used in the margins of our lives. Mind, we have a lot of “marginal” time — the two minute commercial break, the grocery store line, the trip from upstairs to downstairs in our homes, the lull in conversation at a meal, etc. These moments which happen throughout the day — we fill them with an email check, a Facebook update, a hop into an app, a quick message to a friend, whatever.

Smartphones fill in these margins. (For good or for bad).

Small increments of interaction mean we must get in and get out. Just because we are on our phones doesn’t mean we can spend 15-30 minutes on them in a single session. Think about how digital and technology improvements are affecting our patience. We expect sites to load fast or we are gone.

As the Custora report puts it, we snack on mobile.

Seinfeld_popcorn

Or how about when we see an email from a friend (or for work) that requires a lengthy response: how likely are you to take the time to respond at length? I save those emails for my PC because it’s way, way too taxing for me to type on my smartphone or tablet.

That said, if I’m snacking on a minute of mobile distraction and hop onto a retail site, well, if that experience is fairly seamless and quick, I can be in and out, purchase made, and on with my day in a flash. The key is that it’s painless and easy.

For that reason, while mobile interactions may often be “local” in intent (e.g. we are looking for a local store to buy some product), it’s often the case we’re just filling marginal time — time in front of the TV or relaxing around the house. Interest piqued and a few minutes to spare glued to our phones, we’re apt to shop right then and there.

But retail sites need to be efficient in getting us in and out of the e-commerce experience. Because our mobile device time is innately a snack—not a meal.

Retailers best take advantage.

It’s not enough for shipping to be free. It must be fast.

July 8, 2014 justin meta

54% of shoppers have ditched an online order due to long estimated delivery times. Anyone surprised?

Jim_Carrey_UPSman — It’s not enough for shipping to be free. Online retailers better make it fast, too.

That’s one finding of the UPS/comScore report that hit the wire a few weeks back. While at least a few online shoppers are in a rush to get their goods, 83% are willing to wait an additional two days for delivery if shipping is free). Unsurprisingly, 58% have added items to their shopping carts to qualify for free shipping.

What do we make about all these expectations around free and fast shipping?

Thinking back to how we ratchet our expectations higher and higher as we get faster Internet connections, thereby becoming less and less tolerant of poor web experiences (e.g. we abandon a video that is taking too long to load), this shift in shipping expectations makes complete sense.

As consumers have come to expect their online orders to be both free and fast (read: Amazon’s Prime free 2-day shipping driving the behavioral change at the margin—or Zappos absurdly fast turnaround even when it’s not overtly expected), they are less willing to accept orders that will have slow delivery times.

While this conclusion likely doesn’t apply to every order online, it’s certainly happened to me. Case in point, I was shopping a wagon online on both Amazon and Home Depot. This guy:

Amazon:

The Home Depot:

Same item. Same price. Free shipping in both cases.

Where do you think I bought it? Amazon.

Home Depot just got "noped" by Amazon. — Home Depot just got “noped” by Amazon.

Why did Amazon win a sale of an oversized home improvement product? Two-day shipping from Amazon versus a week-plus estimated delivery from Home Depot. This was, ultimately, an easy decision (particularly since I needed this item by the weekend).

So how’s a traditional retailer going to compete? Well, the other thing you’ll notice is that The Home Depot was stocking this item online-only. In other words, to The Home Depot, they are going to have to ship this item no matter where it goes.

Where they could have won this sale was by providing free expedited shipping.

If I was able to get this item just as fast from Home Depot as Amazon without Prime membership, well, that’d be a win for me as a consumer. After all, I’ve got a Home Depot nearby in case something goes wrong or I have issues or need to return it. That’s an area that a local retailer can win over Amazon.

Regardless, this situation exemplifies how consumers are going to make the decision that serves them best. And store loyalties aside, it’s not enough for a traditional retailer to match on price and free shipping when you’re fighting for a sale against a retailer offering a little lagniappe.

Create Your Own Advertising Channel

June 26, 2014 justin meta

Why compete for advertising space across noisy, ugly (traditional) media channels when you can create wholly new channels that (more) naturally grab the attention of customers?

This “renovated billboards” approach seems like a smart way to do just that.

Great(er) Expectations—The Effects of Digital on Patience

June 24, 2014 justin meta, social

Scene from Parks and Recreation, tossing a computer. — What is your reaction when websites take forever to load?

An article by Nicholas Carr titled The Patience Deficit discusses the human perception of time. Specifically, the article alludes to research around page load times and video load times—in short, as we get faster Internet connections, we grow less tolerant of slower web page and video loads. Here’s the relevant clip from the study:

Back in 2006, a famous study of online retailing found that a large percentage of online shoppers would abandon a retailing site if its pages took four seconds or longer to load. In the years since then, the so-called Four Second Rule has been repealed and replaced by the Quarter of a Second Rule. Studies by companies like Google and Microsoft now find it takes a delay of just 250 milliseconds in page-loading for people to start abandoning a site. “Two hundred fifty milliseconds, either slower or faster, is close to the magic number now for competitive advantage on the Web,” a top Microsoft engineer said in 2012. To put that into perspective, it takes about the same amount of time for you to blink an eye.

Carr goes on to reference separate 2012 research around online video viewing that suggests a causal link between faster Internet connections and less patience for “startup delay.” Here’s a clipped graph from the research (PDF):

The takeaway from the above seems to be that when it comes to our expectations around digital media load times, they are connection-dependent. Raise your hand if you’ve gotten stupidly upset when your home internet goes down? And while our tolerance for (slower) mobile Internet connection speeds may be greater, we are still only willing to tolerate so much.

I wonder about how this human behavioral component affects other interactions. Here’s one that should hit home: who hasn’t groaned when a friend or family member has left you a voicemail in lieu of sending you a text message?

whycheckvoicemail — Not scientific but this about sums up my personal feelings toward checking voicemail.

While text-based communications have all sorts of shortcomings, their advantage is the easy of transmittal. A glance and you can read a text message. It also takes more effort to draft a text due to the interface (typing); this makes the sender more likely to stay on point.

The effect of digital on our expectations is profound yet poorly understood.

Your thoughts?

H/T to NTO.

* Clipped from a book titled What Should We Be Worried About?

Millennials Living Parents — The “Boomerang Kids”

June 22, 2014 justin meta

ownplacefridge

The New York Times magazine has an article titled It’s Official: The Boomerang Kids Won’t Leave (June 20, 2014) that highlights an incredible aspect of Millennials:

1 in 5 people in their 20s and early 30s is currently living with his or her parents. … [A] generation ago … 1 in 10 young adults moved back home …

That”s a 2X increase in one generation.

What’s changed? Sure the credit market imploded causing a major recession a few years ago, but is that the root cause? I much prefer this narrative from the article:

Childhood is a fairly recent economic innovation. For most of recorded history, a vast majority of people began working by age 4, typically on a farm, and were full time by 10. According to James Marten, a historian at Marquette University and the editor of The Journal of the History of Childhood and Youth, it wasn’t until the 1830s, as the U.S. economy began to shift from subsistence agriculture to industry and markets, that life began to change slowly for little kids. Parents were getting richer, family sizes fell and, by the 1850s, school attendance started to become mandatory. By the end of the Civil War, much of American culture had accepted the notion that children under 13 should be protected from economic life, and child-labor laws started emerging around the turn of the century. As the country grew wealthier over the ensuing decades, childhood expanded along with it. Eventually, teenagers were no longer considered younger, less-competent adults but rather older children who should be nurtured and encouraged to explore.

Jeffrey Jensen Arnett, a psychologist at Clark University who coined the term “emerging adulthood,” sees boomerang kids as the continuation of this centuries-long trend.

Regardless of the cause of adult-aged kids living with their parents, it’s just one more substantial difference in a generation that grew up at the frontier of digital.

What are some of the implications? Financial dependence. Over-emphasizing job decisions (e.g. Do I really want to do X? That’s not my passion. What do I love to do, anyway?). Having kids at a much later age. Greater rigidity. Dependence on adult-supervision. Indecisiveness.

Those are mostly negative things in my mind. Surely there are some positives. Anyone want to suggest a few?

comScore: Online Shoppers Shop Offline-Only 21% of the Time

June 20, 2014 justin meta, mobile, search

A recent comScore / UPS study titled Consumers Demand More Flexibility When Shopping Online has a slew of interesting omnichannel data nuggets, not the least of which is this—online shoppers complete a shopping experience exclusively online about 39% of the time which is nearly 2X more than they do all their shopping “offline” or in-store — 21% of the time. Meanwhile, the other 40% of their shopping is cross-channel. Parse it:

Separately, there was a one finding in the report that I’m still wrapping my head around:

When shopping on mobile devices, 41% of respondents said they prefer a retailer’s full website vs. a mobile website (34%) or mobile app (25%).

I read that and I’m at least a little like …

Why bother with a mobile site or app if consumers don’t want that experience? Or perhaps the question is: why don’t consumers like your mobile-optimized site? Why don’t they want your app? And while I’m a little aghast at this finding, I reflect on my own behavior and find that I frequently request desktop site on my Nexus 5 when I’m handed a mobile site.

Exception: Amazon.com.

Other findings in the comScore report of note:

58% have added items to their shopping carts to qualify for free shipping
83% are willing to wait an additional two days for delivery if shipping is free
74% of consumers prefer most of their packages delivered to their home
53% of online shoppers have had items shipped to a store; 43% made additional purchases in store
82% respondents saying they would complete the purchase if they could return the item to a store or have free return shipping (66% said they view a retailer’s returns policy before making a purchase)