How consumers use technology and its impact on our lives

Introduction

The impact of technology on our lives has been so significant that it has been likened to the 4th Industrial Revolution (Schwab, Klaus (2017). We are on the verge of a societal shift forward and the way in which we conduct business will never be the same.

Access to the Internet

Two decades ago, the internet was new, only 4% of the population had access to it and you needed to be an expert coder to program it (Internet World Stats (2019). Today, more than half the world’s population is using the internet, enormous amounts of information is transferred, stored, shared, uploaded and downloaded and anyone can be a creator or sharer of information.

The 3 primary drivers of increasing internet access have been mobile phones, affordability of internet plans and faster internet speed.

The implications to businesses are revolutionary. Geographical, cultural and language barriers are removed, new industries are created every day, established industries become irrelevant, consumers can be manufacturers, there are more touchpoints than ever before to connect with consumers, yet cutting through and delivering your branded message is harder than ever before with consumers overwhelmed by choice and easily distracted.

Let’s look how people use the internet today. In 2019, in one internet minute, (@LoriLewis, @OfficiallyChadd (2019), most people are using the internet primarily for work, communication, entertainment, information, social connection and shopping.

What’s even more interesting, is how this has evolved over time. Online communication, (i.e. text messages, emails, Snapchats), has increased significantly over time, but what is most interesting is that these messages are becoming more visual and voice orientated. This is evident by the creation of Emojis and Gifs and voice messages sent. Businesses and Brands need to take note of this shift in how people are communicating and ensure that their brands remain relevant in this new language. If consumers are talking to their friends in visual texts, brands need to adapt this style in their advertising to engage with consumers. An excellent product example of this is Pepsi’s ‘Say it with Pepsi’ “PepsiMoji limited edition cans encouraging consumers to share emotions via their choice of cans. An advertising promotion example of this is Fitness Brand F45, using popular GIFs to convey emotion and connect with their consumers.

Digital devices used by audiences

Given that the internet can be accessed virtually anywhere in the world, it is no surprise that there are multiple devices that can be used to access the internet. Traditionally desktop computers dominated, however in Australia, Mobile Phones are the #1 device used (96%) to access the internet (Hootesuite and We Are Social (2019).

We also know that consumers are often using multiple screens simultaneously to access the internet, for example at home using TV Screens, Tablets and Mobile Phones simultaneously. This has significantly impacted advertising effectiveness and consumers actively avoid ads by switching their attention to another screen. It is also difficult for brands to cut through and grab a consumer’s attention when they are browsing across multiple devices. For digital advertising, this may still count as an impression served, even though engagement and attention were zero.

This is one of the reasons why brands have integrated their content more seamlessly with platforms, for example using Influencers on Instagram to promote brands or YouTube bloggers to create content for brands, thereby improving both engagement and attention.

How customers search for information

Let’s travel back in time to 30 years ago. Imagine you were looking to buy an airline ticket to go on holidays to South Africa. How did you go about collecting information and recommendations to optimize your purchase decision? Most likely, you read through the travel section in the newspaper and spoke to a travel agent. Today, you can use your mobile phone to search through literally hundreds of different flight options to find the best price and time for you. Technology and the internet have given everyday people the ability to search and find almost anything they need at their fingertips in record time, thereby the ability to become their own travel agents. They can search for cheap flights and read hotel and experiences reviews with the greatest of ease, allowing them to compare, ask questions and choose.

A study by ThinkGoogle (2016), reveals that people use the following resources to help them find out more information: Search engines (40%), Retailer website or App (19%), Visited another website or App (19%), Visited store (15%), Use a map (12%), Looked at images or photos on a site or app (10%), Asked someone via call or text (8%), Watched an online video (6%), Used social media (6%) and Connected with a business (6%).

Imagine that you are a hotel in South Africa, trying to attract Australians to come and visit and stay with you. You will need to ensure that your online presence (SEO, website, reviews, promotions etc.) is up to date with relevant content and information, appearing in the relevant searches, reaching targeted audiences etc. so that when consumers research hotels in South Africa, that you are in the top consideration set.

The weight loss industry is a great example of an industry that has been revolutionized by consumer’s access to information prior to purchase. Gone are the days of previous market leader Weight Watchers and their physical weigh-ins in a community center. Nowadays, social media has changed the way people interact with the weight loss industry. An Australian example is the “Healthy Mummy” Facebook group, which has almost a million members. Members can easily search for information in the group, which “Healthy Mummy” products to use, how to get the best results and include their own testimonials and reviews on the page. This effortless access to information and member interaction has led to sales generated that would not have been achievable outside of the online environment.

What consumers buy online

Online shopping is a growing market channel, both globally and here in Australia. Whilst bricks & mortar is still the dollar share king in Australia, in 2018 alone 72% of Australians have shopped online and collectively spent $18.6 billion online, up +22% versus prior year.

Mobile shopping (or M-Commerce) has significantly fueled online shopping.  Research conducted by Australia Post (2018), estimated that in 2017, one in five online purchases were made from a mobile device, which had increased by 58% from prior year.

The implication for businesses and brands is enormous, the impact of lost sales due to not being available for purchase online has led to the demise of many brands. Just look at the recent example of Toys R Us, one of the major toys brand a decade ago. But their failure to adapt to an online strategy in conjunction with a retail offering, has led to their exit from the Australian market a few years ago. Interestingly, they are re-entering the Australian market with only an online only offering.

Online video consumption

Zenith Media (2018), predicts that by 2020 consumers will spend 84 minutes every day watching online video, this is up by 11 minutes versus prior.

Given the significant share of consumer’s time that video is commanding, brands are increasing their investment in video-on-demand platforms, such as YouTube and Catch Up TV. Whilst digital advertising spend is still trailing that of more traditional channels like TV, it continues to increase and is predicted to overtake eventually.

More and more brands are starting to use short form video to advertise and connect with consumers online. Research has shown that short form video content can have greater cut-through and impact than static ads and can help to:

(1) Improve web traffic

(2) Win sales

(3) Educate users

(4) Offer support and help

(Parker, Sam (2018).

As an example, Hersey’s used two famous vloggers on Twitch, namely Ninja and Dr. Lupo, to talk about their Reese’s bar whilst they were busy playing Fortnight. You can imagine a typical consumer watching TV, watching Twitch, answering a few emails and browsing their phones, will be more likely to take in a message about brand when one of their favourite people is talking about it, rather than a traditional ad on TV.

Consumer trends

The table below is a quick summary of how technology trends have impacted consumer behaviour over the past few years and how it can further develop:

Looking ahead, below are 3 future trends which I believe will shape the way technology impacts consumers over the next few years:

  • Augmented Reality: Just as Video Commerce is set to be the next major selling platform; Augmented Reality will become a powerful purchase driver. Brands can use AR to virtually create the experience of using their brands, demonstrate how it works, how it looks and how it can add value to consumer’s lives.
  • Chatbots: As technology advances, Chatbots become more sophisticated and can conduct auditory or textual conversations in a near human-like manner. For business, Chatbots can save time and money, they can improve the customer experience, reduce human errors and create greater efficiencies (Sloan, Kayla (2018).
  • Health Monitoring: Personalisation of health data as well as wearable health and fitness trackers are revolutionising consumer health. An example of this is online health company, Viome, that collects personal data about your microbial health and then personalizes an eating plan specifically tailored for the individual to optimize their digestive and microbial health (Viome, 2019)

Summary

Looking back on how much technology has impacted our lives over the past decade makes one realise how much more transformation is still to come. The brands that are successful today, have anticipated the impact of new technology and have adapted before the technology emerged. The brands that did not evolve with technology have become irrelevant and have been replaced by competitors who are faster, cheaper with a more superior offering and connecting with consumers in more relevant touchpoints. The challenge for brands is not to just keep up with technology, but to predict future ways in which technology will impact consumer’s lives and stay ahead of those.

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Chart 1: Internet World Stats (2019). “Internet growth statistics. https://www.internetworldstats.com/emarketing.htm [Accessed 23 June 2019]. Please note chart is created by Sonja McCarthy