THE STATE OF AU DIGITAL DISRUPTION 2018 REPORT

Transcription

1 THE STATE OF AU DIGITAL DISRUPTION 2018 REPORT A CONSUMER INSIGHTS INDEX By Toluna, the only global insights provider powered by the perfect fusion of technology, expertise, and community.

2 CONTENTS About this report 3 Introduction 4 Methodology and terminology 4 Attracting consumer attention 6 Converting to customers 8 Factors in discontinuing use 11 The future of digital disruption 13 The most widely popular disruptors 15 Conclusion 17 Appendix 18 2

3 ABOUT THIS REPORT Toluna is the only insights provider uniquely designed to empower the on-demand, global economy. We re powered by the perfect fusion of technology, expertise, and community which we use to connect businesses and consumers to deliver on-demand insights. The following consumer insights index presents the results of a survey run to better understand consumers and the impact of digital disruption. 3

4 INTRODUCTION If you had told consumers twenty years ago that they would someday be subscribing to services for monthly clothing, makeup, and pet toy delivery, the idea would have been met with scepticism. Likewise, had you told consumers that they would be getting two-day delivery orders from Amazon, that they would be cancelling Pay TV in favour of streaming video services, or that they might no longer hire taxis for singlepassenger travel, few would have believed you. Yet, thanks to the changing expectations of consumers in our on-demand economy, these situations are now considered standard. Traditional ways of doing business have been wholly disrupted in many industries, creating a new mindset among shoppers and pushing companies to innovate if they want to keep up. Disrupting for disruption s sake won t lead a company to find success as a recognised disruptor brand, however. Instead, consumers have very specific requirements, interests, and expectations that need to be met for a brand to enjoy the benefits of successful innovation. METHODOLOGY AND TERMINOLOGY Toluna surveyed 719 people between the ages of 18 and 55+ across Australia about their use of, opinions around and interest in digital disruptor companies and marketing. The survey was launched on July 2, 2018, and completed in less than 24 hours using Toluna s QuickSurveys platform. We applied gender weighting to the results using Toluna s analytics technology. Data is representative of the Australian population. We asked consumers to self-identify regarding their adoption of new products and services modelled after Everett Rogers five consumer types. In his 1960s theory, called the Diffusion of Innovation, Rogers proposed that adopters of any new innovation or idea can be categorised as Innovators, Early Adopters, Early Majority, Late Majority, and Laggards. The choices we presented to our respondents are as follows: I am usually the first among my friends and acquaintances to adopt new products when they re first introduced (we refer to this group as the Innovators ) I adopt new products shortly after they are introduced into the market (we refer to this group as the Early Adopters ) I like to collect more information about the product and will weigh the pros and cons before I make a decision to buy it (we refer to this group as the Early Majority ) I adopt a new product mainly because most of my friends have all adopted them (we refer to the group as the Late Majority ) I will buy a new product only if what it replaces is no longer readily available (we refer to this group as the Laggards ) 4

5 The majority of our respondents (50 percent) identified themselves as Early Majority. The second largest group were Laggards at 18 percent, then Early Adopters at percent. Almost 9 percent of respondents identified as Innovators. The Late Majority had the lowest turnout, at 5 percent. What type of consumer do you consider yourself to be? Innovators I am usually the first among my friends and acquaintances to adopt new products when they re first introduced Early Adopters I adopt new products shortly after they are introduced in the market 18% 50% Early Majority I like to collect more information about the product and will weigh the pros and cons before I make a decision to buy it Late Majority I adopt a new product mainly because most of my friends have all adopted them Laggards I will buy a new product only if what it replaces is no longer readily available 18% 5% 9% 719 Respondents The role a respondent plays in purchasing decisions within their household impacts the direction of the shopping choices in the home, so it s interesting to note that 72 percent of respondents said they were responsible for the shopping in their household and 25 percent said they shared the responsibility. Just 3 percent said they were not responsible. Are you responsible for the shopping in your household? 3% No 25% Share responsibility 72% Yes 697 Respondents 5

6 ATTRACTING CONSUMER ATTENTION

7 Before we dive into the results, it is necessary to define how we define digital disruptors for this report and for our respondents. For the purposes of this study, we consider digital disruptor companies to be those that have transformed a traditional way of doing things using web-or app-based services. When asked about memorable disruptor brands, Uber seemed to be at the top of everyone s list. 13 percent recorded it as the first disruptor brand that comes to mind, with many of them mentioning a fondness for UberEats. ebay (8 percent) and Amazon (5 percent) took the second and third positions. But what is it that makes Uber, ebay and Amazon so memorable? What kind of marketing can deliver a similar level of popularity and memorability for other brands? According to our respondents, word-of-mouth is the most remembered marketing for a disruptive brand (37 percent). Ads on social media came in second at 26 percent, and digital/web-based ads were recalled by 11 percent. Word-of-mouth, social media and digital ads are the main marketing channels that consumers reported to have helped them remember a disruptor. What kind of marketing/advertisement do you most recall for any disruptive brand(s) 8% Out of home (such as ads on the subway, bus, billboard, etc.) 8% Flyer sent to my home address 10% Other, please specify 37% Word of mouth 11% Ad on general news or information website (such as weather.com or cnn.com) 26% Ad on social media 719 Respondents Further, 62 percent of those surveyed considered social media as the primary advertising channel for digital disruptors to market their services and products. Do you think that social media is the main advertising channel digital disruptors use to market their services? 38% NO 62% YES 7 1,007 Respondents

8 CONVERTING TO CUSTOMERS

9 Attracting consumer attention and being remembered is part of the goal, but the real objective for any disruptor is to convert prospects to buyers. So what moves people from seeing your marketing to becoming your customer? Once again, word-of-mouth (40 percent) came in as most influential for our respondents in making the decision to purchase or subscribe to a digital brand. Social media ads were deemed most influential by 21 percent, and general web-based ads were voted most persuasive by 12 percent. Which kind of marketing/advertisement influenced you in making the decision to purchase/ subscribe to the distruptive brand(s)? 7% Out of home (such as ads on the subway, bus, billboard, etc.) 9% Flyer sent to my home address 11% Other, please specify 40% Word of mouth 12% Ad on general news or information website (such as weather.com or cnn.com) 21% Ad on social media 719 Respondents Online reviews (51 percent) were cited as the most important factor to respondents when considering buying new things. Close behind were recommendations from friends (41 percent) and knowing that returns are easy (38 percent). More than half of the consumers said they like reading reviews when buying things online. When you consider buying new things which of the following factors are important to you? 719 Respondents 57 percent of respondents stated that a free trial was important when considering a new disruptor brand. A key factor that had, in the past, encouraged most of our respondents to consider trying a new disrupter brand was price (34 percent). Next were accessibility (17 percent) and a free trial period (13 percent). 9

10 When asked what factors would make them willing to consider trying a new disruptor brand now, 57 percent said a free trial period. Loyalty benefits (43 percent), sign-up discounts (39 percent), same-day delivery (31 percent) and new-member gifts (31 percent) were the next most important incentives. Which of the following would make you willing to consider trying a new digital disruptor brand 719 Respondents Health and beauty and wardrobe delivery services struggle to capture consumers hearts. What would you miss the least if it were no longer available? 703 Respondents Some categories seem to have better success than others when it comes to converting consumers to customers. Wardrobe subscription services, such as Threadbox and Wingal, were low in priority for our respondents, with 51 percent saying they were least likely to try them in the future. Health and beauty subscription kits, such as Bellabox and Peony Parcel, were the next lowest in priority, with 43 percent vvoting them least likely to try. 10

11 FACTORS IN DISCONTINUING USE

12 Customers rarely stay loyal for life, which means disruptor brands need to understand what changes can result in discontinuing use of a product or service. We know that price matters when it s time to buy turns out it also matters when it s time to renew. Price increase ranks number one among several categories as the reason to discontinue using a new product or service. When asked about transportation carriers such as Uber and Ingogo, 74 percent of respondents said that an increase in price would cause them to discontinue use. Price was also the number one factor for discontinuation of meal kit delivery category (77 percent), quick-turn shipping retailers, such as ebay (76 percent), and entertainment services (78 percent). A decrease in convenience was the second most important factor that could sway consumers away from a product or service in all four categories. Data breaches were the third most important factor. We can see that our respondents are price sensitive, but what are some of the other significant factors that would cause them to discontinue use? For transportation carriers, a decrease in convenience would cause 41 percent to stop using the service. Decrease in convenience was also the second problem for quick-turn shipping retailers (49 percent), entertainment services (41 percent) and meal delivery kits (48 percent). Data breaches were cited as the third most serious threat to loyalty across all categories. Respondents are sending a clear message that they are most interested in affordable, convenient products and services. But they also expect the companies they buy from to be serious about data protection. 12

13 THE FUTURE OF DIGITAL DISRUPTION

14 Some industries are perceived as being safe from digital disruption and others where consumers expect major changes in the coming years. What consumer industry do you think is most vulnerable to digital disruption? 719 Respondents According to our respondents, while no industry is completely immune to digital disruption, the wedding and accounting industries are least likely to be disrupted in the future (2 percent and 4 percent, respectively). As for the most likely to be disrupted, 17 percent of respondents said the entertainment industry. At 15 percent, the financial services industry was deemed second most likely. Are we now living in a subscription economy? Subscription economy is a phrase used to describe a seismic shift in business in which traditional pay-perproduct (or service) companies are moving toward subscription-based business models. Do you agree or disagree that we now live in a subscription economy? 719 Respondents 46 percent of respondents somewhat agreed that we are now living in a subscription economy. 31 percent somewhat disagreed. 14

15 THE MOST WIDELY POPULAR DISRUPTORS

16 Quick-turn retailers, such as ebay and Amazon, seem to be the most ubiquitous disruptor brands, with 64 percent of respondents saying they have used them. The next most-used online services were chat apps, like WhatsApp and Viber (54 percent). Following close behind were entertainment services like Netflix, Stan and Foxtel Now (52 percent). More than 50 percent of surveyed respondents have used services in these categories: Quick-turn shipping retailers (like ebay or Amazon) Conferencing and chat services (like Slack, WhatsApp or Viber) Entertainment services (like Netflix, Stan and Foxtel Now) Have you ever used any of the following services? 719 Respondents 16

17 CONCLUSION As the numbers collected in this report show, no matter what innovations a company brings to the table, it s consumers who will ultimately decide whether the disruption is a success or a failure. In addition, we can begin to see that a successful innovation can eventually become an expectation. If there is one thing we can take from this observation, it s that digital disruption raises the bar and broadens future opportunities. 17

18 APPENDIX

19 ADDITIONAL INSIGHTS To access, cross-tab, and analyse the respondent data through a TolunaAnalytics dashboard with the results, click here. ABOUT TOLUNA Toluna provides consumer insights designed to empower success in today s on-demand, global economy. Powered by the perfect fusion of technology, expertise, and the largest global community of influencers at the ready, Toluna delivers rich, reliable, real-time insights to individuals, and companies of all sizes Our automated consumer insights platform, TolunaInsights underpins everything we do. Clients can access the platform directly, leverage Toluna s managed services, or create fully-customised digital consumer insights programs via our engineered services. Toluna is committed to promoting Insights on Demand, an entirely new way for businesses to obtain insight and understand constantly shifting consumer sentiment and taste in the on-demand economy. Toluna is a founding member of the Insights on Demand Consortium, a multi-lateral group that s advancing the principles and adoption of Insights on Demand. The company has 24 offices globally spanning Europe, North America, South America, Asia Pacific, and MENA. CONTACT TOLUNA Looking for even more consumer insights? Contact us at toluna@toluna.com and we ll be happy to discuss your specific needs, or if you d like to run your own survey visit quicksurveys.com to get started for free. www. 19

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