CHAPTER 3

What Connects the Target?

In the beginning of electronic commerce, competition came from both click-only companies, as well as other brick-and-mortar companies, so firms found it necessary to develop an online presence. The first retailers online who did venture forth found the Internet had given them a competitive advantage over those that remained entirely brick-and-mortar. Click-and-mortar companies found a new consumer market, those who were unable to be brick-and-mortar customers because of time or space, or those who liked the opportunity to shop online.

Many large retailers were reluctant to develop an online presence because of the fear of cannibalization. In essence, their customers would stop going to the stores and only shop online, leaving retailers with expensive real estate and no profits. What these retailers failed to understand was their target market. Those who would shop in the stores continued. These customers also began to shop online, and now on mobile devices. However, online, and now mobile, has spawned segments of shoppers that stores fail to attract.

In determining the segment, retail establishments study those who would frequent within a market area. For example, if higher income families heavily populate a location, more likely stores and restaurants that cater to upscale consumers will develop in the area. Location in e-commerce, though, is different. Upscale consumers can still be the target, yet their location is different. Many marketers have recently found their upscale market online in China. Same segment, different location. However, the target market is different.

Defining a target market may seem easy, but targeting the right market can take time. College students are NOT a target market. Homemakers are NOT a target market. College students and homemakers are segments of the population. Capturing the essence of college students or homemakers can lead to the development of a target market. Are the college students attending a university or community college? Are they living in a dorm or commuting? Are the homemakers young mothers or empty nesters? Do they have young children or taking care of aging parents? Each has different buying needs and wants. Each is different in where and how they buy.

M-commerce takes targeting to another level. Targeting becomes granular. It is not just about the location where the target lives, but the target in and around the purchasing location.

Consumers are motivated to shop online because it is convenient, it is different, and increases the variety of products available. Depending upon the person or situation, motivations to shop online motivations can be utilitarian (need), or hedonic reasons (fun). Lowest price for a product is important, but many online shoppers just prefer surfing. For those who shop online, they are usually shopping lovers, tech lovers, or just browse for the adventure (Brengman et al. 2005).

Money and time drive convenience for consumers. Finding the lowest price takes time, but offers the convenience of saving money. Money-conscious shoppers like e-commerce. These consumers spend time online researching for the lowest price, whether it is the product price, shipping cost, or other monetary choices. e-Marketer (2015) finds that travel research and booking is still primarily on desktops (52 percent).

Time-conscious shoppers are more likely going to use m-commerce. Price is an essential component to their shopping experience; however, these consumers want to make a quick purchasing decision. Mobile coupons and online price comparisons aid consumers who want both types of convenience when shopping on their mobile devices. However, ultimately consumers want a website, no matter what the device, which is convenient to navigate quickly, containing the information (or content) that makes their search expedient.

Digital Content

Content is king—the new mantra of marketing departments has implications beyond royalty. Content is information. Customers, to make better purchasing decisions, use information. The Internet has enabled consumers to find information when needed. No longer do buyers have to wait until a trip to the auto dealer to learn about cars. Consumers can look up competitive pricing information while in-store. Information, or content, is now readily available and is now convenient. However, the lack of relevant content, inconsistency between online and mobile site content, and content that is not optimized for quick searches are making consumers unhappy with most websites. Table 3.1 highlights some of the content found on e-commerce and m-commerce sites.

Table 3.1 E-commerce and M-commerce content types

Content allows marketers to relate with customers in various ways. Content allows engagement, interaction, information, and a defined call to action.

In developing content, an understanding of the user is pertinent as well as reasons for content. In short, content

• solves a problem—understand why the user needs the information
• is effective—content should move the consumer along the path to purchase
• is concise—deliver content quickly and efficiently
• targets the user—focus content on your market and their needs
• fits the channel—content should be appropriate to the website, social site, or mobile application
• is consistent—content should have the same message throughout each marketing channel

Websites: The Key to the Consumer

Of all visits to websites, 53 percent were from mobile devices (Branding Brand Mobile Commerce 2015). In 2014, the share of visits from desktops and laptops dropped from 18 to 15 percent. Interestingly, the share of visits from tablets dropped as well (17 percent), while the share for smartphones increased 41 percent.

Forbes Insights (2013) found that while mobile is useful for their positions, most executives do not use mobile devices for purchasing because of difficulty in navigating through mobile websites and apps. Most preferred using tablets for searching for product information; using their mobile device for purchasing would be the natural next step. In fact, executives would prefer purchasing on mobile devices, both tablets and smartphones, if it were easier to do so.

Consumers like a virtual environment that is similar to a retailer’s physical structure for a reference point (Wikström, Carlell, and Frostling-Henningsson 2002). The look and feel of a website should emulate that of the store. Incompatibility keeps many shoppers from shopping on websites because of confusion on the part of consumers. If a website does not complement the look and feel of what the shopper expects, the attitude toward that website may be negative. For example, an upscale department store should have an upscale website presence. Consumers do not expect to view savings information on an upscale website. Designer products and fashion updates should be present on the website, as in the store. Now, consumers expect this same compatibility for mobile websites and applications.

Usability and interactivity attract consumers to websites (Constantinides 2004); content keeps them interested and purchasing. Usability refers to the ease of using a website, including easy navigation, updated links, and quick loading. Interactivity is responsiveness through human-to-human or human-to-computer interactions. Consumers will spend more time on sites, that are usable and interactive. Hence, the longer time someone is online, the more likely they are to shop online (Lohse, Bellman, and Johnson 2000).

Browsers perceived considerably more financial, time, and psychological risks on e-commerce websites than heavy or moderate shoppers, whereas moderate shoppers mere more likely to perceive product performance risk, and heavy shoppers perceived less overall risk (Forsythe and Shi 2003). However, sites that attracted bargain seekers do not have high repeat purchasers (Reibstein 2002). Sites that take advantage of low prices may only attract the most price-sensitive customers, those that lack loyalty, or bargain seekers (Reibstein 2002). Chandon, Morwitz, and Reinartz (2004) studied repeat purchasing behavior in terms of intentions, finding that the likelihood of repeat purchasing declined over time after the first purchase.

Marketers who use mobile devices for marketing purposes are finding difficulty in transferring e-commerce website design. In fact, there are many inherent problems with mobile devices, keeping mobile from the explosive new technology that everyone was hoping mobile marketing would become.

Small screens, tiny keypads, and limited battery life are some of the inadequacies that consumers find when using mobile phones, and other mobile devices. Moreover, though it sounds strange, the big finger syndrome is responsible for wrong key strokes in transactions and typing. The small size of the mobile device screen, though it is getting larger, is still too small for some graphics and images for websites. Lastly, the attention span of those on a mobile device is shorter than those using a desktop computer. Understanding this restraint, website design, navigation, and the buying process must be taken into account.

Most consumers find that mobile websites do not give enough content. Even if the mobile website is easy to navigate, the lack of content makes the sites inadequate (SalesForce 2014).

Google research (2012) found that most consumers (74 percent) would return to a site that is mobile-friendly, and more likely to buy (67 percent) from that site. On the other hand, 61 percent would go to another site if they could not find what they were looking for right away. In addition, 96 percent found that most of the mobile websites they encountered were not designed for mobile devices. Many felt frustrated and annoyed (48 percent) and felt they wasted their time (36 percent) and less likely to engage with the company (52 percent).

The impact of these challenges has led marketers to find the ideal atmosphere in which to conduct business in the mobile market. Because mobile marketing encompasses advertising, commerce, as well as promotion, the ideal servicescape, or physical environment, must be able to overcome the challenges mentioned previously for all mobile marketing purposes.

Atmospherics, how the site looks and feels, are as important to virtual commerce as store layout is to traditional retailers, if not more so. Atmospherics refers to the designing of space to create a positive purchase environment that may enhance the likelihood of purchase (Kotler 1973–1974). The characteristics of a website, like a retail establishment, influence consumers’ shopping behavior (Menon and Kahn 2002). This includes the environment of an online retail establishment, which has been found to affect consumers’ desire to purchase, though conventional retail store layout did not apply to a virtual retail layout (Vrechopoulos et al. 2004).

Atmospherics are as important to virtual commerce as store layout is to traditional retailers, if not more so. The relationship between the retailer and the consumer is an important element that cannot be offered in other channels (Kolesar and Galbraith 2000) and must be satisfied by the online retailer through the capacity for direct personal interaction. As the traditional retail outlet has changed over time, the online shopping experience has moved toward atmospheres that have their own cues for customer satisfaction. Some of these have come from the traditional store whereas others have come from the online experience itself. These are likely be the way in which mobile commerce atmospherics will manifest itself in the time to come.

Customers tend to judge a website in terms of quality and satisfaction in terms of its design, reliability in fulfillment, privacy and security concern, and customer service (Wolfinbarger and Gilly 2003). Novak, Hoffman, and Yung (2000) suggested that the activities involved in product search do not yet offer levels of challenge and arousal for a compelling online customer experience. Although touch and feel are important to the experience for consumers when purchasing products (Li, Daugherty, and Biocca 2001), an online experience can still be positive with the interactivity that the Internet offers.

Mobile Applications

In connecting to the Internet, consumers spend 12 percent of their time browsing and 88 percent of their time with mobile apps (IAB 2014). Mobile applications, or apps, have become increasingly important in mobile commerce for both businesses and consumers. Developed for both Apple and Android platforms, apps are software downloads for mobile devices. That is the good news. The bad—every company has an app. The iPhone App Store launched in July 2008 with 800 apps, and by September 2014, there were over 1.3 million apps available. Apps have become the principal method for information dissemination in mobile. Specific to smartphones and tablets, apps are downloadable software, usually bearing the logo, or other brand identification.

Mobile apps have a high level of user engagement, which can translate into a more positive attitude and personal connection toward a brand (Bellman et al. 2011). Companies are enthusiastic about developing apps in order to maximize the impact of brand awareness. Hence, the excessive number of apps on the market—both free and priced. Not only is the number of apps growing, but also the time spent with apps is increasing.

Starbucks, which has been the mobile marketer for several years, integrates mobile commerce within their app for 13 million users for over 6 million mobile apps weekly. Mobile transactions represent over 16 percent of the company’s total transactions. Starbucks customers can order, track their loyalty program, and pay through their Starbucks app. Customers have shorter wait times and a better in-store experience when using the app. Starbucks is using the app to introduce express locations to streamline the purchase even more.

Some of the preferences for using apps over the mobile web (IAB 2014) include

• More convenient
• Easy to use
• Ability to use when the mobile device is not connected to the Internet

Those who prefer the web did not want to spend money to purchase apps, were disappointed in the apps downloaded, and found the web browser easier to use. Others found apps took up too much space on their devices and too much time to download.

Other problems with mobile apps include lack of retention and abandonment. Downloading does not equate to usage. According to Localytics, in 2014 20 percent of apps were used only once, while usage of apps over 10 times climbed to 39 percent, indicating app retention is increasing. Retaining the app is more likely for those who purchase an app. However, abandoning an app, or app churn, is higher when users do not return to the app within seven days of downloading. In fact, 60 percent of users never returned if the app was not used within seven days of downloading. Keeping this in mind, firms should market their apps in order to increase usage to those downloading within the first seven days. Yet, if the app does not contain content, design, and usability, no marketing efforts will be sufficient.

There are many uses for apps for mobile commerce. Facilitating better customer engagement, apps can address needs and wants in terms of shopping. Apps are your business. Apps tell customers who you are and how you are going to assist them. Apps should not create problems, but offer solutions to problems and challenges. Apps should answer the question How do I? Apps should offer value to both the customer and the business, as shown in Table 3.2.

Table 3.2 Value of mobile apps

Responsive Design

Consumers react positively to websites and applications with informational content, hassle-free navigation, and appealing design. Users will immediately abandon a site if it causes them to react negatively to site usage. Responsive design refers to optimizing sites and apps taking into account movement through the space, layout, coloring, fonts, and usability. Coalescence of all that the site offers should invite users to respond to offers, read content, make purchases, chat with staff, and recommend the site to others. Users want sites and apps that respond to their needs and behaviors.

Responsive design takes into account the environment of the site. Putting a catalog online as an e-commerce website does not work. Taking the e-commerce site and shrinking it for m-commerce does not work. Taking a mobile phone app and calling it a tablet website does not work. Nuances of different devices call for distinctions in their development.

Originally fashioned for information technology developers, responsive design took into account the architecture of websites and applications. However, responsive design is pertinent to marketers as well.

E-commerce websites should be designed to take advantage of the space available. Monitors range in size, with some using two monitors at one time. Large images, several frames, bold colors, lots of text can be used to fill space. M-commerce websites and applications do not have the advantage of space. In fact, because of the shortage of space, designing for mobile, various screen sizes must be taken into account.

Use of keyboards, phone pads, and touchscreens affects design. Cursor-based devices have different structures. Touchscreens do not support hovering, changing from a pointer to a hand when hovering over a link before clicking. Spacing links so that fingers do not touch the wrong link is imperative. Tap targets must be placed in what is known as thumb-zones—where the thumb rests on the mobile device. Screen orientation should be taken into account. Can the mobile site rotate depending on the orientation of the screen? A fluid layout should have the ability to switch from portrait to landscape mode. Load times need to be shorter to take into account battery life of the device and Wi-Fi connections. Color support varies by device, meaning sharpness and brightness of images will differ. In addition, for all sites, content should be optimized for search engines. Ensure your content is properly displayed, succinct yet to the point, and stresses location, as most mobile searches are local.

Lastly, design sites for cohesiveness. Online websites, smartphone websites, tablet websites, and mobile applications should have the same look, feel, design that attracts customers to your business. Colors, fonts, images, and other design features should combine so that customers know they are doing business with you no matter the device. Develop a theme that is consistent throughout all development and marketing efforts. Cohesiveness not only aids in search engine optimization, but also allows customers to move fluidly throughout your digital spaces.