Marketing

Open all hours

September 26, 2014

Europe

September 26, 2014

Europe
Sara Mosavi
Contributor, The Economist Intelligence Unit

Sara is a Policy and Research Manager at UK Commission for Employment and Skills working on issues such as youth unemployment, productivity, apprenticeships and further education. Prior to this, Sara worked as an Editor with The Economist Intelligence Unit's Thought Leadership team for over three years researching projects on educuation, talent, risk management and organisational behaviour. Sara holds a MSc in International Public Policy at UCL and read Italian and Linguistics at St Hugh's College, Oxford.

Contact

An EIU survey commissioned by IPA investigating how UK businesses are adjusting their strategies to target and sell to connected customers.

In September 2014 The Economist Intelligence Unit surveyed 176 UK business executives on behalf of the Institute of Practitioners in Advertising. The purpose of the survey was to investigate how businesses are adjusting their strategies to target and sell to connected customers—economically active consumers that use multiple technological devices, and are confident and capable in using these for a wide range of online activities. 

The key findings are:

Despite the growing number of connected customers, few UK businesses have a strategy to target and sell to them. Over four-fifths (84%) say that the proportion of their consumer base that they consider to be connected customers is growing, and three-quarters recognise engaging with these customers to be a strategic priority. Yet only 29% have a strategy to target and sell to connected customers. 

Few UK businesses have a sales strategy for mobile technology. Over one-third (35%) do not currently have such a strategy, and about one-fifth (18%) say they do not need one. Less than one-third (29%) have a well-established mobile-technology strategy (12 months or more), and 16% have launched one in the last year. Larger companies—those with annual revenues in excess of £5bn—are ahead of the curve: 45% have had a mobile strategy for over a year. 

Social media becomes a more important—if not the most important—customer communication channel. While just 11% of respondents say that social media was their preferred method of communication with customers over the past three years, over the next three, one-third (32%) say that will be the case. This shift is particularly strong among large companies where the increase is nine-fold (from 5% to 45%). In fact, social media will overtake email over the next three years as the preferred method of communication for these companies. This is striking as nearly two-fifths (38%) of executives from larger businesses say post was their preferred method of communication over the past three years. 

Sharing information with customers is easier than having a dialogue with them. Over three-fifths (63%) say they are good or excellent at sharing information with customers, while 54% say the same about holding an instant dialogue with them. The difference is more marked among those with a well-established strategy to sell through mobile technologies: 84% say they are confident in sharing information compared to 63% who say the same about holding an instant dialogue. 

Connected customers make companies nervous about their brand and reputation. The biggest worry for businesses when interacting with connected customers is exposing their brand and reputation to online comments and social media posts. As more and more consumers make the transition from being passive recipients of information to actively engaging with brands, businesses will inevitably lose some control over their image and reputation. 

Investing in digital technologies is crucial to companies’ strategies to target and sell to connected consumers. Similar proportions of respondents identify investments in their website, e-commerce platform and mobile technology as fundamental to their connected-customers strategy (39%, 35%, 32% respectively). Investment should help companies make better use of the customer data they have available; currently 37% say they are not confident in using data collected from online sales to inform their strategy to target and sell to connected customers. 

Receive forward-looking perspectives from our editors - Subscribe now for our Weekly Digest