Most of us use social media every day. Research shows this online networking makes people feel better about themselves. But could that positive feeling have a negative impact on behavior, making you spend more or even eat more?
As strange as it sounds, a new study suggests the answer is “yes.” Two marketing professors say their research shows – for the first time – that using online social networks can influence behavior by reducing self-control. They conclude that Facebook and other social media can have significant effects on consumer judgment and decision-making.
“People who use Facebook more tend to have a higher body-mass index (BMI), increased binge eating, carry more credit card debt and have lower credit scores,” said Andrew Stephen, an associate professor at the University of Pittsburgh.
Stephen and Keith Wilcox, an associate professor at Columbia University, believe these “unintended psychological consequences” of Facebook use are related to the ego boost people get from social media. And they found that effect is greater if you have a high percentage of close friends online.
“Simply browsing Facebook makes people feel better about themselves and momentarily enhances their self-esteem,” noted Wilcox. “It’s that enhanced self-esteem that ultimately lowers your self-control.”
I’m not surprised that the advertising isn’t converting. I knew it wouldn’t. There are 2 really big but fixable problems. The psychology of the guest is wrong. The ads are in the wrong pace. Display advertising placed on the far right, the top, or the bottom of a page is always offered at the lowest CPM (cost per thousand) because it always has the lowest CTR (click through rate) and lowest CTC (click to conversion) rate.
Over the past 11 years I’ve successfully launched thousands of campaigns and it has always been true. Never run your ads with a publisher if they are placed at the right, top or bottom of a page.
The solutions are to place the ads on the left hand side of the page and to place the navigation links at the top or the right hand side of the page. I’d also suggest creating a channel for the ads that is seems exclusive and compelling in color and copy. Finally I’d assemble an editorial team tasked with making sure that all banner ads meet a creative and file size specs.
However, I think some way, some how, Facebook will find a way to parcel out and package into profiles all of the user generated data on its servers which it will then sell to major industries.
On the next page is the article.
- Tom Polanski
1. Cash-Strapped Consumers Shift Brands
According to a blog from Gian Fulgoni in Ad Age Digital, about 54% of consumers said they bought the brand they wanted most in 2008. By 2010, this had dropped to 45%, and 43% this year. Declines were observed in every category, with the most severe drop (17 points) in over-the-counter medicines and the lowest in the household category (6 points).
If consumers aren’t buying the brand they want most, they are switching brands, says Fulgoni. When a “peer” brand is on sale, 38% in 2011 say they bought it compared to 33% in 2008. But they also turn to a cheaper product. About 19% of consumers switched to private-label products in 2011, up from 14% in 2008.
When downsizing caused consumers to switch to another brand, 14% said it usually did and 54% said it occasionally did. But when asked which cost-controlling action they would prefer, 62% more consumers chose a smaller size over a price increase. Brand marketers appear to be backed into a “damned if you do, damned if you don’t” corner.
Take online jeweler Stauer. It’s offering a $249 amethyst necklace for free — provided customers pay the $24.95 it costs to ship it. Stauer will lose money on the deal, but it hopes to reel in new customers who will buy other jewelry.
“In this economy, you have to be outrageous in your offers,” said Michael Bisceglia, the president of Stauer who found that more than a third of customers who took advantage of a similar deal on a $179 pearl necklace in 2009 bought additional items. “You have to shake up the world a bit.”
Not every retailer will go as far as giving away merchandise during the holidays, but many will offer profit-busting incentives. It’s a critical time of year for merchants, which can make up to 40 percent of their annual revenue in November and December. And they’re so worried that Americans are spooked by the weak economy that they’re willing to sacrifice profit for sales.
Nordstrom, for instance, is one of the first retailers to offer free shipping on most orders, no matter how small, even though it could wind up paying $3 to ship a $7 pair of socks. Furniture chain Raymour & Flanigan is allowing customers to go four years without paying interest on their purchases — the longest period it has ever offered — even though it will have to help cover a chunk of those charges itself. And Sears is not only offering to match the cheapest prices customers find online, but the department store chain is giving them an additional 10 percent off the difference.
“You may be making a $1 profit instead of a $3 profit,” Fiona Dias, chief strategy officer of members-only shopping service ShopRunner.com, said about retailers. “But you’re not losing a sale.”
Retailers are nervous about holiday sales because many Americans are cutting back on spending as they grow increasingly concerned about the stubbornly high unemployment rate, stock market turmoil and an overall fragile U.S. economy. In fact, a recent Gallup poll found that eight of 10 Americans think the country is in a second recession.
“Retailers are now scared because some believe they’re in a second recession,” said C. Britt Beemer, chairman of America’s Research Group. “And the second recession is hitting them in the biggest shopping season of the year.” Read the rest of this entry »