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The Connected Consumer - UK - May 2015

“Effective segmentation and focused targeting strategies through content personalisation are the key to making the benefits of contextual marketing to consumers outweigh the perceived disadvantages, thus boosting acceptance and adoption.”
– Sara Ballaben, Technology Analyst

This report looks at the following areas:

  • How should companies look to engage consumers with contextual marketing?
  • Digital and in-store touchpoints can complement each other

The mobile-driven disruption brought about by the rise of a generation of digitally-savvy, connected consumers challenges companies to be personal, helpful and informative at all times through real-time contextually relevant content that offsets consumers’ concerns over privacy and cyber-security.

As consumers’ patience for adverts not relevant to them decreases and the risk of overexposure increases, brands able to develop a relationship with each individual that enables a truly personalised customer experience across all channels are rewarded with higher conversion rates, deeper customer engagement and lasting brand loyalty.

Additionally, consumers’ multichannel approach to researching product information coupled with touchpoints other than brands’ websites playing a supportive function in the research process, highlight shoppers’ effort to make an informed purchase decision by counterbalancing the pros and cons of different sources.

Omni-channel integration, effective segmentation and focused targeting strategies hence become the key to coupling the simplicity and reliability of the brick-and-mortar location with the flexibility of the digital options. It’s crucial to make sure the benefits of contextual marketing outweigh the perceived disadvantages, thus boosting acceptance and adoption and positively impacting brands’ bottom lines.

But branded app penetration is still limited, with a direct impact on the ability to roll out real-time contextual marketing through beacon technology. Companies that digitally target multi-channel Millennials and connected parents – who are the most likely to engage with brands at multiple touchpoints – through enhanced in-store functionalities and mobile payment integration will develop a competitive advantage in streamlining the customer experience and offering a seamless consumer journey.

Additionally, peer influence is becoming central in arriving at a purchase decision and is transforming branded communication into a two-way process of value co-creation. Companies able to capitalize on user-driven social media content by empowering and encouraging early adopters to act as advocates will be the most successful in engaging their customer base with real-time marketing messages.

This report looks at the myriad of online and offline touchpoints available to consumers in the digital era, investigating how UK consumers feel about these numerous options and what their preferred communication channels are when researching product information, contacting a company and making a purchase.

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Table of contents

  1. Overview

    • What you need to know
      • Connected consumers digitally challenge retailers…
        • …and expect a seamless omni-channel and personalised experience
          • Consumers want the best of both worlds
            • The potential of contextual marketing
              • Empowered customers co-create brand value
                • Scope of the report
                • Executive Summary

                    • The rise of the connected consumer
                      • The majority of consumers use three or more sources of information
                        • Figure 1: Repertoire of sources of information about brands and products, February 2015
                      • Secondary touchpoints have a supporting function
                        • Figure 2: Attitude towards utility of sources of information about a brand or product, February 2015
                      • Mobile apps need to be improved to appeal to the connected consumer
                        • Over half of consumers feel online customer service is not effective…
                          • Figure 3: Attitudes towards communication with companies, February 2015
                        • …and only few are ready for location-based marketing
                          • Consumers prefer less intrusive marketing channels…
                            • Figure 4: Preferred sources of information about offers and deals, February 2015
                          • …but want the best of both worlds
                            • Figure 5: Correspondence analysis of attitudes towards payment channels, February 2015
                          • Will digital wallets be a game changer?
                          • Issues and Insights

                            • How should companies look to engage consumers with contextual marketing?
                              • The facts
                                • The implications
                                  • Digital and in-store touchpoints can complement each other
                                    • The facts
                                      • The implications
                                      • Market Background – What You Need to Know

                                        • The rise of the connected consumer
                                          • The development of a personal data economy
                                            • Contextual marketing enables a truly personalised customer experience
                                              • Omni-channel integration guarantees a seamless consumer journey
                                                • Empowered customers co-create brand value
                                                • Market Background

                                                  • The rise of the connected consumer
                                                    • Figure 6: Ownership of smartphones and tablets, January 2012 – November 2014
                                                  • Cyber-security, privacy and the personal data economy
                                                    • Figure 7: Concerns relating to online data/security, November 2014
                                                  • Be personal, be relevant
                                                    • And find the perfect timing
                                                      • The real-time enabler: Beacon technology
                                                        • What is beacon technology?
                                                          • How can beacons enable smarter shopping experiences?
                                                            • What’s next? New frontiers for beacon technology
                                                              • From multi-channel to omni-channel
                                                                • Empower your customers to co-create brand value
                                                                  • Figure 8: Snickers’ tweet after the Italy-Uruguay FIFA Worldcup match, June 2014
                                                                • Innovation can be a bottom-up approach
                                                                • The Consumer – What You Need to Know

                                                                  • The majority of consumers are multi-channel
                                                                    • The connected consumer: Millennials and parents of under-16s
                                                                      • Two-way communication means twofold expectations
                                                                        • Limited use of mobile apps poses a challenge
                                                                          • Digitally target multi-channel Millennials and connected parents
                                                                          • Brand Touchpoints

                                                                            • Which information sources do people use?
                                                                              • Brands’ websites are the preferred source of product information
                                                                                • Figure 9: Sources of information about brands and products, February 2015
                                                                              • The potential of secondary touchpoints
                                                                                • The majority of consumers use three or more sources of information
                                                                                  • Figure 10: Repertoire of sources of information about brands and products, February 2015
                                                                                • Be ready to digitally target multi-channel Millennials…
                                                                                  • Figure 11: Repertoire of sources of information about brands and products by age, February 2015
                                                                                  • Figure 12: Use of selected touchpoints by age, February 2015
                                                                                • …and connected parents
                                                                                  • Figure 13: Repertoire of sources of information about brands and products by parental status, February 2015
                                                                                  • Figure 14: Use of selected touchpoints by parental status, February 2015
                                                                                • But target them separately
                                                                                  • Which sources do they find most helpful?
                                                                                    • Secondary touchpoints have a supporting function
                                                                                      • Figure 15: Attitude towards utility of sources of information about a brand or product, February 2015
                                                                                    • Mobile apps seen as the least useful touchpoint…
                                                                                      • …and need to be improved to appeal to the connected consumer
                                                                                      • Perceptions of Information Sources

                                                                                        • Positive perceptions of brands’ websites
                                                                                          • Figure 16: Correspondence analysis of perceptions of sources of information, February 2015
                                                                                        • Mismatch between use and perceived utility of visiting a store
                                                                                        • Attitudes towards Communication with Brands

                                                                                          • Over half of consumers feel online customer service is not effective…
                                                                                            • Figure 17: Attitudes towards communication with companies, February 2015
                                                                                          • …but about a third want to connect on all devices at all times
                                                                                            • The benefits of an improved online customer service
                                                                                              • Are consumers ready for location-based marketing?
                                                                                              • Preferred Channels for Offers and Deals

                                                                                                • Consumers prefer less intrusive marketing channels…
                                                                                                  • Figure 18: Preferred sources of information about offers and deals, February 2015
                                                                                                • …but modern digital channels are emerging
                                                                                                  • …and are preferred by the connected consumer
                                                                                                    • Figure 19: Interest in selected sources of information about offers and deals by age and parental status, February 2015
                                                                                                • Attitudes towards Payment Channels

                                                                                                  • Consumers want the best of both worlds
                                                                                                    • Figure 20: Correspondence analysis of attitudes towards payment channels, February 2015
                                                                                                  • Is personalisation the key to boosting app use?
                                                                                                    • Will digital wallets be a game changer?
                                                                                                    • Appendix

                                                                                                      • Abbreviations

                                                                                                      Companies Covered

                                                                                                      To learn more about the companies covered in this report please contact us.

                                                                                                      The Connected Consumer - UK - May 2015

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