Press Releases

Consumers prefer Search over friends and family

04 March 2019

Salmat’s 2019 Marketing Report also reveals a mismatch in marketer and consumer behaviour, a heavy reliance on discounting, and that in-store tech is failing to connect

Australia, 4 March 2019: New research from Salmat has found that Australian consumers are increasingly
turning to technology - more specifically, Search engines - for recommendations, over their own friends and
family. Search engines topped the list of 23 channels that consumers use to make purchase decisions (49%),
making it more influential than recommendations from friends and family which came in second (46%). The
findings are from the third annual Salmat Marketing Report (SMR) which compares the behaviours of Australian
marketers and consumers to give in-depth analysis and advice on marketing strategies.

Consumers are increasingly turning to technology for advice, over real people who they know and trust. The 26% decrease in consumers going to friends and family is a dramatic shift from 2017, when 72% of respondents chose to go to them before making a purchase.

Mismatch between marketer and consumer behaviour

Despite Search engines being the most influential channel for consumers, there is a mismatch between marketer investment and consumer behaviour – with only a quarter of marketers investing in Search Engine Optimisation (SEO) and Search Engine Marketing (SEM) (28% and 25% respectively) to reach their audience.

The SMR found that marketers are instead putting their money into social media, with over half (54%) of
marketers investing in this channel in the last year. This is despite only one in four consumers (25%) saying they use social media as an information source for making purchase decisions.

Shane McClelland, Head of Marketing & Corporate Communications at Salmat, said: “This mismatch
between marketer and consumer behaviour is surprising and is of course leading to challenges in reaching new
customers. Consumers’ habits, behaviours and expectations are rapidly changing, so as marketers we need to keep an eye on the data we have and adapt as needed. We need to do this regularly and quickly to prevent losing customers to competitors.”

Price counts for 70% of a purchase decision

Australian consumers are largely driven by price, and money is often the deciding factor for consumers when it
comes down to their final purchase decision. In fact, consumers say that price counts for close to 70% of their
purchase decisions. However, when asked about their top concerns when buying products, value for money came out on top (85%).

The research indicates that marketers are acutely aware of the role price plays in consumers’ purchase decisions and are discounting their products regularly - 26% are discounting weekly, and 28% discounting monthly. Given consumers' focus on value for money as their top concern, this presents an opportunity for marketers to stand out from the crowd by highlighting the value for money of their products.

McClelland commented: “Everyone discounts in Australia and whilst price is still a huge deciding factor for
consumers, it isn’t the only way brands can stand out. Looking outside of that, consumers are more receptive to
brands that deliver value for money – this is still price driven but demonstrating value for money is something
marketing can really own. Instead of discounting heavily or focusing on undercutting the competition on price,
we should instead demonstrate why our products deliver the best value for money. Messaging can focus on this in addition to offering promotions. This of course needs to be delivered to the consumer via the channel they use to search and browse for brands.”

In-store tech fails to connect

Clearly, technology is becoming more influential in the customer’s buying journey - but not all technology is
equally influential. When shopping in-store, consumers are more inclined to use their own phone to go online to
compare prices, find the best deal or access specific retailer apps (57%), or research product information (56%), rather than use the technologies that retailers offer in store (31%). Therefore, in place of investing in tablets, iPads and virtual reality experiences in-store, marketers should look at investing in SEO/SEM, online catalogues, online reviews and owned online assets such as a brand’s website - areas that are holding the attentions of consumers.

“We already know consumers like to shop around – especially when it comes to finding the best deal. But what
we’ve found is that they do that research on their own devices – mainly on their mobile whilst they are still in
store. This makes a lot of the in-store technology redundant and rarely used by consumers. Instead, marketers
should look at investing in creating in-store environments to harness consumer behaviour – charging points,
relaxation areas, experiences to keep consumers in store for longer, and ultimately then converting them to a sale.” McClelland concluded.

ENDS

Methodology
All figures, unless otherwise stated, are from YouGov. Salmat commissioned YouGov to conduct two online
surveys - one with consumers and one with marketers. The consumer study was conducted between 28
September – 1 October, 2018, while the marketers study was conducted between 26 September – 5 October,
2018.

The consumer sample comprises of 1,039 Australian consumers aged 18 years and older. Age, gender and
location quotas were applied to the sample.

The marketers survey was based on 512 Australian marketers who are key decision makers in the marketing of
products in businesses with 25 or more employees.

Following the completion of interviewing, the data was weighted by gender and region to reflect the latest ABS
population estimates.

About Salmat
Salmat is a leading Australian marketing services provider. We help clients connect with their customers, weekin, week-out. Salmat's unique combination of targeted letterbox and online marketing channels enables clients to Reach, Convert and Serve their customers. We also provide a wide range of back office solutions, through our Philippines-based Managed Services business.

Founded in 1979, Salmat has evolved from a small letterbox distribution business to an ASX-listed company.
With a talented team across three countries we work with some of Australia’s most recognised and trusted
brands.

“Reach: We offer the broadest reach media (online & offline), with the ability to target individuals and up to 17
million people. Convert: We deliver conversion across multiple channels, creating more opportunities for our
clients’ customers to buy. Serve: We make every one of our clients’ interactions count online and offline.”

About the Salmat Marketing Report
The 2019 Salmat Marketing Report compares the behaviours of Australian marketers and consumers to give indepth analysis and advice on recommended marketing strategies for the year ahead. The report uses insight on how marketers are investing budgets, what channels they’re focusing on, and how they’re evaluating their
strategies. Looking at the three stages of the customer buying journey - Awareness, Consideration and Purchase- it also explores how consumers research products and services, the factors influencing their purchasing decisions, and general shopping behaviour.

This is the third report in the annual Salmat Marketing Report series. To find more marketing insights and tips,
please download our previous reports here: 2017, 2018.

For further information please contact:
 Gem Mejer
 Senior Account Manager, WE Buchan
 M: +61 435 291 299
 E: gmejer@we-buchan.com