Acceptance grows for online advertising - survey

The Consumers and Convergence IV report, which is based on a survey of more than 5,600 consumers in 22 countries (including 300 from the Republic of Ireland and 100 from Northern Ireland), also finds that 64pc of people globally would be willing to allow their online usage and personal profile information to be tracked if that would result in lower costs. In Ireland, however, the figure is just 52pc.

Overall, the survey finds a number of interesting differences between global and Irish consumers around willingness to accept online advertising, openness to sharing personal information, comfort with mobile transactions and readiness to pay for online content.

Globally, 42pc of respondents said they would be willing to receive advertising on their mobiles in return for lower prices or free content. KPMG notes challenges for those looking to use mobile technology for marketing purposes in Ireland, with the figure falling to 28pc in the Republic and to 31pc in Northern Ireland.

Where consumers are viewing ads online, the survey also found a strong preference for advertising messages tailored to individual interests as opposed to generic campaigns. Just over half (52pc) of respondents in the Republic and 61pc of those in the North prefer tailored activity as opposed to 11pc in the Republic and 12pc in the North preferring generic campaigns.

While an increasing number of consumers said they were willing exchange personally identifiable information (PII) for something of value, anxiety about data privacy is also on the increase. Nearly eight out of 10 global consumers (79pc) say they are concerned about unauthorised access of PII. Despite this, 58pc say they would be willing to allow their online usage and profile information to be tracked if it resulted in lower costs. This figure drops to 52pc amongst Northern Irish respondents and to 46pc in the Republic.

Privacy concerns

Regarding privacy when using mobile devices, 54pc of global respondents say they are ‘very concerned’ about this issue. In the Republic of Ireland 50pc of respondents expressed a similar concern with 42pc being the equivalent figure in Northern Ireland.

The report notes that the increasing prevalence of GPS-equipped phones and 3G and 4G mobile apps means that companies may be able to track consumer information and behaviour as well as location. It says that, in order to get consumers to opt-in to this kind of location- and context-based tracking, marketers will almost certainly have to provide something of significant value in return and transparent privacy policies will be vital in gaining consumer trust.

Trends

The report also finds that 34pc of consumers globally now say they are comfortable using a mobile phone to handle their online banking and financial transactions, compared to only 14pc in 2008. It points out that while the increase in comfort level is significant, it is important to realise that two-thirds of consumers are not yet comfortable conducting financial transactions on their mobile phones, something that could represent a considerable market opportunity.

Some 28pc of global respondents have purchased an item from a retailer via a mobile phone, up from 10pc in 2008. However mCommerce penetration in Ireland has been significantly lower. Only 8pc of those in the Republic and 15pc of respondents in the North indicate similar purchasing history.

Paying for content

Globally, 57pc of consumers say they would never pay for access to frequently used content. Overall, 43pc of respondents will pay for some content if a site they visit frequently began charging for content. The corresponding Irish figures are significantly lower - 12pc for the Republic and 15pc in the North.

When asked about the kind of content they would be willing to pay for, consumers North and South indicated that they would be most willing to pay for video, music and games and least likely to pay for news. In almost every case, the willingness of people in Ireland to pay for any category of content is somewhat less than the global average.

Interestingly, respondents from BRIC (Brazil, Russia, India and China) countries are much more willing to pay for both online and mobile content than the global average. BRIC consumers are also more willing than others to receive advertising in exchange for cheaper or free content or services both online (61pc BRIC vs 49pc G7) and on their mobile devices (50pc vs 30pc).

The emergence of the information sharer

The report also highlights the emergency of a new breed of ‘information sharer’ - consumers who make up around 10pc of the market and who are willing to bargain PII in return for content and services and who are more open to online and mobile advertising.

KPMG says, that in order to gain a greater understanding of this category, it segmented out consumers who said are: willing to exchange their PII for cheaper or free content; comfortable doing banking with a mobile device; and comfortable accessing their personal medical information on their mobile device in three to five years’ time.

It found that information shares are more likely to be from the leading emerging markets than to be American. They are more likely to be employed full time than others (83pc vs 65pc). They are far more willing to see tailored ads on mobile devices (75pc information sharers compared with 52pc overall).

Just 11pc of information sharers say they don’t want to see ads at all, compared with 36pc of the total survey. They are much more willing to receive ads on a PC in exchange for free or cheaper services or content (82pc vs 56pc). Information sharers are more than twice as likely than others to buy goods from a retailer using their mobile phone (58pc as compared to 28pc overall globally). They are also three times more likely to use mobile banking applications on a daily basis than other global consumers (15pc vs 5pc).