The Death Of The PC: What Happens Next?

In what could signal the collapse of the current PC market dominance, the latest report on shipments has shown that they have dropped by -13.9% for the first quarter in 2013, against same time last year.

The International Data Corporation (IDC) released their findings this month, and the result shows some startling figures.

Of the top 5 vendors worldwide, only the Chinese-owned Lenovo (formerly IBM) showed no percentage decrease year on year – although they also showed no increase. As one of the fastest growing technology brands in the marketplace (No. 1 for technology in Asia, No. 2 in Europe, although not well known in Australia), the fact that Lenovo has stalled in their growth shows more than anything that the PC market has plateaued.

The IDC analysts are pinning the blame for the drop on the decimation of Netbook sales, as well as the shift in consumer and corporate spending on phones and tablets rather than PCs. The boost expected from Windows 8 not only didn’t materialise, but it seems has had the opposite effect. Consumers have stayed away in droves from the new operating system, put off by the fact that it is a very expensive way of turning a PC into a tablet, when you can buy a cheaper tablet instead.

Apple was not immune from the drop in PC sales, with their shipments declining worldwide. Apple however partly makes up for their loss in desktop and laptop sales with increasing sales of the iPad.

Not so for Microsoft, who has seen lackluster sales of its hardware in addition to its latest Windows operating system. The reaction to Microsoft’s role in the PC market has been a downgrade of its shares from Neutral to Sell by Goldman Sachs, the global investment banking and securities business.

So what happens next?

David Glance, the Director of the Centre for Software Practice at the University of Western Australia has opined that the disappearance of the PC will first be noted in the home, with the classic desktop being replaced with tablets, phones, and other smart devices (such as the Smart TV), followed by the workplace, as docking stations, external keyboards, and cloud computing allow workers to interface their mobile units directly with the office.

Some small businesses have already embraced this change, with businesses as diverse as performance groups to real estate agents dropping their PC workplace in favour of working directly from iPads and an Apple base-station to stay on the move.

With Woolworths announcing this week that they are moving from PCs and Microsoft-based business products to Google’s offerings – dumping the likes of Outlook, Office, and PCs for Gmail, Google Docs, and Chromebooks, we are seeing the shift in momentum with the big corporations as well.

What it means for us

The major factor to take form this is the ever-increasing uptake of mobile is now being reflected in sales. While the digital push is still leading the way, the use of mobile apparatus is sky-rocketing, and with the introduction of low-cost tablets to the marketplace (and the subsequent reduction of PCs) mobile is now the leading media touchpoint for many audiences. The other important factor is making sure that our websites are optimised for a mobile audience. With the increases discussed, more people searching and surfing on their mobiles means more people visiting sites from those devices. If the website visited is not optimised for mobile, people may be likely to move to another site that is.

What Happens When Government Websites Sell Advertising Space?

Buried in last year’s 2012-13 Budget was a line stating that the federal government committed $300,000 to trial the sale of commercial advertising on the Bureau of Meteorology (BOM) website. While we are now nine months into the trial, no rock solid results have yet to be released. Spending five minutes clicking around on the BOM site, the only ads currently being served are links to other parts of the BOM website.

There are some very strict advertising regulations regarding appearing on the site. This includes the size of the ads themselves – nothing can appear except for a general 300 x 250 MREC. Not to mention who can and can’t appear on the website. There can be nothing promotion tobacco, alcohol, or gambling, nothing relating to bombs, guns, and weapons, no sexually explicit content, as well as the most interesting one – no advertising of a political nature.

Returning 3.3 billion pageviews in 2011, the BOM site is a dream for online advertisers – but there seems to be some reservations from parties on all sides. One of the big questions being put up for debate, is whether website users will assume that the advertisers that appear on a government website have obtained some government “stamp of approval”, or are affiliated with the government in some way. So what is the best way to utilise this (possible) halo-effect?

What it means for us

This type of placement lends itself to a more brand-oriented style of advertising, rather than a direct response-style, click here to purchase style. By associating with the BOM “brand” the advertiser could experience the halo-effect of being in that specific, well-trusted environment.  The next question, should this trial prove effective, is what other website the Federal Government could open up to advertising. Imagine the brand-positioning possible from advertising on australia.gov.au, or even a supermarket appearing on the website for the Department of Agriculture?

Nielsen Radio Survey #2 – The Results

The latest Nielsen radio results are in, and the big news (for Sydney) is the dominance of 2Day FM is finally at end, with WSFM claiming the No. 1 FM spot for All People. This change has been experienced across the Metro marketplace, with either declines or a steadying in ratings as opposed to other stations experiencing growth.

While this is early days, we could be experiencing a shift in the radio consumption habits of the Australian populace. The other thing to remember is that the data is taken from a specific sample size, and it is believed that there are not only less people listening this survey, but the rise of digital radio stations is cannibalizing the traditional radio audience. With the huge amount of digital radio stations appearing across the spectrum, there is no real “threat” to traditional radio as if yet.

Below we had included the data for All People across the different markets. If you would like some further information about the recent radio survey, including market and demographic specific data, please do not hesitate to contact your Woolworths@Carat representative.

SYDNEY – All People BMAD Mon-Sun

MELBOURNE – All People BMAD Mon-Sun

BRISBANE – All People BMAD Mon-Sun

ADELAIDE – All People BMAD Mon-Sun

PERTH – All People BMAD Mon-Sun

Male Shoppers on the Increase

Not being known for their spending proclivities, the newest research from Nielsen has shown that, on average, men are increasing their share of the shopping trips made across most retail sectors.

Female shopping trips are most important to the mass merchandiser and dollar store channels, while male shopping trips are of greater relative importance within convenience/gas, grocery and warehouse club outlets. Women spend more money per trip than men in all of the channels examined, but in many channels, the differences between the sexes are not as great as one might expect. Nevertheless, spending differences do indicate that women drive the larger stock-up or planned trips as they outspend males by $14.31 per trip in supercenters and by $10.32 per trip in grocery stores.

There is one channel where mean lead women in shopping – the convenience/gas market. This does not raise eyebrows, as the classic stereotype of the wife doing the weekly shopping, while she sends the husband down the road to pick up any extras required throughout the week appears to be alive and well.

While the data in this Nielsen report is US-based, similar trends have been evolving across Australia. A Deakin University report into men and shopping identified an increase in shared shopping responsibilities across families when it comes to the next trip into town.

The Deakin report also identifies that while men are becoming more involved in the regular weekly shops, women are getting more involved in the big-ticket purchases that were formerly male-led – computers, TVs, and cars.

The most interesting fact taken form the Deakin report is that the key training ground for men in relation to breaking down tradition views of male/female shopping stereotypes is grocery shopping. A “well-trained” grocery shopping man is more likely to be interested in purchasing new products/a variety of products, as well as be involved in purchase decisions for the household.

With the emerging data painting a new portrayal of the family shopping unit, it behooves advertisers to embrace the new shopping unit and not to exclude any part of it. The new weekly grocery shopper is the husband and wife unit. No longer are the aisles filled with the lady of the house only, while the electronics store has lost the image of being the male refuge at the shopping centre and now boasts guys and gals making joint purchase decision.

What it means for us

Advertisers (including Woolworths) need to expand their definition of who is buying what. While it’s true that the data is slowly changing, we should be forward looking into what this emerging group will do – will they follow conventional shopping patterns or will a new norm appear as the percentages grow ever closer?

As a grocery-purchasing male (a “well-trained” once according to Deakin), I do the grocery shopping weekly with my wife – we write the list together, but she has final say over brands. We also shop for big ticket items together; furniture I shop with her, electronics she shops with me. As a Gen Y husband, this doesn’t feel to be something different, but what research is showing to be the new norm.

Luring the Virgin Consumer

As technology pushes the boundaries of opportunity, the newest economic force is appearing in the marketplace – the Virgin Consumer. The Virgin Consumer is unfamiliar with many of the products, services, apps, experiences or brands they encounter every day. However, far from being coy, they lust after, try out, and experiment with all these new brands, products, services and experiences more than ever. As long as brands make them effortlessly simple, intuitive, and fun.

These consumers can be broken down into two specific subsets – the Eager Virgin and the Experienced Virgin.

Eager Virgin

The Eager Virgin is focused on newism – the higher than ever appetite for what’s new. The hyper-competition in the marketplace has led to “new” ideas now no longer being seen as purely a marketing ploy (reminding us of the classic marketing conundrum “How can it be new AND improved? If it’s new there has been nothing like it before, and if it’s improved then it isn't new”), but delivering to the consumer more convenient, intuitive, and surprising innovations in their chosen fields. Virgin Consumers have the drive to experience and experiment with new forms of technology and opportunities offered by both new and established brands.

Experienced Virgin

The Experienced Virgin has the same drives and appetites of the Eager Virgin but with one added caveat – they have now been living in a world where access to the “new” is as easy as clicking a button or accessing a web page. These Experienced Virgins are tech-savvy, but not necessarily knowledgeable in the field itself.

Accessing these consumers and turning them from the fleeting acquaintance that they like to stay into the opposite partner in a full-time relationship is the key to building and improving upon a solid customer foundation for the future. The Virgin Consumer is the emerging commercial superpower, being made up of aspects of the “grey dollar”, the “family dollar”, and the “young dollar” without compunction.

What does this mean for us?

From an overall business standpoint, the Virgin Consumer gives us another reason to innovate our offerings. Newism is a movement that shows no sign of stopping, as technology can only innovate, not reverse how we interact with our environments. We as a business have had great success thus far in innovating for our audiences across all manner of advertising media (scented newspaper ads, “steaming” coffee billboards, digital supermarket walls) and as we continue to be an Australian-market leader in this area, the Virgin Consumer may be further attracted to our portfolio of businesses.