QR Codes - Myth & Reality

QR Codes – Myth and reality Online survey and interview analysis

4th September 2012

Chris Mears / Senior User Experience Consultant [email protected] Andy Farmer / Strategy Director [email protected]

QR Codes – Myth and Reality 2

Contents

1. Introduction .................................................................................................. 3

2. Methodology ................................................................................................. 5

3. Demographics .............................................................................................. 7

4. Usage ............................................................................................................ 9

5. Mobile Shopping Experience .................................................................... 16

6. Effectiveness .............................................................................................. 19

7. Qualitative audience feedback ................................................................. 21

8. Conclusions ................................................................................................ 25


1. Introduction The world in 2012 is a multi-channel marketplace. Brands that fail to engage effectively with their audiences at point of need, across their chosen media, are missing out on a large commercial opportunity. There is a wealth of statistics to back up the story.

- Customers who purchase from a store through multiple channels spend 14% more annually on average than their single-channel counterparts (JupiterResearch)

- In some sectors these multi-channel customers are 25 to 50% more profitable than their single-channel equivalents (McKinsey & Company).

However, offering multiple channels for audience interaction doesn’t guarantee success. A 2010 report by NCR Corporation found that:

- The vast majority of consumers prefer a seamless experience across channels

Without a consistent experience across all touch points the value of multi-channel is greatly diminished. More importantly, each touch a user has with a brand must add value.

Unfortunately it seems that brands are still struggling with how to implement these strategies effectively.

The big issue is that whilst the number of brands that offer the full suite of media is increasing, these media remain isolated from each other. This is partly because creating a single view of the customer presents hurdles, both in terms of cost and technology integration. However, there are lower-cost techniques and tools, which can help to transfer the user across channels and bind that experience together.

An example of this is QR codes. In theory they are simple to implement and to use and can be used across the full range of media.

However it would appear QR codes are struggling to find their place in consumers’ hearts.

- In the three months ending July 2011 only 5% of Americans who own mobile phones actually used QR codes (Forrester Research).


With 6.8% of all European web sales estimated to come from mobile phones in 2017 (Forrester Research), we wanted to see whether, if properly implemented, QR codes could be the magic bullet that brands should be using to help drive multi-channel sales.

Conversely are they being employed by marketers with no real thought beyond new technology and destined to be consigned as a fad, replaced as the next big thing?

In order to do this we undertook an online survey in summer ’12, as to individuals’ use of QR codes and mobile. This was followed up with a series of qualitative 1to1 interviews to tease out more detailed opinion based on a specific set of QR code campaigns. Our findings follow below.


2. Methodology From a user experience perspective are a number of different success factors which are important when designing effectively across channels.

Peter Morville references the ‘Cross-Channel Crystal’ (http://findability.org/archives/000652.php) which describes 6 different facet’s to an effective cross channel strategy – connection, composition, continuity, context, consistency and conflict. Tyler Tate merges this down to 3 core elements (http://uxmatters.com/mt/archives/2011/10/the-rise-of-cross-channel-ux-design.php) – consistent, optimised and continuous. We believe however that the magic number is 4, as the key facet missing is in fact, the one which makes all the others possible.

Familiar

There should be a short learning curve to accomplish the same task on different channels. For example, buying groceries on a PC should not be a massively different experience to doing it on an iPhone application. This should extend to the branding, tone of voice and design language.

Optimised

Each channel should be optimised for its usage context and capabilities. Mobile phones should use location aware features, tablets should feature rich touch screen gestures and in-store kiosks should be able to interact with the stores systems.


Progressive

Each channel should help the user move further towards an end goal, be that a purchase on an e-commerce website or reserving a book at their local library.

Aware

This is the facet which ties all the other attributes together. Seamless experiences are core to an effective cross-channel strategy and this requires synchronisation. From the user’s point of view, this means actions they take in one channel should be reflected on the others. They should be able to start a process on one channel, and complete it on another. In more modern parlance, this magical ingredient could be considered to be ‘the cloud’.

Our key aim in this study was to assess how well brands are meeting the above four success factors in their QR code campaigns.


3. Demographics

3.1 QR code users tend to be in their late 20’s

Our results indicate that those most likely to scan a QR code are those aged between 25-29. This tails off sharply under this age, possibly due to reduced spending power in terms of having a smartphone with the correct technical abilities to scan the codes.


Above the age of 45 years old the results again drop off sharply – possibly indicating a lack of knowledge or technical awareness.

3.2 Those in IT, web and telecoms occupations are most likely to have used a QR code

There is a strong skew of those respondents who have used a QR code with those in the IT, Web and Telecomms industry. Due to an increased awareness of technology, people in these occupations may be more likely to be early adopters of things such as QR codes, or more knowledgeable about how they work.


4. Usage

4.1 Over half of respondents never, or rarely (monthly) use their mobile phone for shopping

Almost 40% of respondents never shop on their mobiles. This is at odds with Neilsen’s recent survey that half of US Smartphone users use mobile shopping apps. (http://www.internetretailer.com/2012/08/02/half-smartphone-owners-use-mobile-shopping-apps).

However, the above finding corroborates a wider range of studies and our client website stats. These indicate that more mobile users still research a purchase rather than buying on mobile (http://www.internetretailer.com/2012/08/21/snapshot-smartphone-user). Factors such as security concerns, data connections and time constraints whilst on the move likely playing a part. “Killing time is the killer app of mobile”* with activities such as browsing, gaming and media consumption being performed regularly by our respondents. http://www.useit.com/alertbox/mobile-writing.html


4.2 Respondents show little preference between apps and mobile optimised websites for buying on their phone

In a slightly unexpected result, respondents showed only a slight preference for apps over mobile optimized websites. This is good news for brands, as mobile optimised apps are often less costly, and faster to produce – and accessible from a wider variety of devices. However, this is countered by the still larger reach of a browser based solution, which means that mobile apps alone will only engage a percentage of the available audience.


4.3 A vast majority of respondents who have scanned a QR code require a separate app to do so

The lack of in-built scanning applications in mobile devices is a major problem for the uptake of QR codes. Users must have pre-existing knowledge of what a QR code is and actively download an app in order to be able to scan them. This dramatically cuts down the potential audience a QR code will be effective for.

Until scanning ability becomes native to popular mobile operating systems such as iOS or Android, the best way for brands to capitalise on QR codes may be to build the functionality into their own mobile apps to offer richer cross channel experiences – rather then using them as generic tools in advertising.


4.4 Those who have scanned a QR code are more likely to have shared their location using their mobile

Those respondents who scan a QR code are more likely to have shared their location using their mobile. This presents opportunities for more location-aware uses of QR codes which offer tangible benefits to users. These could include customer rewards or creating shared experiences or communities based around a particular location.

Rather than just taking users to branded content QR codes could be used to promote and create and develop buzz around in-store events through the digital domain.


4.5 The majority of QR codes respondents scanned are coming from print sources

There is a very good reason for this particular skew, and that is simply that print is static, and much easier to scan. Improper placement of QR codes on moving or limited time-window media such as on TV adverts has been an issue.

In the case of TV ads, codes are often only up for a second or two before the next advert begins, meaning the viewer has to either pause or rewind the TV to scan the code. A lot of effort is therefore required by the individual for what is sometimes very limited reward.

The relative propensity of poster placements is also not surprising, showing that outdoor advertisers have embraced the opportunity to continue the conversation with those travelling and with access to technology.

What is striking is the lack of apparent in-store QR code application (1.79%). This is indicative that retailers are still yet to embrace the multi-channel ideal. The ability to add codes to product displays for example would allow users to link to product information or more detailed lifestyle/education content such as video. The fact this appears not to be the norm is potentially either because such bespoke content is not available or too costly to create – or that there is still the question of attribution for online sales that be driven by in-store visits with different price points and offers.


4.6 Of those respondents who have never scanned a QR code before, almost half do not know what one is

Often marketers put QR codes on a poster or other medium with no explanation as to how to use it. The assumption that most people who know what a QR code is and does is misguided! As the graph shows more than half of survey respondents don’t.

It’s also interesting that even though half the respondents know what a QR code is, they have still chosen not to scan one. Again, this may be due to poor signposting as to what benefits they will receive by scanning the code.


4.7 Those respondents who spend more than an hour a day on their mobiles are most likely to buy something using their phone

This statistic appears to confirm the assumption that those users who are more comfortable with using their mobile device may be more inclined to use it for advanced tasks such as shopping.


5. Mobile Shopping Experience

5.1 Shoppers think there is a discrepancy between the experiences offered on mobile & the main website or store

A majority of respondents feel that the overall experience when using their phone to buy was different to that of the main website or retail store. It is important for brands to ensure a consistent and fluid experience between their different channels – taking care with things such as branding, tone of voice and design language. This leads to familiarity, which builds user confidence and can be an important factor in conversion.


5.2 Almost a quarter of the content the QR codes led to were not optimised for mobile

The fact that any QR code leads to non-mobile optimised content is extremely surprising and is reflective of brands using them as they are the latest thing, without fully thinking about how they would be used in a real world context.

A large appeal of a QR code is that it gives you quick access to something useful. A non-optimised mobile experience makes any sort of content difficult to digest on a small screen and can take longer to load over a 3G or GPRS connection.


5.3 63.16% of QR codes scanned lead the respondent to content they considered useful

However this means a significant proportion (36.84%) of the content respondents accessed via QR code isn’t considered useful. This kind of negative experience may put people off scanning another code in the future.

When asked what sort of content would lead the respondent to scan another code, the most popular responses are offers and free items.

This suggests that people will only put the effort in to scan a code if it gives them some monetary benefit.

“Content does not encourage and it's not an incentive either”.

Respondent feedback


6. Effectiveness

6.1 Only 38.59% of QR codes are leading to content related to conversion based activities

17.54% of respondents say that their QR code scan led to a product and 21.05% say they were taken to an offer. Both of these could be considered content that directly leads to a potential sale.

The above finding is at odds with the previous respondent assertion that offers and freebies are the most attractive destination content.

However, the fact that the around 60% of the content destinations outlined don’t have an obvious conversion activities associated with them means that the effectiveness of the QR code campaign is difficult to measure in the majority of cases.

Beyond counting page views, it is difficult to judge how successful a piece of information has been in terms of eventually leading the person to make a purchase or other valuable brand interaction.


6.2 Of those who scanned a QR code 5.36% converted into a purchase

There appers to be roughly a 5% conversion rate of repondents initially scanning a QR code and then eventually purchasing something as a result.

If this is representative of all interactions then this would be a reasonable figure context of the digital domain. However, better signposting and education around the codes, and a higher concentration around offers or freebees could help increase this conversion rate further.


7. Qualitative audience feedback For the second part of our research we undertook a benchmarking questionairre with 12 subjects about 10 QR code campaigns. Our results revealed a number of interesting findings and three key themes of contention.

7.1 Aesthetics Whilst there were a number of respondents who said it was likely they may scan some of the QR codes we presented them, poor aesthetics were a major turn off.

- “QR codes are ugly” - “Aside from being the ugliest poster I've ever seen - it's intriguing.”

- “Hideous design “ - “It's hideous “ - “The QR merges within the body of the car, hard to see”

- “..just appears as an ugly blemish on the advert” - “Starbucks could be a bit more original about the design of the QR code, seems it was put there as an afterthought”


7.2 Content signposting Poor signposting of the content or added value the QR codes offered was also a recurring theme in our benchmarking research. Despite actually offering some compelling content in some cases, such as an interactive scavenger hunt with prizes in the case of Starbucks or a trip to a world premiere of a new car launch for Mercedes – brands were overall letting themselves down in actually signposting this content, instead relying on consumers knowledge of QR codes and curiosity to engage.

- “No idea what this does or why I need it” - “The QR code has no details about what it would do”

- “no idea what it does”


- “You have absolutely no idea what scanning the code would take you” - “There's no explanation of what this is - it could be a virus for all we know.” - “I have no idea what it offers”

- “Great explains the benefit of what you will find when you scan” - “clearly state what it offers” - “I like recipes - useful content”

7.3 Placement The placement of the codes was a key factor for our respondents, with a number of them citing an improvement in placement as a reason to make them more likely to scan.

- “Depends on if there is connectivity. This looks like it's on the tube.” - “Wouldn't work in the UK where you can't get interwebs in the underground.”


- “Be very difficult to scan the back of a bus” - “Seems the code has been put there for the sake of it.” - “Worst idea ever”


8. Conclusions The evidence gathered tells us that current QR code implementation is not effectively meeting the requirements any of facets outlined in good multi-channel strategy; familiar, aware, progressive, optimised.

The survey and interview findings also paint a clear picture about the usage of QR codes, the people that are likely to interact with them, and the QR code experiences brands are are delivering.

There are limitations for brands using QR codes to support a specific conversion activity, such as a sale, as over half of respondents rarely or never use their phone for shopping. However, this will improve over time as mobile technology gets better, and user trust in it increases.

What’s encouraging is that 5% of repondents say they have purchased as a result of scanning a QR code. Although the survey is skewed by high levels of ‘early adopters’ (respondents in IT and Telecomms), it indicates that if used correctly QR codes are potentially very useful tools.

User feedback indicates that to be successful QR codes need a strong clear call to action, a great offer, good placement and once scanned, a consistent, usuable brand experience.

Unfortunately most brands are currently failing in these tasks. Too much destination content is generic & isn’t considered useful. Its effectiveness can’t be measured and nearly a quarter of it isn’t even mobile optimised.

Brands are failing to ask key questions around context. Where will the person be when they are scanning this code? How can we make it clear what the benefit of them scanning it is? Is it taking advantage of the capabilities of the mobile device? It’s no good placing awesome content on a poster in an underground station without a signal. Equally bad is having awesome content with no indication that it is there.

The goal of many brands that use QR codes still seems to be as a tool to support marketing awareness activity. Often they are failing here too due to widespread lack of understanding as to what QR codes do and how to use them. There is a large gap in expectations and knowledge between those intended to use QR codes, and the brands and marketers producing them. Better audience education and signposting is required to improve take-up.

It’s also apparent that QR codes are another example of brands trying to use technology to facilitate old marketing models rather than emerging opportunities. It’s relatively easy to put a QR code on an outdoor banner or magazine advertorial opportunistically and with little thought beyond perhaps some existing destination content. However, supporting the in-store experience


via digital content and a QR code is more involved. It requires a seamless content experience and product offer between web, phone and store. The potential benefits currently seem to be outweighed by operational issues and/or organisational costs involved.

Perhaps the biggest hurdle the QR code faces is lack of native support in mobile operating systems. With around 83% of respondents who had scanned a QR code requiring a separate app to do so, users not only need an awareness of what a QR code is, but also enough desire to scan one and to spend the time downloading an app to do so.

This is a barrier to the average consumer taking QR codes into their hearts and minds, which may only be overcome by native integration within either iOS or Android, and Google/Apple’s mass marketing power,

Final thoughts

Of course there is the distinct possibility that QR codes are trying to do a job they were never designed to do. Originally used to track vehicles in the car manufacturing process, are they really the best way for consumers to access content? By the time you have pulled out your phone, fired up the QR app, tried to get a decent scan of the code and waited for your browser to fire up (assuming there is a data connection), have you really managed to do a small task quickly - one of the key strengths of mobile devices?

To be truly useful, QR codes should enable the user at multiple touch points and across multiple channels in their user journey – and from a business perspective lead them to some sort of measurable conversion. On current evidence their use is very one- dimensional, and with a few exceptions, they offer content which doesn’t help consumers get any closer to that key conversion point.

With a little more thought, QR codes could be useful to consumers and enrich their interactions with brands. But at almost 20 years old, how long before the next big thing replaces them?

QR Codes - Myth & Reality

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