1

Quantifying the Economic Value of Online SharingTHE RETURN ON A SHARE

2

With the growth of the social web, we turn more often to friends and strangers for recommendations on where to go, what to eat, and what to buy.

SHARING IS THE CONNECTIVE THREAD OF THE SOCIAL WEB

3

THE

IMPACT OF SHARINGIS WELL-DOCUMENTED

73% of survey respondents process information more deeply, thoroughly, and thoughtfully when they share it.

92% of people trust recommendations from friends and family, and 70% trust consumer reviews they found online.

38% During a four-week test, Starbucks’ Facebook fans and “friends of fans” were 38% more likely to make a purchase.

4

BUT HOW DOES IT ALL TRANSLATE TO

MONETARY IMPACT?

Conjoint methodology uses statistical modeling to determine the relative importance of various factors affecting the consumer purchase decision.

5

SHARETHIS COMMISSIONED THE FIRST STUDY OF ITS KIND

Luxury

Premium

Standard

Economy

TypeSource

FamilyFriendsAcquaintancesStrangersProfessionals

In-PersonOnline ShareConsumer Review

Strength

ExcellentGoodModerateBad

BRANDPURCHASE

CONSIDERATION

PRICE

RECOMENDATION

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Methodology

2 STUDIES

ConjointTrade-off analysis

CPG AutosConsumer Electronics

LikertTraditional rating survey

CPG AutosConsumer Electronics

6,000 CONSUMERS

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THE TAXONOMY OF SHARINGFIVE TYPES OF GENERAL RECOMMENDATIONS

1 Online sharing. Personal recommendations and opinions shared via email or social networking by friends, family members, acquaintances or strangers.

2 Consumer Reviews. Recommendations and opinions published in online media or on social networks by strangers.

3 Consumer Ratings. Ratings, usually with up to five stars, by strangers in online media.

4 In-person Recommendations. Personal recommendations and opinions shared face-to-face by friends, family members, acquaintances or strangers.

5 Professional Reviews. Articles and product reviews published in traditional print media and in online media written by professionals and experts.

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Key Findings

Recommendations have more impact on a consumer’s decision-making process than brand or price

Highly positive online shares generate a 9.5% increase in purchase intent, while negative reviews can decrease intent by 11.0%

Online sharing has a measurable effect on a product’s prices, driving incremental value by as much as $1.54, $34.47, and $9,623.74 for supermarket goods, mini tablets, and autos, respectively

FINDINGS

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10

IMPACT OF PRODUCT CHARACTERISTICS ON PURCHASE INTENT

58%

34%

8%

56%

24%

19%

56%

25%

19%

Autos Electronics CPG

Recommendations

Price

Brand

Recommendations have more impact on a consumer’s decision-making process than brand or price

IMPACT OF RECOMMENDATION COMPONENTS ON PURCHASE INTENTThe strength of a recommendation is far more important than its author or source

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41%

11%

6%

43%

10%

3%

43%

11%

2%

Autos Electronics CPG

Strength (bad, moderate, good, excellent)

Source (family, friends, acquaintances, strangers, professionals)

Type (consumer reviews/ratings, online shares, in-person rec., professional reviews)

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RELATIVE VALUE OF RECOMMENDATION SOURCEAcross all product categories, consumers value most the opinions of friends and family

CPG Electronics Autos

8.0% 7.7% 7.5%

12.7%

8.5% 9.0%

14.0%

9.6%

10.7% 10.5%

11.7%

Strangers Acquaintances Close Friends / Family Professionals

RETURN ON ‘EXCELLENT’ RECOMMENDATIONSHighly positive shares yield a return of 9.5%

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Consumer R

atings

Consumer R

eviews

Online Sh

ares

In-Person Reco

mmendations

Professi

onal Revie

ws

6.3% 7.3%

9.5% 10.6% 10.2%

6.0%

6.2%

11.2

%

13.2

%

7.1%

7.6%

8.1%

9.3%

10.5

%

5.7%

8.1%

9.2%

9.3%

10.0

%

CPG Electronics Autos

NEGATIVE RETURN ON ‘BAD’ RECOMMENDATIONSNegative shares lower purchase intent by 11.0%

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Consumer R

atings

Online Sh

ares

Professi

onal Revie

ws

(11.3%) (11.2%)(11.0%) (11.2%)

(10.2%)(13.

1%)

(13.

1%)

(12.

5%)

(12.

9%)

(10.

6%)

(10.

6%)

(10.

5%)

(10.

6%)

(10.

5%)

(10.

2%)

(10.

0%)

(9.9

%)

(10.

0%)

(9.9

%)

CPG Electronics Autos

PRICE IMPACT OF ‘EXCELLENT’ RECOMMENDATIONS – JAGUAR XK Positive recommendations add significant incremental value

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INCREMENTAL VALUE: +$9,365 +$7,494 +$7,378 +$6,520

$85,865

ProfessionalReview

$83,994

In-PersonRecommendation

$83,878

OnlineShares

$83,020

OnlineReviews

+$4,601

$81,102

OnlineRatings

$76,500

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PRICE IMPACT OF ‘EXCELLENT’ RECOMMENDATIONS – MINI TABLETSThe price lift relatable to online sharing is noticeable across all three product verticals

Consumer Ratings

Consumer Reviews

In-Person Recommendations

Online Shares

Professional Reviews

$22.09

$23.56

$24.91

$28.76

$32.44

PRICE IMPACT OF ‘EXCELLENT’ RECOMMENDATIONS – AUTOSFor autos, positive online shares are as effective at driving value as in-person recommendations

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Consumer Ratings

Consumer Reviews

In-Person Recommendations

Online Shares

Professional Reviews

$2,312

$3,277

$3,708

$3,766

$4,702

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PRICE IMPACT OF ‘EXCELLENT’ RECOMMENDATIONS – SUPERMARKET GOODSFor CPG brands, positive online shares have nearly twice the impact on price as general consumer reviews

Consumer Ratings

Consumer Reviews

In-Person Recommendations

Online Shares

$0.42

$0.44

$0.79

$0.93

1.8x

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PRICE IMPACT OF ‘BAD’ RECOMMENDATIONS – VISINE

Negative reviews drive value down

After Negative Consumer Review

After Negative Online Share

After Negative In-Person Recommendation

$6.97 $7.01 $7.03

Incremental Loss: - $1.03 - $0.99 - $0.97

$8.00

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WHAT DOES IT ALL MEAN?

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>MARKETERS: INVEST IN SHARING!

View current customers as marketing partnersBoost advocacy by targeting existing customers, providing shareable content, and encouraging them to share their experiences.

Enable Customer EvangelismWhen building your marketing strategy, consider your audience’s motivations, context, and channels, and ensure that sharing tools are seamlessly embedded into the experience.

Monitor your online presence through sharingLarge changes in activity can provide early indications of potential opportunities or issues to be addressed. Look across social channels for a broader context.

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>AND TREAT SHARERS AS POTENTIAL ASSETS

Address negative reviews openly and honestlySocial media makes bad reviews go viral. Address problems, encourage open dialogues, acknowledge mistakes, and seek swift resolution wherever possible.

Use paid media to target and convert new customersSocial sharing increases the propensity to buy by 9.2%, making social marketing tactics a good complement to traditional paid media strategies.

Use social insights to optimize mediaSocial signals can be used to determine where and when to spend media dollars. Leverage insights gleaned from social analytics to optimize marketing spend.

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>PUBLISHERS: MAKE SHARING EASY AND ACTIONABLE!

Get StartedGenerate remarkable, attention-worthy content to drive traffic and engagement.

Reach your entire audienceBroaden your social channel reach beyond Facebook and Twitter. Collect insights to truly understand how your content performs across the web.

Command higher CPMsKnow and understand the social quality of your content to help advocate for higher CPMs.

Embrace developers and turn data into actionLearn to work closely with developers to create new apps that engage consumers in novel and exciting ways.

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THE VIRTUOUS CIRCLE OF SHARING

SHARING

INSIGHTS

OPTIMIZATION

EARNED MEDIA

LARGER AUDIENCE

APPENDIX

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ABOUTSHARETHIS | BERESFORD | THE PALEY CENTER FOR MEDIA

ShareThis uses large-scale social data to deliver breakthrough insights, audience building and advertising solutions across mobile and desktop environments. Every day millions of consumers use ShareThis to share content across multiple devices and more than 120 social channels including Facebook, Twitter, LinkedIn and Pinterest — giving the company unrivaled visibility into online social behavior. The company works with 50+ of Advertising Age’s 100 leading national advertisers and is based in Palo Alto, Calif. To learn more visit http://www.sharethis.com.

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Beresford Research helps companies seize market opportunities through thoughtful research based on innovative methodologies and rigorous execution. We create initiatives that are tightly aligned to our clients’ strategic needs, and provide unique industry insights. Founded in 1991 as a marketing and consulting firm, Beresford Research brings a strategic focus to every project. We partner with our clients to provide creative, customized solutions that deliver unprecedented value without the overhead. Clients include Booz & Co., Novartis, Oxford Economics, PhoCusWright, The Week and Towers Watson. For more information, please visit www.beresfordresearch.com.

The Paley Center for Media seeks to preserve the past, illuminate the present, and envision the future through the lens of media. With the nation’s foremost public archive of television, radio, and Internet programming, the Paley Center produces programs and forums for the public, industry professionals, thought leaders, and the creative community to explore the evolving ways in which we create, consume, and share news and entertainment. In an era of unprecedented change, the Paley Center advances the understanding of media and its impact on our lives. The Paley Center for Media was founded in 1975 by William S. Paley, a pioneering innovator in the industry. For more information, please visit www.paleycenter.org.

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109

107

100

108

106

105

103

Strangers Acquaintances Close Friends / Family

In-Person

Online Sharing

Consumer Reviews

INDEX: ONLINE RATINGS BY STRANGERS (100)

WHEN SHOPPING FOR GROCERIES, CONSUMERS…VALUE OF RECOMMENDATION SOURCES (CPG):

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103

102

100

102

101

101

100

103

Professionals Strangers Acquaintances Close Friends / Family

In-Person

Online Sharing

Consumer Review

INDEX: ONLINE RATINGS BY STRANGERS (100)

Professional Review

WHEN IT COMES TO ELECTRONICS…VALUE OF RECOMMENDATION SOURCES (ELECTRONICS):

29

In-Person

Online Sharing

Consumer Review

INDEX: ONLINE RATINGS BY STRANGERS (100)

Professional Review

105

105

102

103

103

102

102

106

Professionals Strangers Acquaintances Close Friends / Family

WHEN BUYING VEHICLES…VALUE OF RECOMMENDATION SOURCES (AUTO):

30

Source Author Store Brand

Standard Brand

Quality Brand

Premium Brand

Consumer Ratings Strangers $0.24 $0.36 $0.47 $0.62

Consumer Reviews Strangers $0.24 $0.38 $0.49 $0.64

Online Share Strangers $0.35 $0.54 $0.70 $0.91

In-person Recommendations Strangers $0.43 $0.66 $0.86 $1.12

Online Share Acquaintances $0.46 $0.71 $0.92 $1.20

In-person Recommendations Acquaintances $0.54 $0.83 $1.08 $1.41

Online Share Close Family/Friends $0.51 $0.78 $1.02 $1.33

In-person Recommendations Close Family/Friends $0.59 $0.91 $1.18 $1.54

VALUE OF AN ‘EXCELLENT’ RECOMMENDATION – SUPERMARKET GOODS

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Source Author Economy Brand

Mid-Tier Brand

Premium Brand

LuxuryBrand

Consumer Ratings Strangers $799 $1,452 $2,397 $4,602

Consumer Reviews Strangers $1,133 $2,058 $3,396 $6,520

Online Share Strangers $1,119 $2,033 $3,356 $6,442

In-person Recommendations Strangers $1,139 $2,070 $3,416 $6,559

Online Share Acquaintances $1,239 $2,251 $3,715 $7,132

In-person Recommendations Acquaintances $1,259 $2,288 $3,775 $7,248

Online Share Close Family/Friends $1,487 $2,702 $4,459 $8,560

In-person Recommendations Close Family/Friends $1,507 $2,738 $4,519 $8,676

Professional Reviews (Online) Professionals $1,579 $2,869 $4,734 $9,089

Professional Reviews (Print) Professionals $1,672 $3,037 $5,012 $9,623

VALUE OF AN ‘EXCELLENT’ RECOMMENDATION – AUTO

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Source Author Apple iPad Samsung Galaxy

Dell Venue

Google Nexus

Consumer Ratings Strangers $21.77 $21.69 $22.41 $22.49

Consumer Reviews Strangers $23.22 $23.14 $23.91 $23.99

Online Share Strangers $22.26 $22.18 $22.92 $23.00

In-person Recommendations Strangers $26.05 $25.96 $26.82 $26.91

Online Share Acquaintances $23.96 $23.87 $24.67 $24.76

In-person Recommendations Acquaintances $27.75 $27.65 $28.57 $28.67

Online Share Close Family/Friends $27.42 $27.32 $28.23 $28.33

In-person Recommendations Close Family/Friends $31.22 $31.10 $32.13 $32.25

Professional Reviews (Online) Professionals $31.13 $31.01 $32.04 $32.16

Professional Reviews (Print) Professionals $31.13 $33.25 $34.35 $34.47

VALUE OF AN ‘EXCELLENT’ RECOMMENDATION – MINI TABLETS

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Source Author Store Brand

Standard Brand

Quality Brand

Premium Brand

Consumer Ratings Strangers ($0.52) ($0.79) ($1.03) ($1.34)

Consumer Reviews Strangers ($0.52) ($0.79) ($1.03) ($1.34)

Online Share Strangers ($0.50) ($0.77) ($1.01) ($1.31)

In-person Recommendations Strangers ($0.49) ($0.76) ($0.99) ($1.28)

Online Share Acquaintances ($0.49) ($0.75) ($0.98) ($1.27)

In-person Recommendations Acquaintances ($0.48) ($0.74) ($0.96) ($1.25)

Online Share Close Family/Friends ($0.48) ($0.74) ($0.97) ($1.26)

In-person Recommendations Close Family/Friends ($0.48) ($0.73) ($0.95) ($1.23)

IMPACT OF A ‘BAD’ RECOMMENDATION – SUPERMARKET GOODS

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Source Author Economy Brand

Mid-Tier Brand

Premium Brand

LuxuryBrand

Consumer Ratings Strangers ($1,423) ($2,586) ($4,266) ($8,177)

Consumer Reviews Strangers ($1,391) ($2,529) ($4,170) ($7,982)

Online Share Strangers ($1,392) ($2,531) ($4,174) ($7,990)

In-person Recommendations Strangers ($1,390) ($2,528) ($4,168) ($7,978)

Online Share Acquaintances ($1,381) ($2,511) ($4,140) ($7,922)

In-person Recommendations Acquaintances ($1,379) ($2,508) ($4,134) ($7,911)

Online Share Close Family/Friends ($1,358) ($2,471) ($4,072) ($7,785)

In-person Recommendations Close Family/Friends ($1,357) ($2,468) ($4,067) ($7,775)

Professional Reviews (Online) Professionals ($1,350) ($2,457) ($4,048) ($7,736)

Professional Reviews (Print) Professionals ($1,342) ($2,442) ($4,023) ($7,687)

IMPACT OF A ‘BAD’ RECOMMENDATION – AUTO

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Source Author Apple iPad Samsung Galaxy

Dell Venue

Google Nexus

Consumer Ratings Strangers ($32.3) ($32.2) ($33.2) ($33.3)

Consumer Reviews Strangers ($32.2) ($32.0) ($33.1) ($33.2)

Online Share Strangers ($32.3) ($32.1) ($33.2) ($33.3)

In-person Recommendations Strangers ($31.9) ($31.8) ($33.8) ($32.9)

Online Share Acquaintances ($32.1) ($32.0) ($33.0) ($32.1)

In-person Recommendations Acquaintances ($31.7) ($31.6) ($32.6) ($32.7)

Online Share Close Family/Friends ($31.7) ($31.6) ($32.6) ($32.7)

In-person Recommendations Close Family/Friends ($31.4) ($31.3) ($32.2) ($32.4)

Professional Reviews (Online) Professionals ($31.4) ($31.3) ($32.3) ($32.4)

Professional Reviews (Print) Professionals ($31.2) ($31.1) ($32.0) ($32.1)

IMPACT OF A ‘BAD’ RECOMMENDATION – MINI TABLETS

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SAMPLE CONJOINT SCREEN

Brand %

Price %

Any Recommendation (%)

Other %

20%

27%

54%

19%

25%

56%

Conjoint Relative Importance

Likert Totals Exclude Other

Likert Totals include Other

AUTOMOTIVE ATTRIBUTE RELATIVE IMPORTANCE COMPARISONS

AUTOMOTIVE LIKERT VS. CONJOINT RELATIVE IMPORTANCE

TABLET ATTRIBUTE RELATIVE IMPORTANCE COMPARISONS

TABLET LIKERT VS. CONJOINT RELATIVE IMPORTANCE

Brand %

Price %

Any Recommendation (%)

Other %

17%

20%

63%

19%

24%

57%

Conjoint Relative Importance

Likert Totals Exclude Other

Likert Totals include Other

SUPERMARKET ATTRIBUTE RELATIVE IMPORTANCE COMPARISONS

LIKERT VS. CONJOINT RELATIVE IMPORTANCE – SUPERMARKET GOODS

Brand %

Price %

Any Recommendation (%)

Other %

14%

53%

33%

8%

34%

58%

Conjoint Relative Importance

Likert Totals Exclude Other

Likert Totals include Other

AUTOMOTIVE ATTRIBUTE RELATIVE IMPORTANCE COMPARISONS

AUTOMOTIVE LIKERT VS. CONJOINT RELATIVE IMPORTANCE

Brand %

Price %

Any Recommendation (%)

Other %

13%

18%

36%

34%

20%

27%

54%

19%

25%

56%

Conjoint Relative Importance

Likert Totals Exclude Other

Likert Totals include Other

Brand %

Price %

Any Recommendation (%)

Other %

13%

14%

46%

27%

17%

20%

63%

19%

24%

57%

Conjoint Relative Importance

Likert Totals Exclude Other

Likert Totals include Other

TABLET ATTRIBUTE RELATIVE IMPORTANCE COMPARISONS

TABLET LIKERT VS. CONJOINT RELATIVE IMPORTANCE

Brand %

Price %

Any Recommendation (%)

Other %

10%

36%

22%

32%

14%

53%

33%

8%

34%

58%

Conjoint Relative Importance

Likert Totals Exclude Other

Likert Totals include Other

SUPERMARKET ATTRIBUTE RELATIVE IMPORTANCE COMPARISONS

SUPERMARKET LIKERT VS. CONJOINT RELATIVE IMPORTANCE