By Justine O’Neill, Senior Director, Analytic Partners.
Bricks and mortar, just clicks or bricks and clicks – the retail landscape is constantly changing. Add to this a myriad of new marketing technologies and legislations, not to mention the impact of the coronavirus crisis – and retail marketers on the eternal quest for customers could be forgiven for asking ‘just how do we keep up’?
Underpinning this seemingly constant flux there are some key marketing challenges, which must be identified to help the savvy retail marketer deliver.
Quality over quantity
The omnipresence of advertising and abundance of choice often paralyses retail customers, forcing many to turn away when they’re served content that doesn’t meet their requirements.
But that choice can be a false dawn for marketers too. In the choice equation of quantity versus quality – pity the marketer who sacrifices good content and tailored messaging in exchange for seeing their messaging on countless platforms.
To stand a chance of being noticed, retailers must prioritise good quality, impactful creative when building their advertising campaign. According to our research, built over the past 20 years, creativity is the biggest driver of advertising performance and increased ROI and one third of the impact of a video impression depends on creative implementation.
Too many vs too few
But nothing is ever that straightforward. While quality must be the watchword, marketers must still reach their desired audiences and too few channels will be just as damaging as too many. Our evaluations show that more usually brings more. For example, multi-channel campaigns across at least three channels are about 23% more successful than campaigns via just one channel. It is not only important to choose many channels, but also those that fit the product and target group and to find the right combination. A campaign through online and offline channels can be 45% more successful than one that only runs online or offline.
The multi-channel approach is particularly successful when synergies are created between the different platforms, so that the message within the campaign is reinforced. Though the content must be tailored to each channel – even if it seems to be the same format. For example, the combination of TV and online video can enable a 35% increase in ROI– but not if a TV commercial is simply used one-to-one as a skippable pre-roll ad on YouTube.
Analytical paralysis during measurement
A retail campaign distributed across many channels may mean more ways to measure how successful a campaign has been, but with this comes a more topline understanding of a vast range of channels and granular expertise is often lost. A uniform measurement is problematic and companies become less able to understand which drivers are really responsible for performance increase or waste. Saying goodbye to third-party cookies makes the situation even more difficult.
Unfortunately, there is no one solution to this paradox. Rather, it lies in a mix of different instruments and a holistic approach. For example, the cookie challenge can be overcome by setting up a way to gather first-party data accessing cohort data or relying on context-dependent advertising.
As with a campaign, impact measurement also requires a holistic approach that is strongly aligned with the customer’s complete marketing experience. Those who take this holistic view can take a better look at the overall picture – and thus understand synergies and better predict the performance of the company. In this way, targeted optimisations can be made and measures can be carried out in all important investment areas such as marketing, operations or the introduction of new products.
In the digital world change happens fast and retailers are under pressure to adapt and while performance and short-term sales are becoming increasingly important, they are not the drivers of long-term sustainable growth. Retailers who only focus on immediate sales targets in the short term are likely to see negative effects in the longer term.
Retailers must use measurement methods that evaluate both short and long-term consequences. This also means that marketers have to deal with how much they want to spend on brands and performance. Our evaluations show how important investments in the brand message are: Brand messages exceed the performance of product, advertising and functional messaging in 80 per cent of cases. But companies need to find the right balance between branding, product and performance messaging. This is the only way they can achieve both their corporate and performance goals.
Rapid change, a flood of information for consumers, the feeling of constant acceleration – and often associated overstrain – among marketers: it has never been easy to always be up to date and keep up with every emerging market requirement. But, the experience of the last 20 years shows that success lies ahead for the savvy marketer who stops from time to time and reflects on the four principles mentioned:
1. Creation: Use strong creation to stand out from the flood of information that overflows the consumer.
2. Planning: When planning media, rely on several channels that are specifically selected according to reach and target group relevance. Pay attention to media synergies and adapt advertising to the platform.
3. Timeframe: Aim for both short-term and long-term success, which is mainly achieved by strengthening the brand.
4. Proof of effectiveness: Holistically measure the effectiveness of the measures in order to react adaptively to market changes and to optimize strategies over time.