The digital marketplace has created a new breed of retail consumers and merchants have never been more challenged to reach them. Knowledge and innovation are not enough to fundamentally change the retail marketing game anymore. It is time to rethink, re-imagine and redefine retail marketing.
Fortunately, the technology that drives the new marketplace also provides the mechanisms for more personalized and better-targeted marketing strategies that can influence this new digital, online-only generation.
The King is Dead, Long Live the King
Television and print media have long been the venues to reach mass groups of consumers. However, that’s changing as more people shift away from watching television during its scheduled time or even reading the newspaper. Our multi-screen world is changing both online and offline shopping, while also undermining established marketing strategies. So how can retailers reach out to their clientele if the traditional mechanisms of TV, press, direct mailing and billboard advertising have become increasingly irrelevant?
The answer: look at other ways to embed messaging into target customers’ lives. Forget CNN, Fox and the BBC; if you are not advertising on Netflix, Facebook or YouTube (and other social media channels) then you are already starting to lose a key audience that will only keep growing.
When all information consumption is done on a PC, tablet or phone, even an email campaign or a flashy ad on your website will struggle to keep up.
Digitize and Personalize with Data
Mass advertising will not disappear overnight, but its influence is certainly waning. Advertisements are shifting toward not just digitization but also personalization, powered by increasingly sophisticated algorithms and predictive models that analyze transaction data and digital media trends. In fact, 35 percent of what consumers purchase on Amazon and 75 percent of what they watch on Netflix come from product recommendations based on such algorithms.
The real-time conversations brands have with people, as they interact with websites and mobile apps, have changed the nature of marketing. The modern-day marketing department needs to combine the creative narrative side of the discipline with the technical side of data. But timing remains paramount. To deliver, marketers are increasingly looking to reach out to their prospective customers to maximize their interest and improve the likelihood of a sale. Some savvy retailers are even timing their customized messaging based on social media usage. For instance, Thursday evening is a much more fertile time vs Tuesday morning, as the consumer base is shifting into “weekend mode” and more likely to pay attention to the messaging.
The marketing potential is huge. With intelligent data analytics, retailers can uncover who is liking, sharing, posting, tweeting, watching and how long they are engaged. Tailoring advertisements and offers to those who are most interested, at the right time, is a winning formula.
Keeping Payments in Step
As retailers change their focus toward digitally targeted advertising, the underlying payment systems need to follow with simple and frictionless payment mechanisms that enable instant gratification through e-commerce gateways. A highly targeted advertisement only works if the corresponding purchase is simple, immediate and hassle-free. The challenge for brands is to connect with customers through all available devices in real-time.
Company-directed marketing is also competing for attention with peer recommendations through social networks, user reviews and the like. Research shows that for the average consumer, peer recommendations carry 10 times more weight than recommendations from salespeople. Indeed, social media could well make up 22 percent of marketing budgets in five years as retailers increase their spending to facilitate and influence peer connections between brands through paid advertisements and branded pages on social media.
Retooling for Relevance
Today’s connected consumers are using smartphones, iPads, laptops – and even glasses and watches – to access content. As a result, marketing departments need to provide compelling campaigns across these different devices and become proficient in using these technologies. Marketers need to update their skills to make the most of these fast-moving and highly relevant campaigns, and, therefore, need to work closely with data specialists, web developers, and social media professionals.
Marketing is concerned with understanding people’s motivations and using these insights to create campaigns that promote brands and encourage people to buy products. The real stars are the ones who can balance a passion for technology, data, trends, and creativity, all at the same time.