4 trends impacting retail marketing strategies
Street vendors of the 18th and 19th century would sell their goods and services in open-air markets to make themselves known.
Fast forward a few centuries and brands can now rely upon the likes Google, Amazon, and Facebook to help them push their products in front the eyes of consumers.
Print is back in fashion
The history of direct mail in the United States is long. The first direct-mail catalog sent out in the U.S. is said to be Tiffany’s “Blue Book” in 1845. Montgomery Ward, Sears, and J.C. Penney were among the others who joined the fray. According to Nick Egelanian (CEO of SiteWorks) the largest players in print advertising were at one time grocery stores and drugstores.
Retailers used to be more inclined to shop catalogs because customers weren’t as online at the time. RetailNext’s head of insights, partnerships Lauren Bitar said that consumers could easily flip through print catalogs and choose the items they liked, then call or return the completed order form in the mail to make their purchase.
Bitar stated that online shopping became a major channel and that more advertising dollars were spent on it than on a catalog.
As data-rich platforms such as Facebook and Google became more popular for digital advertising, catalogs lost their appeal.
“Print’s historic difficulty was that there was no attribution — compared with digital — so you can’t track the actual sales,” Alex Song (CEO of DojoMojo), told Retail Dive.
However, despite the rapid rise of ecommerce, which was further accelerated in the past year due to consumers’ limited visits to the stores, some retailers and brands still use print catalogs strategically. The appeal of print catalogs is partly due to the fact that major players have begun to abandon it. This has made them more attractive for retailers who want to stand out.
Bitar explained that catalogs enable retailers to show their brand to consumers in a way that they might not be able experience online. When the consumer is missing that tactile experience, being able to display something in a space can help them feel more connected.
According to Polly Wong (President of Belardi Wong), direct-mail marketing has seen a significant increase in popularity, besides catalogs. Wong stated that since May, between 80% and 90% of Belardi Wong clients, which tend to be more wealthy, reported “really high growth numbers” in any given period, as well strong response rates in mail for customer acquisition and retention.
“She has to touch it in order to recycle it.”
As online competition heats, direct mail has been a popular option for direct-to-consumer companies. However, relying on Facebook and Google alone has led to direct mail becoming less attractive.
Wong stated that there has been an “incredible resurgence” in mail. We have successfully launched more than 200 DTC brands into the mail over the past five years, which is why we have so many customers. They are looking to diversify their marketing strategy. With all the changes and rising digital costs, nobody wants to be totally dependent on Google or Facebook.
Brands have had to rethink their approach to direct-mail marketing. “Honestly, the people who left print — the Victoria’s Secrets of the world – they just created a downward spiral. Wong stated that as a customer, he received three direct mail pieces within a week. “People who turned down direct mail were probably not interested in receiving it.”
While some people abandoned the channel, many found it an affordable marketing solution as digital advertising became more costly.
To give you an idea of the cost, you can mail a full-sized catalogue for 65 cents including postage. DTC retailers and brands spend an average of $2-$4 per click. It’s crazy,” Wong stated. You can mail 6-8 catalogs to highly targeted audiences for as little as one click. What’s more, direct mail and catalogue marketing are actually very affordable.
DojoMojo’s Song says that having a physical presence can help build credibility and legitimacy around your brand.
A physical catalog may be the key to enabling consumers to purchase more expensive products online.
Wong stated that if you want to convince someone to buy a $300 sweater and you are an emerging DTC brand, it is difficult to acquire digital customers for brands with high ticket items, such as jewelry or fashion. There is a correlation between square inches and response rates if the consumer doesn’t know you and you have a higher pricing point. This is because the direct mail piece itself has more response rates.
Wong said that print, by default has 100% visibility with the consumer. “She has to touch it in order to recycle it.”
“What’s old is new again”
Brands have reintroduced other advertising forms that were not as popular, such as direct mail and catalogs. Wong stated that “we always joke around here, What’s old is still new again like TV and print,” noting that technology and data associated with these channels are much more advanced today.
However, brands will approach physical marketing in different ways, particularly between bigger, more established retailers and smaller DTC brands.
The general cost of print advertising is high. Song stated that even though costs have decreased over the years, it is still a very expensive marketing channel for young brands to pursue, especially if there isn’t clear execution. Song said that bigger brands will find ways to use it in meaningful ways. I believe smaller brands will do things we have seen before, such as subway takeovers.”
Many digital brands, including Spotify and Thinx, have disrupted traditional marketing by buying subway ads in New York City in recent years to draw attention to their products and companies.
Song warned that as channels become more popular, they may no longer offer the same opportunities. Think about the Casper subway takeover. Song stated that the Casper subway takeover took place four years ago. It was quite innovative because New York’s subway ads were not considered prime print advertisements to buy. Casper was able to obtain it for super low prices, and they made economics work. This legitimized them somewhat because it made all subway commuters feel like they were a big brand. They are taking over the whole subway.
Combining agile marketing with print can help brands combine the appeal of print and the benefits of digital marketing. Song explained that brands can place a printed advertisement on the side a vehicle. If people are near the vehicle with GPS enabled, they can receive an ad based upon their location.
“The store is not a new marketing channel, but it’s who uses the store to market their products that has changed.”
Bitar stated that “the store as a channel for marketing is not something new.”
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