• 56% of US consumers want to be able to choose after purchasing an item online whether it will be delivered to their home or available for in-store pick-up
• More than 80% want to be able to return merchandise to a store even if it was purchased online or over the phone.
• 70% consider it important for store associates to be able to find an out-of-stock item at another store location or distribution center and arrange for the product to be held for customer pick-up or shipped to their home. 
• Two-thirds want to be able to order an out-of-stock item at an in-store kiosk, over the phone or on a PC.
• European shoppers expressed an even higher demand for multichannel shopping features.

• 81% are fully or partially integrated across all of their sales channels (e.g., store, call center, Website, kiosk, catalog).
• 87% are or will be able to provide the ability to track order and shipment status in the next 12 months through the purchasing channel, and 77% will be able to provide that capability via any combination of channels.
• 43% have a process that allows customers to pick up their orders in the store regardless of the purchasing channel.
• 48% have an automated process that allows customers to return their orders to the store regardless of the channel through which it was purchased.
• Two-thirds will have in the next 12 months the ability to view on-hand, in-transit, and available-to-promise inventory at each location via a single mechanism.
• 60% will have in the next 12 months a process that enables store associates to find an out-of-stock item at another store location or distribution center and arrange for the product to be held for customer pick-up or shipped to their home.

• Consumer electronics purchases are the most frequently shopped product category among multi-channel shoppers, followed by apparel, accessories and footwear, home improvement, DIY and appliances.
• Apparel, accessories/footwear and grocery have the greatest % of impulse purchase decisions per basket in the US.
• The grocery market had the highest number of impulse purchase decisions per basket, as well as the largest percentage of impulse shoppers, in the UK.
• Over 75% prefer shopping "Online to Store" followed by "Store to Online" (7%) and "Online to Call Center" (3%).
• US consumers spent the most on purchases made between the "Online to Call Center" channels, while UK consumers spent the most between the "Online to Mobile" segments. 
• The 18-24 year old group in the US and the 25-34 year old group in the UK have the most multi-channel shoppers. 
• 46-50% of shoppers switched loyalties to retailers as they shopped across different channels, with price as their primary motivation for change, followed by convenience and product availability.

• According to PriceGrabber, 38% of US online buyers shopped both online and brick-and-mortar stores, using both channels about the same amount. From the rest, 31% preferred shopping online while 27% preferred physical stores.
• A Piper Jaffray report says that "offering products through multiple channels was key for online retail success." While no single e-commerce platform dominates, US online consumers prefer fixed-price third-party sales most, followed by going directly to a retailer’s Website, then search, auction and comparison sites.
• The e-tailing group reported that "the in-store experience is still far more robust than what one finds comparably online when stellar store associates are part of the equation." When they compared the experience of finding product information at multi-channel retailers’ bricks-and-mortar locations vs. their online shops, physical stores scored a 3.98 out of 5 across the 50 items evaluated, while online stores averaged 3.05.

These technologies "can save the sale for retailers by creating an endless aisle of products when the store is out of stock or space limitations prevent the retailer from displaying its full selection." Additionally, kiosks provide customers with supplementary product information available from the retailer's Website.

At grocery stores, kiosks have transitioned from manned stations to standalone sources information that can grab customer attention and influence their purchasing decisions by offering food-related items such as recipes, health information, wine pairings and cooking demonstrations.

• 33% said spending will be reduced and 33% said spending will be constant / marketing mix will be reallocated
• 56% of CEO think of brand-building as an investment, while 21% think it's an unaccountable but necessary expense
• 70% currently measure brand growth according to sales and net income, while others use third party brand equity valuations (15%), shareholder value (9%), household penetration (4%) and company culture (3%).

• What to Do When Your Marketing Budget Is Cut - While your management wants you to react immediately, you know that an ill-considered elimination of marketing support can quickly translate into a disastrous drop in sales. Rather than responding hastily and arbitrarily just to show activity, I recommend performing a quick analysis of your situation to get a better understanding of your best business alternatives. This will help you to redirect your marketing budget to maximize results.

• Using Search Data to Drive Annual Budget Planning - This year an uncertain economy will leave its mark on all line-items, search included. And even though search spending is likely to remain flat, the clever search marketer will present a refined strategy based on changing consumer tastes, as evidenced by recent search data and offline indicators. Assuming that the smart marketer has been analyzing such data for years, 2008-2009 is the time to put it to the test. 

• Rethink Your Search Marketing Budget for 2009 -  Data shows that 49% of marketers set their PPC budgets too low and burn through that money too quickly. Many marketers also consider SEO efforts as “free,” causing them to overlook the costs of external consulting or in-house staff time needed to implement tactics. The article provides advice for "creating a budget that will help you optimize your dollars" including tips that cover setting goals based on the quality of the leads or customers generated by search marketing,combining SEO and PPC into one search marketing budget, carving out a percentage of your search budget for testing, analyzing past campaign and testing results for new activities, and supporting your budget requests with facts.

• Online home improvement retailer - A large part of the reason that only 5.7% of home improvement buyers make even one online purchase a year is that they want to see, touch and feel products like plumbing fixtures. To solve this problem, Improvement Direct "created an in-house photo studio that takes images of products from several angles, and then creates Flash-based images that allow site visitors to spin an item to get a complete view of it." The retailer is also "creating its own videos that allow knowledgeable employees to provide information about products." The result - conversion rates increased by 20% for products with these 360-degree views.

• Electronics retailer - By adding basic how-to videos that help familiarize consumers with the basics of technology, the company has lifted conversions and increased accessory sales 12% in some of the pages they've already tested. They've also received great customer feedback and gotten people to come back to their site again, even when they're not planning to buy anything. The case study also includes several lessons they've learned in the process:
  • Find content ideas by searching your customer forums, asking your sales associates, mining customer service for ideas, and talking to your suppliers/manufacturers. 
  • Focus on the products and topics you want to cover by first targeting the big, easy wins and only then proceeding to your more niche idea.
  • Keep your production quality requirements low for and easy and “relatively inexpensive” process --- simple graphics + shot transitions + basic editing software + an HD camera + untrained staff members.
    
  • Do not use the videos to sell, do not mention price or discounts or do any marketing
  • Test to find the best combination of format, player, presentation, placement and other video attributes, possibly using a usability lab, multivariate optimizing and results monitoring.
  
  
• Supermarket chain - A UK chain, which sources and packs fruit and vegetables straight from British farms, has created a video that follows the journey of certain types of apples from tree to store. The online video stars their apple buyer, who works closely with farmers to get the apples in-store when they are best in season.

• Research the subject before starting, including instructional videos on YouTube.
• Set a solid metric-based goal, such as number of visitors, purchases, leads and conversions.
• Choose a format, such as short conversion-oriented videos, how-to videos and newscast topic-oriented videos.
• Get the right equipment, including a camera w/a hard drive (not high def), a tripod, halogen lights and editing software.
• Prepare scripts and storyboards that tell a story, organize the set and set up the lights and sound.
• When shooting the video, don't worry about imperfections, do multiple takes and leave some wiggle room. 
• When editing, avoid fancy transitions, stick to stock sounds and make the file as small as possible.

Bottom-line: since they can't count on current ad formats so marketers need to "start looking at things like direct content integration and product placement. There's still a place for things like banners and skyscrapers, but it's much more about brand awareness than inducing conversions." An additional issue raised by this study is whether "the click should be the focal point for determining a campaign's success, regardless of the ad unit," or whether marketers should look at cost-per-action (CPA)-based models, as well as "more holistic measurements, including clicks, CPM, and other factors taken together."

To that last point, comScore research shows that online ads do indeed have a significantly greater impact "than a typical 0.1% click through rate would suggest," as clickthroughs don't take into account the impact of online ads through "view-throughs" on future consumer attitude and behavior, as well as overall ROI. The effectiveness of online ad campaigns in meeting "branding objectives such as heightened brand awareness, improved attitudes toward the brand, and increased purchase intent, results ultimately in incremental purchasing."

According to the study, online ads "typically lifts online sales by 27% for two weeks to three months, (and) the lift in offline sales is typically 17%." Exposure to ads also increases site traffic (65% for one week and 46% over a period of four weeks) and online searches for trademark products (52% in the first week and 38% in the first four weeks). Bottom-line: "Not only does online marketing have the benefits of more attractive advertising rates and a faster growing retail channel, but it's clear... that Internet marketing also generates incremental sales in retail stores."

• According to Deloitte's holiday survey, gift cards will be the top gift purchase this holiday season for the fifth straight year. Although 66% of consumers plan to buy them, they plan to buy less of them compared to last year (5.3 vs 5.6) and spend less money on each card ($28.43 vs $36.18). Even when it comes to gift cards, people focus on the necessities. Case in point, the popularity of gift cards for gasoline increased to 17% from 13%.
  
  Despite the convenience of gift cards, consumers have 5.9 unused cards on average (vs 3.7 last year) and 14% are unlikely to ever redeem all their cards. 23% are concerned about the store closing before they can use a card and 24% have had at least one card expire before they could use it. "...Retailers have an opportunity to capitalize on this important revenue stream by implementing more creative and aggressive gift card redemption programs."

• The NRF survey had similar results - they expect gift card sales to fall nearly 6% as some people pass them up in favor of holiday bargains. Fewer people will purchase them (53.5% vs. 56.6% last year) and when they do, they will spend less ($147.33 vs. $156.24). The biggest spenders will be men and those over 45. They suggest that retailers may want to "make minor adjustments to holiday plans as fewer people may be hitting the stores in Jan. to redeem gift cards.”
  
  Interestingly, although gift cards will be the most requested gift this year (followed by books, CDs, DVDs, videos, video games, clothing & accessories), those on the buying side aren't as enthusiastic about them. The main reasons are that they feel the cards are impersonal (22.7%), they would rather stretch their dollar by buying merchandise on sale (10.9%), and they do not want to buy a card with expiration dates or added fees (9.8%).
  
  
• Yet another gift card survey, this one from the National Research Network (covered by BrandWeek), showed that while they continue to be a popular and practical alternative to gift-giving, retailers need to better understand what appeals to their target markets in order to make them more personalized. "The perception that gift cards are impersonal is the top inhibitor for consumers purchasing gift cards, with nearly half of respondents citing that as a factor."
  
  Despite the financial state of the market, over half of consumers plan to purchase at least one card. And although half of recipients typically spend more than the gift card amount when redeeming it, 15% of them spend less than the total gift card amount, giving the card issuer a benefit either way. Discount stores are the most popular gift card benefactors, with 42% reporting purchasing a discount store card in the past year, followed by restaurants (26%) and clothing (21%).
  
  
• One final survey from Archstone Consulting expects sales to dip 5% with only 24% of consumers planning to increase their spending on gift cards. Consumers will also shift their spending towards household necessities such as groceries, and gas, or small indulgences such as dining at restaurants. But retailers can increase card purchase by creatively using incentive programs, such as coupons or discounts for either the purchaser or the recipient.
  
  Sales of cards through outside locations (grocery, drug stores, banks and kiosks) are expected to grow by 30% vs 2007. Pre-paid bank cards are still the most desired gift cards because of their flexibility, with restaurants/fast food selling more cards than any other category. Surprisingly, while the 13-24 year-old group has the least discretionary income, they spend more on cards than any other demographic on a relative basis, and receive almost 40% of them.

• Yesterdays (25% of boomers, 69% of them are cutting back on spending) - These boomers are pessimistic and typically have lower incomes and more health issues. While they are disconnected and disengaged, they still "buy with clout". Retailers should advertise to them by using price and value messaging, while "reinforcing and validating that they aren't alone and that most average Americans are just as concerned with making ends meet."
  

• Todays (30% of boomers, 39% of them are cutting back on spending) - This boomer group has retained their optimism, spending and celebration of self. They have a higher stable income, as well as a vanity streak, feel accomplished and fortunate, are risk-tolerant and their health is good. They are planning well for retirement but are still willing to pay for higher quality. 

• Tomorrows (45% of boomers, 60% of them are cutting back on spending) - They have lower and middle incomes, but still feel that "tomorrow will be better than today." Although one-third have suffered recent declines in health and are struggling financially, they are self-directed, as well as community- and volunteer-oriented. They key to reaching them is "spirituality and connection: to community, to religion, to information," as well as "hopefulness and optimism bearing themes that tap into their aspiration for a stable future", instead of "retire rich" themes.

Bottom-line: To create customer-focused marketing with "relevant communications, interactions, and content, regardless of channel and customer interaction point" requires the leadership of a CMO who can "define and lead a ...strategy that crosses product, channel, geographic, even functional boundaries."

Posted by Universal Ad

• How Retailers Can Navigate Inflation's Hazards - Many retailers have found themselves in a tough situation, locked between rising product costs and a limited ability to raise their prices. But Wharton faculty say that handled carefully, the current inflationary period may actually be a business opportunity for some retailers, especially if they make selective changes in inventory management, pricing and promotions.
  
  
• Retailers Feeling Our Pain - Recently retailers have been going out of their way to let their shoppers know that they understand how tough it is out there. Most, by now, have offered various forms of sales assistance and only time will tell if they have been successful in capturing a greater share of shopper dollars along with their offers of help.
  
  
• Will Retail Ever Bounce Back? - During this time of economic turmoil, many sense that when we finally emerge, some key aspects of the commercial world will have been fundamentally transformed. I suspect retail in America is one of them. Casting your mind forward five years, how do you think the retail landscape will be different?
  
  
• Retail Innovates in Hard Times - While financial and economic news is bad for both consumers and businesses these days, the retail sector is being hit especially hard. However, amid the sales drops and predictions for a dismal holi­day season, there are signs that a few retailers haven't been stopped dead in their tracks by the finan­cial turmoil and are moving ahead with innovative projects.
  
  
• Thriftiness on Special in Aisle Five - While it might seem counter-intuitive for stores to teach shoppers to cut their spending, several chains have concluded that providing such knowledge can spur loyalty and keep customers from trading down to cheaper competitors. In an era of prosperity, easy credit and changing social norms, many of those classes were revised to focus on more up-to-date topics.
  
  
• Stop Giving Your Customers Reasons to Leave - Despite current economic conditions, retailers should continue to explore investments in technologies that provide improved customer service and optimize operational efficiencies in order to improve their competitive market position. This article outlines some recommendations for retailers facing various market-driven challenges.
  
  
• Start Planning for the Rebound Now - While it's may be true that things will get worse before they get better, it is just as true that winners will emerge during these uncertain times. Smart retailers will make prudent plans to survive today's challenging environment, but more importantly, they will also continue to execute on a plan to enable them to leap ahead when the economy rebounds.

• Making Marketing Count in a Down Economy - There is no better time than now for marketers to prove their value by demonstrating the revenue-generating potential of their department. The knee-jerk response is to focus on growth through customer acquisition. But experience has taught us that concentrating on understanding and keeping the customers you've got is the strongest strategy in battling churn.
  
  
• Steps for Success in a Down Economy - The smart marketer knows that even in tight economic times, budget cuts to marketing often only result in lost sales, not improved revenues. Now is the time for marketers to make this fact known. Here are a few key steps every marketer today must employ to shift perceptions of their discipline from discretionary cost center to proven and essential value generator.
  
  
• Marketers Need to Adapt to New Economic Conditions - Marketers need to be ready to adapt and innovate to manage and exploit new market conditions. Here is how marketers can provide added value in even the tightest of economic times. You must remain flexible, especially when it comes to gaining customer insight, integrating marketing channels and measuring and analyzing results.
  
  
• Execs Offer Tips on Weathering the Recession - Most people in this business don't yet understand how hard this recession is going to hit by the first and second quarters of next year. It's going to be very severe and they don't understand how deep and long this thing is going to be. So here's some advice on how marketers could better manage the challenges created by the current recession.
  
  
• Carat Urges Clients to Maintain 'Voice' - Because consumers behave differently during recessions, the good news is a chance to grow market share for those willing to learn from history and adapt tried-and-true practices to the media environment. For companies to recapture pre-recession sales levels within a year requires spending 60% more money than the amount saved by cutting the ad budget in the first place.
  
  
• The Challenge Is To Wisely Spend Reduced Ad Budgets - Historically, marketing budgets are among the first to be cut in a budget crunch, but spending more during tough times when competitors may be scaling back is a good way to strategically boost market share. Effective marketing spending during economic downturns is not about how much you spend but how you spend it.
  
  
• An Old Buzzword Is Back: Bargains - As the year began, consumers started to see a trickle of advertisements that played up brand value rather than attributes like status or prestige. As the economy worsened in the spring and summer, the trickle became a torrent. Now, as the crisis in finance continues, a veritable tidal wave of ads devoted to saving money is washing over the country.
  
  
• Marketers Take a Softer Tack to Reach Uneasy Consumers - In response to the roller-coaster stock market and plunging housing prices, marketers are adopting a softer approach to peddling their wares, playing up comforting images in their ads and focusing on family and the warmth and safety of home. Some marketers are even reviving old advertising to remind consumers of happier times.
  
  
• In a Recession, Try Empathetic Marketing Ideas - With all the contemporary conversation about co-ownership and co-creation of brands, I would have expected to see an absolute torrent of brands trying to walk a mile in their customer's shoes. The paucity of such programs is both a surprise and puzzlement. The only ones I've seen even alluding to today's financial realities come from the fast food category.
  
  
• Increase Spending, Market Share In A Recession - Savvy marketers realize that it is because many marketers cut advertising spending during a recession that it is the best and least expensive time to gain market share through advertising. Publishers are more open to negotiating deals. Plus, there is less competition as other companies reduce budgets. This is the time to brand yourself as the leader in your category.
  

• Recession-Proofing Your Brand - When you choose to cut marketing, you put your brand at risk, increasing the likelihood that your brand will lose relevance to your target audience and your retail partners. The key to making your brand survive--and dare I say even thrive--during a recession is to outthink your competition. Following are three strategies to recession-proof your brand.
  
  
• Four Communications Strategies for a Down Market - In light of the recent turmoil in the global financial markets, marketers must step back and assess all of their communications to ensure they are in sync with their customers' current situation. In this weak economy, marketers must modify their message to respond to customers' changing perspective.
  
  
• Invest in Digital Marketing in Down Markets - Smart companies invest in digital marketing in down markets for an assortment of reasons. Primarily they are looking for efficiencies that allow them to continue to market to their audiences. Behavioral marketing is about targeting refinements that enhance marketing effectiveness and make it a natural for budget-challenged marketers.
  
  
• Turn Your Web Site Into a Cost-Effective Recession Solution - With smaller marketing budgets, companies are hunting for cost-effective, measurable systems to sagging sales figures. Surprisingly, many sales and marketing heads don't know enough about the true power of web marketing and the latest tips and tricks to take full advantage of its cost-effective nature.
  
  
• Winning Marketing Tactics in an Uncertain Economy - The state of the economy impinges on the marketing budgets of companies small and large. Although search marketing is recognized as providing a higher ROI than other marketing channels, clients today seem to want even more for less. Let's mull over some tactics to squeeze every last drop from a shrinking marketing budget.

81% of all respondents currently operate a loyalty program, with 45% registering customers for loyalty programs via sales associate in the store, 41% at the point of sale, and 41% online. 21% use “cross channel loyalty tools that align with cross-channel customer demand” and 34% plan to implement this capability within the next year. Their top two objectives - lifetime customer value (57%) and competitive advantage (39%).

Real-time customer data is also starting to gain traction, with 14% tracking customer purchases and behavior as part of their loyalty initiative metrics within one or two hours of purchase, and 23% planning to implement real-time capabilities within the next year. The two most effective strategies for using customer loyalty data --- “elements that suit specific customer affinity and preference” (53%) and “personalized promotions across channels” (52%).

Case in point - Virgin Entertainment reported that "its two-year-old loyalty program was starting to pay significant dividends," with the average dollar spend by VIP members being 60% higher than non-members in 2008.

The Aberdeen report also outlined best practices for retail loyalty programs -

• Develop customer reactivation campaigns (within three to 12 months of departure) to reduce attrition and improve lifetime customer value.
  
• Increase frequency of multichannel loyalty campaigns from an average of one to two campaigns per quarter to four campaigns to increase share of wallet.
  
• Establish single point of ‘ownership of the customer’ for more cohesive relationship marketing decisions.

• Loyalty Programs Suffer from One-Size-Fits-All Approach (following a recent WSJ article) - According to two professors, many customer loyalty programs aren't boosting marketing share as intended because most retailers adopt a one-size-fits-all approach. They argue that product discounts aren't changing the long-term buying behavior in shoppers who value things like personalized service, convenience or shopping pleasure more. Not surprisingly, the professors argued that retailers should focus on providing customers with more "individualized rewards, based on what they value."
  
  
• The Customer Loyalty Myth - Do loyal customers translate into steady sales or profits? Intuitively, the answer should be yes -- and indeed, customer loyalty is a significant metric by which companies rate their performance. However, there a few problems with the concept of customer loyalty and a corporate strategy to develop it. For one thing, customer loyalty is difficult to measure. Two, even if it were easy, it doesn't necessarily add to a company's bottom line.
  
  
• Immersive Customer Experiences Aren't Just for Customers - A successful loyalty strategy requires that you immerse your creative team in every aspect of its design and implementation. To engage customers in relevant and continuing conversation, creatives must continually better their customer knowledge. At the beginning of any loyalty marketing initiative, establish the program's foundations and goals. Make sure everyone intimately understands not only the value proposition, but also how customers are expected to respond to it. Then, take the process a step further by submitting your creative team to customer "immersion therapy."

With that in mind, you need to create more relevant marketing communications by putting together "an intelligent (and responsible) recommendation system" and "marketing pieces filled with merchandise based on the individual's past purchase behavior" using, for example, unique personalized URLs that lead to personalized landing pages with real-time deals. 

Even if you don't have much data, you can boost sales by combining names and past purchases to create highly personalized messages with creative presentations to cross-sell, bundle, and introduce new offers. Even if you don't have any transactional history, you can still make it work with highly relevant messaging, based on ZIP codes and knowledge about your competition.

Posted by Universal Ad