Britain's retail experts are shifting promotional priorities in-store this summer as classic footfall drivers like advertising, sponsorship and celebrity endorsements fail to halt declining customer numbers on the high street.
A new retail study by Mohive has collated the experiences and opinions of over 100 retail marketing and promotions experts currently managing campaigns for Britain's leading high street names.
Findings suggests marketers believe they have done everything possible to encourage shoppers out of their homes and into our high streets, and are now focused on leveraging communications options in-store to boost conversion rates and turn browsers into transacting customers.
Key findings include, when it comes to price cuts, retailing has reached rock bottom. Re-aligning promotions to meet current customer needs has taken its toll and most retail marketers say they can’t discount any more.
A discounting point of about 20% is the most popular option for retail marketers and more than four in 10 say that this rate represents their average discount over the year so far.
Nearly 60% say they do not think they can discount any more than they have done already; the remainder say they would consider further discounts if necessary.
Retail marketers are also supporting fewer products with more campaigns.
While most experts claim the recession has fuelled streamlining to reduce product range, just over 83% or respondents believed that the number of campaigns they manage has increased in recent months.
Most respondents (58.45%) estimate an increase of about 10%. Nearly 14% thought they were managing about 20% more product campaigns today. A few (less than 4%) said their campaign portfolio was up by about 40%.
Shrinking product cycle goes a long way to solving the puzzle of more campaigns being produced to manage less product.
Across all sectors most marketing experts in retail believe that product cycles have shrunk by about three months. In some sectors – like furnishing – this was not considered a particularly dramatic, but in others – like clothing – where product churn can relatively short, three months may represent a major portion of the classic product cycle.
The top five next big challenges for retail marketers rolling out campaigns this summer are:
1. Keeping store managers and staff in the loop (70.30%)
2. Rolling out product campaigns faster (69.31%)
3. Keeping product campaigns aligned to customer needs (68.32)
4. Converting in-store browsers into transacting customers (64.36%)
5. Keeping product campaigns fresh and effective (57.43%)
Frugal spending, carefully targeted at elements that promote a good experience in-store, supported by drivers like direct marketing or web/soc networks (which are stable or growing in importance) over classic ad spend or sponsorship (which seem to be losing appeal) would appear to be the emerging model of choice for retail marketers working through these current tough conditions
Mohive CEO, Lars Unneberg, said, "The real question for retail marketers in the current climate is: 'What more can we do to improve the performance of the product campaigns and promotions our business depends on?’
“While the vast majority taking part in our study seemed to think they had classic external factors like television advertising, PR or magazine promotions covered, nearly eight in ten now say that internal issues like in-store merchandising or staff ability to recommend and advise, are of growing importance in an environment where footfall is in general decline"
The full survey will be made available to the retail marketing industry via an online webcast due to take place at 3pm tomorrow (July 2, 2009). Register for the event free at http://tiny.cc/retai100
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