Tag Archives: Retail marketing

The Drum – ‘Regrexit’ or not, smart targeting never been more important for retailers

Regrexit blog

As much as I might want to avoid the subject, it is impossible to look at retail predictions for 2019 without looking through the lens of Brexit. As the uncertainty continues over a possible deal, I want to try and think about the effect it will have on retailers in 2019, what is probably concerning them and what if anything we can do to brace ourselves.

I watched the fascinating Channel 4 live debate show, Brexit: What the Nation Really Thinks, which aired in November. Polling and market research agency, Survation interviewed 20,000 people online across the UK from 20 October to 2 November 2018 in the biggest ever independent Brexit opinion poll. If you didn’t see it, according to the poll if the referendum was re-run, there would be a swing toward remain at 53% to 47% – but that’s neither here nor there right now!

What was interesting, with my retail hat on, was how attitudes to the overall economic outlook of the country and people’s personal finances by age group would impact retail strategy planning their 2019. Overall, the study found that 44% think Brexit will be bad for the economy, versus 31% thinking it will be good. This deteriorating consumer confidence is already being played out on the high street where we are seeing a continuing stream of store closures – not just because of Brexit, but certainly not helped by it.

When you start to delve deeper into the demographics there is a clear picture emerging among the different age groups – as the age group increases attitude to Brexit, economic outlook and effect on personal finances get more positive. While 45 year olds and younger now overwhelmingly have a negative view of the economy post-Brexit, for 55-64 year olds it is much tighter (34% think it will be good, versus 40% bad) and for 65-74 year olds it swings to positive (42% think it will be good, versus 35% bad).

A clear majority of consumers aged 54+ also think Brexit will either be good or make no impact to their personal finances. There are two factors behind this. Firstly, they are after all ‘Generation Wealth’, with more assets and financial independence so therefore less likely to feel they will be adversely impacted. Additionally, as a majority wanted to vote leave anyway, they were clearly unimpressed by what they see as ‘project fear’ from the remain side about some of the reported negative financial impacts.

However, for worried millennials a far different picture emerges. Just 24% think Brexit will be good for the economy versus 50% bad. Meanwhile 44% think it will be bad for their finances, against 18% good. Not surprising when you consider their careers started after the financial crash and they are less secure in their jobs.

So, what does this mean for retailers in developing marketing strategy? Insulated from any of the more negative personal financial impact of Brexit and with more confidence in the country’s future could we see the baby boomers create a mini retail boom?

However, for millennials, worried about their personal financial security as well as the economy, retailers will need to entice them to shop. Millennials seek out experiences which also applies to the way they shop. Retailers need to engage with this audience through the customer journey making any purchase a positive experience. What is the USP versus Amazon for this digital, increasingly disenfranchised demographic?

Having a distinct strategy for the different demographics and understanding their mindset, spending power and intention will be key. Also, being agile and flexible and able to react quickly to the market and buying signals. Just as the outcome of the negotiation won’t satisfy all political parties or a now fractured population, neither will a one size fits all retail strategy. Start planning now to remain relevant to your customer base as we move into unpredictable 2019.

To read the full article visit The Drum.

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Back to school: a lesson in brand relations

 

Back to school in my youth was always met with a heavy sigh when my parents calculated the uniform costs and I wanted the latest pencils and rubbers. These days, trends have changed. Thanks to the competition among discount supermarkets like Aldi, Lidl and Asda we’ve seen uniform costs and stationary prices plummet, giving consumers a far greater choice at more reasonable prices often using ‘event’ advertising campaigns increasing footfall into store and bolstering revenues in other areas of their business.

There’s one category that’s changed everything as it becomes a staple of the ‘Back to School’ event, particularly in higher education: consumer electronics – to be precise computing – adding a whole new layer of cost parents must budget for. While retailers should consider an all-year-round back-to-education strategy, back to school begins to increase in prominence from August, especially in the technology category. The value of the back-to-school market in the UK is estimated to be worth around £1.45bn and while uniforms and stationery will make up a large proportion of this market, the increasing requirement for technology in the classroom means that edu-tech continues to be a growth opportunity for retailers.

Every school, college and university around the UK differs, but they all require some level of ‘technology’ input and expense from parents. As government budgets for school funding continue to decrease, this need will only get bigger and more expensive. It’s a costly exercise and therefore something no parent or student wants to get wrong. A bring your own device (BYOD) policy is becoming common place and enables the market to grow to support this with the right advertising, marketing and in-store execution. As a considered purchase – and for many their first computer that they don’t have to share – the need to try before you buy is important. It’s a seminal moment for most teens. The look, the feel, the height and size are vitally important to most, especially in our streaming culture where the device is both for work and play.

Not everyone is tech literate and understands what product is best for their child and, yes, some schools have preferred suppliers, but often parents are sent out into the big wide world to get a lap top or a PC and the choice is overwhelming and confusing. This often leads to a whole host of questions: what hardware and platform do I opt for? What software will I need to buy? What about security? Is it going to be out of date before the end of the school year? Is it robust enough? Am I spending more than is necessary?

For teenagers going to University this is a chance to upgrade their old ‘shared’ kit and start fresh with new equipment that has the functionality to assist them in delivering their course and honing their tech skills ready for the workplace. This is a great opportunity for brick and mortar retailers to position themselves as the advisor – the place to go when you’re inundated with choice, don’t know what to buy or where to go to experience the products to touch and feel and work out if they’re right for you.

The ability to choose from a range in an environment geared towards making this decision is crucial for university and tertiary education students; different courses will require the technology to have specific functionality. Retailers need to be inquisitive and understand the student’s lifestyle to match the product to their needs. Technology purchases are not just about the one product these days, they are multi-functional lifestyle solutions, so in-store staff have to be trained to ask the most pertinent questions: What will you study? Is design (weight and size) a primary consideration? How do you consume media and home entertainment? What’s the budget?

Amazon will be a key back-to-school destination – especially for the 30% of Brits that now have Prime membership – but this is something Amazon and other online retailers can never do as effectively when a personal approach to a considered purchase is needed by a brand and retailer.

Never underestimate the first consumer interaction with your brand – an emotional connection that shouldn’t be undervalued. Not only is it a great opportunity for a brand to bring a new customer into their portfolio and up-sell them through their product ecosystem as their needs and lifestyle changes; it is also the chance to create an advocate and customer for life. Brands invest heavily in extra activity around back-to-education including Fresher’s Fairs and NUS affiliated marketing. Paying attention to planning and implementing in-store strategies within retail is an essential part of any back-to-education marketing strategy.

Daniel Todaro is managing director at Gekko

Read the original article on The Drum

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Are retailers providing an experience that’s worth the trip?

Save the shops! A mantra I’ve heard numerous times having worked in retail for the last 20 years. Yes, consumers love shopping online, but there’s no doubt they want to preserve the ‘real’ shopping experience especially for high-value tech/electrical products.

Whether they are looking to upgrade an existing device, buy into a new product category such as the smart home, or make a distress purchase to replace a product that has failed, consumers are looking for a solution to a lifestyle problem. As a retailer, it’s within your power to provide this solution, offering consumers the right product for their needs and, in doing so, reinforcing why traditional retail is still the best platform to buy technology products.

I think there’s a big disconnect between what consumers need from retailers and the experience they get. We’ve recently seen the news that Maplin has collapsed into administration, yet the sale of tech/electrical goods is on the increase – one of the fastest growing categories. Consumer electronics retailing lends itself like no other as a tool for retailers to be more dynamic in showcasing solutions and brands to lure consumers.

The information gap

Let’s look for example at the popularity of streaming and how it’s driving the sale of hardware. Streaming is becoming increasingly the norm for many, curating the music, TV and media that’s preferred at a time that suits consumers’ lifestyle. Netflix revenues have increased 36% year-over-year and Apple’s purchase of Shazam for $400m shows the market is continuing to evolve.

These brands are the new media giants, beating down the once dominant studios who are now consolidating to survive. But without hardware and devices, none of this is possible. I’m ensconced in this world and most of the consumers we speak to have very little understanding of what hardware to purchase and want help and advice.

This is where retailers can win, but they are not making the most of their assets – the team on the ground. These people are the face of a retail brand, interacting with the customer, the first port of call, the golden ticket to success, the ones that can transform your business but only if appropriately trained – and therein lies the problem.

Make the most of being face-to-face

That first face to face interaction is critical; sales staff should be asking key questions of consumers to discover why they are in the store and their needs, budget and motivations.

Are they looking to buy new, upgrade a device or has something broken down and needs replacing? What do they currently have? What specific features do they require? Where will it be used? How often? Is it a primary or secondary device? What is their preferred price range? A customer wants reassurance that the product will meet their needs and solve their ‘problem’.

It is important to ensure your staff can demonstrate the product, are trained on core ranges and brands so that they can explain the benefits to shoppers and don’t make the mistake of ignoring what the shopper has told them so that the features link naturally to the customer’s lifestyle or specific needs. This could make all the difference to their decision to purchase, helping to close the sale.

Shoppers need to know how the product will solve their unique ‘problem’ so that they walk away satisfied and hopefully come back for more. Online will never be able to provide this level of service so retailers need to take control of their destiny and provide consumers with an experience that was worth the trip.

Click here to read the article on The Drum

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