Archive for All Things Digital

Amazon Must Deal with “e-Out-of-Stocks”

Welcome to the vagaries of retailing, Amazon. With the advent of the recent “Prime Day ” event that promised “Black Friday” type deals and excitement, many (if not most) shoppers were left with the equivalent of looking at bare shelves. Certainly there is an understanding among shoppers that really “hot deals” carry the “while supply lasts” caveat, however when the supply is so small that only a fraction of the audience can participate, the risk of alienating more shoppers than you endear, becomes very real.amazon-o-o-s

Ironically, for e-retailers, one of their key advantages over bricks and mortar stores is their ability to access “endless aisles” or virtually unlimited inventory, minimizing the notion of out-of-stock. However, when Amazon and other e-tailers overtly promote specific deals and sales events, they better be prepared to sell some merchandise, or risk alienating the very audience they are attempting to attract. If an on-line shopper logs on one hour after the sale begins…. only to find the popular items and deals are gone and only remnant items are left, the e-tailer will have done more damage to their customer constituency than good.

Further and finally, social media provides an instantaneous shopper feedback forum.  Yesterday’s post event tweets were dominated by such terms as “garage sale”, “flea market” and “crappy yard sale”.  Angry shoppers tweet more than happy ones. E-retailers should know that the report card on their efforts will be immediate and cutting if their sale disappoints more than it delights.

Mobile, Mobile, Mobile

During a recent panel discussion* on the topic of digital coupons, I asked Ajay Amlani, General Manager and Founder of You Technology what his three top areas of priority in terms of increasing the efficacy and volume of digital coupons and content in the coming year.

His answer, without hesitation was adamantly

Mobile, Mobile and Mobile!

He went on to assert that the overwhelming penetration of smart phone ownership and increasing usage during the shopping journey should be enough provocation for anyone with a proactive marketing strategy to include a healthy dose of budget towards reaching shoppers via their mobile device somewhere within their shopping process.
 

Devising a cogent mobile strategy presents an array of choices mobileandtraditionaland complexities that are unknowns to even some of the most experienced marketers. Arguably, before retailers and brands get into specifics on mobile (smart phone) marketing, it should dovetail into a more traditional, comprehensive marketing strategy and a broader Omni-Channel Strategy as the neighboring graphic depicts.
 

While retailers are becoming increasing more comfortable with budgeting and executing Omni-Channel initiatives they are often done as tests or ad hoc. In turn these forays into new media are not strategically linked with more traditional merchandising and marketing programs.
 

So is it the case with Mobile Marketing. The following are quick points of consideration when building a mobile strategy.
 

  • A good place to start the process is to view mobile as a distinct medium to the shopper with the same stature of print, television, radio and outdoor. With an increasing number of shoppers using their smart phones to access circulars, deals, coupons, comparative pricing, and product availability, mobile deserves its own line item in the budget.
  • Secondly, gain an understanding of what is different about mobile vis-à-vis the other forms of communication. Establish the measurable elements associated with mobile and determine accordingly how success is measured. Clicks, Views, Open Rates and other new metrics are vital to understanding the basic level of engagement. If mobile marketing employs SMS texting,  email blasts or banner web advertising, benchmark successful engagement metrics in each of those elements. Be knowledgeable of what constitutes best of breed performance among your key competitors and retail channel.
  • Additionally, keep in mind that of all the Omni-Channel media, mobile is clearly the most pervasive as can serve as a connective tool to all the other facets of a marketing program or campaign. Consequently be prepared to measure impact of mobile communicated programs on sales, customer count, transaction size, category penetration and other traditional metrics. Without eventually correlating the impact of mobile programs with the metrics share holders and senior management value, even successful mobile programs can go unappreciated.
  • Finally, I think it wise to use mobile engagement as a means to better understand your shopper base. With each mobile engagement, be positioned to use the results of the engagement as a means to segment your shoppers. Knowing which shoppers and shopper profiles display a high propensity to engage via mobile is extremely valuable information as plans are made for future mobile outreach.

* From Panel Discussion at the Association for Coupon Professionals Conference, April 16, 2015 in San Antonio, TX

Price Chopper Launches New Coupon/Loyalty Program …from Loyalty360.org

Price Chopper Launches New Coupon/Loyalty Program

By: Jim Tierney, Loyalty360

BACK TO RESULTS

Price Chopper’s new coupon/loyalty program launched as a result of matching customer expectations, according to Glen Bradley, Vice President Marketing Analytics, Price Chopper Supermarkets.The chain operates 135 stores in New York, Massachusetts, Vermont, Connecticut, Pennsylvania, and New Hampshire and is fueled by an extended family of more than 22,000 teammates who collectively own more than 47% of the company’s privately held stock, making it one of the nation’s largest privately held corporations that is predominantly employee-owned.

Customer engagement and brand loyalty are two guiding lights at Price Chopper.Bradley said Price Chopper launched its original AdvantEdge E-coupon program to meet the needs of its customers “who are always looking for new ways to save money on groceries.  Google Zavers, who had provided back end support for our e-coupon program notified us in mid-2014 that they would be exiting the business. We took this opportunity to redesign our program with our new partner, Inmar, so that we can provide a new and improved program with enhanced features for our customers.”Bradley explained that the AdvantEdge e-coupon program allows customers to load digital coupons to their AdvantEdge loyalty cards and redeem coupons without the hassle of handling paper.

Previously, shoppers could only digitally load up to 99 coupons on their AdvantEdge card at a time, but the new program through Inmar allows more.  Customers now have access to over 150 digital coupons and can also use the Price Chopper website to search for products and will see corresponding offers for favorite products.“We have an extensive list of coupons on both national brand and our own Price Chopper brand products available in an easy-to-use interface on both PriceChopper.com and our Price Chopper Apps for iPhone and Android,” Bradley said. “We will be adding new features soon- things that were not possible with our previous technology partner.

Price Chopper plans to rename its 135 stores Market 32.“The AdvantEdge e-coupon program fits perfectly into our branding initiative as we seek to provide exceptional value to our customers through technology and service,” Bradley said.

Source: Price Chopper Launches New Coupon/Loyalty Program | Loyalty360.org

 

It is the retailer who will bring relevance and content to these new digital coupon programs.  Without their offers, in-store support and integration with other marketing and merchandising programs, digital coupons will remain a very small portion of the overall number of coupons redeemed in the marketplace.  Congrats to Price Chopper, (Market32) for taking the bull by the horns!  

Mark Heckman

So Many Retailers, So Little Time……

 

Like many of you, I have become a very accomplished “speed deleter” of un-targeted and irrelevant retailer email.  I believe my record is a hundred and seven deleted emails in twenty-five seconds.  Too lazy to actually unsubscribe to the author of the email, I rationalize staying connected by believing that they may actually send me something of value someday.  I wait.

En mass “email speed deletion” may be this consumer’s way of cutting a an email marketer off in mid sentence, but with more merchants doing un-targeted email blasts, the lower the open rates will become for everyone. While email has become a preferred alternative of more expensive direct mail, its efficiency is waning as more join the fray.

Alternatives are emerging.  Blogger-fed websites and the more established coupon distribution sites are beginning to build a following with shoppers who seek deals and content as they plan their next shopping trip.  These sites have a distinct advantage over the email distribution method.  First and foremost the shopper is motivated to come to the site, looking for deals.  The more relevant the offers and the retailer’s are to the shopper, the better the traffic and the results will be for that site.

All You, Retail-Me-Not and Savings.com are three such sites that are gaining traction by creating enough content from enough retailers to make the visit to the site worthwhile for the shopper.

They are on the right track.  

However, they still suffer from being disconnected from the total shopping experience.  Many of these sites have mere passive relationships with the retailer content they post on the site.  While coupon codes, shopping lists and circular content are available, a shopper cannot fully engage with each retailer by checking on their point totals for continuity programs, or drill down into their loyalty clubs and personal preferences.  For that content, the shopper must go back to the retailer’s own site in turn making the shopper’s life more complicated, not less.

One answer appears to lie in the creation of comprehensive central content aggregation site, one in which the list of participating retailers satisfy key requisites for shopper-centric loyalty.  I see them as follows:

1. Content: The retailers must understand the enhanced reach they will receive by “actively” posting both targeted and mass content on an additional central shopper/loyalty site for shoppers and use the site as a means to allow full integration into points, personal profiles, and past performance. While they maintain their own sites, this new central site provides the shopper a new, additional option for engaging the retailer.

2.  Community: This central site must represent the major players in each of the Shopping Communities built, meaning one or more major supermarket, mass retailer, chain drug, sporting goods, home improvement, electronic superstore, and an array of smaller complimenting loyalty retailers.  Consumer Research tell us that Shoppers wildly support the concept of a single site with overwhelming numbers of intended engagement if such thing every existed.

3.  Consistency:  This central site must strive to grow its community of retailers in both number and volume of content, by promoting a dialogue with its shoppers and retailers, meeting their evolving needs. Shoppers and the components of loyalty are extremely dynamic and if retailers are going to actively participate, they must see the platform as one of consistent growth and progressive thinking.

4. Centricity:  Big retailers will not engage any new commonly-shared platform with other retailers unless the central site and its engagement platform embrace the importance of maintaining the retailer’s control of their brand equities and their shopper database.  Both are table stakes for participation. Attempting to lure big retailers to the site without recognizing their requirements and strategies, will not succeed, no matter how loud the clambering from the shopper.

Final Thoughts on the Subject

Creating a comprehensive, central shopping/loyalty site will not happen without investment in both systems and strategy.  Actively sharing content from multiple retailers ultimately means a Single Shopper ID for each shopper that links to shopper back to each of the retailers on the site.  “Innovators” are in the marketplace and focused on just this concept.  Like many “Big Ideas”, a comprehensive central shopping/loyalty site is much easier to image than to execute, but if memory serves me correctly, I believe that’s what some said about scanning UPC Codes back in the seventies!!

 

mh

 

 

 

 

 

 

Building Loyalty at Kroger …with Digital Overlays

I love the “digital overlay” concept.  It makes so much sense to me to drive digital coupon adaption by linking these new savings options with more traditional promotions.  It is not a surprise to me that Kroger is leading the way, employing brands and promotions with these digital overlays.  Details below;

“ConAgra has also effectively employed programs with digital overlays. For example, a January 2013 meal-solutions program sent an email blast to Kroger’s loyalty card shoppers with load-to-card coupons and incorporated a customized landing page at ReadySetEat.com. “Growing business with Kroger’s loyal shoppers is our priority too,” says Yurovski. “The programs that focus on loyal Kroger shoppers and our brand shoppers return higher ROI than those that target the competition’s [shoppers].”In each of these efforts, Kroger relied on its email database from global market research firm dunnhumby the retailer owns half of dunnhumby USA to identify and reward Kroger’s most loyal shoppers. The company’s ongoing partnership with Kroger has long set the industry standard for effective targeted marketing. “Over the past few years, dunnhumby has raised the bar with increased emphasis on post-program analysis, including following the shopper’s purchase behavior beyond a single mailer and introducing targeted digital communications,” says Catapult’s Cross.”

via Retail Intimacy, Part 3: Building Loyalty at Kroger | Path to Purchase Institute, the leaders in shopper marketing.

Making Digital Coupons “Less Invisible”

Updated 10-13-13

We live and shop in an age where apps and websites are designed to improve the way we shop, including reducing the use of paper circulars and coupons we use to save money.  To that end, I am amazed as to how many new smartphone apps are now available, most designed to deliver many of the same tangible benefits of the past, but now in a more flexible and consumable fashion.   But despite the obvious advantages of both cost efficiency (of eliminating paper) and consumer ergonomics (of not having to clip and carry coupons), the adaption rate of digital coupons, while increasing each day, still represents less than 3% of all coupons redeemed.   

Further, adaption rates of shopping apps are also growing, but look around the store the next time you shop for groceries and count the number of shoppers using their phones to either shop or pay.  You may grow old trying to find one.  So if “digital” is so wonderful, so flexible, so efficient, why do we not see more digital use?

In my mind, one of the key deterrents of digital coupon adaption lies in one of its inherent advantages.  It’s INVISIBLE!   Yes, without the muss and fuss of clipping coupons, load-to-account, digital offers are “clipped” electronically, placing them in the shopper’s account, requiring the shopper only to identify themselves at the store through a card or account number and purchase the said item related to the offer.  Pretty simple.  But brands are still balking at the efficacy of digital coupons, all the while taking advantage of the targeting flexibility and perhaps more importantly, the ability of “capping” the markdown expense by simply “deactivating” the offer once a threshold of coupons have been either redeemed or “digitally clipped”.  The fact of the matter is that brands very much like the “advertising equity” that paper coupons and  paper circular placements provide, elements that digital coupons do not typically offer.

No one should criticize the brands their right to cap their exposure vis-a-vis digital coupons, at least until more data is available that yields the response history needed for reasonable comfort in letting the digital coupon run until a pre-determined expiration date is reached.  But ultimately it will be important to eliminate these caps in favor of a prescribed expiration date, if digital coupons are to reach critical mass.

Accordingly, what we have today are digital offers that “float”  invisibly and out of the stream of consciousness of the consumer, coupled with the possibility that the deal could “vaporize” at any moment, at the discretion of the brand making the offer.

So it would seem to me that if we could retain all the benefits of “invisibility”, but yet provide more tangible reminders and evidence of digital offers, we just might see the engagement rates of digital offers increase significantly.

PublixDigitalEnter the retailer.  While the fate of digital coupons is widely thought to be in the hands of the brands that create the vast majority of the offers, it is the retailer who can provide the single most salutary support mechanism, namely in-store offer recognition.  This “recognition” may manifest in various forms.  It could be an app that senses where you are in the store, or a targeted SMS text message, a printed shopping list loaded at the retailers website or at an in-store kiosk, or a number of other new “at the shelf” message venues.  But more often than not, this recognition will be a good ol’ sign.  That’s right, a shelf sign (or tag) that is sufficiently intrusive to break out of the clutter of  thousands of messages thrown at the shopper each time they venture in a retail store.

Realizing that targeted offers cannot be signed with item and price as they are often directed to subset of shoppers, support signage can come in the form of general information about the ability to receive offers by signing up for the program.  However,  it is important that a digital specific price and item program anchor the digital program.  This can be accomplished by the retailer offering  and showcasing each week an array of digital deals that either are stand alone offers and even more effective, bolster existing traditional offers as a “digital bonus”.  Other more overt options for digital offers are waiting to be created.

Like all things retail, digital coupons must compete with the many other cost containment programs the retailer offers.  If digital content remains largely invisible and “behind the scenes”, the odds are that the program will never reach a significant amount of shoppers.   In obscurity, digital content will never be in position to truly change the retailer’s connection to the shopper, a connection that the shopper is looking for, and will find at a competing retailer if necessary.

 

 

 

 

Amazon Fresh…Changing the Rules of Engagement

MorningNewsBeat.

A news article posted by MorningNewsBeat speaks to RetailNetGroup’s recent analysis of the experiment in on-line grocery shopping that is Amazon Fresh.  I am always interested in those who are convinced that to-your-door groceries is coming into its own.  While Ahold’s Peapod, Fresh Express, MyWebGrocer, and others have carved out a sustainable yet small niche in the grocery industry, Amazon may just be the one to kick start the offering on its journey to a more pervasive service.

Unlike those other services, Amazon is seemingly prepared to expand this service without any sustainable profit in sight.  They likely mean it when they say Amazon Fresh is a strategic initiative, not a profitable tactical one.  Without the burdens of financial contribution, coupled with Amazon’s mastery of logistics, Amazon Fresh could conceivably be the service that finally breaks through to critical mass.mobile-shopping

If that is true, Walmart, and all leading traditional supermarkets will need to pick up the pace on refining and expanding the services.  It could also mean that delivery fees are lower, order size minimums are waived, and it certainly could mean that home delivery and in-store pick up will never pay out using traditional metrics and full allocated costs.  Amazon Fresh may dictate that all players in this space see it as strategic as Amazon purports.

Departments and offerings within the mix of the traditional supermarket that do not profitably stand on their on is not a new phenomena.  Just add on-line grocery shopping to the list and understand the indirect benefits of incremental shoppers and transaction size growth that these services can foster.  With Amazon moving in, and Walmart not about to be left out of the mix coupled with more time starved, tecno-savvy consumers, the stars are aligning for grocery e-commerce.  Let the games begin.

 

The Death of Big Paper…or Not?

Safeway’s CEO, Steve Burd touted just last week that their new and expanded CRM program “Just for U” is now reaching  55% of Safeway’s shopper base and doing extremely well.  So well, he claims that perhaps, just perhaps by the end of this year, Safeway could actually stop printing a weekly circular and rely solely on the reach of “Just for U” to communicate its marketing programs and offers.  It begs the question, “Are finally starting to see the “end days” of Big Paper”?

Weekly CircularsI refer to the weekly circular and the FSI as “Big Paper”  due to the fact paper and printing comprised almost half of my entire annual advertising budget as a retail marketing and advertising VP.  Image the savings or better yet, the re-purposing of these resources if we could eliminate the weekly circular?   But I’ve heard all of this before.  In fact pundits and prognosticators have long predicted the demise of the dreaded, inefficient weekly circular ad.

So what’s different this time.  True, Safeway and their key competitor, Kroger seem to be on track to transition much of their promotional marketing content away from mass and to targeted, digital media.  That’s significant and new.  What is not new is that the rest of the playing field is either invested in EDLP programs, without access to a customer database, or is just too small to command the necessary brand content away from their the broad reach of their mass programs to the much smaller reach of their fledgling digital properties.   In addition, Valassis and News America are in no hurry to stop their FSI presses.  FSI’s are proverbial cash cows and they will not go down without a fight.

Then there is the issue of targeting.  Aside from the costs savings of communicating digital versus paper, the most compelling reason to go digital is the ability to fluidly target and vary both content and pricing all the way down to the individual shopper.  But to be able to effectively accomplish targeting, retailers need to address some very formidable obstacles which include;

1.  Flexible targeting & modeling software capable of  working fluidly across retail channels and customer touch points to include, email, social, POS, SMS, and proprietary Applications.

2.  Intellectual property to effectively build targeting strategies that almost necessarily will involve CPG brands and their strategies.

3.  A huge offer bank of content as best of class targeting infers that not everyone will see all the offers, just those relevant to them.

4. Highly active and updated email, SMS, and Social Media customer lists.

5.  Connectivity between the targeted, digital communications and in-store messaging and signage.  The majority of purchase decisions are still made in-store and close to the shelf and brands still covet the brand equity afforded them by traditional paper media. Digital needs this support to be truly effective.

Kroger and Safeway proudly tout they have accomplished much of the aforementioned list. For them, the death of Big Paper may be on the horizon.  For many other retailers, much work is left to do before the Rain Forests are saved and the printing presses grind to a final stop.

 

Is Your Digital Strategy “Active” or “Passive”?

All the hype, pomp and circumstance aside, digital marketing is mere blip on the radar screen for most retailers…especially those in the grocery channel.  I say this with all due respect to grocery retailers as I understand their need to hitch their wagons to those media and programs that represent critical mass.  Accordingly, digital engagement in the grocery channel, defined as communicating digital content and offers,  is far from grabbing the headlines away from traditional venues and promotions.

My assessment of as to why digital programs still live in the periphery of the retailer marketing options centers around whether digital programs are passively or actively promoted.  Pour another cup of coffee and let me explain.

Passive digital programs are those that are launched relatively quietly, typically exclusively on digital touch points.  For example, in the case of a grocery retailer offering load to card or load to account digital coupons, there is often little or no mention of these programs in the mass media such as weekly circular television, radio, or even direct mail.  Further and even stronger evidence of the passivity of promoting digital content, there is rarely any mention or reinforcement of the program in-store.  Please don’t bother asking a cashier or associate about the program in-store, you will only get a blank look and a shoulder shrug.

Another key component of a passive approach to digital is content itself.  Retailers who expect hundreds of meaningful, widely WinnDixe1purchased brands to drive the content bank of these digital programs, often find that unless the shopper is in the market for an obscure meat seasoning, or a new herbal toothpaste, the digital offers available have little relevance to their shopper’s needs. But yet retailers who take a passive approach launch programs with these offers and then wonder why engagement is so disappointing.

Here’s the first take-away for retailers.  Digital is not going away.  Shoppers want it.  Shoppers are hooked on the concept and other channels of trade and on-line retailers are setting the early shopper expectations in both content and technology. As Winn-Dixie aptly “tags” their new digital program, “The Future of Savings is Here”.  They have it right.

The second important point for retailers is that passively engaging digital and waiting for the content to arrive, is depriving them of a golden opportunity to become a committed leader and thus gain share of wallet from their current shoppers and actually be in position to lure shoppers from their competitors. But this can happen only if the retailer takes an “active” approach to digital.

Here are a few recommendations I offer to become an active retail digital marketer.

1.  Shout about the program in-store. Point of sale signage, bag stuffers should tell the story.  Associates should be aware of the program and endorse it at every opportunity.

2.  Drive the digital content with retailer-sourced offers.  Make the commitment to have some of your “skin in the game”.  Measure results and then “invite” your brand partners to contribute based upon your early positive results.

3.  Tie digital into the mainstream of your marketing program.  If you offer paper coupons in your circular or paper direct mail, convert them to load to card or account.  Also, think about layering digital bonus savings on front page items, end cap features, perhaps have a “Store Managers Digital Offer of the Week”.  Get inventive.

4.  Measure the results and use the resulting customer data to become iteratively smarter about which offers and content drive the best results among your shoppers.

5.  Don’t forget to include store brand offers.  Nothing will get your brand partners interested in participating faster than if they see their share of category sales diminishing due to the impact of your store brand digital offers and campaigns.

Active digital engagement is an opportunity to lead, differentiate and embrace the future.  Staying passive will keep you comfortably operating in the past or at least until you fade from the scene.  It’s your choice.

 

 

 

 

 

 

 

Brand-Retailer Relationships: “Partnering” or “Biting the Hand that Funds You”

When the Food Marketing Institute met this year for its annual warm-weather retreat, aka, The FMI Midwinter cooperationsConference,  one of the topics that is being touted was “partnering”, specifically between the Food Marketing Institute and the Grocery Manufacturers Association, (GMA). A perfect partnership opportunity for the two major food industry organizations to combine forces, share expenses and develop notable synergies.  Stay tuned, but I see no reason that this new marriage should be a long a prosperous one.

But as for the members of these two fine organizations, the individual brands and retailers, “partnering” has produced mixed results.  Over the last twenty years several industry movements have served as catalysts for partnering.  Category Management (CM), Efficient Consumer Response (ECR), and more recently Shopper Marketing-Path to Purchase (PTP) have led to co-authored and co-funded studies that lead to books and presentations.   But lasting partnerships among brands and retailers, not so much.

Reasons for less than optimal results abound. The truth is that on key cultural and process issues, brands and retailers are wired very differently. Retailers live in the moment.  Brands often live in the future.  Retailers adjust the components of their business hourly, while brands deliberate and strategize over months and years.  Brands move managers and executives relatively quickly through their organization, while retailers tend to keep their team members in positions longer.  Both feel they “own” the customer and are keenly anxious to extend that advantage.  For these reasons and others, many retailers continue to “bite the hand” that funds them.  In turn, brands continue to believe they represent a significant portion of the retailer’s life to form a direct to shopper relationship.  Both practices are unwise and bode poorly for the future.

Technology and a sagging economy have nurtured a new variable, namely an empowered shopper.  This shopper has ceased control of the conversation and is quickly demanding better information, more relevant deals, and more efficient shopping alternatives that only the brand and the retailer together, can deliver.

Loosely translated, retailers with data and new shopper touch points need shopper insights and content from brand to attempt to satisfy the insatiable appetite of the new empowered shopper.  Sure, brands and retailers can try to go it alone, but given the short window of opportunity, new competitors pouring through that window each day, and the impatience of the shopper, it is hard for me to image anything but the power of a well formed partnership providing the best solutions for the new millennium.

As with all things that yield positive and timely results, there are requisites for success.  Here are some.

  1. Lasting partnerships are formed typically at the top of each organization.  The commitment must be clear and consistent.
  2. A good partnership has an accountable contact person on each side of the relationship, who must answer the bell when things get bogged down or do not flow as expected.
  3. Outcomes must be clearly communicated with success metrics known to all.
  4. There must be equal or near-equal benefit from the relationship.
  5. The partnership must grow and evolve, rather than stagnate and become mundane.

Perhaps the conversations at FMI Mid-Winter will serve as a harbinger for further brand-retailer alliances.  The shopper is waiting….waiting…waiting…

 

mh

 

 

 

 

 

 

The Great Digital Disconnect

Like many things that come along in the world of retailing, digital content and especially digital coupons have been a disappointment to many with regards to their immediate impact to the business.  While shoppers are increasingly pre-shopping on-line, loading coupons and building shopping lists prior to their journey into the world of bricks and mortar, their activities still remain on the peripheral of most retailers mainstream focus.  This is particularly true in the grocery channel, where I have spent the majority of my career.

There are number of theories about why digital content has not become a more significant element of shopping.  Some of the barriers that are evident to me are;

  • Lack of Technology Integration In-store:  That translates to the inability for most retailers to allow the shopper to actually use their mobile device in-store to aid in the shopping experience.  Mobile payment capabilities, while catching on, is still not ubiquitous to the point of becoming mainstream for the shopper or the retailer.
  • Competing Value Propositions: Brand money and retailer focus always migrates to those elements that move cases, drive sales and can be measured.  While digital content is considered slick and most retailers believe it is the communication media of the future, paper coupons, weekly circulars, and other traditional promotions still bring drive the vast majority of sales and the quick return on investment that brands and retailers must have to run their business.
  • Dearth of Digital Content:  This is the biggest void.  Clearly many retailers and manufacturers are dipping the toes in the water, but digital offers and information continue to be an under-nourished entity, which is especially damning if the brand and retailer want to target this content so that it is meaningful to the shopper.  Hundreds of digital offers, covering some of the highest household penetration categories need to populate the offer bank, not a just few dozen, that mostly contain high margin, low penetration categories, that is the norm today.

Digital content has been wrongly positioned (in my humble opinion) as a series of stand alone events and content that often have no connection to the mainstream value proposition of the retailer.  To that point, there is an opportunity to gain acceptance and reach a degree of critical mass with digital content, if two things happen.

  1. The digital content is directly linked or layered to existing value elements of the retailer.  This means digital deals that are positioned as bonus savings on end cap items in the store, front page items in the circular, or even targeted offers that are in direct mail or email communications.
  2. There must be evidence of these digital offerings in-store.  Signs with QR codes to connect with content, references to how to load digital content to the shopper’s account while the shop in the store is rare.

When these conditions are met, shoppers will embrace the offers, engage with digital content programs at a much higher level.  Consequently, brands will be more likely to spend their trade or shopper marketing dollars with the retailer who can deliver a more holistic digital approach.  Then the fun begins.

 

mh