Proof
Points
Latest October retail sales data from the U.S. Department of Commerce, Census Bureau, indicated that some key retails areas experienced a decline while online retail rose slightly from the prior month. While two large pharmaceutical companies have just announced promising COVID-19 vaccines, consumers are still bracing for a virus surge for the holiday season which means greater online sales and less foot traffic to brick-and-mortar outlets.
The latest November retail sales data from the U.S. Department of Commerce, Census Bureau, indicated that some key retails areas are experiencing a decline despite holiday spending. Consumers are largely staying home amid a virus surge this holiday season, which translates to greater online sales and less foot traffic to brick-and-mortar outlets.
Latest October retail sales data from the U.S. Department of Commerce, Census Bureau, indicated that some key retails areas experienced a decline while online retail rose slightly from the prior month. While two large pharmaceutical companies have just announced promising COVID-19 vaccines, consumers are still bracing for a virus surge for the holiday season which means greater online sales and less foot traffic to brick-and-mortar outlets.
Whether you’re a brand manager, a marketing director, or a retail business owner, one of your challenges is probably growing sales, especially today. The good news is that we can see from the latest Advanced Monthly Retail Sales Report (see recap below) that sales are starting to rebound. However, depending on your unique situation, your sales might not be rebounding as quickly as you would like. To turbo-charge growth at scale, the following provides a roadmap including tactics you can employ to improve your retail sales while also strengthening your brand’s experience and exceeding your customer’s expectations.
The key to driving retail sales is to ensure that you are effectively engaging with your customers throughout their journey. Below is a three-step roadmap with key tactics to employ for connecting with your customers at various points during the journey.
Remember that in today’s environment, your customers are expecting your brand experience to match, whether online or offline.
According to a Harvard Business Review paper, creating a personalized experience for the consumer can increase sales 5 to 15%.
However, in order to enjoy this type of jump, you will need to define, align, and measure your customer’s experience along each touchpoint in their purchasing journey. Let’s take a look at the three-step roadmap which shows this in action:
To build awareness online, you can use display and video targeted at a broad audience. For offline brand awareness, you can use media placements in print, out-of-home, radio, and TV. At the start of the journey, personalization is minimal. This allows to you to reach as many potential customers as possible, while still having some flexibility on your target audience, e.g. out-of-home placed in specified geographical locations and digital characteristics like age, gender, location, and affinity.
Checklist:
Be sure to have a website that is eCommerce-enabled. This includes a mobile app, if applicable
Create a content strategy for social media and as well for your blog. Your blog will help deliver potential customers to you organically from search engines
Lay the groundwork for a Customer Data Platform (CDP) that will help organize your customer data from emails, social media, your website and your CRM. A properly executed CDP can increase sales by 15 to 20%
Choose an email marketing automation system to help send your brand message to potential customers
To help your customer, you need to give them the right information at the right time. Specifically, this means having content that informs your customer in the format that they like. Create content that resonates, such as in-store video displays that demonstrate the versatility of your product or how to use it. Or on your website, you could have illustrations for how to use your product, instilling confidence in your customer that they are making the right purchase.
When the customer is at your store or website, make it easy for them to comparison shop, with your comparable products as well as your competition. Rest assured, your potential customer is already aware of what the alternatives are to your product. With that in mind, you have an opportunity to draw direct comparisons on your website of the benefits of your product compared to your competitors.
Checklist:
In-store, have digital displays that can help educate your customers. Likewise, feature similar video content on your website
Allow potential customers to join your email list to receive the latest updates
Monitor popular content on your website and promote it
Develop a personalized customer experience using data from your CDP to send the right messages to your potential customers, e.g. personalized emails and ads based on their engagement with your brand
A customer data platform (CDP) is an application that unites your customer data interactions into customer profiles for a holistic view of your customer and your brand’s interaction with them.
Once the customer has reached the point of purchase, you need to make the process as seamless as possible. Additionally, this is an opportunity to deepen the relationship with the customer. Apart from your in-store POS being up-to-date and able to accept any type of payment that your customer wants to make, you should allow your customer to further engage with you. For example, allow the customer to be able to have their receipt emailed to them along with other engagement activities, e.g. initiate a return, receive customer service and locate the closest store. For online customers, give them an opportunity to create a profile where their payment information can be stored safely and used again on the next purchase.
Checklist:
Provide order online and curb-side pick-up
Use omni-channel campaigns to engage one-on-one with your customers
Give your associates tablets that allow them to assist the customer without having to return to a traditional POS register
As noted earlier, disruption has caused some retailers to rethink and quickly retool their strategy. The latest data from the Census Bureau’s Advanced Monthly Retail Sales in July gives some insight into how different retailers are performing and gives you the opportunity to compare yourself against your peers. Read on for our retail sales insights for key categories.
Nonstore Retailers
Nonstore retailer sales in July continued to slow down from the April spike. The latest McKinsey survey now shows the approximately 15-45% growth in online shopping across multiple retail categories should continue beyond the crisis.
General Merchandise Stores
Positive growth for this retail sector has stopped monetarily when compared to the previous month, with a -0.2% change in July
While consumers still appear to be cautious on non-essential purchases, the most recent survey data shows this is starting to improve.
Retail Trade
Overall consumer retail spending slowed its growth in July to a 0.8% increase compared to the prior month, and far from its 16.8% record increase in May.
While consumers are still using curb-side pick-up, the McKinsey survey showed that customers who shop in-store are now showing a preference for self-checkout.
Department Stores
As the summer comes to end, department stores and malls are seeing sales that remain flat. Compared to June, department store sales were relatively unchanged at 0.1% growth.
However, according to the McKinsey survey, consumers showed a strong preference for department stores and retail stores who offer the ability the purchase online and pick-up at the store. 65% of consumers who used this option said they intend to continue using it.
Grocery Stores
After the initial spike in March, grocery stores are still benefiting from consumer demand. The latest sales numbers for July, although slowing, showed another positive increase at 0.4%.
According to the McKinsey survey, 53% of consumers who are using grocery delivery services plan to continue after the pandemic has passed.
Food Services and Drinking Places
Though not as strong as May and June, restaurants and bars experienced another increase at 5% for July.
Google Trends data still shows that there is demand for dining in a restaurant. In the past 90 days, the data shows that the search phrase “restaurants open for dine in” experienced a 650% increase.
The Stratistry team loves nothing more than digging deep into available data and research to derive actionable insights that can help lead your brand to achieve better business results. Contact us to find out how we can combine the art and science of marketing for your brand.
Sources:
U.S. Department of Commerce, Census Bureau Advanced Monthly Retail Trade Report 8/14/2020
Matt Ariker, Jason Heller, Alejandro Diaz, and Jesko Perrey, “How marketers can personalize at scale,” Harvard Business Review, November 23, 2015
Julien Boudet, Brian Gregg, Jason Heller, and Caroline Tufft, “The heartbeat of modern marketing: Data activation and personalization”, McKinsey & Company, March 22, 2017
Tamara Charm, Shruti Bhargava, Resil Das, Anne Grimmelt, Eunice Kim, Kelsey Robinson, Salvador Tormo, “US consumer sentiment during the coronavirus crisis”, McKinsey & Company, survey 8/7/2020
Consumer spending is still strong in June with yo-yoing expected in the coming months due to more anticipated coronavirus lockdowns.
Digital and omnichannel shopping are here to stay.
Consumers are seeking inspiration online for where to shop.
Walmart is the clear leader in grocery as they have embraced the digital transformation and reaped the reward from their effective curbside service.
Consumers are still craving in-person experiences at restaurants.
The latest June retail sales numbers from the U.S. Department of Commerce, Census Bureau, continues the positive trend started in May, but should be considered in the light of spiking COVID-19 cases in many states across the U.S. The Advanced Monthly Retail Trade Report includes their first calculations of June’s retail sales.
It seems that our recovery may be stalled by this latest surge in the pandemic. Analysts say that fear caused by the virus caused consumers to pull back their spending at the end of June. However, their prior spending in June led to an increase of 7.5% in total U.S. retail and food services sales over May.
As the folks at Russell Research noted, we took “one step forward, two steps back.” At the beginning of June, their COVID-19 Monitor showed that over 1/2 of Americans thought the trajectory of the pandemic was positive. Just a few weeks later near the end of June, it had shifted to only 38% of Americans believing that the pandemic is getting better. Furthermore, nearly half of Americans who live in the South and West regions of the country, where cases are really surging, now say the pandemic is actually getting worse.
A McKinsey & Company survey in late June took it a step further and found that more than 50% of Americans believe it will take longer than 6+ months for the economy to recover and that the crisis will continue to impact them for another 4+ months. As such, the homebody economy continues with consumers adapting with new habits that are likely here to stay. In fact, 73% of consumers are still not comfortable returning to their regular out-of-home activities. They are waiting for milestones beyond simply lifting restrictions, such as approval from medical authorities, further safety measures to be put in place by retailers, and the development of a vaccine or better treatments. Read on for our retail sales insights for key categories.
Despite a slight dip in total nonstore retailer sales in June, it is clear that the flight to digital is here to stay. In fact, the McKinsey survey actually showed a 15-30% growth in reported online shopping that consumers say will continue after the crisis.
As explained by Steve Dennis, a senior retail contributor to Forbes, the disruptive impact of digital technology has been significantly fueling an epic revolution in the retail industry for the past two decades. Customer journeys are now officially digitally-enabled.
Positive consumer sales growth continued in this sector with a 2.7% increase in spending.
Sales in this sector may reflect the fact that consumers have shifted some of their discretionary spending from experiences like concerts and summer camp to more tangible items in this category, like TVs and gym equipment.
Consumer spending was still strong with a 6.4% increase, after the 16.8% record increase in May.
The McKinsey survey found that consumer intent to purchase is shifting toward value and essentials. In fact, spending on essentials was the only category that reflected a positive intent. Consumers are simply being more careful overall as they evaluate what and where they are spending. Forty percent report being more mindful of where they spend, while 38% are actively looking for ways to save money when shopping.
Another insight from the McKinsey survey is that cleaning and the use of masks and physical barriers are top priorities for consumers in deciding where to shop in-store.
Malls and department stores have benefited from the lifting of lockdown restrictions with a sales increase of 19.8% in June for this category on top of the record 36.9% increase in sales we saw in May.
Yet, digital continues to greatly impact this category. Not only is contactless shopping and BOPIS (buy online pick-up in store) here to stay, but the McKinsey survey found that 60% of consumers used inspiration from digital channels, such as social media and online ads, to decide where to do their shopping.
Consumers who have shifted their grocery shopping online amid concerns regarding their safety are likely to stay that way. Per the McKinsey survey, one participant reported that a local grocery store “doesn’t do drive up or delivery, so we can no longer go there. We now exclusively use curbside grocery pickup and will continue to do so going forward.”
Google Trends data reflects the leadership of Walmart in this area with searches for grocery.walmart.com increasing 1,950% in the last 90 days.
Consumers have also been hit with limited access to some of their favorite brands during the pandemic causing them to try different brands. Now 70% report that they expect to integrate these new brands into their post-COVID-19 life, according to McKinsey.
Sales in this category continued their positive trajectory in June as receipts at bars and restaurants jumped 20% from May to June.
Google Trends data also reflected this pent up demand for dining in at a restaurant. The top five queries were significant at over a 5,000% increase in the last 90 days. These trending queries were all variations of “restaurants open for dine in.”
According to the McKinsey survey, 72% of Americans were at least somewhat concerned about the dangers of dining in at a restaurant or bar in June, which was an increase of 15% over the prior month.
Recent consumer research from Datassential found that 63% of consumers will feel most safe going to a restaurant with outdoor seating after shelter restrictions are lifted.
Yet, cleanliness is of paramount importance. Whether a restaurant was perceived to be clean and sanitary was reported to Datassential as the top consideration for selecting a restaurant to visit after the coronavirus crisis. 76% said that a restaurant’s cleanliness and food safety procedures “will always matter more to me now than it did before.”
Datassential reported that 29% of people plan to eat inside a restaurant less, even after restrictions are lifted. The McKinsey survey also found that 18% of Americans have enjoyed restaurant delivery so much during the pandemic that they intend to use it even more moving forward.
However, the positive growth experienced in May and June has recently stalled, according to OpenTable, the restaurant reservation website which tracks the number of seated diners.
The Stratistry team loves nothing more than digging deep into available data and research to derive actionable insights that can help lead your brand to achieve better business results. Contact us to find out how we can combine the art and science of marketing for your brand.
Sources:
U.S. Department of Commerce, Census Bureau Advanced Monthly Retail Trade Report 7/16/2020; McKinsey & Company Covid-19 US Consumer Pulse Survey 6/26/2020; Russell Research Covid-19 Monitor 6/19-6/22/2020; Datassential.com/coronavirus; Google Trends
If you have a successful business today, you know that having a meaningful and differentiating online presence is table stakes. Once you’ve established that solid online presence, you also have to effectively market it in order to fill your pipeline. As businesses grow, they have to decide what the tipping point should be for hiring an outside digital marketing agency. Frankly, there are many tipping points that will cause a business to hire a digital marketing agency. It could be that the business' current digital marketing strategy is leading to declining growth with the right prescriptive action unclear. Or the business may have outgrown its own capacity or desire to manage the digital marketing strategy and execution in-house. But whatever brings you to the tipping point, I believe the following are the three top reasons you should consider hiring a digital marketing agency.
Assuming that you pick the right agency, you’ll gain access to a team of experienced and qualified experts. Not only will they be current on the latest relevant trends in the ever-changing world of online marketing, but they also have likely worked on projects similar to yours in the past. They’ll bring fresh thinking to your challenges and the ability to help you stand out against the competition. Ultimately, they’ll help you build the right online marketing strategy based on a host of factors including your target audience, your industry, the competition and what makes your brand compelling.
A good digital marketing agency helps you test, learn and refine your marketing plan based on the results it garners. First, your strategy should be firmly rooted in the Key Performance Indicators (KPIs) you are hoping to measure. Then, that strategy should be continually put to the test and evaluated on a monthly basis. A monthly review of those KPIs should be provided through the tracking and reporting of the right metrics and data. The best agencies will partner with their clients to build strategies that are both measurable and allow for this continued refinement and collaboration.
Many businesses try to handle their marketing efforts internally, fearful of the cost to hire an outside agency. However, the cost to hire an in-house marketing professional can be even more substantial. They have to be able to research, develop, write, monitor and even analyze your marketing plan. An outside agency should be able to provide all of these services for a fraction of the cost you would pay for a qualified candidate. In addition to that, hiring an outside agency should also free up the time and attention you’ve likely been spending toward building and cultivating that ongoing marketing presence. After all, you have plenty of other priorities upon which to direct your attention. This will free you up to do what you do best–running your business.
A perfect illustration of these three reasons can be found in the form of our very first Stratistry client. As the CEO of a mid-sized engineering firm, he had been running his own Google Ads campaigns, spending a substantial amount of money every month. However, he wasn’t sure how to track the effectiveness of the ads, and hadn’t had the time to update his company website in more than 5 years. He hired us to help refine his brand positioning, update his website, implement tracking for his Google Ads campaigns and improve his marketing ROI. At the end of the day, I believe that’s the ultimate benefit of hiring a digital marketing firm–they have the expertise and ability to drive measurable and profitable results.
The Stratistry team loves nothing more than helping a new client better manage and execute their digital marketing strategy. In fact, one of the first projects we often undertake for a new client is building or updating their website. Visit this article from DesignRush for more on how to choose a web design agency. We’re actually proud to to be recognized as one of DesignRush’s top web design agencies. Contact us to find out how we can combine the art and science of marketing for your brand.
