For non-food retailers, the corona pandemic is increasingly turning into a disaster. Not only do retailers struggle with the economic losses caused by the lockdowns, which have not been compensated for by the shop counter’s digital extension, the current re-opening of their shops is now being threatened by the next disillusionment: Homo Corona Digitalis.
Much as we wish our lives to finally return to “normal” – the past year has brought with it enormous changes. No matter where we look, it is becoming apparent that we probably won’t return to a “before corona” period. Retail is no exception. Here, the great risk for brick and mortar business can be found especially in customers’ digital conditioning during the pandemic period. It would seem that digital shopping has become the “new normal”. Even the very last online-averse shopper has now figured out how to cover their needs online; even the last few grandparents now look for and find gifts for their grandchildren online more often than downtown.
Amazon cracked the $100 billion threshold in the last three months to the end of 2020, with revenues surging 44% in this time. Compared to the previous year, the entire e-commerce sector grew by 24% in the same period. These gigantic figures alone make it clear what an acceleration booster corona is for the retail sector’s digital transformation.
Does this sound the inevitable death knell for stationary German retail, as some are already pessimistically prophesying?
In my opinion: Not necessarily, because this calculation is made without considering the most important factor in the equation. The human element.
A longing that cannot be satisfied digitally
The “downtown” experience is both multidimensional and multi-sensory. The longing to go out, stroll the streets and shop at leisure is huge. After the long and grueling period of isolation, people are longing to get outside, socialize and enjoy themselves again. These feelings cannot really be satisfied digitally. Thus, we will continue seeing a complementary duality between digital and physical shopping.
However – and let me make this very clear – the balance of power has shifted in a landslide-like manner There will be no full return to an “old economy” normality in the retail sector.
Rapid response systems instead of long process chains
For brick and mortar business, it is a question of rethinking fundamentals now, or (not even in the medium to long term) having to face existence-threatening problems. The adage that there is always hope, no longer applies. Apart from readjusting business models, it is important to question one’s future communication setup, too. Long lead times and corresponding process chains for physical inserts or out-of-home advertising have proven impractical during the crisis. Is this a pointer for the future?
The short-term nature of political decisions forces retailers to think more in terms of quickly realizable systems for addressing people, especially for re-opening, but also beyond that. This automatically leads to a paradigm shift away from offline toward online media as a new basic pillar.
A lack of reach of digital measures is no longer an accepted excuse
To date, the lack of reach has always been the knock-out criterion for primarily using digital channels. However, multi-stage campaigns that are geared to the product’s relevance for the customer, both in terms of time and content, and thus ensure precise activation, make it demonstrably possible to achieve a convincing increase in visitor flows in stationary shops today.
An example: For PORTA, a furniture chain store, we realized a 23% increase in shop traffic in a three-stage digital-only campaign, in cooperation with BRANDLOCAL, our geo intelligence subsidiary.
The three stages of the digital-to-store activation campaign followed a scheme based on the target group’s needs and their actual location.
In the first step, the reach stage, the appropriate audience was selected in the respective store commuting areas via geo intelligence and addressed with large-scale display advertising with a wide reach.
In the subsequent consideration stage, the target group was filtered using a pin-pointed, in-market approach. In other words, only people were addressed who were seriously interested in buying furniture.
In the third stage, everything was targeted at the store visit. The hyper-locally targeted and mobile-focused campaign served to stimulate direct visits to the furniture stores.
How retailers can optimize their communication
There is a whole range of measures that can be used to encourage Homo Corona Digitalis to go shopping in the real world. The following three components are just a small excerpt of the possibilities:
- Delivering special offline offers to online shoppers
Particularly for the re-opening stage, retailers should focus on geo-targeting primary online shoppers in the respective product category to attract them with targeted offline-only offers and services. - Multi-stage drive-to-store campaigns
Precise selection and targeting of relevant customers in the respective time window: Multi-stage drive-to-store campaigns ensure targeted stimulation and, ultimately, activation. - Geo-intelligence analyses as the basis for the hyper-local media mix
Upstream geo intelligence analyses of a wide range of data on brand, target groups, PoS performance, etc., provide the best basis for tweaking the local media mix for maximum impact – and this individually for each store.
This article was first published with wuv.de on March 31st 2021.
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