Retailers Home in on Digital Strategies this Holiday Season: Mobile Booms, Cybersecurity Looms
Coming off the heels of a modest but successful Cyber Monday
, and with reports of increased online sales over Thanksgiving
Weekend, we just released the final round of results
from our ninth annual Retail Compass Survey of CMOs, which suggests that retailers will remain focused on all things digital as we head into December.
With more consumers spreading out their fixed holiday budgets throughout the season, there has been less emphasis on Black Friday and Cyber Monday
, and retailers are largely considering this year’s peak period a marathon, as opposed to a sprint. Still, sales are projected to rise modestly
this year, and retailers are pulling out all the stops to make sure their marketing strategies position them to compete for consumers’ limited dollars in a crowded and intensely competitive landscape. According to our findings, retailers’ holiday marketing and advertising budgets will rise by 1.1 percent this year, compared to a decline of .98 percent in 2013. Overall, 72 percent of CMOs surveyed plan to spend about the same on marketing and advertising this holiday season as they did last year, meaning they have been putting in overtime to determine the optimal mix of strategies to differentiate their products and win over customers from November to January.
We fully expect that this season’s winning retailers will be those that can stay in front of shoppers with attractive deals and offerings on a number of channels
, providing the most convenient, seamless and dynamic shopping experiences. Doing so requires retailers to streamline and improve upon each touchpoint of their customers’ journey, both in-store and online. In fact, one-in-four retail CMOs say that they have changed their holiday marketing strategy this year in response to consumers’ demand for a more seamless experience across channels. Of those retailers, 100 percent are using consistent pricing across channels and 86 percent are expanding product delivery options for customers. Staples, for instance, is offering an in-store and online price match guarantee and free shipping
of online orders for loyalty members, and Toys “R” Us
is offering a newly-developed rewards program, free online layaway and improved in-store pickup.
In recent years, retailers have transferred their knowledge of what works on desktops to smartphones and tablets
, and mobile marketing has become a critical platform in their holiday playbooks. This year, nearly half of all retailers (49 percent) plan to include mobile in their holiday marketing strategy, a jump from 38 percent in 2013. Overall, retailers CMOs will spend 14 percent of their budgets on mobile, up from 6 percent in 2012. Adobe’s holiday shopping forecast predicted that shopping on smartphones and tablets would account for $1.6 billion in sales
on Thanksgiving, Black Friday, and Cyber Monday combined. It therefore comes as no surprise that big box retailers are on their mobile game this holiday season, with Target and Wal-Mart having vamped up their mobile apps, making it easier to browse, build product lists and roll out new features.
Aside from online marketing strategies, retailers are also highly focused on digital as it pertains to managing consumer data and ensuring cybersecurity during the peak holiday season. Following large-scale data breaches
—such as Target’s
last December and Home Depot’s
more recently—concerns over breaches spiked this year, with 17 percent of CMOs calling it their top challenge related to the vast amounts of consumer data they maintain, up from just 2 percent in 2013. Meanwhile, about one-in-three (34 percent) retailers perceive risks related to potential data breaches and cybersecurity to be higher this year than last. Other top data management challenges cited by CMOs include using customer data for marketing efforts (28 percent vs. 44 percent in 2013) and acquiring customer data (27 percent vs. 19 percent in 2013).
Stay tuned to the blog for the final survey report from the 2014 Retail Compass Survey of CMOs, where we delve deeply into the most compelling insights from CMOs related to this year’s holiday season.