Bliss Integrated Communication
With modest sales projections for this year’s holiday shopping season, competition for customers remains fierce, and the winning retailers will be those that offer the most convenient, consistent and dynamic shopping experiences. According to a recent BDO USA, LLP
survey, chief marketing officers at leading U.S. retailers say their overall marketing and advertising budgets will rise by 1.1 percent this year, compared to a decline of .98 percent in 2013. Despite the fact that 72 percent of retailers expect to spend about the same amount on marketing and advertising compared to last year, they have been hard at work determining the right mix of strategies to stay in front of customers throughout the season.
As part of their overall holiday strategy, retailers are trying to enhance each touchpoint of their customers’ journey, both in-store and online. A full 71 percent of retail CMOs are familiar with the concept of an enhanced omnichannel shopping experience, and one-in-four 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, 95 percent are using consistent promotional strategies across channels and 86 percent are expanding product delivery options for customers.
Over the last several years, mobile has emerged as a critical platform in retailers’ holiday marketing playbooks, both for engaging customers and converting online sales. Approximately half of all retailers (49 percent) plan to include mobile technology in their holiday marketing strategy this year, a jump from 38 percent in 2013. Overall, retailers will spend 14 percent of their marketing budgets on mobile, up from 6 percent in 2012. Following a seven-year trend, social media remains a highly popular holiday marketing tactic. The 84 percent of retailers using social media this year say that it will comprise an average of 19 percent of all marketing efforts, up from 14 percent in 2013.
“More retailers are waking up and investing in mobile, and this year really signals a turning point in how they are vying for consumers’ attention during the peak holiday season,” says Natalie Kotlyar
, partner in the Retail and Consumer Products Practice
. “Mobile engagement is quickly becoming table stakes when it comes to winning over new customers and converting sales in November and December. The most successful retailers will be those that are out in front, experimenting with new technologies and developing the convenient shopping experience demanded by today’s customers.”
These findings are from the most recent edition of the BDO Retail Compass Survey of CMOs,
which examined the opinions of 100 chief marketing officers at leading retailers located throughout the country. The telephone survey was conducted in September and October of 2014.
Additional Findings of the 2014 BDO Retail Compass Survey of CMOs Include:
Consumer data challenges top-of-mind amid slew of data breaches in 2014.
As large-scale data breaches and cyber threats targeting web-based platforms have dominated headlines this year, retailers remain cognizant of their perceived cyber risks in the run up to the holiday season, especially after Target’s costly breach last December. In fact, concerns over the risk of data breaches spiked this year, with 17 percent of surveyed retailers calling it their number one challenge pertaining to the vast amounts of consumer data, up from 2 percent in 2013. Meanwhile, roughly one-in-three (34 percent) retailers perceive risks related to potential data breaches and cyber security to be higher this year than in 2013.
Overall, as retailers look to effectively manage and leverage their troves of customer data accessed through in-store purchases, e-commerce and social media, 72 percent find the process challenging, and 45 percent find it very challenging. While best practices are still emerging around big data, retailers are more comfortable when it comes to using consumer data for marketing efforts, with only 28 percent of CMOs surveyed this year citing this as their top challenge—an improvement from 44 percent last year.
Retailers focus on Facebook, Twitter and LinkedIn to connect with customers.
As more consumers begin and end their holiday shopping online, retailers continue to leverage social media sites to spread promotions and help convert sales. Consistent with last year’s findings, the vast majority of retailers (76 percent) will be featuring Facebook campaigns this holiday season, while Twitter and LinkedIn remain the second and third most popular social networks among retailers, with 27 percent and 21 percent, respectively, using these platforms. With greater online competition and increased promotional activity this year, retailers are also beginning to experiment more with “buy buttons” on platforms such as Facebook and Twitter, which could help boost the conversion rates and ROI of their social media activity.
The BDO Retail Compass Survey of CMOs
is a national telephone survey conducted by Market Measurement, Inc., an independent market research consulting firm, whose executive interviewers spoke directly to chief marketing officers, using a telephone survey conducted within a scientifically-developed, pure random sample of the nation’s retailers.
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