Footfall was in decline even before the pandemic and growing numbers of traditional retailers are investing heavily in their retail media portfolios as a means to shore up revenues. But, and let’s be honest with ourselves here, when is the last time that in-store advertising really improved your customer experience?
The reality is that a great many retailers simply cannot afford to pass an income stream over in a challenging economic climate. While retail media might be one of the fastest growing media channels, it is not the only growth option open and it is not an end in itself.
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A retailer is not – and should not try to be – a media agency. Tinkering with ads to optimise the right message for the right time of day, for instance, probably isn’t the best use of budget, at least not if there aren’t enough people coming into your store anyway.
Traditional retail chains might instead put that time in assessing how they can give customers clearer reasons why they should come to their stores and spend money – and, where necessary, to remind them where they are located.
The problem with the retail media model
Here’s an unpopular opinion, retail media really is money for nothing – retailers are simply monetising space that already exists in a store. It is the icing, it should not be the cake.
My fear is that many traditional High Street chains are using retail media to try and convince shareholders that they can remain competitive against e-commerce retailers. But as our economy becomes increasingly digital-first this will be exposed for what it is – a sticking plaster solution.
The problem with retail media, and one that seems to blind retailers from the bigger picture, lies in how they charge for it. After all, what matters most to brands using it is visibility and this applies equally to in-aisle signage or ads on self-checkout screens. If it was priced in a transparent way, visibility would align to footfall. And if that were the case, then retailers would have to focus on what should really matter most to them and the brands they work with – growing the numbers of people visiting their stores.
Addressing the real problem
The situation faced across many categories is that it will become ever more challenging to convince shoppers there’s a good reason to venture in-store when online is more convenient, and often cheaper.
This means retailers will need to work harder to make the most of their estate and digital best practice shouldn’t mean deploying more DOOH screens. The alternative isn’t radical but it is more involved, the outcomes make the effort worthwhile though – influencing long-term behavioural change.
Understanding your audience – what they want, why they want it and when – are the types of signals that can be read across third-party digital channels, from search, to social media and reviews. All offer location insights that can inform business strategy at a local level and the messaging that will help drive footfall: do you need more signage to help people locate the store, introduce new services to differentiate from the competition, or is it time for a refurb?
By closing the loop between online intent and offline purchase, it becomes possible to target new customers and high-value lapsed shoppers to bring them to specific stores.
Making this work in practice entails shifting from ‘brand down’ (i.e. generic national branding campaigns) towards ‘local-up’ approaches that allocates budgets to specific areas, which can mean right down to postcode level for specific stores. It requires a more agile approach to planning, but can be used to address particular business needs, for example to focus on struggling sites or to bring more affluent customers to a store.
The physical value exchange
What’s important is getting the message right. People choose a particular shopping channel depending on their contextual needs, so the challenge lies in interpreting the digital signals for clues to intent. Not all will suggest people want to shop in-store but when it’s appropriate to nudge them in the right direction, you first need to give them a good reason to invest their own time into making that journey.
Geotargeting aligned to messaging that underlines what additional value can be unlocked at a particular location, presents a compelling proposition. A seasonal offer, exclusive product drop, or an in-store event might capture attention, but what’s most important is giving customers a reason to keep coming back. Here, community, customer service and specialist expertise will always be core differentiators.
Yes, this sounds like a lot more work than installing additional DOOH – because it is – but using location as the lever to turn an occasional digital shopper into a loyal multi-channel customer is well worth the effort.
People want an experience that is different than what they’d get online. Physical stores should represent your brand in its purest form and showcase what makes it special. So, without wanting to sound like a broken record, people don’t go to shops to look at ads. Retailers owe it to their customers – and to themselves – to do it better.
About the author: Mike Fantis is Vice President, Managing Partner at DAC Group UK, a digital marketing agency connecting brands with local and national audiences.
