By Steve Dennis, Crain News Service
NEW YORK (Sept. 14, 2015) — In the balance of power between retail brands and consumers, companies traditionally held most of the cards.
Brands decided the messages they wanted to promulgate and tightly controlled the channels of communication. Their budgets were mostly focused on creating big moments when their brands could shine. For consumers, the decision journey was mostly linear, time-consuming and constrained by scarcity of information, access and choice.
Clearly this has all changed.
The power has shifted radically to the consumer, who now has nearly infinite access to information and product choice anytime, anywhere, anyway. Price transparency is ubiquitous, and consumers control many of the throttles on the messages they receive. Mass marketing is on the wane, giving way to greater personalization.
Today, brand marketing and the consumer's path to purchase are rarely characterized by a few big, well-orchestrated moments. Instead, many small interactions coalesce to determine success. In this new era, what happens in the now — in what Google refers to as “micro-moments” — is often becoming more important than the cumulative effect of our best-laid and elaborate marketing plans.
Not very long ago, the consumer mind-set was very much an intentional act to go online — to boot up and log in. Today we live online and are virtually tethered to our smart devices 24/7. When a need arises — to gather info, research a potential purchase, check the best price, locate the nearest store or whatever might satisfy our intent — that impulse can be acted on wherever we are, right now.
This is not just theory. Google's research, for example, indicates that 82 percent of smartphone users use their phones while in stores shopping for products. And that rate is growing. This dynamic forces all brands to re-envision their strategies and embrace marketing's new “power of now.”
To illustrate this further I've developed a strategic growth model for retailers (which I call “WE-tail”) that is anchored on five core experiential elements:
- Harmonized. More and more, the blended channel is the only channel as customers use any and all touch points to learn, discover, research and ultimately buy and support a retail purchase. It's no longer about online or bricks and mortar, but a well-integrated “one brand, many channels” strategy.
- Personalized. Many categories are stagnant, which means the only way to generate meaningful top-line growth is to steal market share. Products and experiences that are designed to treat different customers differently — along with personalized marketing treatments — are becoming the antidote to increasingly less effective mass strategies.
- Localized. Context is becoming king. At last, geo-location technology can be employed to get much closer to CRM's Holy Grail: the right offer to the right customer at the right time. But it goes beyond that. Consumer behavior is fundamentally changing because of what mobile uniquely allows them to do. The way consumers use smart devices creates a series of micro-moments, creating new opportunities for retailers to win or lose.
- Socialized. We live in a connection economy, and consumers often turn to their networks for inspiration, information and validation. With the emergence of “buy” buttons, it's no longer just about sharing.
- Amplified. With an abundance of choice and a tsunami of marketing messages, the only way to break out from all this noise is to push to higher levels of relevance and remarkability. “Good enough” rarely is any more. Value propositions must rise above a sea of sameness, and we must deliver a story that demands to be told.
Many retailers are making headway on some of these elements. Yet few seem to truly understand that historical advantages are fraying. They don't seem to get that immediacy is redefining the definition of relevance.
Steve Dennis is president and founder, in 2009, of SageBerry Consulting L.L.C. The firm says it “helps retail and luxury/fashion brands and investors realize remarkable, customer-centric growth and marketing strategies,” and has “particular expertise in omni-channel transformation.” He wrote this piece for Advertising Age magazine, a New York City-based sister publication of Tire Business.