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Marketing
6 Questions Surrounding Retail’s “Apocalypse”
It’s clear that retail in the US needs some major transformation. There is no denying the steady, multi-year decline in US brick-and-mortar store traffic as more retailers are closing significant portions of their chains or liquidating their businesses entirely. But is it all doom and gloom?

While in-store traffic has trended down, retail sales in the US have experienced continuous growth overall and the National Retail Federation is predicting another strong year with a +4.4 percent increase in sales in 2019. Much of that growth does come from e-commerce sales, but more retailers are reevaluating the role of their brick-and-mortar stores to safeguard the bulk of their business. Even digital pure-play retailers like Warby Parker, Untuckit and Wayfair are expanding beyond their online platform by opening brick-and-mortar locations across the US.

But the question remains: is US retail on life support, or are we on the verge of a complete rebirth? Let’s ask two of Empower’s retail experts Amy Johnson, senior director of media integration & Laura Nix, vice president of client leadership.

1. Has The Retail Apocalypse Truly Arrived?

Who can forget last year’s heartbreaking photo of Geoffrey the Toys R Us giraffe with his packed suitcase and final wave goodbye amongst the empty shelves of his store? Turns out Geoffrey had lots of sad company. According to commercial real estate firm the CoStar Group, over 250 million square feet of commercial retail space has been closed within the last two years in the US. This staggering pace of closures is expected to continue in 2019 as the Business Insider predicts up to another 4,000 physical store locations will be closing this year alone. Consumer shifts to spending online, experiential spending vs. material goods, and subscription-based juggernauts such as Amazon are major contributors to these store closures. But if we are being honest, retailers have been complacent over the years. The lack of innovation in the physical space has left shoppers uninspired sending retailers in this downwards spiral at the brick and mortar level.

Empower’s Recommendation: Evolve or die. Retailers can’t rest on their laurels and rely only on what has worked in the past. They must have a gameplan for testing and learning across the enterprise. This includes testing different store formats, creating a new relevant in-store experience, utilizing store locations as distribution centers, or by leveraging some of your best assets, your associates. Despite pervasive tech usage with retail shopping at our fingertips, humans still crave person-to-person interaction. Give shoppers a reason to visit your brick-and-mortar stores with an experience they can only get at your stores.

2. Ok, but is Retail Really Dead?

Retail is not dead. It’s not even on life support. The retail industry is experiencing a rebirth right now as we speak. While retail in the US is at a crossroads, the future has arrived in China under the leadership of Alibaba. Alibaba is best known for its online marketplace, but it’s goal to combine the best of both online and offline retail with a complete digitized experience should inspire US retailers. Alibaba has created a New Retail which has revolutionized all areas of retail including grocery, automobile, luxury, and even the lifeblood of many societies, the mom-and-pop stores. Alibaba is mastering the power of the mobile device to empower the shopper and to help save the retailer.

Empower’s Recommendation: Go above and beyond to do what’s right for your customers. This will make you stand out from your competition. Listen to your customers and streamline the buying process with a frictionless experience that keeps them coming back.

3. Is Brick-And-Mortar Shopping a Thing of the Past?

Brick and mortar shopping as we know it must evolve. Brands that develop their stores into a more experiential physical display of the brand will stand out. Consumers want to experience the brand as part of their purchase journey. Brands like Macy’s know they can be much more than a retail destination. They are an entertainment brand, steeped in tradition. The Macy’s Thanksgiving Day Parade has been a staple in the hearts of America since 1924. They are leveraging that heritage to bring to life store experiences, called STORY that reflect “Magic Moments” in the current fashion climate with refreshed content experiences seasonally.

Empower Recommendation: Leverage your retail space as a medium. Create a medium that makes an impact. Don’t just serve an impression, but create a lasting impression.

4. Are Retailers Taking More Risks with Bold Positions in The Marketplace?

Retailers are doing more than just having philanthropic or charity connections. They are taking a stance on what matters most to them. Brands like Dick’s Sporting Goods have stopped selling firearms in its stores in response to school shootings across the US. Levi Strauss & Co. was founded by immigrants and vocally opposes certain laws that restrict immigration. Best Buy has doubled down on investing in their employees because they know it sets them apart. But much like Migos, they walk it like they talk it, by taking care of their employees with perks like backup child care for their associates.

Empower Recommendation: Have the courage to stand for something more than the short-term sale. Plant the flag and live your company mission and values by leading with conviction.

5. Should Brands Shift Their Focus on The Next Customer Once a Consumer Makes a Purchase?

Only if you want your brand to follow Geoffrey the giraffe to the unemployment line. The purchase point becomes an invaluable opportunity to solidify the relationship with your customers and help to foster an ongoing connection with that customer.

Empower Recommendation: Retailers should leverage post-purchase channels including texts, emails and receipts to customize and nurture the relationship with purchasers. Invest in a CRM program and test and learn with a variety of messages, offers and incentives. This will lead to the next purchase or brand interaction increasing retention and loyalty.

6. Does Winning in Retail Mean Solely Focusing on Driving Optimal Roas?

Retailers are in the business to drive sales and grow profit margin. But when retailers only chase the most efficient ROAS, they end up neglecting to invest in the brand with an acquisition strategy that is designed for the long game. The result over time has a negative impact on brand equity and ultimately erodes the base volume of sales.

Empower Recommendation: A balance of a brand building as well as short-term activation are necessary for long term sustainability.

Despite the ongoing news cycle announcing the next chain of store closures, the retail category could very well be on the upswing. But it requires the most savvy of companies to capitalize on the opportunity and give shoppers a reason to shop with them. In our fast-paced world, it’s now the consumers who are in the driver’s seat. They don’t “go” shopping, they are always shopping.

It’s critical for retailers to recognize and evolve to stay in front of the ever-changing landscape. Creating seamless interactions, in-store experiences, taking a stand and staying true to their brand is critical for retailers to be successful. It’s an exciting time to be in retail and no time for retailers to stand by and watch the paint dry.

Constant innovation is the only way to stay in the game.

Retail Center

Empower’s Retail Center of Excellence helps its retail clients navigate the retail landscape and innovate to stay ahead of their competitors.

Sources:

  • Business Insider 2017 & 2018
  • NRF Big Show 2019, “Magic Moments”, “Leading with Conviction”, “Innovate or Die”, “Post Purchase Communications”
  • Wall Street Journal: Link
  • Ad Age: Link
Media
What is Media Planning?
Looking up the definition of “Media Planning” will result in some concise description that goes something like this: “The process of identifying the most effective media for advertising a product, service or brand.” While short and sweet, that description only scratches the surface of what “media planning” really is and fails to mention that “media planning” isn’t really about “the media.”

It’s about creating connections with consumers. They are at the heart of every plan we have the privilege to create. As a very enthusiastic “media planner,” I acknowledge there is a lot of “power in the placement,” but I also believe that media placements are more than just ad delivery mechanisms. Creative media plans have the power to forge and foster meaningful relationships between brands and consumers, which makes “media planning” a very complex process. A data-driven, human-centric, imaginative, tech-enabled, passionate and collaborative process. Identifying effective media is certainly part of the process, but uncovering insights that allow you to empathize with the very people you are trying to connect with and designing plans that provide a value exchange between brand and consumers is exactly what we do.

Differences Between Media Planning and Media Buying

Both media planning and media buying have their own nuances and complexities, but they are not entirely independent from one another. Both parts require a fluid set of skills, extensive collaboration and are equally important to a successful plan.

Planning should lay a solid foundation built off a well-thought out strategy and buying requires excellent implementation. A great strategy and plan are nothing if it’s not executed well. Conversely, exceptional execution won’t be able to deliver results if the plan was not built on sound insights.

At Empower, our media planners work closely with our buyers throughout the planning process to inform and align on the optimal approach and plan for each client. By integrating between practices and partners, we work not only to buy media but also to find ways to produce creative media.

Media Planning
At a simple level, media planners use a series of inputs to develop a comprehensive plan that sets the course and helps establish guardrails for the buying team. Planners are the architects that lay out the blueprints of a plan using a blend of art, science, creativity and precision.

Media Buying
Once we determine what we will buy to meet brand objectives and foster consumer relationships, we identify how we will buy based on client needs, marketplace opportunities and learnings from past campaigns. Complexities of the media landscape also lead to nuances of how we negotiate and purchase media. Buying is more than negotiating CPMs and locking in schedules or placements. And while improved automation and systems have assisted the buying part of the process, human interaction is still essential. Our buyers have built and cultivated relationships with key partners and publishers. This open and ongoing dialogue is advantageous for both negotiating buys and added value as well as monitoring performance and ensuring optimizations are being made for the length of the buy.

Media Planning Challenges

As with any piece of the marketing eco-system, media planning has its challenges that need to be considered and addressed when developing a plan. The challenges outlined below are representative of bigger macro trends that impact marketplace dynamics and things that are more difficult for brands and agencies to control.

Evolving Media Landscape
The media landscape is in a constant state of change making the dynamics of planning more complex and nuanced than ever before. The proliferation of ways in which consumers are able to consume content are practically endless. This provides more opportunity to reach consumers, but competing for their attention in a very cluttered environment can make it harder for a brand to break through and form a connection with them. Market fragmentation among media providers also makes for a more challenging environment to purchase and measure media consistently.

Due to this complex landscape, collaboration is key at Empower. Empower has an extensive team of subject matter experts that work hand in hand with the media planners. Our subject matter experts understand how consumers engage with different media platforms. They know how to navigate the nuances of the different media platforms and stay on top of all the minutia of in their focus areas that could impact the plans and measurement. This includes things like staying up to date on the latest trends, addressing brand safety and transparency challenges, regulation changes, changes in partner offerings, emerging tech and new capabilities.

Consumers Have Control
There is more opportunity to reach consumers than ever before, but consumers are in control. This is a significant shift from the early days of advertising in which brands dominated the conversation. Consumers can choose when, where and how they’d like to interact with a brand and engage in advertising. Now, they can even choose to not interact at all with ad blocking and with ad-free environments.

Additionally, with the rise of social media, people have a platform that amplifies their voice and allows them to participate in a larger collective conversation. This is especially important to note as it has become very apparent that consumers have a lot of power to dictate public opinion of brands, products and services.

Even though consumers are in the driver’s seat, it doesn’t mean brands are powerless. Brands just need to operate under a different set of rules than in the past. This leads to the importance of understanding your target audience and the value your brand or service provides. It’s about creating shared meaning by linking what your brand stands for and what consumers care about. Then initiate and sustain long term connections through the media ecosystem – this may start broadly with building brand awareness with a new audience segment or require a more personalized approach. There is no “one size fits all” approach as it relates to identifying the “right” channels, mix or levels to reach your consumers, but ensuring consumer experience is relevant and seamless across channels is key.

Big Data
Data can be both a blessing and a curse. We are in an exciting time with the emergence of new technology that is fueling the rise of mass data. There are vast expanses of data available at our fingertips, but data is like oil – it’s useless unless it’s refined. It’s important to be selective of the types and quantity of data sources you are using to avoid paralysis by analysis. The data will tell you what your audience wants, and it’s on your brand to listen.

Data is at the core of everything we do and, while it’s a key piece we use to inform the planning process, we also utilize data to make optimizations and measure our executions to ensure success. We have access to and utilize industry tools and we evaluate historical learnings, social conversation and measurement to inform planning. We leverage first, second and third-party data to uncover the audiences who are most likely to engage with our clients’ brands. We then deploy our marketing tech stack to find them and deliver a relevant experience no matter where they are to maximize the impact of media investments.

Media and Message Need to be Connected
It’s critical that the message and media work together and sometimes the media plan is developed separately from creative or vice versa. The creative messaging, of course, is also vital in driving an effective plan.

Communication needs to be authentic, relevant and memorable to the people we are trying to reach. It is also important to note that messaging needs to be consistent. Messaging should be tailored to the different platforms used in your media mix but needs to have a connective thread for consumers to be able to tie back to the brand. The media placements are meant to reach the right people at the right place and time, but the creative needs to communicate the right message in order for the plan to drive results.

Basics For Developing a Strong Media Plan

  • Start with a Strong Foundation
    • Establishing a clear and realistic objective in what you want your plan to accomplish is key. A media brief that clearly states your marketing objectives and provides detailed information on the brand or product being advertised helps the planners lay a solid foundation to build upon.
    • Establishing and understanding the audience you are trying to reach is critical. You need to understand your audience and how your brand can provide value to establish that connection.
  • Consumer and Category Intelligence
    • Establishing and understanding the audience you are trying to reach is critical. You need to understand your audience and how your brand can provide value to establish that connection.
    • You also need to understand the category in which your product or service is competing. Study your direct competitors both small and large. With the rise of direct-to-consumer brands, it’s important to pay attention to competitors across the spectrum.
    • Social listening, syndicated research, brand research and competitive spending can help identify consumer and category insights.
  • Knowledge of the Media Landscape
    • Identifying your audience and the media touchpoints they engage with is only part of the puzzle. You also need to understand the nuances of these touchpoints to be able to plan and activate in these channels appropriately.
  • Collaboration
    • Collaboration is key. Establish clear and open lines of communication with your agency partners, vendors and internal teams. Given the complexities of planning and the challenges we face it’s essential to work together and rely on our respective areas of expertise to come together to produce the best plan.

Tips for Media Planning

Lastly, these key tips can help with your next media plan:

1. Stay curious. Keep up with trending topics in media and marketing trades, watch the news and stay connected with social media. You need to be alert and aware of what’s happening within the marketing ecosystem and within society, as all these factors impact your consumers, which impacts your plan.

2. Know your audience. And know the value that your brand or offering provides. Brands no longer dominate the conversation. Actively listen to what your consumers want and follow the data breadcrumb trails to understand what they need. Shared meaning between brand and consumer can help create long lasting and emotional connections.

3. Be nimble. Media planning, buying and execution require flexibility and the ability to adapt to the challenges and changes of a dynamic marketplace. A media plan should never take a “set it and forget it” approach and there is no “one size fits all” solution, so it’s important to continuously monitor performance to identify optimizations that should be made.

4. Measure. Measurement helps you identify and understand what is working and what is not. This can inform optimizations within your current plan and helps provide guidance and insights to inform your next plan.

5. Collaborate. Ensure there are open lines of communication. Given the complexities of the current landscape and consumer dynamics it’s essential to tap into expertise of others and bring individuals strengths together to create a cohesive, measurable plan that drives results.

Marketing
The C Word: People Don’t See Themselves As Consumers, So Why Do We
Worried about data and privacy with your marketing efforts? This one simple change can help keep you and your organization on the right side of the debate.

The word consumer is as old as capitalism itself. It’s that all-encompassing term for the people you want to do business with. The word is not bad or evil in its own right. It was created to aid in understanding, as words tend to do. The human language has all sorts of terms that help frame the context of a group of people including audiences, congregations, patients, etc. These terms help define the context and norms with which we interact.

The C Word: People Don’t See Themselves As Consumers, So Why Do We

From the marketer’s perspective though, those norms have become too one-sided.  We speak regarding “targets” and “cost per point” that make our work sound more like hunting and financial transactions than productive communication.  While it used to make sense for business people (including marketers) to narrowly think about people when they were in a consumption state of mind, digital technology has taken commerce into our homes and can occur at any time.  The line between “consumption” and everyday life no longer exists.

Therefore, if you’re worried about your data practices and whether you are utilizing that data in the fairest way possible, simply strip the word “consumer” from your vocabulary and ask instead, how would the people who created this data feel about this effort?

People don’t define themselves as “consumers,” they see themselves as humans.  They may add more nuance by defining themselves by interest or activity, but I have never heard a person say they are an avid “consumer.” It may sound silly at first, but trading the term “consumer” for “people” automatically opens the door for empathy and a desire to seek solutions that serve rather than hunt.

To reiterate a best practice, we’re preaching alongside data conversations, always remember:

Ask not what your data can do to reach consumers; instead, ask how this data can be used to serve the people that created it?

Would a person, not a consumer, think it’s appropriate that you have access to this data?  How can this data be used to improve the experience for people? (NOT) Another GDPR Article is another recent POV that also encourages this way of thinking.

Humanizing your data by forcing yourself to vocalize that there are always real people who created it will not only help keep you on the right side of an ongoing ethical debate, it may even open your eyes to thinking about marketing efforts in a whole new way.

Empower