Marketers’ Digital Romance Is Out Of Touch With Retail Reality

tom-mitchelData-Driven Thinking" is written by members of the media community and contains fresh ideas on the digital revolution in media.

Today’s column is written by Tom Mitchel, senior director of programmatic solutions at MaxPoint.

The New Year was sobering for many reasons, not the least of which were reports of physical retailers closing store locations. It’s estimated that some major retailers will close up to 15% of their stores in 2017. This change affects retailer strategies, and also changes product marketing within those stores.

However, in marketers’ zeal to embrace the growing digital path to purchase, are they and their tech providers being short-sighted about the relevance of the physical path? If so, we are narrowly looking at the shift from physical to digital as linear and one-directional. The reality is that the shift is highly dynamic. Our strategies and success metrics need to embrace this truth.

This new retail marketing era of dynamic balance between digital and physical begs a new fundamental question: What media is truly performing? If a brand is selling a product that’s bought off a shelf, did it waste 15% of its ad dollars targeting an audience that isn’t stepping foot into the store? Should advertisers mandate filters for foot traffic with the same voracity with which they’ve mandated viewability?

Being a programmatic geek, I used to question why advertisers would pay to reach viewability goals if their demand-side platform could optimize for user actions, including clicks and conversions, and then subsequently filter out nonviewable media. Smugly, I had it in my head that everything could be solved by placing conversion pixels and setting cost-per-lead goals proportionate to the page’s attribution in the purchase path.

This pitch worked for a lot of advertisers, but I’ll never forget the day I was squarely put in my place by a CPG brand that flatly told me people don’t buy mayonnaise online directly from a brand. That its website didn’t matter. All the company cared about was the impression – that shoppers knew the brand name when walking through the aisles.

This nonperformance ethos holds true for video, out-of-home and radio. As we move into a world with more alternative programmatic media, we must remember that audience data is still king. Thinking of media outside of a screen forces us to explore nondigital metrics that contribute to brand success.

Digital savviness has made us forget a basic retail truth: Consumers still like to shop in stores. As such, marketers’ strategies and metrics need to embrace purchase intent in the physical world. We have site traffic goals, so why not foot traffic goals? We have CRM files to retarget online shopping carts, but did we forget about the real shopping cart?

Even dominant etailers like Amazon are recognizing the boundaries of pure digital commerce and digital metrics. Amazon is beginning to launch brick-and-mortar retail locations. We can assume it’s a step to bridge the gap between the physical and digital consumer paths.

As marketers look to recast budgets to address dynamic shifts in digital and physical purchase paths, we have to think ahead and look at physical bodies the same way we look at mouse movements on a web page.

Follow MaxPoint (@maxpoint_int) and AdExchanger (@adexchanger) on Twitter.

4 Comments

  1. This could not be more true. We are finding that many retailers are still struggling to obtain a single view of the customer - they know everything about their online and mobile behaviors but there is a breakdown when it comes to the physical stores. With the recent store closures and struggles traditional retailers are going through, it is imperative that they uncover who is in their physical locations - regardless of purchase. By closing that gap in the customer journey, they'll be able to evaluate which online marketing activities actually drive store visits and invest more in what works.

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  2. I couldn't agree more. In order to be able to do this properly, brands need to be able to triangulate offline buyers and prospects with online buyers and prospects at the individual level. Very few companies can do this accurately, persistently and at scale.

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  3. Shocked that Amazon is doing brick and mortar, but as much as I use ecommerce, I have bought stuff that turned out to be way different than I could tell online,,,

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  4. Though every small or big retail business has made its presence online in order to cater most of the customers still there is a need to get actual customers on board. Yes, advertising plays a vital role, be it in form of video for television or an audio for radio or other platforms. This will for sure lead towards the actual customer desiring the said services.

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