The challenging landscape of Retail
Retail like society is going through some drastic changes and with change comes challenges. There are many challenges and depending on who you talk with, you will hear different ones. For some it could be getting customers to your store, for others it might be increased online sales conversion and a third could be facing problems regarding franchise owners and their sole focus on tactical communication.
No matter the challenge they can all be linked to the digitalization of the retail sector. The digitalization has changed customers purchase behavior and made it possible for completely new players to disrupt the market. Today many of the Swedish retail players feel it’s a struggle to stay alive. To this date over 5000 physical stores have had to close due to the digitalization and changed consumer behaviors. If we look ahead, an additional 6000 to 11 000 stores will face the same destiny within a 7-year period.
The media agency is well positioned to tackle the most important problems
As a media agency we lack the power to help our clients tackle all of their challenges, but we have the ability to take on the most important one, namely to drive interest and preference for our customers stores or their web shop. Our clients are often so occupied with the big structural changes that they are having a tough time focusing on anything else. But as consultants we often sit on the most important perspective. We are right in the middle of consumers and brands. And our core competence is to bring those two together. By doing so we are a core player in helping our clients to grow their business in a world that is more challenging than ever before but also filled with more opportunities than ever before.
Customer centric is key to success
So, to succeed as a retailer today, no matter if you launched from physical stores, online sales or somewhere in between, the key is to look at it from a consumer rather than brand perspective. With a customer centric approach, you are well positioned to create value for your customers which in turn is a very good position if you aim to grow your business. This means that OMD need to have a full understanding of who your customers are, what their needs looks like and at what touchpoints we should communicate with them to maximize effect of the media investments.
What does it take to succeed?
In today´s digital media landscape, it is common that advertisers focus on the “most likely to buy customers”, the low hanging fruit, the eager to push purchase ones. It is an effective strategy if your aim is to increase ROI and short-term sales but for brands that want to be relevant in 10, 50 or 100 years from now another strategy is more suitable, the one that focuses on creating market penetration. Brands grow primarily by attracting new consumers, not increasing loyalty amongst existing ones and communication can do so. To charm us, to get us interested in products we did not know existed and to fall in love with brands we previously had not heard of.
Since the modern consumer neither lives a digital or analog life, but rather somewhere in between our responsibility is to make sure that all potential data about the consumer is shared between different specialists and medias. There is no lack of data today, but there is still a lack of smart data. Data that says something about our consumers, data that gives us insight on what to communicate, where to do it and when to do it.
By implementing a new way of working and with specialists whose sole reason to exist is to erase silos and making data and insights available for different specialist we have managed to go from big to smart data. This has been key in helping some of our largest clients tackle some of their biggest problems no matter if it regards driving footfall in stores, sales online or a mix of both.
To sum it up
The challenges for retail are many and very often quite hard to solve, but if you focus on getting to know your consumers and what their lives look like you will be able to solve the most important one, namely how to create growth.