Retail Marketers Prioritizing Brand Building and Sales Over Loyalty

September 20, 2012

This article is included in these additional categories:

Analytics, Automated & MarTech | Brand Metrics | Data-driven | Email | Mobile Phone | Retail & E-Commerce | Social Media

Retail marketers are spending most of their time building their brands and drive sales, and are not as focused on engaging customers or building customer loyalty, finds RSR Research [download page] in a September 2012 report. Asked to rank various priorities according to how much time their company’s marketing department spends on each activity, 29% said building the brand was their highest priority, matched by the 29% who said driving sales was their top priority.

By contrast, building customer loyalty and engaging customers each garnered just 7% of the vote for top priority. Instead, 22% said that building customer loyalty was their lowest priority, and 9% said the same about engaging customers. The lack of an emphasis placed on customer engagement and loyalty is somewhat surprising, given that asked to name their top 3 business challenges, a leading 51% of respondents said that customer retention has become more difficult and building customer loyalty is challenging.

Top Performers More Focused on Social Media, Mobile Ads

Data from RSR’s “Marketing in Retail: Making the Case for the CMO” indicates that retailers with comparable store/channel sales growth of over 5% (“winners”) are more focused on some newer digital channels than “laggards” (those with comparable growth of less than 5%). 61% of winners said they are leveraging Facebook or other community social networks (such as Hi5 or Renren), compared to just 45% of laggards. Similarly, winners are more likely to be using Twitter (43% vs. 29%) and mobile advertising (33% vs. 23%). This focus on social media is understandable given that respondents overall are highly focused on brand building, yet it bears mentioning that social media is now being increasingly viewed as a tool for customer engagement, which is less of a priority among the retailers surveyed by RSR.

Email a Leading Source of Customer Data

Although winners are leveraging email less than laggards (49% vs. 61%), email marketing is well recognized by the RSR survey respondents as a viable source of customer data. Two-thirds of the respondents said they are either currently (47%) using email as a source of demographic data or will do so in the future (19%), making this the leading source of demographic customer data among those identified. (In-store was next, with 59% either currently using the channel or planning to do so.)

Email also leads in adoption among sources of customer behavioral data: 45% are currently using email for this purpose, and an additional 14% have plans to do so. In-store (POS, employee mobile, kiosk) is next on the list again, with 41% using this source for behavioral data, and an additional 14% planning to leverage the channel.

Finally, while the email and in-store channels lead as current sources of customer sentiment data (31% and 29%, respectively), when factoring in planned future use, social media (53%) edges them both for this purpose.

About the Data: The RSR Research survey was conducted online from June to September 2012 and received answers from 131 qualified retail respondents. 28% came from companies with more than $5 billion in revenue in 2011, while 46% had less than $1 billion. Respondents sell a variety of products, and 80% have either their headquarters or a retail presence in the US.

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