Retail marketing: Trends for 2010 and beyond

OK, I know it’s a long post and you’ve probably read a plethora of other opinions on retail marketing trends, but The Drum asked for my opinion and, when you look at the type of clients we have, it’s a pretty valid point of view. Honest!

Seriously, it’s full of insight based on over a decade of experience creating and developing brands in the retail marketing sector and covers how high street brands can survive and thrive in the current market. Enjoy.

How can high street brands gain stand out in this increasingly competitive sector?

In essence, nothing has changed as retail has remained competitive for decades – strong brands with good and relevant products thrive whereas brands that lose their core positioning in the market fall away.

High street brands, just like any brands, need to focus on their whole offering and positioning in the market. How brands are adapting to the growing media opportunities is, inevitably, key to their success or failure. The ability for brands to connect with their consumers has never been greater and those that are able to offer a well co-ordinated content marketing strategy alongside more traditional methods will retain and grow their consumer base.

If brands play to their strengths and create a distinctive message that enough people will buy into then they have a chance.

Can the environments in which goods and services are sold have as much effect on the consumer as the quality of the goods themselves?

I think that the environment is key to the overall consumer experience and can certainly add value to a brand and its products and services. The whole concept of consumer environments is a far broader term than it once was and is increasingly relevant to how a consumer accesses goods and services online and via evolving technologies.

A seamless and unobtrusive consumer environment makes it far easier and satisfying for a consumer to buy online or via a mobile device. The App Store is a perfect example of this – a great way of users finding the App they need exactly at the point they need it even if they don’t have cash or a card on them. Over 3 billion apps is impressive stuff!

Brands also have work to do in educating their consumers, especially if there is a wealth of choice for them and the retail environment is the perfect place to do this. We worked with Tesco to create an in-store screensaver that allows customers to engage with and find out more about the capabilities of every individual computer in the Tesco range. This helps consumers with the decision making process whilst also encouraging them to use the actual products prior to purchase.

Of course, consumers will only remain loyal if the quality of the goods meets their expectations but, in terms of customer acquisition, the consumer environment is key.

How are retail marketers becoming more savvy in their quest to communicate with the consumer?

As already alluded to, successful retail marketers are moving with evolving technologies and viewing the communication process as an ongoing exercise rather than bursts of activity relating to new product launches or sales and seasonal events.

An extract from a recent post on the Engine Creative blog best explains why this beneficial:

“It’s all good news for organisations that are able to offer a genuinely good service to their consumers. Focussing resource on content marketing enables a level of interaction that traditional marketing methods have, historically, often lacked. The added pay off is that, in turn, this interaction can (and should) result in a more efficient and targeted approach across other marketing activity.”

How big a part does online play in the communication of retail brands?

I think I’ve covered this in answer to other questions although, specifically, there are more opportunities for retail brands to interact and influence the decision making process if they can get their message across online.

Another key aspect of online is the ability for brands to gather valuable data about their customers that they would struggle to do in store. Consumers are a captive audience when they’re shopping online and far more comfortable handing over their details at the point of purchase. This is, for obvious reasons, hugely valuable for retail brands if they’re then able to manage how the data is used and can add value to the consumer experience.

How has online shopping really effected the high street? And what can the high street do to remain relevant? 

A combination of the rise of online shopping and a global recession has contributed to the downturn in the high street. This doesn’t mean the end of the high street but rather an evolution of exactly what role the traditional retail environment will play in our lives.

For some high street brands I think that this evolution will be focussed on brand positioning and allowing consumers to experience and touch the brand in a way that’s impossible online. A shift towards customer service as opposed to a straightforward product offering.

The flipside to the online shopping revolution is that businesses that have grown from online success will naturally gravitate to building a presence on the high street. This will be an interesting process in brand development and should shake up the established high street brands in a positive way.

Is social media a suitable tool for retail brands?

Absolutely. Social media is the gossip on the high street on a massive scale. One rogue #fail and a retail brand can start trending for all the wrong reasons. On the other hand, the hype around new product releases such as the iPad have generated unprecedented social media activity. This may be in part due to the technical nature of the product but it does highlight both the suitability and power of social media in the retail market.

Recent research has highlighted that retail brands still aren’t making the most of this opportunity and it is hard to believe that, according to the research, only 8% of retailers have a blog on their site. This is actually great news for retail brands as it’s a whole area of communication that is still to be exploited.

What other new technology is being utilised well by retailers in their marketing?

Email marketing is a hugely powerful technology that is now a well established marketing tool that delivers measurable results. Whilst it’s not a new technology, it is continuing to evolve and successful retailers are harnessing email in ever more refined ways.

There’s been a lot of hype around augmented reality over the past 12 months as the technology has matured alongside the smartphone evolution. Location based services that can deliver products to consumers as and when they need (or want) them are going to be hugely influential in consumers decision making process. It also bodes well for the high street as a presence will still be vital if retailers are going to make the most of this technology.

How important a part can agencies play in the growth of the retail sector?

I’d like to think that agencies like ourselves will continue to help in the growth of the retail sector! We’ve certainly delivered some great results in terms of sales and customer behaviour changes and I think that the role of agencies is far broader than it has ever been.

Where I think that creative agencies can add real value is in terms of being able to adapt to and lead the way with evolving technologies and content creation. A talented and forward thinking all round creative agency is not restricted by media and can, therefore, deliver a wide remit of requirements relevant to the individual retail brand. This, inevitably, helps growth in the retail sector as quality agencies respond in a bespoke fashion and create a strong proposition across media channels for their brands.

What part do special offers and sales play in the retail marketing equation? And do these devalue the offer of the retailer?

Special offers and sales promotions are, and always will be, a huge part of the retail marketing equation because everyone is looking for a bargain. Whilst there is no longer widespread haggling with retailers on the high street, this process is still thriving online through a raft of price comparison sites. For certain goods this can be detrimental as any perceived value can be eaten away by distributors fighting to retain and gain customers. In the short term this is good news for consumers although I can’t see how this model can be sustained.

Special offers and sales shouldn’t devalue the offer of the retailer if they’re managed sensibly as it’s an established and practical way of shifting stock and introducing new products. The problem comes when retailers and / or products are on an almost constant special offer and consumers expectations about how much they pay for a product or service are permanently reduced. This, for obvious reasons, is unsustainable business and it is at this point that marketing needs to earn its keep and reposition the offering.

What part can brand building play in the retail sector? Or is upfront sales the quest in the present market?

As with all marketing activity, brands need to specific about what they are looking to achieve before they invest in any activity. For some products, the dance compilations we create marketing collateral for example, impact sales are what they live or die by and so marketing activity is of the moment and focussed on generating immediate success. In many cases, this can then lead on to a brand building process if sales and general interest is sufficient.

A prime example of upfront sales leading to brand development work is the Clubland brand we created for Universal Music TV. From a dance compilation release 7 years ago, the brand has evolved into a multi-million selling dance phenomenon:

“From the process of creating the iconic Clubland logo through to producing all album artwork and devising unique marketing strategies to increase sales and consumer loyalty, Engine Creative has been a true brand guardian.”

It’s all about balance and the flexibility to evolve a strategy based on how a brand performs in the market.

Are retailers doing enough to build relationships with the consumer? Who is doing this best? And how can this be maintained and built on?

There are some great examples of retailers building customer relationships and, in turn, building loyalty. The best examples are those where consumers have already bought into the products and the brand and are then open to building the relationship further.

I think Fred Perry’s partnership with The Specials over the past 12 months has been a great example of them tapping into their iconic heritage whilst still retaining the integrity of the brand. This, in turn, has enabled them to build the relationship with their target audience and, as someone who is already partial to a classic Fred Perry shirt, the fact that I’m also kept up to date with tour dates and Specials news, for me, is an added benefit.

We did a similar thing with the Clubland brand and, knowing the target audience, developed a competition element to involve the consumers in the launch of the compilations. The hugely successful Clubland Babe Competitions to find cover girls included the creation of viral video content based around ‘bad’ competition entries that were posted online and shown on Clubland TV. The Clubland Babe Competitions and subsequent Best of Babes merchandise has built a huge following for the brand because it taps perfectly into the lifestyle of the consumer.

Is the point of sale still the most important arena in the retail marketing armoury?

Point of sale will always be a massive aspect of retail marketing although it has now moved online, it’s mobile and it’s interactive. How retail brands adapt to this changing landscape will dictate how successful they are and it won’t, nor should it, be the same for all brands. I want the ease and convenience of being able to make purchases in a seamless way on my mobile and the brands I will gravitate to, I hope, will recognise this trend and adapt their offering accordingly.

It all comes down to the unique positioning a brand creates for itself, who their consumers are and how they can best fit the point of sale into the lifestyle of their customers. These decisions will be based on ongoing communication with there consumers and should, in turn, result in a far more targeted and effective marketing process.

What trends are you currently noticing in retail marketing?

As already described, the biggest general trend is how retail brands are making the most of digital technologies although there are obviously certain trends that are sector specific. For example, one of the biggest changes that we’ve seen is in the music industry and the rise an rise of the single download. Consumers are cherry picking their favourite tunes and, rather than seeing this as an issue, the proactive labels are packaging up all of these best sellers into massive selling compilations.

I also believe that consumers are looking for quality products that last and deliver value. This will mean that brands in the middle market might struggle to find their place if they’re neither price conscious or quality driven. Expectations regarding customer services are also higher and I think this, again, is a growing priority for consumers to ensure that they receive value for money for their recession pound.

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