The retail sector is undergoing a lot of changes. This is not only due to the growing competition and increasing advertising spend, but also to new channels, technologies and media. Digitalization has fundamentally changed consumer’s shopping behavior. Not only is today’s consumer always informed and connected, he is also constantly switching between different devices and between the online and offline worlds.
The result: increasingly complex customer journeys. For successful and targeted campaigns, however, marketers need to know and precisely understand these journeys. The ability to understand your customers’ behavior holistically is a requirement for allocating advertising budgets efficiently across multiple channels and advertising measures. In our blog post, we have summarized 3 of the biggest challenges retailers are facing nowadays and give tips on how to master these with help of attribution.
#1 CUSTOMERS HAVE HIGH DEMANDS
Consumer behavior has changed enormously in recent years. The typical picture book customer journey is rare these days. On their path to conversion, consumers come across countless touchpoints with the brand across a wide variety of channels and devices. Our attribution study for the retail industry shows that almost half of all customer journeys consist of more than one device and touchpoint.
The majority of consumers (81%) expect every online experience to be tailored specifically to them and brands to understand their interests and intentions (Accenture). Personalization is therefore becoming increasingly important in marketing. For advertisers, this means they must understand the customer journey in its entirety in order to recognize customers across all devices and channels and be able to address them with relevant content.
Cross-device attribution enables marketers to identify consumers across a wide range of channels and platforms. With this holistic view of the customer, advertisers are able to put the customer and his experience first and with that strengthen their brand equity.
#2 STATIC MODELS LIKE LAST COOKIE WINS ARE NO LONGER SUFFICIENT
When it comes to evaluating the effectiveness of their marketing measures, many retailers still use outdated methods. The Last Cookie Wins model, which assigns the sole advertising success to the last touchpoint in the customer journey, is still in use frequently. As a result, retailers often rely on marketing measures that haven’t actually achieved the desired results. Optimization is therefore blind and based on incomplete data.
However, the average customer journey in the retail industry consists of 20 touchpoints and lasts 18 days (Exactag, Attribution Study Retail). In view of this complex customer journey, the Last Cookie Wins approach should be regarded as outdated.
Data-driven attribution models, which are based on automated, intelligent algorithms provide a solution because they evaluate and analyze each individual touchpoint between consumer and brand. The result is an unambiguous assignment of each touchpoint’s credit and contribution towards the conversion. Retailers can then identify which marketing campaigns were successful and which were not. With these insights they can adjust their strategy, reallocate budgets and make informed and smart decisions.
Further reading: Using Marketing Attribution to understand the Customer Journey
#3 ATTRIBUTION LINKS THE ONLINE AND OFFLINE WORLDS
One of the biggest difficulties in retailing is the fluent and constant transition from offline to online shopping and vice versa.
When searching for a product, consumers naturally switch back and forth between stationary and digital shops. Before buying a product in a store they research online. Others check the quality of a product in the store and later buy it online to look for special offers. This constant change makes it increasingly difficult for retailers to track their customers’ journeys.
Marketing attribution collects data of all digital channels at user level and links it with offline measures (e.g. catalogue advertising). All data sets are then centralized and stored in a single system.
This knowledge helps marketers to derive important processes for their marketing strategy to link both worlds. This way the consumer senses a holistic brand experience.
In these challenging times, advertisers in the retail sector feel the need to perform more than ever before. High demands of customers and strong competition require marketers to replace old and outdated methods and to apply future-oriented strategies.
As a leading provider of marketing attribution, our mission is to provide our customers with the best possible support in using attribution to optimize their marketing strategies and advertising budgets.
In the study, we investigate key questions concerning the impact and performance of digital marketing channels and provide benchmarks for our customers. With the help of anonymous customer data, the study provides insights into what today's customer journeys look like, how marketers can fairly evaluate individual touchpoints and how marketing channels and budgets can be optimized with the findings.
With data-driven attribution, retailers can measure, analyze and optimize their marketing measure. The holistic view of the behavior and needs of consumers enables marketers to create innovative and tailored content that inspires customers and drives sales and brand awareness.