The rise of the shelf
There’s no doubt that the time and resource dedicated to managing the digital shelf and the volume of data it produces has significantly risen amongst brands. The digital shelf is now a Board level issue with the C-suite looking for monthly or even weekly data on performance and trends.
As a result, it was probably no surprise that in a snap poll of event attendees 90% said they monitor the digital shelf, with 57% doing so to increase sales and revenue and 21% monitor it to acquire new markets and open new markets.
It’s something that needs constant attention: in a digitally-driven market, it’s essential to react quickly when customer habits change. The pandemic powerfully demonstrated the speed with which things move. Remember those days at the beginning of the first lockdown when there was mass panic buying of toilet paper, hand sanitiser and cleaning products? Out of stock levels of around 80% were common on some products, according to Andrew Pearl – an unprecedented situation. But that soon subsided. The second lockdown saw a spike in demand for personal fitness products; this latest lockdown has seen a shift towards items to boost personal comfort at home as well as pet-related purchases.
“Trends can dramatically increase over the course of a month – and then drop off very quickly,” Andrew said.
So, here are our five tips for managing your ‘digital shelf’ to maximise return on investment and staying on top of trends.
- Optimise your own digital shelf
Managing your own website must be a key priority – it remains an essential gateway for your customers. Think about your site as a digital version of a physical store. Just like supermarkets, what products do you want to promote on your homepage and what products would work best for impulse purchases near checkout? Like the sweets and goodies supermarkets place temptingly near the tills. Your overall goal, whether it be profitability, brand awareness or market share, will help you to decide which products to dedicate resources to and where to position them on your website.
Your own website data and sales levels should tell you at which points people are engaging and if you’re putting out the right product selections.
- Manage your extended shelves
Keep agile, keep tracking. Are you optimising your content on third party websites and platforms and meeting their requirements? Andrew reflected that through the pandemic, many businesses’ content and marketing requirements changed, citing one major US retailer that introduced some 180 changes during 2020. Meanwhile, search has become “the new battleground”. If you can improve search performance organically through the right keywords and descriptions, this can drive a more sustained uplift than through sponsored activity. But nevertheless, as it’s now possible to sponsor a keyword on Amazon for just a few hundred pounds, small and medium sized brands have the possibility of knocking big players out of the top results. Constant adaptability and speed of reaction are critical.
- Track multi-modal data
A recent KPMG global survey of 70,000 participants showed that not only do over half of consumers view digital channels as their main way of contacting brands in the future, but almost 6 in 10 claim to be multi-modal. This is a newly coined phrase we’re going to hear more and more frequently – what does it mean? Consumers are equally happy to shop on their phones, laptops, or – wait for it – in a shop! The consumer interacting with their device whilst physically shopping creates new opportunities. Consumer goods businesses need to therefore connect the dots and make sure that their multi-modal data is talking to each other to enhance the customer experience. If a customer buys a product in a store, then your digital marketing strategy for that person will change.
- Analyse and act on customer data to drive value
It’s not enough to simply gather data across digital platforms and touchpoints – you’ve got to be able to act on that data too. Only then can you truly apply a commercial lens to your marketing and data tools and drive value.
Achieving and demonstrating this ROI has become imperative. It’s another effect of the pandemic that every area of spend across consumer businesses has come under the spotlight. This means it’s essential to have the tools to predict the incremental increase of any change, for example, a price decrease or a bigger media budget.
However, as Dimitar Mitev warned: “You need to recognise that these things are not linear. There is a diminishing return on investment above certain levels. For example, say you spend £1,000 on digital ads and that gets you 50 leads, tripling the budget won’t necessarily get you 150 leads. The proliferation of available data sources helps us model this accurately so that you can establish the break-even point and achieve an optimal balance.”
- Prepare for a cookie-less future
Next year Google Chrome – the most popular web browser – will block cookies. It’s a major shift that will re-write the rules of the web. Consumer businesses will have to change tack around how they track and target consumers. Ultimately, this won’t remove the ability to target individuals, but extra effort and business change will be needed.
“Effective tagging, tracking and integrating with first party data more effectively will become essential for ‘cookie-less’ audience measurement and targeting,” Dimitar observed.
It is a move in the right direction though and we need to remember that not all customers find the harnessing of their data welcome. In our recent Me, My Life, My Wallet survey 30% of men said it was ‘cool’ for businesses to use their data for personalization and the same percentage considered it ‘creepy’. Only 27 per cent of women thought it ‘cool’, and 34 percent deemed it ‘creepy’. The implication being that companies need to know when and how to harness the insights appropriately across different cohorts and segments – which ironically you need the data to do.
Please don’t hesitate to contact me if there are any aspects that you’d like to discuss.
And, if you’d like to attend future ‘In Conversation’ events, please email Sarah Rodger who will ensure you’re kept fully in the loop.