By David Haase, Chief Development Officer, Triad
If you listen to eMarketer, the 2018 holiday shopping season could be very strong for those prepared to harness it. To quote from a recent report: “Online holiday shopping in the U.S. is set to grow to $151 billion this year, up 14% from $133 billion in 2017. Total holiday sales will grow at a more conservative 1.7%. All told, we’ll see approximately one-fifth of all U.S. holiday shopping this year happening online — and of course, digital touchpoints will influence lots of sales that ultimately happen in-store.”
That’s promising news if your business is structured to harness the online opportunity during the all-important holiday shopping season. But let’s not discount the role offline can play, particularly when looking at so-called WANG companies.
Jim Cramer, the host of CNBC's show “Mad Money" thinks WANG stocks — his acronym for Walmart, Apple, Netflix, and Google — are poised to perform well in the fourth quarter. These four companies, he says, compare favorably with his original big four: Facebook, Amazon, Netflix, and Google (FANG).
Cramer's shift from FANG to WANG not only reflects his favorable view of Apple and Walmart in the retail sector, but also signals something much larger for the entire industry. Not only is the holiday season going to be the sweet spot for where brands need to focus, it will form the bedrock for future retail growth. Three factors are bringing about this revolution.
1. Consumers’ Elevated Expectations
In today's marketplace, the constantly connected consumer expects more than just a single choice anymore – which, to a retailer, translates to offering omni-channel opportunities, and communicating seamlessly across all channels. Thirty-two percent of consumers agree that the biggest improvement retailers need to make is to integrate the mobile, website and in-store shopping experience.
Many retailers, including Walmart, are doing this by integrating its physical and digital strategies in a way that’s boosting its brick and mortar sales. For example, the acquisitions of digital-only properties such as ModCloth, Bonobos, and Jet have diversified the retailer’s portfolio to provide not only more product offerings to consumers throughout different category verticals, but also distinct shopping experiences. This, in turn, has given consumers more freedom to shop based on preference, while also making it easier for advertisers on those sites to merge online and in-store platforms, thus creating a more connected shopping experience.
Retailers, however, are also pushing other innovative conveniences for shoppers. Take click-and-collect models, for instance. This year alone, Lowe’s reported that 60% of its online orders are collected in its physical brick-and-mortar stores, while Home Depot (43%) and Kohl’s (36%) also saw similar returns from comparable offerings, according to SaaS-based solution provider Signifyd. For supposedly traditional retailers, these collective strategies are pretty forward-leaning, on top of another well-renowned outlet — Walmart’s — complete site re-design this past summer.
Retailers' in-depth understanding of customer journeys – and enabling of multiple ways to shop and interact – can only aid brands in implementing targeted and effective marketing strategies this holiday season. And the more they learn between now and New Year’s Eve, the more they’ll be able to adopt the successful strategies more permanently.
2. Remembering the 5 “Ps” Are Essential
Putting aside the stresses consumers feel to get things done heading into the holiday season, this time of year invokes deep-felt emotions in most of us. Retailers are working to tap into those emotions in various ways by keeping the five essential “Ps” of marketing — price, promotion, place, product and personalization — top of mind.
When executed properly, those five attributes collectively used in unison as part of a larger overall strategy enhances experience marketing and gives marketers the chance to deliver relevant messages that consumers want — when and where they want them. Higher quality interactions resonate on an emotional level with buyers, which can lead directly to sales growth. In fact, Epsilon research shows that 80 percent of consumers are more likely to do business with a company if it offers them a personalized experience.
Quality of experience is now just as important as quality of choice. Walmart, again, and Apple, are perhaps leading the way to offer a strong example of how retailers are implementing cross-channel strategies — as evidenced by the world’s largest retailer’s online grocery pickup service, geo-fencing technology capabilities and in-app mobile offerings — to not only reach customers online and offline, but serve up resonance and relevance at the right time.
Then there’s Apple, which in fact, an MBLM study on Brand Intimacy reports is the world leader when it comes to establishing emotional ties with consumers. “That connectivity leverages and strengthens the emotional bonds between a person and a brand," the report says.
3. More Days to Sell
Another potentially strong tailwind for retail-based stocks is a longer than usual 2018 holiday season. Thanksgiving comes early this year, which means the all-important holiday window in the U.S. will open on Nov. 23 (as opposed to Nov. 28 next year, in which this all-important window will be reduced by six days), adding a week to the end-of-year sales frenzy.
With the potential for a strong fourth quarter, brands should be thinking about how to take advantage of retailer platforms. Retailers, to that end, should be focused on connecting brands and consumers in order to maximize revenue. A strong retail sector also offers an opportunity for advertisers to focus on online, in-store and point-of-sale promotions.
There’s really no more either-or anymore. The future of retail is undeniably omni-channel. Any brand or advertiser that wants to end the calendar year strong needs to both pivot its approach, then adopt these strategies so that they become part of their marketing mix—in the fourth quarter and beyond.
David Haase is the global chief development officer at Triad, and a 12-year veteran of the St. Petersburg, Fla.-based firm.