why-the-retailers-closing-stores-probably-won’t-see-a-major-e-commerce-uptick

According to post-holiday sales data, U.S. overall retail sales were flat or up modestly; however, some traditional retailers saw sales declines to varying degrees. By comparison, online sales were up roughly 19% according to data from Mastercard, which said total holiday retail sales increased 3.4% compared with a year ago.

Macy’s, JCPenney, L Brands, Kohl’s and even Target reported disappointing results. Macy’s said it would close nearly 30 stores, while Pier 1 is closing almost half its stores. Total store closures last year exceeded 9,000 locations.

Mindset: Close stores, push e-commerce

Following lower-than-expected in-store sales, the natural impulse for some retailers is: close stores and push e-commerce. And that may make sense in the abstract and in some instances. However too many “omnichannel” retailers don’t fully appreciate the symbiotic relationship between stores and online sales. This is reflected most significantly in the still-frequent bright line separation (often with separate P&Ls) between e-comm and store teams.

Euclid Analytics CEO Brent Franson told me in 2017 that when stores disappear, it hurts online sales as well. (Euclid was acquired by WeWork in early 2019.) I haven’t been able to find further support for that statement, but it makes considerable sense.

In-store returns boost online sales

In an off the record conversation last November, I was told by a digital commerce executive at a major female apparel retailer that the mention of in-store returns in online ads boosted e-commerce sales. Why? Because people will be more inclined to buy “sight unseen” if they’re confident then can return products in store. And according to data compiled by eMarketer, 75% of online shoppers prefer to return products in-store.

An interesting twist on that concept is the partnership between Kohl’s and Amazon. Kohl’s accepts returns of Amazon products in all its stores. Amazon benefits from more than 1,100 “return centers” (Kohl’s stores) across the U.S. For its part, Kohl’s has said that the policy brings younger buyers into the store, who often go on to buy something.

Local search drives e-commerce too

The in-store return of e-commerce products often results in additional sales. People tend to buy more in a store after returning an online product. And easy returns create support and reinforce brand loyalty.

It also goes the other way. LocalSEOGuide’s Dan Leibson said in a phone interview that many of the firm’s big box retail customers see millions of dollars in online sales being driven by local search and Google My Business. In other words, someone looks for a particular branded store “near me” and then clicks through to the website, ultimately buying something online.

“This is a thing for all major retailers,” Leibson explained. “There’s an underreported amount of revenue coming this way.” In fact Leibson believes that major retailers, paradoxically, should be thinking about local search as a potentially significant driver of e-commerce and optimize their pages accordingly.

BOPIS and consumer agnosticism

This phenomenon also plays off the “omnichannel” paradigm. Consumers are relatively agnostic about where they buy something if they’re confident they can take the product back if it’s not right. This is also reflected in the growth of BOPIS (buy online, pick up in store).

As Deloitte has argued in its “2020 retail industry outlook” report, convenience is a major incentive or issue for consumers: “Whether in the store or online, consumers want a friction-free experience, from finding ideas and inspiration to making purchases, managing returns, and advocating for the brand.”

Convenience is king for consumers

Conversely, when a store fails to deliver on that convenience it can damage shopper loyalty and even the reputation of the brand. I had such an experience with Banana Republic over the holiday when I was not permitted to return a shirt purchased online (that didn’t fit) to one of their stores. I won’t be buying anything more from Banana Republic (online or off).

So, while closing underperforming stores makes economic sense for many distressed retailers they should think carefully about which stores they close and not simply assume that customers will shift their buying behavior to the brand’s online shopping cart.



About The Author

Greg Sterling is a Contributing Editor to Search Engine Land, a member of the programming team for SMX events and the VP, Market Insights at Uberall.



retailers-are-selling-$60-wires-for-apple’s-wireless-airpods

Back in the year 2016, we had no problems. Well, okay, that’s not true. We had some problems. But our headphones weren’t one of them. That’s because headphones featured a universal design that was based upon a simple 3.5 mm jack that had been around for over a century. Then Apple killed the standard audio jack in iPhones and introduced its $159 wireless Airpods.

Tapper on Nordstrom [Screenshot: Nordstrom]

Wireless earbuds seem great, of course, until one falls out of your ear and down a sewer grate. Single Airpod Syndrome is a very real consequence of the new, untethered world of audio. That’s why Apple actually offers single Airpod replacements. That’s also why one company called Tapper introduced a solution of its own: Airpod cords.

First spotted by Boingboing, the $60 strap wraps around your neck and connects to your Airpods via magnets. That means if one falls out of your ear, it’s anchored to your body—like a rope climber is anchored to a mountain, or, you know, a normal, wired pair of earbuds were once anchored to your phone. What more is there to say here? We’re talking about a $60 product that adds wires to a product designed to remove wires from your life. The most hilarious twist is that Tapper’s cord actually has 4/5 stars on Nordstrom right now! Even if half those reviews are ironic, and the other half are planted, that’s still pretty impressive for a few inches of cordage. And a pretty sad commentary on the state of headphones, three years after Apple destroyed a perfectly good universal standard.

how-retailers-can-optimize-facebook-ads-for-direct-response-vs.-brand-building

Facebook advertising is increasingly playing multiple roles in the retail marketing funnel – not unlike advertising on Google, Amazon and other major platforms.

For instance, some marketers opt for a direct response, or mid-funnel, approach with Facebook ads by encouraging users to take specific actions online, in-store, or in mobile apps. Other marketers operate earlier in the funnel and build awareness. Still, other marketers combine these methods to better influence the shopping journey.

But I continue to see a common mistake in the retail industry when marketers go about leveraging Facebook ads. They invest in the channel without clear strategies for how the ads will support direct response, or brand building, or both. There’s often not enough planning around how the ads will drive the funnel on Facebook, and drive the funnel overall.

Direct response and brand building campaigns require different, yet aligned, approaches and processes to maximize their results and avoid wasted ad spend. There are four major factors to consider: audience, ad creative, budget allocation and measurement.

This graphic provides a snapshot of how to think about these factors, depending on the goal you’re emphasizing with Facebook ads. Let’s unpack each factor.

Source: Sidecar

Audience

Ad format is inherently tied to reaching the right audience on Facebook. Dynamic ads are for direct response, while dynamic ads targeting broad audiences are for brand building.

Optimize for direct response: Direct response on Facebook equals retargeting past site and (if applicable) app visitors with dynamic ads. These ads collect user activity from a Facebook pixel on your website and track traffic and conversions at the product level. Retargeting previous site and app visitors with product-centric ads reinforces your brand and makes shoppers reconsider purchasing items from your site.

Your audience here is Facebook users who’ve taken some action on your site over a selected amount of days. These users showed interest in your brand and products, so retargeting them with ads displaying similar products may encourage them to return to your site and make a purchase.

Optimize for brand building: You want to serve captivating ads to Facebook users who are new to your brand and products. Use dynamic ads for broad audiences to target upper funnel audiences that have shopped similar products to what you sell. You can segment your audience further by specific region, age range, and gender.

Other capabilities let you target customers who “like” your competitors. For instance, a large apparel retailer may want to target Facebook users who like its competitors. This retailer may also target customers who like its wholesale partner stores that sell its products. These options allow the retailer to steal market share from competitors and bolster its brand.

Ad creative

Facebook is a social network at its core, but it’s also a place where you can engage shoppers in a meaningful way. This should factor into your ad creative. Develop content to match where shoppers are in the funnel.

Optimize for direct response: Focus on promoting specific items and their unique features. Create images and videos that highlight the best attributes of your products and entice Facebook users to act and learn more. Use succinct messaging and be promotional in your ad copy to inspire clicks.

Carousel ads are a great creative play to move users down the funnel. Use the cards within this ad format to tell a compelling story with your products. Conversion rates are typically higher with carousel ads because they display multiple products. Another positive: Carousel ads tend to have lower CPCs with up to 10 images or videos in a single ad, increasing sales with less spend.

Optimize for brand building: Use creative that conveys your unique value in the retail space. Leverage lifestyle imagery and videos that capture the essence of who you are and what you sell.

Single image ads and collection ads are ideal formats for brand discovery. With single image ads, you can highlight your brand or specific products through an engaging image and promotional ad copy. Showcase your brand further on mobile with collection ads. These ads use a captivating lead image or video along with four accompanying images to tell your story.

Budget allocation

Budget allocation between direct response and brand building ad campaigns should ideally work in tandem based on your business needs.

Optimize for direct response: Direct response (as opposed to brand building) is generally the safer bet for a better return on Facebook ads, which might drive you to prioritize ad budget for this approach. Allocate a direct response ad budget—a.k.a., a retargeting budget—by leveraging your ROAS goal.

For instance, let’s say you need to meet a more aggressive six-to-one ROAS on any Facebook direct response campaigns because you have already acquired the customers through another channel and are seeking to re-acquire them. Knowing your ROAS goal helps you then determine how much budget you should allocate to that type of campaign.

Optimize for brand building: A brand building ad budget, on the other hand, should operate to a CPA goal. That’s because it seeks to generate new customers through dynamic ads for broad audiences. In this scenario, you might determine you’re willing to operate to a more generous goal of one-to-one. From there, you have context to determine your brand building budget.

Again, keep your Facebook ad budget fluid based on your business priorities how they change. For instance, budget to support direct response versus brand building should flex depending on organizational revenue and return goals, brand awareness needs, seasonality, and other factors.

Measurement

Facebook ads engage consumers at the top and middle of the purchase funnel more often than those who are one click away from purchase. As a result, last-click attribution falls short of giving your Facebook advertising effort the credit it deserves.

To help overcome this challenge, Facebook sets its default attribution to a one-day view and 28-day click. Actions taken over these periods count either one day after someone sees your ad or within 28 days of someone clicking your ad.

The default model is Facebook’s way of demonstrating the value of the channel for marketers who are on last-click attribution. This view might work for you if you’re using a single-touch model because it will account for conversions when optimizing the channel.

However, the ideal approach is to move to multi-touch attribution. Multi-touch attribution is critical when optimizing for both direct response and brand building ad campaigns on Facebook—and for your marketing approach globally. It assigns value to each touchpoint, allowing you to see how effective not only Facebook is in your mix, but every other channel as well.

One way to understand the various attribution models is through the Google Analytics Model Comparison Tool. It shows how views of performance change depending on the model. However, no matter your attribution model, ensure you understand Facebook’s attribution settings and consider adjusting them, if possible, to better align with your business objectives.

Be careful to properly value Facebook advertising and its role in the purchase path. Facebook ads are designed to be brand builders and direct response drivers if used strategically in your marketing mix.


Opinions expressed in this article are those of the guest author and not necessarily Marketing Land. Staff authors are listed here.



About The Author

Mike is a retail marketing strategist, fluent in paid search, shopping ads, affiliates, email, display, and comparison shopping engines. As Senior Director of Market & Customer Intelligence for Sidecar, Mike stays close to the shifting retail landscape and how it’s impacting marketing strategy. He has advised hundreds of marketers across retail verticals in the context of their business goals and the industry at large. Mike contributes to Marketing Land as well as Sidecar Discover.



how-brick-and-mortar-retailers-can-succeed-on-amazon

The popularity of Amazon Marketplace over the years has made Amazon a more attractive destination for brick-and-mortar retailers. In a recent column, I discussed the example of one retailer that relies on Amazon to complement its offline operations. Recently published data suggests that Amazon presents a major opportunity for retailers to attract more business by having a presence on the site. As reported in Marketplace Pulse, 78 percent of keyword searches done on Amazon are nonbranded. In other words, most people are searching for product categories such as “AAA batteries” and “men’s shirts” instead of trying to find names of specific brands. Now consider that Amazon has overtaken Google as the most popular destination for people to do product searches. Brick-and-mortar retailers need to view Amazon as a platform to not only sell more products but to build your reputations. Doing so will create a virtuous cycle of success.

Here’s how retailers can win on Amazon

Winning on Amazon isn’t very different from using digital outside of Amazon. You need to attract customers and keep them. The fundamentals are the same, even if the rules differ from one platform to the next.

Attract customers

You’ve heard it said — how many times now? — about Google, Facebook and other digital platforms that attracting and converting customers is about combining an organic and paid media strategy with the management of customer reviews.

  • Optimize for search. For example, optimize product titles and product category descriptions to answer the 78% of nonbranded searches occurring on Amazon. Make sure you include a brief and concise description of what your product does, how much quantity is available, and depending on your category, crucial details such as color, size and price, all of which will keep you in the consideration set for more detailed generic searches such as “men’s shirts size medium.” Pay close attention to how you manage Amazon backend keywords, which are keywords that you use on the backend of your seller account. And, in the age of visual storytelling, it’s essential to use strong, clear images that allow shoppers to do detailed comparisons.
  • Capitalize on Amazon Advertising. Amazon is putting a dent into Google’s and Facebook’s dominance of online advertising, as I discussed in a column last year. Its share of digital advertising, while small, is rising and stealing business from Google in particular. Over the past few years, Amazon has unleashed a slew of advertising products for businesses whether they sell products on Amazon or not. Among the popular Amazon Advertising products: Sponsored Products, which make it possible for businesses to promote products to shoppers who are searching with related keywords or viewing similar products on Amazon. They appear as inventory alongside search result. People who click on the Sponsored Product listing are taken to your inventory. On the other hand, Display Ads serve up relevant ads to shoppers who are actively viewing specific products – and the content can appear on a competitor’s product inventory. These are just a few of the products available among Amazon’s rapidly expanding toolset.
  • Mind your reviews. Customer reviews on Amazon function like they do on Google: they increase your chances of being chosen, and they make your products more visible. In fact, reviews are among the most important ranking factors under Amazon’s A9 search algorithm. Unfortunately, unethical businesses are trying to game the system with fake reviews. But fake reviews are not a reason to ignore a strong reviews program. It’s important to proactively managing reviews – and, yes, managing reviews means asking for them, so long as you adhere to Amazon’s terms of service (such as using the Seller Central Buyer Message system). 

Keep customers

Keeping customers is about being vigilant to monitor input from customer reviews to improve your products and services. Here is another reason why managing your customer ratings/reviews on Amazon is essential as well as far-reaching in scope: they are the building cornerstone of your reputation.

A five-star review in and of itself doesn’t mean a whole lot. But a pattern of reviews over a period of time gives you valuable unstructured data that you can and should use to improve your service, whether you need to price your products more competitively, carry a better selection of inventory, or improve your fulfillment practices.

Reviews help create a virtuous cycle on Amazon: the more positive reviews you get, the more likely it is that those non-branded searches are going to land on your merchant page. When people come to your page and see those reviews, they are more likely to buy what you are selling. The reviews, in turn, also give you feedback to help you improve your products and services, which leads to more positive reviews.

But you don’t create this virtuous cycle unless you use that input from reviews to get better.

What you should do next

There’s another major benefit to being on Amazon: you’ll protect yourself as Amazon expands into physical retailing through operations such as its brick-and-mortar bookstores and Amazon Go for groceries. If you are a well-established retailer with a strong local presence, you have an edge – and you can capitalize on it by relying on your storefronts to manage product fulfillment for your online presence. But that edge may not last. The time is now to act by taking advantage of the strengths of retailing’s largest online search platform.


Opinions expressed in this article are those of the guest author and not necessarily Marketing Land. Staff authors are listed here.



About The Author

Reputation where he and his teams are integrating location-based marketing with reputation management and customer experience. Adam contributes regularly to publications such as Search Engine Land, participates in Moz’s Local Search Ranking Factors survey, and regularly speaks at search marketing events such as Search Marketing Expo (SMX) West and State of Search as well as industry-specific events such as HIMSS. Follow him on Twitter @phixed.




how-retailers-can-avoid-the-9-biggest-pitfalls-of-facebook-advertising

Facebook’s ad business shows no signs of slowing, generating $14.9 billion during the first quarter of the year. That’s up 26% year over year. With this growth has come a major expansion of Facebook’s audience targeting capabilities. Many retail marketers understand the advertising potential that Facebook holds as a result.

But this sophistication isn’t without challenges. The growing complexities involved with setup and campaign management can often leave the most seasoned marketers in need of direction when advertising in the channel.

Facebook advertising success boils down to the three areas of study: pixel and campaign strategy, audience targeting and measurement. Learn about the pitfalls involved in each and how you can navigate them with the right approach.

Pixel setup and campaign strategy

Those with experience setting up Facebook ad campaigns can attest to the platform’s cumbersome interface. With the vast array of settings and targeting capabilities, it’s easy to take shortcuts that result in poorly targeted campaigns that drive minimal results.

Pitfall #1: Setting up the Pixel incorrectly

Pixel setup is critical to tracking all customer interactions so that targeting is effective. Before diving into campaign settings, ensure your pixel is uploaded to your website and tracking what your website and app visitors view and purchase. Review your Pixel Events in relation to your business goals and get a better understanding of your customers’ path to purchase. To confirm your pixel is uploaded and running, use the Facebook Pixel Helper.

Pitfall #2: Choosing the wrong attribution window

Attribution settings for the Facebook pixel default to a one-day view and 28-day click. This means actions taken over these periods count either one day after someone sees your ad or within 28 days of someone clicking your ad. If you have a tight, ROAS-driven business, consider adjusting these settings so they fall in line with your business objectives. You have the option to change the attribution window to one-day, seven-day and 28-day view and click attribution.

The default attribution model is Facebook’s way of demonstrating the value of the channel for marketers stuck in a last-click world. You may benefit from one-day view if you’re using a single touch attribution model since it will take conversions into account when optimizing the channel.

Pitfall #3: Selecting the wrong campaign type for your business goals

Define your goals and determine what type of Facebook campaigns best suit your business. Use Facebook’s different ad formats to fulfill these goals. Facebook dynamic product ads let you create retargeting campaigns that direct customers down the purchase funnel. Dynamic Ads for Broad Audiences (DABA) let you create prospecting campaigns that target new customer acquisition. Using these two formats, you can serve relevant ad content to re-engage past site visitors and target new shoppers unfamiliar with your brand.

Pitfall #4: Neglecting to add tracking parameters for your data source of truth

Append tracking parameters to each of your Facebook campaigns to avoid the pitfall.

You can do this by creating a new campaign or working on a saved campaign in Ads Manager. Select an objective you want your parameters to achieve and add the website URL you want to track. Fill in the parameters by entering a key and an assigned value. For example, if you’re tracking an ad with the ocean as its image, you can add “image=ocean” as the parameter. The key is “image” and the assigned value is “ocean.”

These parameters help track performance within your data source of record and serve as a second source of truth in measuring campaign success. You can track the effectiveness of your ad based on your parameter objective and understand which ads are helping you meet your goals.

Pitfall #5: Starting with the wrong campaign strategy

Campaign setup should segment your traffic into separate objectives you wish to report on and optimize. For instance, separating retargeting ad sets from prospecting ad sets lets you effectively manage more budget and optimizations between two different objectives. Keep in mind that the bulk of settings and targeting options take place at the ad set level and not the campaign level. This creates more flexibility to group various initiatives under one objective (like retargeting campaigns for different product sets or audiences).

Audience strategy and targeting

When it comes to audience strategy and targeting, marketers should focus on allocating budget toward the highest performing traffic sources. This especially true for retailers focused on the highest return on ad spend. Facebook’s ability to drill down into granular audience sets – like demographic and interest targeting – sets it apart from its competitors in an important way.

Pitfall #6: Targeting the wrong audience

Use dynamic product ads and dynamic ads for broad audiences to reach the largest number of Facebook users. Dynamic product ads are retargeting-based ads that focus on moving users down the purchase funnel. Create separate audiences (ad sets) for people who have purchased products, added items to their cart, and site visitors. Because each group is at a different stage of the purchase process, these ad sets will give you insight into how likely they are to convert.

Layer time filters into these segments based on data amount and audience size. For instance, your purchased products audience can be split into two segments: “purchased in the last 30 days” and “purchased 30 days .” Consider this same process for each audience segment and break each up into time segments that align with your business and how your customers shop for you products.

Depending on the amount of data at your disposal, the above structure can break down even further. You can split audience by device and, if possible, by platform (Facebook vs. Instagram). Each of these segments has performance differences to help prioritize how you spend your budget for the best return.

The goal of audience segmentation is to eliminate overlap and ensure that you control recency and frequency of ad delivery. This will prevent you from saturating your audience with ads, which often results in ad blocking.

Pitfall #7: Targeting too broad of an audience

Dynamic Ads for Broad Audiences (DABA) is a prospecting ad format that drives new customer acquisition. These ad units help fill the customer prospect funnel for the retargeting campaigns discussed above. This segment of customers is where Facebook’s audience segmentation capabilities prioritize and strategically spend valuable budget dollars.

To start with DABA, choose targeting that most aligns to your business (running, womens apparel, etc.). Once you decide core interests to target, create ad sets with additional segmentation for demographics like gender, age, and device.

If audience size permits, consider additional segmentation for placement and platform. After finalizing the baseline structure of ad sets that target interests, consider duplicating the structure to target lookalike audiences for additional exposure.

Pitfall #8: Overlooking bid strategy

Marketers often fail to consider a bid strategy when advertising on Facebook. By choosing the wrong strategy or neglecting a strategy altogether, they exhaust budget quickly and ad performance suffers.

There are six bid strategies available for Facebook ads. Each supports specific objectives and has unique benefits. Facebook sets bids for five of these strategies, including lowest cost, in which Facebook manages all bidding and reaches your lowest cost opportunities while spending budget. Consult the Facebook Bid Strategy Guide for a complete look at strategies, objectives, and when to use each.

Measurement

Most marketers struggle to find the value of each marketing touchpoint in any one purchase path. They often default to tracking performance via last-click attribution. This model, which credits one touchpoint as the entire customer journey, is antiquated and typically leads to inefficient spending. To get a holistic view of the sales journey across multiple touchpoints on Facebook, consider changing your attribution approach.

Pitfall #9: Using the wrong attribution model

Facebook is a platform that engages consumers at the top and middle of the purchase funnel more often than consumers that are ready to buy. Because of this high-funnel intent, retailers need to shift their measurement focus to multi-touch attribution (MTA). This will help assign value to each touchpoint so it receives the credit it deserves.

Most shoppers use a variety of different platforms to shop. Facebook’s increasing role in the customer journey makes MTA a valuable tool in measuring how effective Facebook ads are in a marketing mix. It is especially relevant for marketers who advertise across multiple channels, as MTA evaluates each channel’s importance in a sale. Consider the many MTA options available: Linear, Time Decay, U-Shaped, W-Shaped, and Algorithmic.

Avoiding Facebook Advertising’s pitfalls

Facebook is a great platform to build awareness, advertise specific products, and drive revenue. However, many marketers simply invest in the channel with no clear strategy, which frequently leads to wasted ad spend.

Whether you’re just getting started or an established marketer advertising in the channel, consider these pitfalls when working your Facebook ad campaigns. With the right knowledge in place, you can avoid burning your budget on limited results.


Opinions expressed in this article are those of the guest author and not necessarily Marketing Land. Staff authors are listed here.



About The Author

Sidecar, Mike stays close to the shifting retail landscape and how it’s impacting marketing strategy. He has advised hundreds of marketers across retail verticals in the context of their business goals and the industry at large. Mike contributes to Marketing Land as well as Sidecar Discover.