Annual Trends Survey 2012

Traditional marketing channels are the name of the game for Retail Online Integration readers, with most increasing their focus on email and search marketing in 2012, at least according to this year’s Annual Trends Survey. They’ll also rely on social media, affiliate and video marketing more this year to increase consumer engagement and ultimately grow sales.

For this year’s survey, which as in years past focused on cross-channel marketing and promotional integration, we polled all of the Retail Online Integration and ROI Report subscribers in January. A total of 219 readers responded.

All About Our Readers
In terms of primary business classification, the majority of our readers identify themselves as online merchants (28 percent), followed by brick-and-mortar retailers (24 percent) and “other” (22 percent), which primarily included retail service providers and consultants.

Much like the findings from last year’s survey, Retail Online Integration readers fall into two main types of retail executives: CEOs and high-level marketing professionals. In fact, 41 percent of the respondents are company CEOs and 29 percent are in some type of marketing position. The annual revenues for our respondents’ companies generally fall into the “less than $1 million” and “$1 million to $4.9 million” range, with 39 percent in the former category, 18 percent in the latter.

Affiliate and Video Marketing Grab a Larger Piece of the Pie
Cross-channel retailers’ marketing budgets will, in large part, look pretty much the same this year as they did in 2011. Spending on integral components such as e-commerce websites and retail stores will fall in line with what was spent on those channels last year. That said, there’s some shifting of money that will occur in 2012.

Affiliates will be happy to hear that 24 percent of our respondents will be spending between 20 percent to 39 percent of their marketing budget on the channel in 2012, an 8 percent increase in affiliate spending compared to last year.

Using video to engage, inform and interact with consumers is one of the hottest trends in the retail industry. Retailers planned spending on video reflects this: 17 percent of respondents said they’ll spend between 20 percent to 39 percent of their marketing budget on video this year, an 11 percent increase compared to 2011.

Retailers Stuck in a Social Media Wasteland?
While there’s been talk lately that social media isn’t worth the investment of time or money, retailers apparently haven’t gotten the message. In 2011, 51 percent of respondents had no social media strategy in place. This year only 11 percent of respondents said they don’t have a social media strategy. While only 3 percent of retailers cited social media as their biggest challenge, 25 percent said they’ll be searching for social media expertise in 2012.

Meanwhile, 20 percent of respondents are allocating between 20 percent to 39 percent of their marketing budget to social media in 2012 vs. 14 percent who did so in 2011. In fact, 7 percent of respondents are planning to spend nearly half their marketing budget or more in 2012 on social media, a 5 percent increase from last year.

The primary goal for 41 percent of respondents’ social media efforts is to create customer awareness, engage with fans and promote exclusive content (e.g., behind-the-scenes content, contests). Seventeen percent use social media to generate sales, and another 14 percent use it to drive web traffic.

Print Tries to Stay Relevant
Continuing an ongoing trend, retailers are shifting marketing dollars away from print vehicles (e.g., print ads, catalogs) and towards digital channels. Forty-two percent of respondents last year indicated they would spend 20 percent or more of their marketing budget on print catalogs, compared to only 37 percent who will do so this year.

Advertising in print publications also isn’t high on most retailers’ list of priorities. Twenty-eight percent of respondents said they’re allocating 20 percent or more of their marketing budget to print ads, 16 percent less than in 2011.

There’s some encouraging news around print marketing going forward, however, as direct mail spending will increase in 2012. Forty-two percent of respondents said they’ll spend 20 percent or more of their marketing budget on direct mail in 2012 vs. 35 percent of respondents who budgeted the same for direct mail in 2011.

Another interesting finding is the growing importance of direct sales forces, likely for B-to-B companies. Forty percent of respondents will spend 20 percent or more of their budget on a direct sales force this year, up from 35 percent in 2011.

Customer Acquisition/Retention Remains Tricky
Survey respondents last year cited customer acquisition and retention as the biggest challenges they faced. This sentiment hasn’t changed much over time, as customer acquisition (39 percent) and retention (11 percent) continue to be the main challenges respondents are facing.

This could be due, in part, to the fact that 8 percent of respondents cite challenges in keeping up with new technology, which greatly contributes to the success of customer loyalty and acquisition programs.

Meanwhile, 7 percent of respondents said they have trouble managing multiple marketing channels to deliver a seamless experience across all channels — email, mobile, social media, e-commerce websites, etc. Other challenges include keeping up with a gluttony of legal issues, such as the ongoing “Amazon tax” battle and postal rate increases, which was cited by 4 percent.

Our respondents aren’t challenged by data, analytics, SEO or SEM, however. Only 1 percent cited difficulties in each of these areas. In fact, more respondents cited challenges in social media (3 percent) and mobile (2 percent).

Respondents Not Believing the Mobile Hype?
While 2012 has been dubbed the year of mobile by many, our survey says otherwise. Despite survey results from 2011 saying that respondents would increase their spending on mobile sites by 33 percent and on mobile apps by 28 percent, 38 percent of this year’s respondents said they don’t have a mobile marketing strategy.

What’s more, 53 percent don’t have a tablet marketing strategy, despite the medium’s rapid growth and heavy influence on purchasing decisions. However, 17 percent said they’re looking to hire a mobile expert for their mobile and tablet efforts going forward.

Of those that do have a mobile strategy, 23 percent say they use the channel to generate sales; 15 percent use mobile marketing to promote customer engagement; and 12 percent use mobile to drive web traffic. In the tablet marketing arena, 16 percent use tablets for generating sales and 11 percent use them to drive web traffic. Meanwhile, 12 percent use tablets to create customer awareness and 5 percent use them as a customer service tool.

A Good Year Ahead
Retail Online Integration readers are optimistic about their businesses in 2012, with 90 percent of respondents saying their company will meet its revenue forecasts this year. Hiring, on the other hand, is evenly split, with 50 percent of respondents planning to hire more staff this year and 50 percent not planning to. For those companies that are hiring, e-commerce marketing positions are their No. 1 priority, with 50 percent targeting this area for new hires.