Jan. 30, 2012
By Lyle Bunn
Dynamic Media Consultant
**This two-part summary of the National Retail Federation January 2012 "Retail's BIG Show" trade show and conference is through the lens of the value and directions of digital in-store and dynamic place-based media to improving the success of brands and retailers. While the marquee theme of the event was "Engage and Evolve," the three retail industry priorities of "technology," "engagement" and "talent" were reflected by many exhibitors, retail sector briefing reports and in conference sessions. Sections in this article include:
- The National Retail Federation (NRF) – Event perspectives
- Retail and technology
- Engagement - "Bricks, Clicks and Picks"
- Digital In-Store
- Analytics & In-Store Media
Here is the second installment of this two-parter. Read part one here.
Engagement - "Bricks, Clicks and Picks":
Seventy percent of Americans shop multichannel, including in-store, online and mobile. Retailers and brands are responding with a shift from transactional to experiential marketing, while assuring maximum "fidelity" — consistent brand messaging. The paradigm shift is occurring from multichannel to "omni-channel" engagement, which reflects the melding of the engagement experience between the retailer/brand and the consumer.
Digital in-store media bridges "bricks," or the physical environment; "clicks," or online information and commerce; and "picks," or consumer selection and its influencers. It also turns "presence" into engagement.
Seventy-one percent of retail executives say that shoppers want a meaningful experience with the sales associate as brand ambassador with strong product knowledge and the ability to upsell and cross-sell for greater customer satisfaction and loyalty, according to a Deloitte industry survey.
Many presenters spoke of the need to improve their advertising plans to shift media buying investment away from "renting eyeballs" and into owning audiences. Many retail executives, including Lauren and Bonnie Brooks, reinforced the priority of shifting to "brand demand" messaging from "brand awareness" involving more experiential and social media.
Experience has shown that when retailers use display technologies for both customer and staff-facing messaging, revenues are maximized. In retail categories such as technology, cellular and sporting goods in which associate-assisted sales are significant, digital in-store media provides and reinforces value while queuing associate assistance.
This direction encompasses linking "bricks, clicks and picks" to assure that customers receive a seamlessly-integrated shopping experience between physical locations, online and mobile.
By showcasing product range and attributes using more advanced in-store digital presentation and interactive media, retailers look to exciting brand perception and the selection and purchase location.
"It is not about advertising," noted Mitch Joel, "It is about publishing messages, information and stories to the world — or those in it that you most want to engage with and with you."
Digital in-store media is a transition from passive marketing to more successful active marketing, he indicated, adding that digital and analytics are a "bolt-on" utility. It can typically be added to existing infrastructure and available space, and can deliver immediate results and insights. It is a high-payback medium.
Joel characterized the broadcast medias of TV and print as passive, detached and physical, in comparison to the active, connected, virtual and high-engagement characteristics of interactive media.
Analytics & in-Store Media:
Several presenters asked in show of hands survey, "how many of you have seen the movie 'Moneyball'?" The 2011 movie recounts the transition of professional baseball to an analytics-driven industry. A quote by Mickey Mantle starts the film: "It's unbelievable how much you don't know about the game you've been playing all your life."
Analytics serve to validate investment and optimize campaigns and digital media content related to target audiences toward better communications spending and improving the productivity of retail floor space.
Metrics help to define and refine business objectives, move beyond "the technology" into its application and allows initiatives to be made into "chewable bites."
Workforce analytics and predictive modeling are of growing priority.
A massive transition to analytics and the integration of analytics into operations is expected. Consumer engagement is a "Moneyball" world in which analytics drive investment decisions.
This transition to operationalizing analytics recognizes that information is powerful and uses the levels of abstraction of analytics to gain insights as these grow from data to statistics, information and knowledge toward wisdom.
"Digital innovation is unleashing business, technology and systems" said David Lauren, executive vice president of advertising, marketing and corporate communications for Ralph Lauren Corp. "Our success is anchored in 'merchant-tainment' — the seamless blending of merchandising and storytelling." Lauren outlined how storytelling with images and visuals is manifested in Ralph Lauren branding and merchandising by creating lifestyle aspiration and presenting how this could be fulfilled by Ralph Lauren offerings. Storytelling leads audiences to question "what happened?" and "what if?" — which beg engagement with the brand.
Storytelling has been a staple of TV that was transposed onto still imagery and therefore into print (think fashion magazine ads) and more recently onto websites. "The retail community priority of story-telling is to reinforce the brand in the store," noted Lauren.
This is well served by digital media that can present images beautifully and trigger mobile, audience-of-one engagement. "A flat screen" said Lauren "should not scare someone away or discount the excitement or value of a product, but engage and excite the consumer through the message. Excitement happens by reaching an audience of demographic and psychographic profile with images, messages and stories that resonate with and inspire them."
In-store display content can include a wide range of messages that inform and influence. Increasingly, dynamic signage content presents Accuweather or uses links to databases, point-of-sale or other internal systems to make content interesting and relevant.
"The successful retail model focuses on technology, engagement and talent," said Bonnie Brooks, president and CEO of The Bay (Hudson's Bay Company). The 3,000 NRF delegates who attended her keynote address took notice that The Bay is the oldest retailer in the world, and applauded The Bay's accomplishment of the best sales increase in December of any retailer in North America. She echoed other speakers on the importance of technology, engagement and talent.
Digital media networks have been used for staff communications and development for many years. Digital media providers such as Hughes, Microspace, Broadcast International and others deliver a strong value proposition to retailers looking to cost-effectively train and motivate staff.
The increased use of digital media for customer messaging has often incorporated the use of the infrastructure for staff communications and development.
The retailer focused on their "talent" naturally looks to leveraging marketing communications capability. This multi-use of in-store media for consumer, management and staff communications points to a higher value proposition and ROI from digital media investment.
Retailers are taking a "big picture" view to the 5W's (who, what, where, when, why) for technology-enabled branding and revenue achievement. They are focusing in particular on the "why," while simultaneously defining and refining their corporate directions, positioning and goals.
Digital In-store media indeed does work in achieving business, communications and engagement goals. But because of the time and investment required, it must be scalable, providing return on investment ultimately at the enterprise level for brand and loyalty building, not just benefits at the transaction level.
Anu Gulta, VP Process and Profit Improvement of Michaels, summed up the sentiments of NRF delegates well with the following four priorities of all retail activities and investments:
- Enhance the brand
- Increase consumer reach and loyalty
- Gather and act on insights
- Drive multichannel engagement
NRF was very exciting when viewed through the lens of digital media. Strong vendors are engaging with innovative retailers and the analytics that underpin digital media are helping to validate digital media investment. 2012 could be expected to be a year of retail sector advancement with and through digital in-store media.
Read more about retail digital signage.
Lyle Bunn is an independent analyst, advisor and educator in the high growth areas of dynamic place-based and enterprise media. He has assisted hundreds of firms in the planning of their initiatives and has helped train several thousand professionals. He has published over 200 articles and whitepapers on related subjects, and served as principal writer and editor of dynamic media supplements included in USA Today, The Wall Street Journal and Canada's The National Post. Visit www.lylebunn.com for additional resources related to dynamic Place-based and digital In-Store Media, or email him at Lyle@LyleBunn.co.