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The New Normal for Retail: Time to Rethink Your Marketing Mix

It’s not your imagination: Digital marketing costs are rising and response rates have been dropping

By Polly Wong, President of Belardi Wong

It’s not your imagination: Digital marketing costs are rising and response rates have been dropping. Sure, some of this is seasonal — but a lot of it is not. It’s the new normal.

While marketers can likely expect digital results to pick up slightly this fall, Apple’s recent privacy changes to the identifier for advertising (IDFA) on mobile and rising CPMs are a perfect storm that is driving down return on traditional digital ad spend. The pandemic has shifted people’s shopping habits, which has direct-to-consumer brands looking for alternatives.

One dollar spent on marketing today is not as valuable as $1 spent even a year ago. Costs are up and paid social, display and paid search results are down, as the Apple platform changes mean less tracking, less targeting and less measurement. Add to that supply chain problems, with many retailers still struggling with inventory levels and fulfillment, and on the whole, retailers have found it almost impossible to accurately forecast weekly and monthly sales numbers because of all the volatility in the marketplace.

The truth is that the pandemic has changed everything and it’s time for retailers to rethink their toolkit for meeting buyers where they are.

So, what’s a smart retailer to do?

Add new tools to your marketing mix like billboards, SMS and yes, direct mail. Or more specifically: Beautiful, rich direct mail catalogs that look more like magazines than flyers.

A Facebook ad could cost a brand between $2 and $4 per click, and by the end of 2021 rates are projected jump 100% year over year. But you can mail a full-sized catalog to a consumer for 65 cents. You can only say so much in a paid search link or Facebook ad. But a print catalog offers a physical, thorough experience in your hands and in your home. Which might be why direct mail and especially catalogs are experiencing a pandemic-era renaissance.

Today’s catalogs are less like the old-school product mailers you remember from 20 years ago and more like fashion inspiration pieces. They’re designed to surprise and delight and of course encourage you to shop, whether online or in a store (or both). The demographics of catalog readers are changing too. Ten years ago, 80% of catalogs went to women over 55. Today, they also target 25- to 45-year-olds who want a beautiful, visual and Insta-compatible experience.

Catalogs and direct mail pieces have other benefits too: They’re intimate – they arrive at the most intimate place, your home. They’re a full brand experience – you have 100% share of voice. They stick around longer than emails or display ads. The targeting for consumers is still strong. And they work online too.

For brands taking the plunge, the best practices for catalogs and direct mail that deliver results include:

· Go big with graphics: People process images much faster than text. Photos tell a whole story in seconds.
· Speak in little bites: Have one story per spread. Group related stories to create chapters.
· Make your text scannable: Let headlines, captions and bullets — not paragraphs — lead the way.
· Be brief: The younger the audience, the fewer the words – until you catch them. Then they will like, pin, follow, post and snap to help you tell your story to their friends.
· Be bold: Include plenty of “wow” spreads — which might mean less “stuff.” You want to make a statement.
· Simplify: Fewer fonts and more white space are an antidote to today’s information overload. Less really is more.
· Repeat yourself: Echo your name, URL and offer several times. And then re-target the campaign in digital.
· Be real: Make an emotional connection and you’ll create a lasting and rewarding relationship.

Done right, direct-to-consumer brands of all kinds are seeing interesting results with direct mail —as much 6 to 15 times return on advertising spend is not uncommon. The highest performing catalogs show a range of product across product categories and price points- ensuring the highest response rates. While only one-third of what a customer buys may be directly featured in the catalog because print today is largely a channel driver to web and stores, these richer brand experiences are becoming a critical way to build relationships with consumers.

About the author

Polly Wong is the President of Belardi Wong, a leading direct marketing agency based in New York and San Francisco.

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