To win the retail battle, think small in 2013
It’s time to get really granular to find growth.
- January 2013
- Josh Leibowitz
To paraphrase Steve Martin, 2013 is going to be all about getting small. I don’t mean cutting back. What I mean is, it’s time to get really granular to find growth. Here’s how marketers should get small in 2013:
“Me”-commerce. Retailers and travel providers will need to move away from marketing to broad segments and focus on micro-segments — even down to the level of the individual. We call this level of personalization “Me Commerce” — being able to effectively target and delight each individual customer throughout their decision process. And we know it works. Research shows that personalization can deliver five to eight times the ROI on marketing spend and lift sales 10% or more.
Local markets. Far too many marketers build national or regional marketing plans that aggregate at too high a level to be effective. In addition, sales growth targets and marketing budgets are often spread across each region equally, without taking into account where the best growth opportunities are. The next wave of marketing will need to be hyper local, where you can identify specific sets of customers at the city or even neighborhood levels of detail. For example, sales of skin care products in the next decade will be twice as much in a single city — Shanghai — as in the entire country of Malaysia.
Small wins. To survive, companies need to innovate. And to innovate, companies need to test and learn at speed. What that means in practice is that good innovators make lots of small bets, see what works, then double down on the winners and eliminate the losers. As Wendy Clark, CMO of Coke, said recently at our Chief Marketing & Sales Officer Forum: “Think big, start small, scale fast.”
Next outlook for 2013: Big Data: Stand and deliver in 2013
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