Retailers, here is how to optimize your digital channels: the first steps
For many retailers, optimization is seen as an in-channel action, taught at a basic level to new hires or done by an external agency who are tasked with optimizing a couple of channels that make up a fraction of the digital media mix. Senior staff are then responsible for campaign planning, using seasonality or historical data to optimize when and how much to spend, often unaware of the optimizations performed by channel specialists. The strings are playing Beethoven while the brass play Bach.
Without blowing my own trumpet too much, I earn a living optimizing digital channels for retailers across the globe, from Goliaths with more budget than a small country to Davids looking to dip their toes into the world of online marketing. No matter the size of the retailer, when it comes to optimization there is always a process I go through to ensure success, a lot of which starts before a penny is even spent.
No matter the size of the retailer, when it comes to optimization there is always a process to go through to ensure success
Optimizing for retail can be harder than other categories; retailers understand the need for brand activity, but their bread and butter will always be performance marketing, where digital campaigns are dictated by in-store events, supplier-funded activity must be ran in a certain way, and metrics like reach or engagement will always play second fiddle to revenue numbers.
The latest marketing news and insights straight to your inbox.
Get the best of The Drum by choosing from a series of great email briefings, whether that’s daily news, weekly recaps or deep dives into media or creativity.Sign up
This article is by no means a definitive checklist, as all retailers and channels are different, but for those looking to know more about optimizing for retail read on.
Step 1: understand your objectives
As much as the overall objective for any retailer is to make as much profit as possible, if you were to take the same approach when optimizing your digital channels, chances are you would pump your budget into shopping and search, hit a point of diminishing returns and never be able to grow your business beyond that point. Which is why, in order to optimize effectively, you must first understand your objectives at campaign, channel and business-wide levels.
This is often where the siloed nature of big retailers’ marketing teams can hold them back. The team responsible for paid social know how to optimize paid social, and your programmatic team knows programmatic. However, your paid social team might not know that you are achieving a lower cost per new user via programmatic or vice versa. Which is why it is crucial for a retailer to continuously share performance across channels and to have someone responsible for taking a channel agnostic view to optimization.
Campaign objectives for retailers can vary wildly, from generating new first-time customers to increasing foot traffic or building a userbase on a new social channel. Digital channels offer retailers the opportunity to go beyond just sales or awareness objectives, you just need to be ‘SMART’ (specific, measurable, achievable, relevant and timely).
Once you understand the objectives of the campaigns you want to optimize, you can start to group them. What activity is there to drive loyalty? Which channels bring in new customers? Or build brand awareness? Campaigns can have more than one objective and can fit into multiple groups, but it is paramount that all activity has a clear objective, otherwise optimization becomes pointless.
Step 2: ensure the correct measures of success
Your measure of success should align with your objectives. If you want to drive new customers to purchase, then measuring the success of your activity on cost per video view is of no use. Simply saying ‘sales’ as a measure of success is one of my biggest bugbears. I could spend a hundred pounds getting a £5 sale or relentlessly retarget existing shoppers to make sales. Setting a return on investment or cost per new customer target will quantify your optimization decisions and allow you to better understand the success of your channels.
Ensuring the correct measures of success isn’t just about setting quantifiable measurements, it’s also about ensuring your campaigns are set up to measure correctly. I have previously spoken about the need to use third-party tracking and attribution providers in order to correctly track the success of paid media campaigns. This becomes even more important when looking to optimize across different channels and platforms. Having a ‘true north’ for all activity means retailers can optimize holistically rather than relying on individual platforms, who will likely inflate the importance of their platform in the customer journey.
Step 3: strive for budget fluidity and cross channel consistency
A lot of people dislike the idea of keeping budgets fluid between campaigns and channels. These people tend to have a vested interest in a channel or platform, and this can sometimes be detrimental to the overall performance of your digital activity. Before any activity is even launched, I like to make it clear to my clients that budget splits are not set in stone, and the budget should be spent in the campaigns or channels that best achieve the objectives previously set out.
Sometimes this isn’t possible. Supplier-funded activity is often ringfenced into a particular channel at the request of the supplier, but as a retailer it is important to the optimization process that you can pull and push spend based on the data.
Consistency across channels does not just mean making sure all your images use the same color palette. To optimize, you need to be able to compare apples with apples, and that becomes a lot harder when one channel reports weekly at a top-level using platform data whilst another channel reports back fortnightly by audience using Google Analytics. As a retailer, you should have consistent views across your digital marketing mix.
These are just the first three steps retailers should follow to optimize their digital channels effectively. Look out for steps four through six next week where we’ll discuss the level of control you need, research and testing, and giving your activity some time to work. If you can’t wait and would like more support on this now, get in touch with one of our Summit experts today at firstname.lastname@example.org.
Laurence Cresswell is paid media product manager at Summit Media.
Content by The Drum Network member:
We help brands transform their online business, grow their customer base and make more money from retailing online. In a complex digital marketing world that is ever evolving, our aim is to make the complex simple and transparent, only recommending the best approach and strategy to achieve our clients’ objectives and KPIs.Find out more