Netsertive Blog
5 Reasons to Stop Worrying and Love the Internet
Don't let fear of the Internet paralyze your marketing strategy. It's easy to view the online world as
an intimidating behemoth of highly advanced technology that's only suitable for use by those who
are the most technically knowledgeable among us (or those who can afford to hire professionals who
live and breathe all things digital).
In fact, you shouldn't let fear of the Internet prevent you from utilizing it as an effective marketing
channel. A monthly marketing game plan that involves using the web as a means to promote your
products, services, and brands is not only something you should do, it's something that you must do
to thrive in your local market.
Stop The Presses
Yes, technology is changing the face of retailing just like it is changing the face of many industries.
However, to paraphrase Mark Twain, the reports about the death of traditional retail are greatly
exaggerated.
There is no question about the fact that e-commerce is growing. Not only that, but it will continue to
grow.
But it will never replace brick-and-mortar retailing.
E-commerce and online shopping will play an increasing role in the shopping experience. People
enjoy the convenience of shopping from their desk or using a mobile device. However, e-tailing is still
a long way from dominating most markets.
Online Marketing Leads To Offline Sales
If you think that online marketing is only for huge retail sites like Amazon and Overstock, think again.
When shoppers decide what to buy, they value the opinions of sales associates in stores and
information gleaned from television and magazines. However, it should be noted that the local
retailer websites are now the top sources of information.
The Internet has completely transformed the way people shop. Web-savvy consumers have become
smarter than ever, using the Internet to research goods and products before they buy. Price
comparison websites and consumer forums are frequently browsed during shoppers' "path to
purchase."
Here's the 5 things that you should keep in mind:
1. A Majority Of Retail Sales Are Influenced By Internet Research
The web's influence is greater than the threat of online sales. The Forrester retail study showed that
in addition to the projected $300 billion in online sales in 2014, $1.4 trillion will be influenced by the
web.
In fact, in a study of nearly 2,500 people, Yahoo Advertising and Universal McCann published
research showing that 69% of people trust the Internet for researching their purchases over TV and
magazines. The same study also found that "seeking information is paramount to consumers, making
'discover' tools the most leveraged throughout every step of the shopping process."
Progressive Grocer published studies showing that 50% of purchasers are influenced by online
shopping, with consumers searching on the web before purchasing in-store. The influence of online
will be driven by the growing importance of mobile marketing. Smartphone penetration and one-toone localized promotions will continue to enhance online marketing. According to Juniper Research,
U.S. retailers are predicted to spend $55 billion on mobile marketing by 2015, which is almost double
that in 2013.
By 2017, 60% of all U.S. retail sales will involve the Internet in some way, either as a direct ecommerce transaction or as part of a shopper's research on a laptop or mobile device. That's
according to a new report by Forrester Research Inc. entitled "U.S. Cross-Channel Retail Forecast,
2012 To 2017." Approximately 10.3% of total retail sales in the U.S. in five years will be online
purchases, or $370 billion in web sales compared to $3.6 trillion in total retail sales. And in 2012, 46%
of total U.S. retail sales were either transacted directly or influenced by Internet research on PCs,
smartphones and tablets.
In contrast, last year e-commerce accounted for just 5.2% of total retail spending in the United
States. That's based on U.S. Commerce Department figures that include items rarely, if ever, bought
online, such as gasoline and restaurant meals.
2. 94% Of All Retail Sales Happen In Local Retail Stores
Another study by Forrester Research shows that "94% of retail sales in the U.S still happen 'offline'...
just 6% online." Even if online retail sales double in the United States in the next five years, almost
90% of retail will still be done in brick-and-mortar locations.
"Despite the popularity of ordering online, people still seem to have an affinity for bricks-and-mortar
stores, and they're using shopping apps creatively to make the experience of local shopping timely
and budget-friendly," a Pricegrabber spokeswoman recently said to InternetRetailer.com.
According to Statistics Canada, e-commerce in that country also accounts for less than 6% of total
Canadian retail sales. The lion's share of Canadian retail sales, 94%, is still done at traditional brickand-mortar locations. Sure, in some categories, like books and music, online shopping is an
important way people shop, but let's not assume this will be the case in all categories. Read more.
3. 91% Of Local Shoppers "Have Gone Into A Store As A Result Of An Online Promotion."
Shoppers are doing more research before they buy by using the Internet to pre-shop, price compare,
and read reviews. They are also responding to promotions.
Online access and usage has increased significantly, even in the past year. Mobile technology has
taken this even further, giving shoppers access to the internet and the ability to shop from
anywhere. This has changed shoppers' "path to purchase," impacting the way they consider, and
ultimately buy, products and brands.
4. Customers Who Research Online Spend More In-Store
The opportunities to grow revenue are quite real for companies in the context of a retail
environment. Consumers increasingly expect a seamless, multichannel purchasing pathway that
includes online retailing. In the UK, for example, McKinsey research shows that multichannel
customers spend nearly twice as much on average as customers who only visit the store. Depending
on the circumstances, the monthly spend per customer varies between +84 and +119 percent.
Further, see slide 8 here to see that the average amount spent at a local retailer is boosted when the
consumer first does online research.
5. Online Advertising Boosts Local Store Sales
Consumers are becoming increasingly comfortable with using digital technology in the shopping
environment and presumably will more frequently measure a retailer on how well it supports this
change. The challenge for retail companies is how well they can adapt, how wisely they can make
spending decisions on new technology, and how best they can use technology to continuously
connect with their greatest asset - the consumer.
While multichannel presents retailers with an opportunity to significantly increase revenues, its
complexity also entails challenges. As companies contend with the most diverse set of channels ever
- online research, social networks, word of mouth, etc. - the winning players will have developed a
consistent strategy to address all of the fragmented new touch points by investing in the most
efficient ones while aligning messages across all platforms. Internally, they will also successfully
coordinate messages across the spectrum of channels to ensure that they reinforce and do not
contradict one another.
Netsertive knows how to leverage local online marketing to turn online discovery into foot traffic and
sales in your business. Our unique cloud-based Digital Marketing Engine automates localized online
advertising and channel marketing programs for national brands, encompassing search, display,
social, mobile, video and other platforms. Contact us today, and let us show you how we can take
your marketing to another level.