The large-scale retail sector is one area that is seeing significant changes in the approach to marketing processes. And while some players have shown stubborn resistance to new technologies, at the same time many others have opened up to the opportunities offered by digital transformation. In this post, we have collected 4 examples of marketing that are particularly significant, not only for the financial results achieved but especially because they testify to the brand’s ability to build relationships with consumers.
Since this is an important area of the Retail market, let’s make sure we start with a clear and complete vision of this area.
What is the future for large-scale retail? Examples and trends of online development
The volume of online transactions for large-scale retailers in Italy is setting new records, but the country continues to lag behind other European markets. This is the picture that emerges from the survey conducted by dataminers as part of a monitoring project on the sector.
One very interesting focus area in the study is the the average profile of Italian consumers who are frequent users of large retailers’ digital channels.
- More users seem to have become more proficient and casual in using digital tools during their online food and grocery shopping, for example. In fact, access to online stores is increasing both from the web (69% of accesses) and from apps (representing 31% of accesses).
- And if a promising 15% of respondents over 60 years old say that they use the mobile app for their virtual purchases, this is probably due to the spread of new mobile devices (especially smartphones), which are increasingly functional and easy to use. It’s also due to the growing reliance on electronic payments (just 6% of consumers still choose bank transfers and cash on delivery, while 47% use credit cards and another 47% rely on services like PayPal, Satispay, or Stripe).
- In terms of practices for the delivery of goods, despite the promotions offered by many large-scale retail brands, the vast majority of Italian consumers opt for home delivery (74%) and with little preference remaining for pickup at the point of sale (18%) and through lockers distributed around the city (8%).
In the first part of 2022, big retail has seen a major increase in visits (+78% from January 2020 to March 2022). This is a respectable figure, and one that is crucial when we consider that the new post-pandemic normal was immediately challenged by recent international events, foremost among them the conflict in Ukraine. It is, however, a result that needs to be scaled down if we compare it with the performance recorded in other foreign markets or in other marketplaces. To give an idea of the different orders of magnitude, let’s think back to March of this year:
- 1 million people visited Carrefour Italy’s store compared to 12 million in the French store;
- compared to Amazon’s 182.7 million visits, the top 10 Italian retail stores (Bennet, Carrefour, Conad, Coop, CosìComodo, EasyCoop, Esselunga, Everli, Pam Panorama, Tigros) welcomed a total of just 5.7 million users.
It is no longer sufficient to explain the reasons for this “restrained” growth by limiting it to the low digital literacy of Italian consumers (which is not actually low, as we have just seen, at least as far as online shopping is concerned). What ilSole24Ore highlights by analyzing consumer browsing on the top five retail stores is a disaffection, often mixed with outright annoyance, toward classic promotional tools, such as mega banners on the home page. Much more effective, however, is browsing by category and via search engine.
Their conclusion matches ours, as we wrote in this post from some time ago about the marketing strategies of large-scale retailers. The main limitation is related to promotional budgets, lack of innovation in in-store tools, and, above all, communication that struggles to grasp the need for interactivity and personalization with the target audience. Now that we have outlined some basic coordinates, we can dive into the context and see some of the digital marketing tactics at work that are producing the best buying (and selling) experiences.
Success stories #1: the irresistible rise of Ecommerce
The fourth edition (Dec. 2021) of Netcomm’s Digital FMCG Observatory conducted with NielsenIQ shows how, after the 2020 boom (+146%), ecommerce provided the biggest boost for business growth: 23.5% for a total of €1.8 billion in transacted business, equivalent to 2.5% of the turnover of the entire FMCG (fast-moving consumer goods) sector. According to the Observatory, the 0.4% increase in overall FMCG sales at a time when physical store sales have stalled can be explained precisely by an offset produced by ecommerce.
The forecasts, as Roberto Liscia, president of Netcomm, confirms, are even more promising: “E-commerce is destined to consolidate for consumer goods as well, so much so that we foresee growth between 10 and 15% by the end of 2022.” Capitalizing on such an established trend requires additional effort in the design of the virtual store, which can no longer be conceived (if it ever was) as simply a digital, 24-hour replica of the physical store. While one of the strengths of e-commerce is undoubtedly the availability of products at any time, the real goal must be to create an experience whose perceived quality justifies the change of even very ingrained habits.
Technology tools made available to consumers by retail players (social platforms, websites, apps, interactive content) should be increasingly fast and intuitive, easily navigable and responsive, and developed from the outset according to a mobile first logic. Web-native features can help differentiate the proposition, simplifying and enriching how content is experienced, for a purchase path that is always fluid and immediate, dynamic, and engaging and hyper-personalized.
Success stories #2: the digital flyer
The report presented by Nielsen during the event “Digital at the Service of the Drive To Store: Strategies and Successful Case Studies” showed that the real driver of FMCG transformation is the digitization of promotions, i.e., the shift of investments toward digital drive-to-store solutions, which use smartphones to bring today’s increasingly well connected consumers to physical stores.
The direction indicated by Nielsen at the time (it was 2020) is still valid today: the digital flyer is still a primary strategic investment that is destined increasingly to accompany and often replace paper, the ideal medium for engaging consumers and communicating with them. Again as with ecommerce, the caution is to avoid merely digitizing the classic paper flyer. Instead, companies must differentiate it based on the individual user data collected from a wide range of sources.
Phygital: strengthening digital presence
Examples of successful large-scale retail marketing that synergistically uses different access channels, both physical and virtual, can therefore include the digital flyer at the center of geo-localized drive-to-store campaigns. These are cross-channel marketing activities that are developed to lead consumers to the (physical) store by alternating online and offline touchpoints. This is the case of a message that promises a free gift or a discount sent to the user through a messaging service (instant via chat or SMS) that they will then show in the store.
The digital flyer is a phygital application that is also proving to be effective because it exploits a structural feature of large-scale retail: the presence of chain logic. While stores scattered throughout the territory need to increase their visibility through the web (strengthening their image and building loyalty among existing customers), the digital presence of retailers in itself offers an increasingly relevant outlet for completing the sales process and can take advantage of more widespread communication aimed, for example, at new, carefully targeted audiences.
Success stories #3: Email marketing (the Iperal case)
The Iperal case is emblematic of the way a communication channel—in this case email—can be leveraged to connect with customers (acquired and potential) and maintain a vital relationship with the public. Iperal took the first step of redesigning the newsletter with a new visual and functional template. However, this was not just a cosmetic operation: the change in visual corresponded to a different content approach. Starting from a purely informative and editorial, the newsletter became a promotional tool (with which, for example, to let the public know about offers and incentives, including through coupons).
The key step was segmentation by cluster: the newsletter was personalized for each recipient. From a universal product showcase and coupon for the entire database, Iperal moved to a message that was built according to the specific interests and characteristics of each target audience. It created different content blocks based on individual customers’ needs, interests and previous buying behavior, the subject of which were actually the products most relevant to them.
Email marketing was integrated into an omnichannel strategy (which also leveraged, for example, SMS), which in turn was supported by a marketing automation platform. In Iperal’s case, email marketing was the cornerstone of a customer-centric approach, resulting in an omnichannel flow to intercept the right recipient with the right content at the right time.
Success stories #4: quick or instant commerce
Fifteen percent of consumers also choose an online store for the speed of delivery, compared with 14% who focus their attention on the payment and shipping methods available (Source: ilSole24Ore). Quick commerce (or instant commerce) is a trend to keep an eye on, and one that originated with food delivery. It initially developed with the support of delivery companies, such as Glovo or Getir, and it is beginning to affect large-scale retail (especially in large cities) as well. It encompasses all of the services that guarantee grocery delivery in a short or very short time (even in minutes for some areas). While the decisive element is obviously delivery, the other operations involved in the process are also crucial: from confirming the purchase to contacting the logistics and delivery service.
In Europe, around 10 companies offer instant commerce services and they operate mainly in the grocery and large-scale retail sector. For Italy, the largest are Carrefour, Esselunga, or Coop. Other services of note include: the supermarket chain Iper La Grande I has activated its home delivery service within 35 minutes of ordering, in partnership with Glovo; In Milan, Carrefour offers Hop (in partnership with Deliveroo); in Rome, Getir; and Tuodì, a small-scale retailer that has an agreement with Amazon. (Source: Digital4marketing).
Creating spaces for conversation in large-scale retail: the interactive experience of Doxee
The main causes for the slow online movement of large-scale retailers in Italy can be found in a tendency of players towards the “usual” offers, such as convenience, or related to cost reduction. Instead, marketers in this sector must aim at a comprehensive and systematic renewal that goes beyond developing promotional campaigns or reorganizing spaces within the supermarket: a radical intervention that changes how companies communicate with consumers: from creating contact opportunities to managing a dialog over time.
Marketing strategies for this sector must be continually recalibrated to enhance all of the touch points that a consumer may encounter along his or her journey (because a consumer actively seeks them out or comes across them “by accident”). All of the examples of large-scale retail marketing that we have discussed must fall within a unified and coherent online communication plan where investment in omnichannel initiatives is accompanied by a renewed focus on rational and thoughtful measurement of business performance using Retail KPIs.
It is precisely by building on a solid culture of data that Doxee is proposing its Interactive experience product with the aim of supporting retail marketing. Interactive Experience is the product line that enhances customer data to develop personalized communications and realize a digital customer experience that matches the expectations of the contemporary consumer.
Doxee Pweb®transforms individual user data into an interactive micro-site that propels traditional loyalty programs to an as-yet untried level. Here, the customer can monitor his or her situation updated in real time (with dedicated promotions, an overview of accumulated points, and reward programs), the status of his or her payments (successful, failed, pending), a range of profiled information and numerous insights on selected topics with respect to his or her particular profile (history of preferences and behaviors), and can take advantage of a support base for subsequent transactional steps.
Doxee’s Interactive experience line integrates the role of the physical store into the digital strategy of retail players, helping to modernize, streamline, and speed up digital marketing and transform outdated massive messages into effective communication because it is up-to-date, meaningful, and personalized!