The e-retailer heads into the holiday shopping season behind a 30% increase in fulfillment spending and a widening net loss. North American sales increased ...
Blending online with offline elements can boost overall ROI in promotional campaigns.
CPG manufacturers spend some $50 billion a year on promotions, but only a small portion of that goes to online promotions, according to a new report by Forrester Research, Inc. Many marketers are leaving potential opportunity online untapped. The manufacturers of consumer packaged goods can get more mileage out of promotions by weaving in an online element, says Forrester – but execution will vary depending on the product and the target audience.
About 8% of online consumers, or just under 5 million U.S. households, actively seek out promotions on the Web, whether coupons, rebates, or other promotions. Getting the most response from these shoppers on the web are products that aren’t often promoted offline. There are fewer offline promotional deals on household cleaners like Windex, for example, than on soda pop or snacks. Online promotions on higher-ticket items like cold cereals and products to which shoppers are brand-loyal, like shampoo and cosmetics, also get consumers’ attention. But even shoppers less inclined to actively seek out online promotions – a group representing a much larger audience of about 33 million households -- might take action on them if they were presented in connection with other online activity these consumers already undertake, such as downloading recipes or tracking down health information. Some 70% of all shoppers Forrester surveyed, including heavy promotion seekers and those who were less so, said they’d be willing to receive promotional offers from CPG manufactures via e-mail.
Different marketers should plug into these opportunities in different ways, says Forrester. Product categories with strong brand loyalty should use online promotions to capture names for e-mail marketing campaigns, while lower-loyalty categories like party dips or gravy mixes should use the web to reach consumers with offers at sites they already visit, like retail or content sites. Beyond driving sales, online promotions integrated with offline promotions can deliver other benefits to marketers, such as reducing promotional fulfillment and marketing costs.