Online retailers shifting to relationship marketing for 2006 holiday season
Online retailers will be shifting away from price-based promotions to relationship marketing initiatives such as e-mail marketing to engage loyal customers in the 2006 holiday season, according to the “2006 Online Retail Holiday Readiness Report” released today from WebTrends Inc.
This year, 23% of the retailers responding to the survey said they will not be using price-based promotions to generate online revenue from loyal customers during the holidays, compared to 11% last year. Even among those using price promotions, last year’s most popular holiday marketing promotion—free shipping—is falling out of favor, WebTrends found. Only 45% of retailers plan to use it during the 2006 holiday season versus 62% a year ago.
More retailers also said they won’t be using site features, such as idea centers and customer product reviews, this holiday season—18% versus 6% last year, WebTrends found. Among those using site features, gift idea centers and featured sales items pages remain the most popular site features to generate revenue. However, fewer retailers will be using them this year. Only 40% of retailers will be using gift idea centers his year, compared with 55% in 2005, while only 37% will be using featured sales items pages, compared to 53% last year, according to survey results.
Overall, retailers ranked e-mail marketing as the most important demand-generation activity for holiday success, followed by search engine marketing and search engine optimization. The biggest increases in holiday marketing spending will be in e-mail marketing (52%), SEM (46%) and SEO (38%), WebTrends found. The largest decreases in spending will be for online banner ads (17%), print advertising (16%) and broadcast advertising (14%).
WebTrends surveyed 300 Internet and multi-channel retailers for the report. It defined the holiday season as Oct. 1 through Dec. 31.
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