The e-retailer spends at least 50% of its monthly display ad budget on the highly targeted, data-driven—and often cheap—ad placements using programmatic platforms.
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The warning apparently hasn’t been lost on department stores. Though slow to transport their main business to the Web, they seem determined not to lose choice pieces, such as the $10 billion wedding gift business, a traditional stronghold. Over the last year, most stores have either launched or announced plans for wedding registry sites in partnership with online wedding services like Weddingnetwork.com. In many ways, wedding registries represent an ideal starting point for regional not-coms because they draw from a national base of customers and produce high-margin sales.
But the Web may hold further promise for regional retailers. Forrester’s Williams contends that it gives them an enormous opportunity to go national. The key, she says, is targeting consumers. Rather than relying on store location, assortment and direct mail to drive sales.
Forrester’s view is that Web-savvy retailers will use knowledge about their target customers to sell relevant products and services across multiple channels. They’ll use the Web to assemble a best-of-breed product assortment by adding related categories and partnering with specialty retailers, an option far more risky and expensive to implement in a physical store.
Regional to national?
“Department stores are losing customers to the Gap and the Limited because they do a better job of targeting lifestyles,” explains Williams, who adds that regional stores need to create national reach. “The Web gives them an opportunity to do a better job of focusing on specific lifestyle segments instead of just trying to be a general merchandiser. It’s an opportunity to jump start building a national brand.”
Whether her arguments will find purchase among department store executives remains to be seen. But one thing’s for sure. With shoppers flocking to the Web in ever-increasing numbers, not-coms will not be able to remain that way for long. “It’s a given. Everyone will be online in the next few years,” predicts Stubing. “Shoppers will access the Internet from everywhere. Even the refrigerator door.” •
Stores and their sites
Federated Department Stores
Corporate site offers store information and locators. Store sites are a mix of full-line shopping destinations as well as bare-bones offerings featuring bridal registries and gift cards. Offerings include:
Bloomingdale’s: Carries a wide range of goods at bloomingdales.com.
Bon Marche: Online bridal registry and gifts (co-branded with the Wedddingchannel.com) at bonmarchebridal.com
Burdine’s: Online bridal registry and gifts (co-branded with the Wedddingchannel) at burdinesflorida.com
Macy’s: Online shopping at macys.com
Offers store information and locators as well as online gift cards.
Offers store information and locators. Online gift cards, wedding registry and travel reservations in a partnership with the Sabre System.
Offers store information, history and locators, along with online gift card sales. Just announced it will offer online bridal registry for seven of its 11 stores cobranded with the WeddingNetwork.com. Stores include Famous-Barr, Filene’s, Foley’s, Hecht’s, Kaufmann’s, Lord & Taylor, L.S. Ayres, Meir & Frank, Strawbridge’s, Jones Store and ZCMI
Online shopping and gift registry at Nordstrom.com and Nordstromshoes.com.
Main site currently offers information and store locators. Plans to launch online shopping for Saks and selected stores this summer. Among the company’s holdings: Carson Pirie Scott, Herberger’s, McRae’s, Proffitt’s, Saks & Co., Parisian and Younkers.