Why The “Hard Sell” Will Be ‘Bricks & Mortar’s’ Deathknell

Why The “Hard Sell” Will Be ‘Bricks & Mortar’s’ Deathknell

In this guest post, John Andrews the CMO at brand marketing firm GoodXChange, says retailers who forgo brand building for just selling stuff will fast find themselves in a difficult place indeed…

(Please note John’s comments are written in the context of the US market.)

Guess what? Target is having a sale on summer items! Crazy. So is Kohl’s, Macy’s, Banana Republic, Rue-la-la blah, blah, blah. I know this because practically every single communication from every single touchpoint I could possibly have with these brands tells me so.

Not that I’m paying attention because, like you, I filter, block and generally ignore these messages that are begging and pleading me to pay attention to the latest sale, deal and discount. What happened to brand building and creating relevance to why I should care? In a post-physical retail world, this behaviour can be very dangerous as price-based-only competition is a negative-margin game that will end in bankruptcy.

It’s an especially bad time to be losing relevancy. The primary way that consumers built relationships with brands for the past century was by in-store shopping — which is in the greatest period of disruption ever. Stores were where consumers discovered, experienced and ultimately purchased brands that they learned about through incessant mass advertising. As consumers avoid, block and generally ignore brand messaging, brands without great relationships will find it harder to reach them.

Simply put, the consumer decision hierarchy has flipped from where to get things to getting things they want wherever they are.

The physical channel will fade into irrelevancy and accelerate as the supply chain extends from the manufacturer to the consumer as the marginal cost of distribution goes to zero. From self-driving cars and drones to the gig-economy, getting stuff you want is less about a shelf and more about a need. Physical store traffic is off across the board, with a couple of exceptions — including retailers that aggregate unsold merchandise from other retailers and folks with germane shopping experiences like Starbucks and Home Depot.

Marketing response has been to rip and reapply old tactics to new channels. Blanketing digital channels with transactional messaging and content has become the go-to tactic for many marketers. There is so much focus on selling something and transaction counting — from reach to clicks to conversions — that good old fashioned brand building is being forgotten. Worse still is that every communication is becoming a pitch to buy something.

Every. Single. One.

Predictably, brands are losing meaning for consumers. Transactional messaging is being driven to astonishing levels using massive digital data and retargeting. Digital marketers are practicing yield demand at the expense of brand warmth and loyalty. When brand relationships are reduced to “buy my stuff”, the simplicity of transaction is likely to be the order winner. The reason that Amazon increasingly gets more of my share of wallet is that I don’t have to think about buying things like toothpaste or cat litter, which get crowded out in a increasingly competitive attention marketplace.

Retail relevancy will continue to challenge traditional retailing models as we know them. There is a tonne of inefficiency built into most physical retailing, which creates incentives not only for manufacturers to build stronger relationships but also for consumers to seek more ingrained connections to their retailing outlets. Amazon and Google are building complete shopping experiences inside consumers’ homes though the Echo and Nest ecosystems and others are seeking a piece of this growing channel including Apple, AT&T any many others with deeply established digital channel pathways into consumers’ lives. All of this will continue to make transactional retail less efficient despite better and better consumer targeting data (counter-intuitive to how many marketers are using digital channels today).

The “retail recession” will likely turn into a retail depression as traffic continues to slide, brands and retailers that built strong brand relationships through simplicity of shopping, relevancy and real connections with consumers will thrive, those that haven’t will promote themselves into oblivion.

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