Marketing cloud technology provider Listrak has released its inaugural Revenue Gap Index, reporting a significantly sub-standard marketing performance from the majority of companies assessed. Out of a total possible score of 100, the average score was 43.8 — and only 20% of those reviewed scored 50 or higher.
The Index looked at the digital marketing efforts of a cross-section of retailers, evaluating them in five key areas: identification and acquisition; broadcast campaigns; behavioral triggers; active personalization; and integrated cross-channel. Listrak observed that these last two categories were the most common areas where businesses are falling short, perhaps due to these being newer topics.
Marketing has increasingly turned digital in order to meet consumers where they are — which is browsing and buying online. The Revenue Gap Index identified trends within the retailers surveyed, noting that legacy retailers often have strong broadcast email campaigns, but a weak acquisition and personalization strategy.
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Conversely, “digital hotshots” have a strong command of new channels, like SMS marketing, and a willingness to adopt new technologies, but often neglect industry basics like broadcast email campaigns. Another issue is the frequent inability to tie these various technologies together in an integrated strategy. Without this, notes Listrak, the collected information cannot be effectively utilized and the technologies are made redundant.
“While it may look appealing for a digital hotshot to see a legacy retailer’s large broadcast program or for the legacy retailer to see the newest technology that the digital hotshots are working with, the truth is that they both have major flaws that stem from an incomplete marketing program,” said Ross Kramer, CEO at Listrak. “This siloed, one-dimensional approach helps neither company.”
Instead, Listrak advocates for a truly integrated approach across all marketing channels. Currently, most retailers are working to publish marketing campaigns across several social media platforms, email and onsite. As a result, these businesses are working with multiple programs to manage these various formats, which can create inconsistent consumer experiences — and inconsistent results.
The Revenue Gap Index found that the “Integrated Cross-Channel” area performed the worst on average, with a score of 3.4 out of 20. One common issue was the lack of an SMS marketing channel altogether, despite the fact that mobile commerce is growing rapidly among consumers. The company recommended implementing SMS capabilities as soon as possible, to be managed alongside other channels from an integrated platform.
“Turning to SMS will reach shoppers on their most-used devices — their smartphones,” said Kramer. “SMS draws high engagement from consumers, creating a fresh pool of customer insights. Next, marketers should use a single platform that combines all customer touchpoints. Having a comprehensive view will not only make it easier to keep track of campaigns and data, it will also allow your team to maximize segmentation, behavioral triggers and active personalization capabilities.”
Personalization was another area of the Index in which retailers scored very low. These results are in spite of the growing emphasis on personalization within retail, suggesting a gap between talk and action. Kramer attributes this to a lack of understanding about how to maximize existing capabilities. For instance, many marketers have access to helpful programs, but can’t utilize all of the relevant tools.
He also argues that personalization will naturally be improved once marketing channels are integrated. Personalization relies on consumer data, so if a customer’s preferences and habits are known, these can be used to create targeted offers and inform marketing campaigns. Once marketers are able to collect all the data in one place, strategy will be better informed and able to perform wherever the customer prefers to shop.
“Personalization is not a one-click and done solution,” said Kramer. “Brands should constantly be tweaking their system. Just as consumer preferences change, the personalization recipe should be continually evolving to offer the right recommendations.”