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Dachis Group - Lessons Learned from 2011 Shopping Season
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Dachis Group - Lessons Learned from 2011 Shopping Season
Jan 19, 2012
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1. Lessons Learned from the 2011 Shopping Season by Brian Kotlyar | January 18, 2012Lessons Learnedfrom the 2011Shopping SeasonBy Brian KotlyarConsultant, Dachis Group 1©2012 Dachis Group | www.dachisgroup.com
Lessons Learned from the 2011 Shopping Season by Brian Kotlyar | January 18, 2012Marketers Can InfluenceSeasonal ShoppingConversationDespite an aggregate social media ecosystemnumbering in the hundreds of millions across Facebookand Twitter, major retailers have only recently maturedto the point of integrated marketing across traditional,digital and social media efforts. Dachis Group analyzedsix major retailers during the critical holiday period tounderstand how marketers should attack key seasonalevents from a social media perspective. 2©2012 Dachis Group | www.dachisgroup.com
Lessons Learned from the 2011 Shopping Season by Brian Kotlyar | January 18, 2012 3©2012 Dachis Group | www.dachisgroup.com
Lessons Learned from the 2011 Shopping Season by Brian Kotlyar | January 18, 2012New Year’s Day, Martin Luther King day, Super Bowl, Valentine’s day, Mother’sday, Cinco de Mayo, Father’s day, college graduation, Labor Day, MemorialDay, President’s Day – for most people these are celebratory events and longweekends to mark on their calendar. For marketers these are battlegrounds forconsumer attention and activity. For all the hype around agile marketing,massive campaign exercises dominate the minds and resources of marketers atevery big brand as they try to ‘win’ key seasonal events.To succeed in the scrum for attention marketers plan and fund elaborateintegrated marketing campaigns that span across every medium and channel.The newest and least understood factor in this campaign equation is socialmedia.Dachis Group studied the 2011 holiday shopping season to get to the bottom ofwhat works and what doesn’t for mass marketers. We chose this period andstudy group (large retailers) because these companies earn as much as 40% ofannual revenues in this holiday time period. Consequently it is also the higheststakes time of year for their marketing efforts — the right campaign combinedwith the right pricing strategy can make a huge difference in year-end sales andWall Street valuations.The results, detailed below, suggest that marketers have become highlyeffective in driving interest within their consumer ecosystems around deals andshopping, but that they are leaving an opportunity untapped in the area ofintegrated brand marketing.Brand campaigns extended to social media are the strongestpredictor of sustained campaign conversation.For the period studied Wal-Mart was the most successful in creating relevantsignal within their social media ecosystem with Amazon.com and Best Buy justbehind. These raw measures of activity in a given ecosystem are an importantmeasure of success for brands. They help capture which brands mosteffectively activated their ecosystem and hint at the much broader potentialdistribution across user’s social connections. 4©2012 Dachis Group | www.dachisgroup.com
Lessons Learned from the 2011 Shopping Season by Brian Kotlyar | January 18, 2012Despite this seemingly clear victory for Wal-Mart in the holiday period, rawactivity only tells a part of the story. No brand wants customer service or otheroff-topic issues to be the focus of conversation during a key shopping period.Consequently, on-topic conversation takes on outsized importance and isessential to understanding what sorts of tactics can elicit a sustained campaignor shopping conversation.Of all the brands studied, Best Buy, Kohl’s and Target were able to sparksignificant amounts of valuable campaign conversation in their ecosystems. Ineach case they benefited from a tight linkage between branded campaigns andpaid media that sparked campaign conversation for the duration of that tactic.Best Buy and Target maintained marketing momentum whileKohls tailed off.Retailers that brought a focused and sustained series of branded tactics to bear,above and beyond simple deal sharing, were consistently able to beat theircompetition in sparking campaign conversation. Best Buy, Target and Kohl’sproved most successful at this approach, while Toys R’ Us was thwarted bytechnical difficulties in its attempts to keep pace. 5©2012 Dachis Group | www.dachisgroup.com
Lessons Learned from the 2011 Shopping Season by Brian Kotlyar | January 18, 2012In the “before” period, conversation within the Best Buy ecosystem was almostentirely campaign focused. During the same period, Kohls and Target wereeffectively creating significant amounts of campaign conversation as well. InKohls’ case the crossover from television to social media was a naturalextension of its Black Friday commercial, based on the viral song ‘Friday’ byRebecca Black. Target benefited from wrapping almost all of its “before” periodtactics around the ‘Christmas Champ’ character — including 16 videos, abroadcast television commercial and dozens of Tweets.All of these tactics worked initially, but as the initial burst of activity aroundKohls died down, Best Buy and Target’s more structured and regular tacticskept their momentum. Best Buy transitioned its efforts to promoted ads onTwitter, organic hashtag promotion and linkages between in-line activity andonline activity. Meanwhile Target kept its barrage of ‘Christmas Champ’ activitygoing and continued to garner major campaign conversation.In the ‘after’ period Target kept, and Kohl’s regained, some campaignmomentum, but only Best Buy was able to keep the conversation firmly fixed inthe marketing realm as it launched its “8 Days of Movies” campaign to a strongreception.In each period, brands that effectively executed integrated branded tacticsbenefited from spikes in campaign activity above and beyond ambient shoppingconversation in their ecosystem. This speaks to the ability of marketers armedwith the right tools and budget to cause substantive shifts in the nature ofinteraction across their audience. 6©2012 Dachis Group | www.dachisgroup.com
Lessons Learned from the 2011 Shopping Season by Brian Kotlyar | January 18, 2012Unlike campaign conversation, shopping conversation is hardto influence.Shopping conversation was fairly evenly distributed across companies and timeframes. This is not terribly surprising, first because shopping is of major interestto consumers in this time period. Second, because every retailer is unveilingdeals and doorbusters or publishing circulars across their ecosystem. These aretable stakes tactics that have the predictable consequence of generatingshopping buzz. 7©2012 Dachis Group | www.dachisgroup.com
Lessons Learned from the 2011 Shopping Season by Brian Kotlyar | January 18, 2012Of all the retailers only Amazon employed a differentiated set of tactics aimed atgenerating shopping buzz. Amazon mirrored retailer’s decision to open early onBlack Friday by offering weeks of deals prior to the official start of the day. Thissustained activity enabled Amazon to spark a significant shopping conversationearlier in the holiday cycle than its competitors, and suggests that in future yearsother retailers may benefit from similar actions.Focus is key as non-essential messages get lost in the shuffle.It is notable that most brands launched or mentioned some kind of a cause-related marketing initiative during this time, yet the existence of these effortsbarely registers in our analysis. The explanation comes down to a lack ofattention by both consumers and companies. While it is true that much of theholiday spirit relates to good deeds, the reality is that the real conversationstarters at this time of year have little to do with charity. Gift giving, deal sharing,large meals and travel schedules dominate the conversation and withoutsustained messaging from brands cause marketing messages fail to breakthrough.To make cause marketing work in this context, retailers would be better servedwaiting until a quieter period where there is less fervor around deals. Alternately,brands could attempt to link the cause campaign more concretely to theirholiday activities, but in doing so risk commercializing their giving which mayalienate the audience.Summary and recommendationsDespite the high-stakes nature of the holiday period retailers are still perfectinghow to approach it. The consensus moving into this year was certainly thatdeals and circulars would rule the day. Certain brands were able to cut throughthe noise with brand-focused tactics. This approach should be studied andreplicated across next year’s holiday period as well as any other significantcultural events.The next page features a visual representation of our key findings andrecommendations regarding brand marketing tactics, cause marketing, timing,and cross-channel integration. 8©2012 Dachis Group | www.dachisgroup.com
Lessons Learned from the 2011 Shopping Season by Brian Kotlyar | January 18, 2012 9©2012 Dachis Group | www.dachisgroup.com
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