Retail in Asia

Featured

Is Retail 4.0 the answer to the Changing World of Marketing?

Our shopping experience is becoming more digital. The retail industry will change even further as consumers are looking for more ways to shop at their convenience. Retail 4.0, the transformation of the sector through technology, is clearly here to stay and has also drastically changed retail marketing.

SEE ALSO : Marketing Forecast 2022 : Pandemic aftermath boosts creativity

According to a study by eMarketer, nearly two-thirds of overall ad spend in Asia Pacific now flows into digital channels. Southeast Asia represents the fastest growing region in the digital advertising market, with a CAGR of almost 20 percent for the 2021-31 period.

But relying on traditional methods alone is no longer enough. Brands need to evolve on the marketing front just as quickly as in the day-to-day business. While conventional advertising tactics certainly remain relevant, it is clear that an integrated, omnichannel approach is integral to building an effective marketing strategy.

The rise of omnichannel marketing

Traditional marketing has treated online and physical stores as separate entities. But these conventional methods of mass advertising looking at interest and targeted reach have become less effective. Consumers can easily block these out.

Product recommendations through niche audiences are the next stage. While this is already practiced to a certain extent today, it has not yet been done at the scale and with the accuracy required in the new world of Retail 4.0. Reaching out to very specific audiences through influential people, sites, or groups is how brands will drive real growth. As consumers have become not only more sophisticated but also more selective with their media consumption, brands need to work directly with those who own the audiences.

Omnichannel marketing offers consumers all of the above, while enabling a seamless integration of the digital and physical. By using deep knowledge and understanding of their consumers, businesses implement strategies that improve in-person services while simultaneously cultivating a strong online presence to create a complete and positive customer experience.

The new Singapore Airlines app checks multiple omnichannel boxes. Clients manage and monitor their travel details through their phone, cutting out calls to customer service as well as check-in queues. The app connects to the in-flight entertainment catalog so that travellers can continue watching the movie from where they left off on a previous flight. It offers real-time language translation. The airline leverages technology to provide a complete travel experience that builds a strong and loyal customer base.

Popularization of Digital Marketing and KOLs

Digital marketing uses social media, search engines, and websites to reach customers. Digital has become omnipresent and changed how consumers perceive advertising as well as how brands reach their target audiences. Both Facebook and Google have an ecosystem that spans multiple touch points. As such they will still be very large players but no longer the dominant ones. Competition has grown with platforms like TikTok and other chat applications that have started snapping up significant amounts of screen time away from the incumbents.

The war for social media has resulted in the rise of the influencers—be it individuals or businesses—that are trusted as experts in a field. Audiences are following these people or brands regardless of the social platform. A survey found that 58 percent of Malaysian and 48 percent of Vietnamese respondents discovered new products via social media. This brings social media as an advertising tool to the forefront, given that it is increasingly seen as a means of increasing awareness and gaining brand visibility. Services that can provide brands with solutions that directly reach audience owners are in the best position to benefit.

KOL marketing is especially widespread in the beauty and fashion industry. Cosmetics giant Lancôme claims that 69 percent of their overall media impact value comes from influencer marketing. While KOL marketing for beauty products reigns supreme in China, other countries have also seen increases in campaigns for food products, laundry detergents, and disinfectants.

Content creators who are able to successfully build and retain audiences become more and more important to a brand’s marketing plan. But both parties need to find a sustainable model for their collaboration. Brands need to be aware of the popularity and reach of the influencers and figure out how they can effectively use them. This type of marketing is only effective if advertisers and KOLs appeal to the same targeted audience. The area is still relatively uncharted and metrics are vague, so finding a way to measure and attribute this data as part of a marketing plan is becoming increasingly important.

Martech as a solution

Marketing technology solutions allow retailers to address these issues. Martech enables attribution, tracking, and optimisation of partnership spending. It can manage thousands of partners whether they’re KOLs, discount or cashback sites, blogs, social media profiles and other types of digital property. These platforms are essential for retailers to pivot with an omnichannel strategy to survive the death of the high street due to lockdowns, increasing rent, and competition from local malls.

Affiliate marketing through influencers is becoming more commonplace as more brands embrace the concept of trust-based recommendations to drive sales. This means that this form of marketing needs to be able to cater to the varying needs of brands and understand how content creators communicate with their audiences through the ever growing number of channels and platforms.

SEE ALSO : Overcoming fraud challenges in the “Buy Now, Pay Later” space

As we move forward toward a more integrated marketing, it is important to know how to maximise the value of tech. Rather than focusing on forming partnerships, there needs to be a shift towards managing partnerships effectively and martech solutions are a key component of this equation.

Author : Rossnan Cheong, Director of Marketing, Involve Asia

*Disclaimer: The views and opinion expressed in the article belong solely to the original author and do not represent the views, opinions and position of Retail in Asia.