Back at the beginning of 2017, following his attendance at ‘Retail’s Big Show’, NRF 2017, Velocity Worldwide’s CEO, Enda McShane wrote about the opportunity for customer engagement focused retail technology businesses to partner with each other so as to provide integrated solutions that help retailers create better data-based, insight-based shopper marketing strategies and campaigns. The premise was founded on Enda’s observation of the booth upon booth of tech businesses selling ‘vertical’ solutions, which in isolation might be good for their retail clients, but when integrated with the right data management platform could be great. Greater than the sum of the parts, as it were.
Since then, for our part, Velocity have made it our mission to seek out and develop relationships with fellow retail tech providers that help them and their clients derive real value from the data they generate. This has seen us partnering with a portfolio of Wi-Fi, ePOS, beacon, app, and digital signage specialists that includes leading names like Aruba, Cisco Meraki, The Pinnacle Corporation, Samsung, Estimote, Panasonic, Comqi EnGage, and The Retail Data Partnership, to name just a few.
One of our greatest learnings from this experience is that nobody ‘ate anybody else’s lunch’. Quite the opposite – it was more a case of sitting down to eat together, if we’re to extend the lunch analogy.
While, of course, this has been good for us and our partners, the real winners are our mutual clients.
That data will continue to grow in importance for retailers and brands is irrefutable to the extent that there’s little need here to cite references!
With this comes the growing expectation on the retail advertising and marketing industry – from brand activation and experiential marketing agencies, to advertising agencies – to create and implement campaigns that generate data.
This is at a time where many agencies are feeling the pain.
Take, for example this quote from over the last few days, a deep dive article in Marketing Dive talks about the woes facing big billing media agencies:
“The past three years have been full of stories talking about how the market has changed. It’s natural for the advertisers to want to know if their agencies can operate in that new environment.” Greg Portell, Lead partner, consumer industries and retail, A. T. Kearney.
Then consider the continued pressure on agencies to deliver ever greater return on investment. According to Nielsen’s analysis of their 40,000+ database of marketing activities across TV, print, digital, radio, outdoor and trade spend, the average return on investment comes in at just under $0.70 for every $1 spent on marketing. In effect then, a lot of marketing is costing more to run than the profit it generates. Such ‘negative’ return on investment rarely ends well (read, budget cuts).
If we add to these the trend of brands bringing marketing capabilities in-house, then it’s easy to see how the pressure can mount for marketers. (Hot off the press: a survey of CMOs by Dentsu Aegis shows that over half of CMOs plan to bring more of their marketing capabilities in-house.)
The main course
Writing for Forbes, Keith Bendes talks about the power of physical experiences as one of the best ways brands can connect with consumers in today’s digitally fragmented world. He goes on to give examples of how brands can maximise the return on investment, including extending the experience to digital channels.
A May 2018 opinion piece in The Drum entitled ‘Fragile retail budgets: agencies please handle with care’ places some responsibility on agencies to help lagging retailers catch up on their technology shortfall. The article elaborates that existing cloud-based solutions can be a very cost-effective method of offering retail clients advanced services and functionality.
The role of tech in brand activation and experiential marketing also has a prominent place in the Brand Experience Report 2017: Campaigns of the future insight piece.
Whether it’s an experiential marketing campaign to launch a new product or brand (or to breathe new life into an existing one), or on-going advertising and marketing for a long-time brand or retailer client, even more tactical activities like recruiting for events, pop-ups or in-store sampling, the right agency-retail tech partnership can brings a number of advantages to agency and client alike. While not exhaustive, these advantages include (in no particular order):
So, if for us the last 18 months has been about identifying and developing partnerships with like-minded retail tech specialists – and we’re not ready to stop anytime soon – the next 18 months will see us building mutually beneficial relationships with ‘right fit’ agencies serving the retail and hospitality sector clients.
How we see this working is straightforward: agencies bring their campaigns and we bring our ‘out-of-the-box’ data, personalization and insights platform, Darius® for Retail.
Through Darius®, agencies will be able to create and deliver personalized content that results in compelling shopping and brand experiences for their clients customers, consumers and shoppers.
While not a magic wand for agencies, it is very much a step in the right direction in the introduction (or deepening) of data and insights generating tech for their client portfolios.
It also comes with the reassurance that Darius® picked up the award for the 'Best Solution for Managing Local Data' category at the 2017 Street Fight Local Visionary Awards. It’s also GDPR compliant.
And throughout it all, we don’t expect anybody will be out to eat anyone else’s lunch!
If you are an agency that works for retail or hospitality sector clients, we would welcome a conversation.
If you are a retailer or brand, please share what you’ve just read with your agency!
Damian Donnelly, Marketing & Strategy Associate, Velocity Worldwide
We’d love to continue this conversation about how we can help you get more customers, spending more, more often.