In the last few months we have spent a considerable amount of time talking to sales and marketing executives in some of the largest businesses in the UK. We have tried to listen and learn about what challenges they face and the plans they are developing in order to climb out of the recession as market momentum returns. Our discussions have been centred on the retail industry, but we see the same patterns in other sectors as well.
Most sales and marketing executives identified substantial inefficiencies in the way marketing promotions and product launches are executed. The ability to ensure that front line staff are up to date on the latest product offers and promotions when meeting the customer – a time that is often called “the moment of truth” - is something that everyone seems to be struggling with. And although this challenge has been widely recognised and the remedy has been identified, no one seems to own the problem – everyone seems to believe that it should be solved by someone else.
The challenge
We interviewed over 100 retail-marketing executives about their strategies for promotional campaigns during the downturn. The stories that emerged from this work painted a picture of marketers scrambling to reposition entire product suites. Any focus on “finest ranges” or “exclusive brands” was out according to the people we spoke to, and even the most established purveyors of luxury and indulgence were united behind the industry's mainstream belief that the new "no nonsense, cost-conscious consumerism" required a response focused wholeheartedly on value/price-based propositions.
"Three retail marketers in four are unsatisfied with the way product roll-outs are communicated to in-store staff, and nearly half strongly believe that recent promotions have suffered because they were badly communicated internally."
Next steps in retail survey, Summer 09
The insight
But it is behind the headlines that the really intriguing detail starts to emerge. As our questioning delved deeper, it became clear that retail marketers were not only focused on promoting value / price-centric messages to end customers; they were also intent on increasing the effectiveness of internal communications with frontline sales staff so they could have stronger engagement with every customer with whom they came into contact. And as they reviewed the performance and efficiency of the communications, they recognised that this was a long neglected weakness that could easily be addressed with simple, low-cost improvements.
"In-store merchandising" and "staff ability to engage with customers" are the two big under performers in marketing.
Over 75% of marketers interviewed said that the two tactics which had increased in importance most dramatically and become the new top priorities during the downturn were:
- "In-store merchandising"
- "The sales staff's ability to engage with and advise customers"
They acknowledged that essentially, the scatter gun tactics favoured in boom times where promotions prioritised high-cost external communications such as TV ads or media tie-ins designed to attract new customers through the door, might be downplayed in favour of lean, low-cost internal tactics focused on communicating better with customers already in the store.
To implement this they reviewed their entire communications landscape to uncover key areas where simple, low-cost improvements made in-store could best complement the big-ticket promotional tactics that got shoppers through the door.
Isn't this a job for the insider?
While retail marketers may have reached a consensus on what can be done internally to help steer retailers out of recession, there seems to be little agreement on how it should be done and who should do it.
It is interesting to note that while the majority questioned in our study stated that they had done everything they could to calibrate promotions for today's tough economical conditions, nearly three quarters of them still remained unsatisfied with the way product roll-outs were being communicated to in-store staff; half of them strongly believed that recent promotions had actually suffered because they were badly communicated internally. The problem may be clear, but the business department responsible for its resolution is not.
Taking responsibility
In business, execution is key to making change happen, and there is seldom a lack of problems to solve or ways to improve, but to make these changes someone needs to take on the challenge and drive through the improvements.
The key insight that this research has uncovered is that execution seems to be lacking when it comes to making sure front line staff are up to date. Ironically this challenge can be solved quite easily and economically by using technology. Using interactive updates delivered online (or “e-learning” as it is called in HR circles) you can quickly update everyone on the new promotion or the benefits of a new product and thereby increase your sales team’s cross-selling possibilities.
The interactive update content can be quickly created internally, in a matter of days, by the people that are familiar with the product benefits or the key elements of a new promotion. No technical skills are required. The rapid e-learning revolution has made solutions and best practice available for anyone who wants to change how promotions are executed.
“Technology has made this a challenge that can be solved quite easily; you can quickly update everyone on a new promotion or the benefits of a new product”
Final thought
So, who will take this forward? Sales and Marketing departments have identified the problem and they see how they can increase the efficiency of their promotions and thereby increase sales, so they should definitely be able to own the solution. For HR, the challenge of supporting product launches includes a rare opportunity to affect top line directly – maybe this is their chance to reinvent themselves?
Now, as calls for new collaboration across established retail business departments intensify, it may be time to take stock of roles and responsibilities on the inside – who will step up and make sure your business gets more out of every customer interaction?