More retail companies shift budgets to reach consumers online
July 3, 2009
The evolution of the Internet and consumer buying is pushing more companies to increase their online advertising budgets while creating websites that are consumer friendly. The economic recession is forcing almost every organization to review their marketing budgets and how they attract customers. Today, more than ever companies are placing a new focus not only on customer acquisition, but on customer retention. This shift comes at a time when consumers are stretching their budgets and looking for ways to save.
The evolution of the Internet and shopping online has brought a renewed focus on the ability for a potential consumer to compare multiple products or retailers online within minutes. Today, consumers who are shopping for furniture are likely to seek out opinions on quality, price and the manufacturer. More retail sites are offering the ability for users to interact and leave their own reviews and product opinions. These testimonials aid consumers who are researching their purchases, while enabling the retailer to have some added stickiness to their website, a win-win for the retailer and consumer.
The second generation Internet is proving to be much more lucrative for retailers who have more proven customer acquisitions methods, and proven distribution channels in place to satisfy their customer demands. A number of major retailers are now pushing rewards & rebates to retain customer loyalty. One of the newer concepts is to shop online through a third party website that allows the customer to participate in a percentage of the sale income, through a shopping rebate. These websites are participating with the retailer in a revenue share program and then distributing this back to the consumer in gift cards, rewards or cash. This evolution of customer acquisition can benefit consumers who shop online and are looking for specific name brand appliances, clothing, furniture or household items.
Internet shopping will likely grow between ten to twenty percent year over year for the next ten years, according to most industry experts. More companies are now engaging in loyalty programs, driven through email to “drip market” to consumers who have visited or purchased a product on their websites. Some companies acknowledge they send emails once or twice per month, greatly reducing their customer acquisition costs and enabling them to work with loyal customers, which translate over to better priced products, as well as the company’s bottom line.
The Internet will put more power in the hands of consumers who can shop from the comforts of their home or office, compare prices and order their ideal products with the peace of mind of consumer reviews. There are a number of consumer comparison sites such as shop.com, nextag.com, shopping.com that help to organize retailers and products to help simply the process and make online shopping smooth and efficient.
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