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Direct Response Marketing

Retail Outlet: Think Retail

1 Jun, 2017 By: Anthony Booth, Thane Direct Response

Back in the heyday of direct response TV, retail was optional, providing an additional avenue for revenue and contributing toward extending the life cycle of a product.

Direct response marketers can no longer be limited to direct response marketing. Due to DR’s changing ROI landscape, it is increasingly important that retail becomes part of the marketing equation.

But just as retail can offer opportunities, it also poses tremendous challenges:

  • How do you balance your DR pricing strategy with your pricing strategy for retail stores, for retail online, and for platforms such as Amazon?
  • How do you offer retailers product and/or packaging differentiation without compromising your DR business model?
  • How do you attribute media against your retail business and measure media effectiveness?
  • How do you account for the longer time it takes for brands to be positioned at retail?
  • Retail and brand advertising are very different from DR marketing. Which creative approach do you take for retail?
  • Managing the retail supply chain is far different than managing a direct-to-consumer supply chain. How do you prepare?
  • Where do you sell DR products in-store: the As Seen On TV section or in product-appropriate aisles?

Thinking DR and retail from the outset of operational planning is critical. For example, floor space at brick-and-mortar is valuable real estate, so product plus packaging must take up as little shelf and floor space as possible — not necessarily an issue for DR.

Knowing your retailer is an entirely different process from knowing your DR target consumer — retail buying cycles, shipping policies, displays, and product categories are among the many considerations that need to be planned for early on to meet the demands of retail.

Product differentiation is another aspect of preparing for retail — product size, color, packaging, and pricing are among the elements that may need to be rethought specifically for retail. Not only will retailers take an active role in determining packaging, they often require you to disclose your true per-unit manufacturing costs, along with a breakdown of shipping, packaging, UPC costs, and other expenses associated with preparing products for retail shelves.

Retailers want to know that consumers will be attracted to products before they incur the costs of buying, stocking, and displaying product. DR marketers have an advantage of being able to demonstrate product appeal based on the track record of the product during its DR cycle. However, retailers also often look to differentiate product from other channels of distribution. Therefore, research early in the process is critical.

Buyers expect product distributors to conduct comprehensive marketing activities to support the product at retail, as well as share promotion plans. As a result, DR companies need to consider themselves as both direct-to-consumer marketers and brand-awareness advertisers. This requires a rethink regarding your overall media creative and buying plans. For example, more DR marketers are tagging their short-form ads with the names and logos of participating retailers.

Retail should play an integral role for every DR marketer. Thinking retail from the start will impact your direct response marketing, pricing, packaging — and even product development — plans. However, shifting your thinking from being a DR marketer to being a consumer product marketer will yield revenue dividends and expand your product life cycle. ■

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