A Case for local retailers to adopt online marketing

New marketing mediums especially online and mobile offers greater measurability as it is very effective at giving customized messages to customers. All in all new medium help retailers by creating awareness and generating leads while keeping cost within limits.

The choices for local retailers to reach customers with marketing messages related to product, services, deals and discounts have increased in the recent past. New media options such as internet, mobile and OOH (Out of Home) are proving to be efficient mediums with their own strengths.

Mismatch between Traditional Media offerings and local retailers needs

Traditionally Old media such as print, TV, Radio and outdoor advertising has been successful in creating mass awareness. Big brands and organized retail (retail chains) have used it efficiently to build brand. But for the local retailer old media possess certain challenges.

First, a local retailer does not want to send out as many brand building messages as marketing messages that will result in traffic to the store. So the need is to send out more deals, discount and product information to its target customers. Frequent use of traditional media to send out these messages is a costly affair that an average local retailer may not be able to afford. For example the cost can vary anywhere north of Rs 30,000 for full page ads in local magazines to Rs 1 lac for full page ad in newspapers and outdoor campaigns such as billboard.

Secondly, marketing messages for generating traffic will be more effective if they are customized and are pulled by the target customer. For example, if a target customer is looking for furniture shopping this weekend; then a deal and discount information on furniture products is very useful. It will be even more effective if the customer has the choice to get the message at his own convenience preferably an hour before shopping. Traditional media neither offers customized messages nor a pull based mechanism to customer to retrieve the message.

Lastly, traditional medium provides no direct measurability of ROI (return of investment). It is very difficult for a retailer to ascertain the traffic generated by a campaign in order to decide success or failure.

New Media offerings aligned to local retailers needs

There are more than 30 Million active Indian Internet users across metros, tier 1, tier 2 and tier 3 cities [JuxtConsult 2007, I-Cube Survey - IAMI]. A significant number (32%) of these users search for information on the internet. In fact many of the sunrise sector employees prefer to do a quick Google or Yahoo search before they ask family and friends for information. This behavior change in consumer is brought about by availability of internet at home or office and availability of relevant content and services on internet

New media especially online and mobile medium is very effective at giving customized messages to customers. Many online platforms are interactive and a customer can indicate current preferences on it. Based on the preferences relevant marketing messages can be delivered at the convenience of the customer.

Take example of www.metromela.com, a platform for local community to discover local trends and local choices. On this platform the user community can set deal alerts for the products they want to shop in the near future. Retailers can use this platform to post deals and discount information for their products. Interested users then receive alerts and can download mobile and online coupons to redeem at the local retailer.

MetroMela is able to provide such powerful platform for local retailers because it builds relationship with its users by providing trustworthy and unbiased information and in the process helps the users to make informed shopping decisions. In the MetroMela platform a user gets to see additional useful information such as editorial review, community feedback and deal information. Through MetroMela platform a user can not only discover a local retailer but also get to know community feedback on it. In fact many users use MetroMela platform to voice their opinion and share critical information with others in the community.

New media also offers greater measurability. For example if a local retailer post a online coupon, he can easily track how many target customers have seen his offer, how many have downloaded his coupon and compare it with how many came to him to redeem coupons. This allows him to calculate parameters such as cost per lead and revenue generated from the campaign.

All in all new medium promises to help local retailers counter threat from organized retail by creating awareness and generating leads while keeping cost within limits.

Pankaj Joshi is Founder/VP Marketing & Business Strategy of www.metromela.com. He has strong Marketing and Business Development skills in the Mobile and Internet domains. At MetroMela, he is responsible for managing the marketing and business strategy initiatives of the company.

Issue BG83 Feb 08