Two out of five US retailers do not have a bricks and
mortar store thanks to the internet, and websites are out-earning
real stores, according to a
reportby theDirect Marketing
Association(DMA).
Eugenia Steingold, DMA senior research manager and the report's
chief author, said, "Many, if not most, retailers have now moved
beyond brick and mortar and have added other channels such as
catalogues, websites, TV, and radio for both sales and
promotions."
The report,
"Channel
Integration and Benchmarks in the Retail Industry", analyses
direct marketing practices in each channel and looks for channel
integration. The report measured how many respondents use each
channel, and its effectiveness, measured by return on
investment.
The report's key findings include:
- 41% of survey respondents do not have a physical store.
- The website is the most consistently used direct marketing
channel, followed by e-mail and direct mail.
- Mobile is the direct marketing channel retailers are least
likely to use.
- Among the survey respondents, 66% gather customer information
from direct mail, and 65% gather it from the internet.
- About 83% of respondents segment their customers based on
demographics, 77% do so based on purchasing frequency, and 76% on
products purchased.
- Only 33% provide cross-channel order fulfillment.
- Discounts remain the most popular loyalty program, with 80% of
respondents using them.
- Brick-and-mortar stores (20%) and websites (22%) produced the
highest level of revenue in 2007.
Steingold said, "To be successful, retailers need to merge and
synchronise all channels in terms of consistent brand message,
timing, creativity of promotions, loyalty programs, and
fulfilment."
DMA conducted the internet survey in November 2007, with 101
retailers participating.