Shop.org: The BRIGHT Side of Retail

Josh GordonOne of my favorite annual moments from Shop.org’s Annual Summit is the presentation from Forrester Research VP and Principle Analyst Sucharita Mulpuru. She has such a complete grasp on retail with her annual three part report The State of Retailing Online. For 2009’s version of the presentation she spent time defining how the Web retail channel has outpaced the offline retail channel, and reviewed some possible reasons as to why and how that happened, despite a recessive economy and depressed consumer spending.

Mulpuru arranged Web retail success into six categories:

  1. Reset Goals as Needed
  2. Redefine the Competition
  3. Respect IT
  4. Reinforce Partners
  5. React Well to the Power People
  6. Recognize the Mobility Revolution

Some of the six categories are fairly self evident. For example, adjusting sales and marketing goals to the reality of the marketplace is an absolute must. Fortunately online retailers were not forced into difficult decisions by sliding sales. Mulpuru also made interesting points about the importance of maintaining strong channel partner relationships, leveraging and monetizing social media, and respecting IT. However, the two categories that show the most upside and value are redefining the competition and recognizing the mobility revolution.

Mulpuru gave a fascinating example of redefining the competition by examining how McDonald’s has marketed in the shadow Starbuck’s now shrinking shadow. When making the insightful decision to enter into coffee and coffee drinks, McDonald’s cleverly redefined Starbucks not as overpriced in order to fight the always questionable price war, but they defined Starbucks as overvalued. Big difference. Now McDonald’s was not a low cost alternative, they became more VALUABLE.

Since it is impossible for me to turn off my direct digital marketing brain, I cannot help but recognize the obvious analogy to email marketing. For far too long ESPs have developed pricing models that easily facilitate the up-sell by charging for small upgrades or slight additions to improve the overall campaign. Instead, ESPs should follow the example of leading direct digital marketing companies and thought leaders and reposition to reflect the reality of offering more capabilities for more value, not less money.

Recognizing the mobility revolution is the other point Mulpuru made that resonated. She revealed data that provided how recession proof Apple’s iPhone is. However, as popular as mobile is and the tantalizing promise it continues to show retailers, the number of consumers actually accessing the Web via their mobile device is just 15%. The growth figures have been flat for several years, too, reflecting that adoption exists at a slow pace. This stat is important because it continues to showcase the value of SMS text message programs because the adoption curve is far greater. While M-Commerce is promising and continuing its slow emergence, SMS is still currently the best tactic for instant communications and mobile ROI.

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  1. […] Sucharita Mulpuru, give her annual State of Retailing Online presentation. She focused on "the bright side" of online retailing. While the presentation was fascinating, Mulpuru concentrated less on the […]

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