According to Market Force (previously known as Retail Eyes) 51% of shoppers confirmed that promotions drive them into stores. But, once in the stores are shoppers spending as much as retailers would like? Not always. Some promotions may have missing POS, be unclear, lack key information or simply not be of much interest to shoppers in that specific store. Any of these points will reduce the ROI on a promotion.
The challenge gets harder
For some retailers the increasingly sophisticated promotions from competitors, both online and offline, adds an extra pressure. For example Symphony IRI, (the leading global provider of enterprise market information solutions and services) recommends that retailers continually re-assess and adjust pricing to maintain an optimal price. This leads to increasingly frequent price changes. They also advise identifying cross-promotional opportunities with high-growth categories and brands as the best way to get the most out of promotions. We know that this is something that a number of tier two retailers would love to do better.
Why aren’t retailers fixing the issues?
So what’s getting in the way of retailers’ ability to fix the issues and take full advantage of the recommendations of firms like Symphony IRI? The most common reasons that we hear about are the limitations of their current processes and concerns about the extra burden that will be put on already busy staff in their stores. Some also say that they simply don’t have the time to put in a better system. We don’t very often hear about budget limitations so these are issues that retailers really want to fix and get that improved ROI.
There is an answer
It is possible to make a significant improvement to the ROI on promotions in a matter of days without big IT projects and extra work for your staff. More tier one and two retailers have talked to us about this topic recently than almost anything else.