The Rumors of Retail’s Death Are Greatly Exaggerated!
Every day we read articles about how retail is dying, or at the very least undergoing a dramatic and potentially devastating evolution, raising the question…is the retail “bubble” bursting? Should we be doing a course correction at this point, amending our five-year plans to slow projected growth? Are there fewer sources of reliable, high-responding prospect names available?
We say a firm ‘no.’ Belardi/Ostroy’s business is experiencing appreciable grow through the launch of new catalogs by previously pure-play online retailers, wholesale brands and traditional retailers that are looking for a cost-effective way to find that next responsive customer. These clients find the catalog to be a valuable vehicle, especially for driving demand from customers with positive long-term value. But it is just one part of their marketing mix. In short, our clients are not relying on the co-ops for 80% of their new customers.
Retailers that have run aground (and there are many) are typically too big and increasingly irrelevant, and have thus been forced to shut stores if they’ve been lucky enough to stay alive. Yet, 87% of retail sales in this country are still in physical stores, reinforcing the contention that having a brick and mortar presence still fulfills a huge demand. Being successful in retail is about having a varied marketing mix and skillfully leveraging all channels. In other words, never relying too much on one channel, as consumers’ marketing and shopping preferences are variable and ever-changing.
The cooperative databases Belardi/Ostroy works closely with are constantly evolving. They don’t want their businesses to die, so they are bringing in new sources of data to improve prospecting, and they are creating new revenue streams. And the way we work with the co-ops is unique: we incorporate unparalleled knowledge of how each co-op model performs across our client roster when we’re mapping out strategy for a new client. And we use that expertise to greatly impact the models for each client individually, as every retailer’s requirements and goals are different. But we have clients in so many different categories, targeting so many different audiences, that we have an amazing cross-section of model tests from every co-op from which to refer.
But what happens when there’s an appreciable decline in response rates? We could immediately point the finger at the sources of prospecting names. But it’s also prudent to look to other likely causes such as branding or merchandising issues that often negatively impact prospecting performance. So what ultimately makes for a truly successful mailing? Relevance, authenticity, staying true to your brand and offering the customer a unique experience is the secret sauce. The best prospect models in the world can’t compensate for a marketer that lacks these critical elements.