In the face of a gloomy economic outlook, Prime Minister Kevin Rudd is encouraging Australians to kick start the economy. Time will tell how consumers choose to spend the proposed injection into their bank accounts, and what retail sectors may benefit from this, come April 2009. Recent search insights from Google indicate we should look to how consumers are using the online world to decide what to buy in-store.
Online plays a vital role in shoppers’ decision making. Research from the Australian Centre for Retail Studies (January 2008) showed that 50 per cent of Australian shoppers had researched their products online before heading into a store to complete their purchase. Retailers – from kitchen goods to cars – all have stories of customers arriving with more information than their sales staff, many with print outs from the websites they had visited.
Google Tips
How to capture consumers online and drive them in-store – top tips from Google:
- Search for your own retail name using Google. Are you easy to find, with locations and opening hours?
- Shoppers search for products and product brands far more frequently than they do for retailer names. Search for your key product categories using Google – does your name appear to remind customers of your range? Do your competitors’ names appear?
- Understand seasonality. Google’s free “Insights for Search” tool allows you to see when shoppers are searching for your products and what else they are searching for at the same time
- Test different messages for your search advertising. Are you the “cheapest deal” in town, do you have the “best service” or can shoppers come into your store to “see the full range”? Google’s automated ad copy tools allow you to do this quickly and easily.
- Build customer loyalty. Listen to your customers and allow them to send you feedback. Understand what they want to see online, and what they don’t want to see.
This trend is becoming more important to retailers day by day. Retail searches with Google during Christmas 2008 increased by 36 per cent (in comparison to December 07), showing Australians are increasingly turning to online information sources before visiting a retailer. In January this year, with consumer confidence showing volatility, search volumes are 20 per cent higher than the previous January.
By retail sector, food and drink category searches increased 48 per cent*, apparel experienced a 46 per cent* growth, photo and video equipment increased 42 per cent*, mass merchants and department stores increased 41 per cent* and computers and electronics experienced a 34 per cent* growth. Many major Australian retailers anticipated the surge in searches and undertook website refreshes in the lead up to Christmas.
Retailers can drive sales in-store using search advertising, to remind potential customers they are open and solutions are available. Search marketing allows retailers to talk to customers exactly at the point when customers want information. A shopper searching for items such as; ‘wedding dress in Leichardt’, ‘plasma TV in Caulfield’ or ‘Christmas cakes in Wagga’ is stating a very clear desire for a solution. Any relevant retailer who does not appear in the search results, either organically or via sponsored links, is missing a significant opportunity.
From our experience at Google, the first step is to appear in search results, so that retailers are considered as a potential solution.
From there, retailers can trial promoting specific categories, adjusting their communication strategies to test and learn. Our data shows search queries increase after good advertising campaigns. A good television or press advertisement drives people online to search for further information, whether it is for product specifications or store opening information. Retailers should make sure they have online search campaigns ready to support the demand they create offline.
More advanced retailers soon move from trialing promotional campaigns to ‘always-on’ campaigns, highlighting key trafficdriving categories. This ensures retailers capture shopper interest whenever it arises and build brand momentum over time – even if it’s three months after the promotional campaign. More sophisticated retailers adopt multi-channel retailing, with businesses combining online with store operations to grow incremental revenue.
An interesting multi-channel model from overseas is “reserve online, collect in-store”. Shoppers can research online, as they already do in Australia, and then reserve the items to collect them in-store. Walmart (US) and John Lewis (UK) use this very effectively to offer their national range to all shoppers, no matter how big the local store is.
Walmart found that 20 per cent** of shoppers picking up items in-store also purchased other items, so the incremental opportunity for retailers is real.
The flexibility of online search marketing is a key attraction. There are no fixed rates, no media schedules to negotiate and no minimum investments. Retailers can start small and then use online messaging to grow their business, testing and learning as they grow.
As Google continues to see an increased interest in online around key sales periods, there is no doubt that online will play a crucial role in the Australian retail sector. With every second shopper using online research before they purchase, the importance of online advertising is only going to increase.
