As the commerce landscape has rapidly evolved in recent years, it’s easy to understand why brands focus on digital performance. We’re now at a pivotal time where brands have to merge the old and the new ways we think about commerce if we want to realize the true potential that lies ahead of us.
From a marketing or advertising perspective, I think of commerce as the act of driving or influencing a purchase no matter where shoppers are in their specific purchase journey. It’s an omnichannel toolbox of tactics, techniques and technologies connecting retailers, suppliers and consumers, filling shelves and shopping carts alike. Which is why – as someone who has spent more than 20 years working with retailers – I would always disagree with the thought of commerce being equated with performance marketing.
Commerce is not performance. Commerce includes performance. However, there’s so much justifiable buzz around the stratospheric rise of retail media networks (RMNs) – which among other benefits provide search performance metrics on retailer dotcoms – that, in combination with search and programmatic, performance elements can drown out everything else. The statistics are impressive:
With these sorts of numbers, it’s understandable that anyone who has entered the industry in the last few years might assume commerce is just another layer of performance.
But it is much more than that. Connecting with customers wherever they are, whatever they’re doing, a total commerce [B(1] [B(2] approach activates strategies across stores, technology, media and creative. With total commerce you see the whole board, not just focus on the slender performance sliver of retail media.
I explain total commerce as a tool. There are four different legs: media, content, the store and technology. All of these pieces need to work together for advertisers to truly succeed in this space. The right inventory, with the right message, right engagement tied to the proper merch plan, will drive not only media efficiencies but bottom-line efficiencies for those that take this approach.
By applying this approach, brands can maximize customer engagement touchpoints (and the value generated from them) in the face of increasingly fragmented and evolving purchase journeys.
For instance, while a McKinsey survey shows that 70% of millennials and Gen Zers rely on social media, celebrities, articles or blogs for purchase inspiration, another study indicates that just 17% of baby boomers discover new products via social media. Meanwhile, 57% of ad agency professionals believe shoppable video content will be the next frontier for retail media.
Customers lead diverse, complicated and changing lifestyles and brands can leverage a range of approaches to connect them with their shopping journey – at work, at home, at play, on the move, in store, or online. While few brands will engage customers across every available channel – they should at least consider every channel available to them and understand how their ideal audiences interact with them.
This means incorporating more traditional store-based customer touch points into the mix along with the many digital options. In this way, a total commerce campaign could include tactics such as point-of-sale displays, in-store radio, or retailer magazines working in lockstep with connected TV (CTV), programmatic advertising, and influencer marketing. In the end, it’s about creating a coherent, integrated campaign, built on audience preference data, optimized to the customer journey, employing channel appropriate creative content, and aligned to specific strategic KPIs.
So how do brands go about building one holistic, total commerce strategy, incorporating all channels that will engage customers wherever they are? Unsurprisingly there’s no cookie cutter answer, however the most important foundations are audience understanding, clarity of commercial goals, media planning and data optimization across several areas.
Brands should define audience media consumption and interaction patterns, their buyer behaviors and buying cycles. This provides the key understanding necessary to engage with audiences effectively wherever they are – both literally and in terms of their customer journey. It provides insight on the ideal frequency of engagement, preferred channels, interests, and purchase intent signals.
So if a key audience segment is known to interact with Instagram for example, brands could tap into RMNs with social media advertising inventory in order to get their attention.
Be as specific as possible about your KPIs and the commercial rationale that underpins them. This will shape the composition of your audience, which influences channel mix and creative content for engagement. Audiences will differ if you’re trying to drive awareness, drive engagement, or drive an increased basket size and so – given few brands only want to hit a single KPI – be completely clear on the relative importance of each campaign target. This will prepare the ground for a media plan that addresses your commercial priorities.
To build an efficient, agile total commerce program that maximizes ROI, it’s vital to establish a clear baseline from which to direct engagement strategies. Often when we help brands with their campaigns we start by asking some basic questions. This might include what they are buying, what they are planning, which media partners they are working with, what success metrics they have in place, what performance statistics they hold, or the range and composition of their first-party data.
More fundamentally, we’ll use this ‘audit’ process to establish operational transparency – to make sure everyone is on the same page, understands what each team is doing, to what end, and on what terms. For example, it is not uncommon to find that multiple in-house marketers are unknowingly working with different contacts at the same media partner. This sort of siloed understanding is both inefficient and compromises buying power and campaign clarity.
The retail audit process identifies this type of anomaly and helps develop program efficiencies, people efficiencies, and audience efficiencies. It builds the clear line of sight necessary to execute a holistic campaign that leverages every opportunity in the commerce media basket.
Historically, many brands would conduct a lot of due diligence up front and build out their advertising audience for the year (or cycle) – one and done. But when it comes to building customer audiences for total commerce the era of ‘set it and forget it’ is over. There are too many variables in the customer journey, audience behaviors are changing too frequently, and there are too many options for adjusting engagement across each channel. What’s more, audience data will also vary per targeted KPI.
Brands need to develop a close understanding of audience engagement across this matrix of factors. Vitally, they need to commit to an ongoing process of data optimization to ensure they can maximize the impact of each channel by personalizing the engagement throughout the customer journey.
Total commerce is about relationships: between retailers and suppliers, retailers and consumers, suppliers and consumers. It’s about building relationships on a solid data foundation in order to tailor engagements across all channels. Over the years it has evolved as technology provided new, enhanced means to intersect with customers’ lives and buying journeys – just like RMNs and performance media.
Artificial intelligence (AI) will be next. It is already starting to rewrite the rules of omni-channel engagement and it’s up to retailers, brands and their advertising partners to keep up. Total commerce is about considering everything in the toolbox, every technology and tactic, to maximize ROI – even if those tactics are no longer the ‘next big thing’.
