- Our survey of almost 400 marketers uncovered what separates the leaders from the laggards.
- Retail leaders balance data-driven marketing with creativity and brand building, embedding speed and responsiveness into their processes.
- Leaders also take active control of their data and technology rather than outsourcing much of it.
The Covid-19 pandemic has accelerated both the pace and type of change coming at retail marketers. Yet marketing leaders—those whose growth outpaces the competition—have managed to adapt and gain distance over the rest of the pack in retail.
What specifically sets the best marketers apart? To find out, Bain & Company surveyed 378 respondents in retailing. We examined about a dozen marketing capabilities and asked respondents how their markets have changed and how they are adapting. We then compared the results between the top 10% of companies and the bottom 15%, based on two-year revenue growth and market share gain, to understand the statistically significant traits that set leaders apart from laggards.
Three distinct characteristics stand out that allow marketers to grow faster, work better, and scale up more effectively.
The math and the magic
First, leaders balance the math and the magic, ensuring that data-driven, usually digital marketing does not overshadow creativity and brand building. To that end, leaders are:
- 2.9 times more likely than laggards to align brand and performance campaigns;
- 3.9 times more likely to customize the majority of their data-driven creative content; and
- 1.5 times more likely to use predictive analytics to customize messages.
For years, we’ve heard that the voice of creatives is being drowned out by data-driven marketers. Now, the best marketers are putting them back together, in what one CMO described as “the revenge of the creatives.”
Luxury goods retailer Prada, for example, blends high-tech and high-touch initiatives to reach the right customers with the right product and content at the right time. Live artificial intelligence–generated recommendations allow Prada sales staff to personalize client product proposals. Contact notifications enable staff to engage clients at ideal moments. And a digital app harnesses multiple data sources to paint a comprehensive view of each customer. These initiatives have helped spur nearly 70% growth in sales driven by clienteling (actions by sales associates to establish personalized engagement with the client) over the past two years.
Traveling at the speed of consumers
Because leaders know that marketing will continue to change rapidly, they embed speed and responsiveness in their processes. They are:
- 25.2 times more likely than laggards to fully adopt Agile methods;
- 1.8 times more likely to design fast decision making into their team structures; and
- 4.3 times more likely to embed or even “own” their agencies in the marketing team.
This allows them not only to deliver more marketing quickly, but also to keep pace with their consumers. One leading global retailer has tracked what is important to consumers for over 20 years. Several years ago, “speed” appeared among the top 10 things consumers cited in response to the question “What does great service mean to you?” It is now No. 1.
Owning your destiny
Retail marketing leaders take active control of their data and the tools and technology they use. Many other retail marketers outsource too much of their digital technology. Our survey found that leaders are:
- 2.1 times more likely than laggards to have a fully integrated view of customer data;
- 5.0 times more likely to integrate technology platforms end to end within marketing; and
- 6.1 times more likely to manage their marketing technology stack themselves.
Of course, even leaders face challenges. For instance, the pace of change in marketing puts stress on budgets, and about 63% of leaders and 87% of laggards do not adjust budgets in real time. Most retailers still determine budgets annually, or even on a three- or five-year horizon.
Another challenge persists in the form of organizational silos. Only 18% of both leaders and laggards have integrated their traditional and digital marketing teams.
Retailers that figure out how to address these budget and silo problems soon will make further progress in the perpetual competition for the hearts and wallets of today’s demanding consumers.