Growth Marketing Report: Spotlight on the retail industry
This year, DEPT® surveyed 150 retail and e-commerce marketing leaders from companies ranging from $100 million in revenue to over $1 billion for the Growth Marketing Report.
What did we uncover? 40% of retail marketers grasp the concept of growth marketing, but that leaves 60% who still focus only on performance marketing.
Of the 40% that grasp the concept of growth marketing—only 14% have implemented a growth marketing mindset within their organizations (compared to 37% last year). This creates a strong competitive advantage for companies willing to adopt a broader view of marketing by incorporating mid and top-funnel activities and growth drivers.
Why is the growth mindset so low, you ask?
With a challenging economy and retail market shifts, brands are reducing investment in growth and only focusing on bottom-of-the-funnel marketing. Only 20% of these marketers are putting their digital dollars into all three growth drivers: Strategy and Planning, Data and Analytics, and Creative.
Here’s where DEPT® can drive your strategy forward to accelerate revenue while other brands are stalling. Our vertical research is unlocking growth during economic uncertainty. We want to help you develop forward-thinking future planning that’ll bring exponential growth and long-term success. We’ll break it all down for you—how you can drive growth during a recession.
The importance of growth drivers
Growth drivers are the backbone of any quality marketing strategy–they’re the solid framework upon which everything is built, and investing in growth drivers is the key to crafting a successful growth marketing strategy. Let’s explore their significance:
1. Strategy and Planning: Develop a roadmap and guide that steers your marketing efforts in the right direction. A solid plan helps you prioritize initiatives, identify target audiences, and outline the overall approach to drive growth. It enables you to make informed decisions and allocate resources effectively, ensuring your marketing efforts are focused on activities that generate the highest returns.
2. Data and Analytics: Gather and analyze data for actionable insights. By understanding customer behavior and market trends, you can make data-driven decisions and uncover opportunities that may go unnoticed otherwise. Data and analytics help you optimize your marketing campaigns, identify cost-saving measures, and adjust your strategy based on real-time analytics.
Example: Recognizing the importance of a scalable business intelligence solution, Douglas partnered with DEPT® to develop a central data platform. With the existing IT infrastructure presenting limitations in scalability and slow processes, a flexible data stack was essential for Douglas’s growth.
Implementing a modern data stack resulted in significant time savings for Douglas. This investment in data and analytics empowered Douglas to make data-driven decisions, enhancing its competitiveness and paving the way for growth.
3. Creative: When we talk about creative in the context of growth drivers, we’re talking about crafting a cohesive, customer-driven experience that provides a seamless brand experience. Investing in your unique brand experience is about curating an experience that speaks to your customers and resonates with them on a deeper level.
Example: DEPT® partnered with Savage X Fenty to build a production team predominantly women-led, aligning with the brand’s sense of confidence and inclusivity. By investing in creative, Savage X Fenty and DEPT® were able to harness the power of visually compelling and authentic content to attract and convert customers.
The team seamlessly integrated creative strategy and streamlined planning to produce 18 months’ worth of content across various platforms, including TikTok, YouTube, streaming media, and Instagram. The extensive production efforts across multiple platforms allowed them to reach a wider audience while maintaining the brand’s unique personality and message.
To be a successful growth marketer, you must diversify your investments by including all growth drivers and essential activities in all three funnel levels. So now that we’ve established that to practice growth marketing, brands need to understand it, adopt the proper mindset, and invest in all three growth drivers, let’s talk about how economic uncertainty is causing waves in retail marketing.
Challenges retail marketers face today in an uncertain economy:
- Shifting consumer behavior resulting in decreased consumer spending–retail marketers must understand these shifts and adapt their marketing strategies accordingly.
- Increased competition where retail marketers are struggling to differentiate their brands and products and drive growth amidst competition.
- Budget constraints limit marketers’ ability to invest in growth-driving activities, and they must find creative and cost-effective ways to achieve growth with limited resources.
- Maintaining customer loyalty when consumers are more inclined to switch brands based on more affordable pricing and promotions.
A snapshot of the retail investment landscape
Based on the investments in retail activities in 2023, here are some key points to take away.
- Emphasis on paid media: The highest investment percentage (67%) is allocated to paid media, indicating that retail marketers recognize the importance of reaching their target audience through various paid channels and are allocating a substantial portion of their marketing budgets to drive brand awareness, customer acquisition, and sales.
- The ongoing significance of eCommerce: The significant investment of 55% in eCommerce suggests the increasing recognition of the importance of online retail and the need to enhance the digital shopping experience. Retail marketers are acknowledging the shift in consumer behavior towards online shopping and are allocating resources to improve their digital presence and capabilities.
- Taking a multi-channel approach: The allocations to paid social (49%), brand media (53%), and paid search (51%) indicate a comprehensive approach to reaching a broad range of customers across various platforms and search engines. By utilizing paid social media advertising, brand media placements, and paid search campaigns, retail marketers see the importance of targeting different audience segments and maximizing their reach across various online channels.
- Losing focus on SEO and organic social: The investments in SEO (19%) and organic social (15%) are much lower compared to last year (which was an over-prioritized activity). Marketers are likely pulling back since paid advertising channels offer more immediate visibility and quicker returns on investment.
- Leaning into video, audio, and social commerce: The allocations to video and audio (41%) and social commerce (41%) suggest that retail marketers recognize the power and effectiveness of multimedia content in engaging their target audience. And when it comes to social commerce, retail marketers are embracing interactive and seamless shopping experiences to keep their customers engaged and satisfied.
- Underprioritized areas for retail marketers: Includes programmatic advertising, display advertising, native advertising, CTV, emerging media, OOH/DOOH, and SVOD. Content marketing, influencer marketing, SEO, and organic social are under-prioritized activities in the middle of the funnel. Retargeting/remarketing and CRO are under-prioritized at the bottom of the funnel.
How retail marketers can improve:
- Place a greater emphasis on content marketing and SEO: Emphasize content marketing to build trust, establish authority, and provide valuable information. Creating high-quality content can guide customers through the buying journey, nurture leads, and drive conversions.
Take advantage of SEO to improve website visibility and rankings and enhance your online presence. By prioritizing content marketing and SEO, you can position yourself as a reputable brand and increase the likelihood of customers choosing you over competitors.
- Leverage user-generated content (UGC): User-generated content has recently gained immense popularity. Retail marketers can tap into the power of UGC by encouraging customers to create and share content related to their brand. By leveraging authentic content created by satisfied customers, retailers can enhance social proof, build trust, and genuinely engage their audience.
- Level up your remarketing game: You should prioritize remarketing strategies to re-engage potential customers who have shown previous interest in your brand. By staying top-of-mind and strategically targeting them with tailored messages and offers, you can increase conversion rates and encourage desired actions by staying top-of-mind with your customers, making them more likely to choose you when the time is right.
- Improve the eCommerce customer experience: You should prioritize enhancing the digital shopping experience, especially as you navigate new emerging technologies and consumer expectations in the face of economic uncertainty.
This includes optimizing website usability, streamlining checkout processes, responsive customer support, and providing personalized recommendations to create a seamless and enjoyable online shopping journey.
Emerging technologies like augmented reality (AR) and virtual try-on experiences also present an exciting opportunity to increase customer engagement and bridge the gap between the online and offline shopping experience. With consumers having a wide array of options, you must incentivize your customers with a compelling reason to choose your brand.
- Capitalize on quality creative: Every channel these days is a creative playground, and with the abundance of media we consume daily, investing in crafting your unique brand experience becomes even more important. With the prominence of creator marketing and the shift in how people discover products, your creative practices need to grow and adapt.
From leveraging user-generated content (UGC) that lets you tap into the authentic voices of satisfied customers to embracing AI-creative integration to enhance your creative processes, you can uncover new ways to engage your audience.
By embracing creativity across channels and investing in your brand experience, you have the opportunity to leave a lasting impact on your audience.
Measure your marketing success
Growth marketing is like a complex puzzle–several moving pieces must be finely tuned for your unique brand. But here’s the thing: simply understanding, adopting, and investing isn’t the end of the growth marketing road.
You must also be able to put everything into practice. In the marketing world, everything can–and should–be measured. That’s why we’ve created a special tool called DEPT®’s Growth Marketing Maturity Index™, or GMMI™ for short.
The GMMI™ is our proprietary tool that assesses the level of growth marketing maturity within companies. It considers six fundamental pillars that come together to measure a brand’s vision and investment in growth marketing and how well they put it all into action.
In our comprehensive assessment of retail marketers, a pattern emerged as we evaluated their growth marketing maturity levels using our five-level GMMI™ scale. Notably, 32% emerged as “Performers,” positioned at the third level, and 38% achieved the “Transformer” status, scoring at the fourth level.
What sets this year apart is the notable uptick in the number of respondents reaching the highest level, as 10% scored at the highest possible GMMI™ designation as “Disrupter.” This figure starkly contrasts the 4% recorded in the previous year, showcasing an impressive leap forward in the realm of growth marketing excellence within the retail industry.
Uncover your brand’s potential
Ready to gain insights on how your brand compares to others in your industry? Curious about how your investments stack up against competitors with similar budgets? It’s time to put your plans into motion and see how your brand measures up. Take the Growth Marketing Assessment to discover your unique strengths, weaknesses, and growth opportunities.
You’ll gain valuable insights into your growth marketing efforts and determine where you stand on the journey to growth marketing greatness. Start your growth marketing journey today and unlock a deeper understanding of your brand’s maturity in the world of growth marketing.