When asked about the digital marketing channels having the greatest impact on their businesses, 58% of senior executives working for large retailers point to social media, per KPMG survey results [pdf] released in June 2012. Interestingly, this puts social media’s impact on par with online shopping, which was cited by 59% of the respondents. It also means that more retailers see social media as having had a great impact on their business than email campaigns (49%), mobile shopping (36%), and mobile promotions (28%).
Many Plan Social Media Strategies
The huge impact that retailers are ascribing to social media is leading them to plan several related strategies for the coming year. 57% are planning to use social media for external brand promotion, while many also plan to use the channel for customer insight (51%) and two-way customer engagement (45%). These results mirror past survey findings from the CMO Council, in which marketers cited customer engagement and insight as social media’s top benefits.
Data Analytics Becoming More Important
Meanwhile, retailers aren’t only supporting their customer insights through social media. 68% of respondents to KPMG’s “Retail Industry Outlook Survey” say that use of data analytics plays a significant role in this area. Close to two-thirds also report that use of data analytics is helping them make better brand and product management decisions, while half are leveraging their use of data analytics for pricing decisions.
Even so, a plurality (40%) believe that they are around average when it comes to using analytics, almost double the proportion (22%) who believe they have high data analytics literacy.
New Customers to Drive Revenue Growth
When it comes revenue growth drivers over the next 1-3 years, adding customers (46%) is a far more common goal for retailers than retaining customers (29%). Close to one-third of the respondents say that expansion in core and/or new marketers will drive growth, while close to one-quarter point to improved economic conditions as a growth driver.
- 65% of the respondents said that revenues had increased over the past year, up from 47% in last year’s survey. Over the coming year, 77% believe revenues will increase.
- Pricing pressure (30%) is the leading barrier to growth, ahead of lack of customer demand (20%) and the US dollar’s strength (19%).
- The factors most commonly cited as hindering recovery are decreased consumer confidence (57%) and continued high national unemployment (55%).
- Merchandise costs (39%) and discounting and other sales incentives (36%) were the most frequently-cited threats to profits.
About the Data: KPMG’s data reflects the responses of 100 senior retail sector executives from large ($100 million+ annual revenue), US-based companies. 35% of respondents work for companies with annual revenue of more than $10 billion, while 41% represent companies with annual revenue between $1 billion and $10 billion, and 24% with revenue in the $100 million to $1 billion range. 74% of these companies are publicly held, and 26% are privately held. The survey was conducted in Q2 2012.