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The Christmas Crush does not necessarily mean Gold Rush...

Monday, 8 December 2008

So according to Moneysupermarket.com today is going to be a record on line sales day with over £320 million worth of purchases. Whilst traditional retail high street stores are having a torrid time in 2008 the online bandwagon is gathering momentum.

Granted some traditional retailers have embraced the online world and thus are protecting their share in the market place but a worrying phenomenon is occurring across our towns and cities in the uk which could change the way we measure the success of our marketing campaigns forever.

In previous years in the UK we look to two key indicators to the strength of the marketplace. These have been footfall and total sales. We then break them down into spend per head (or basket value) or number of items bought.

Traditionally these two key performance indicators track together, i.e. the more people you get into the store the more sales you get. However these are strange times, we find ourselves in a global recession and the prophets of doom and gloom expect people to pull the purse strings if not for Christmas but certainly in January for the sales when those credit card statements start landing.

However the one worrying new trend that we are seeing and challenges how we measure the success of businesses and indeed the very future of the retail stores is the breakdown of the footfall leads to sales relationship.

Over the last two weekends I have personally seen and spoken to many consumers who are out Christmas window shopping in our stores across the country. These people really are virtual customers and are using the web to maximise their savings.

I have seen young families trawling the high street stores sampling the latest must have goods, compiling their wish lists, even taking pictures with their camera phones of prices and specs. And then they simply go home and search web on price to make the purchase.

For years Retailers have said if they could be the last store the consumer visits they would be guaranteed the sale and now the web has achieved this but at what cost?

It wont be long before the hight street stores realise they are being treated as a free tourist information attraction and start to combat this new virtual customer practice. Dont be surprised to see photos and even pens and paper banned in store, and even heaven forbid an entrance fee to enter a store redeemable against the goods purchased.

The very fabric of what makes the stores so attractive over the web is the accessibility og the goods and retail experience but if they cannot monetise these vistors then they will have to adapt.

So it would appear footfall is strong in the high street but sales are not and whatever the media say this has nothing to do with our recession, it is a changer in the consumer purchasing process.

May I take this opportunity to wish you a Merry Xmas and a Happy New Year.

COI

Tuesday, 2 December 2008

Central Office of Information:

At a time when focus on costs is key to all businesses and the worry of redundancy hovers over employees and employers alike I find the messages I am being bombarded with from the COI absolutely flabbergasting.

Having spent the weekend at friends who have moved to ST Ives in Cornwall I was faced with at 287 mile trek back to sunny staffordshire on Sunday. Being a slave ot my art, i decided to eject my Drifters CD and review the quality of the commercial radio world travelling through many different counties and transmission areas.

My first observation was just how much of our Sunday commercial radio offerings are not regional at all but networked programmes beamed from within the M25. This is worrying state of affairs when considering 80% of the market is now owned by just 3 companies. I am concerned we will see more of this networking creep into the scheduling to cut costs and again lose our regionality offerings.

However the quality was generally good and the music choices reflected the station licence profiles so I felt the journey was progressing quite well. I then started to listen to the commercial breaks and then my until then pleasant journey started to unravel at a rate of miles...

This time of year suffers from a little known virus known as COI or to give it its fuller name the Central Office of Information. Every other advert on commercial radio is a important announcement from our state telling us how we should live our lives.

It was only because I was travelling such a long distance that I realised how much airtime is being bought and much frequency and thus inventory is being swallowed by this sort of clutter. The actual messages are hilarious with absolutely no Return on Investment or Respnse tools.

Firstly I was politely informed that if my child was to sneeze then I should strongly recommend he uses a tissue and not his hand as this will spread germs! The second advert which i heard no less than 10 times on my trip across 6 stations was a nauseating fly on the wall type radio advert about how Sam had moved in with her boyfriend and so far she was much happier. The advert then flipped to an announcer telling us if your circumstances change then let us know so we can re-calculate your tax credits - Tax credits are a 2 way street! I would love to know how many phone calls they are getting by little Sams wanting to fess up to receiving too much money.

There were more but you get the gist and they really do not deserve an airing in my blog.

Annoying yes, funny certainly but this volume of spend was more than a little diconcerting so I decided to do some research. Radio stations informed me that they are used to this seasonal glut of activity and it has been going on for years. One trade body informed me that the reason was that local goverment have annual budgets and this activity represents the remainder of their spends. If they dont spend it before their financial year end they will have their budgets cut for the following year. it seems it is a case of use it or lose it.

This I find truly abhorrent. We are all having tough times and if local government think wasting hundreds of thousands of pounds just to get the budget renewed for another year then they are wrong. At the very least they need to put real messages out there that are accountable and measurable. By taking this valuable inventory there is simply less airtime available for our struggling retailers to promote their wares and the airtime that remains is sold at a premium due to supply and demand.

I would love to see real spend levels for the COI by month to see if what I suspect is true and if there is anyone out there who can help then please do get in touch. Maybe I should run a radio campaign across all stations to try find the relevant information by advertising a really obscure help line number....