Reflections on 2018 in retail marketing

Imogen Collins
January 15, 2018

As the madness of Q4 comes to an end, retail marketers are looking back at a year full of game-changing trends, updates, failures, and successes.

2018 saw several external forces influencing the space; such as the long hot summer, and continued uncertainty regarding Brexit. 2018 was also a massive year for paid marketing specifically with AdWords rebranding to become Google Ads, numerous updates to Bing, Instagram growing from around 400 million users to over a billion, and many many more surprises. Below, we’ve compiled a list of some of the things which certainly caught our eye this year.

Brexit brought uncertainty

In 2018, Brexit continued to bring about financial uncertainty for retailers and customers alike. Many are still unsure as to how the ruling may impact the way digital marketers operate on a day to day basis. How will this affect delivery to the EU? Should UK businesses be pulling back? Or trying to push the space to gain back the confidence of their EU customers?

Our advice is to keep on pushing the market. Our analysis saw no reduction in buying behaviour following the Brexit referendum. Remember, the Pound is down against the Euro (and the Dollar, for that matter) thus highlighting a unique opportunity for EU consumers; as UK goods are cheaper than ever for EU customers. Two ideas we’ve seen working are:

  • Offering discounted delivery rates or special promotions to Non-UK markets as a way of gaining the confidence of the consumer.
  • Testing your current site in English speaking countries – such as Australia, New Zealand, Canada, or countries with a high percentage of English speakers, such as Denmark. There is no need to change your website drastically, simply switch Pounds for Euros/Dollars etc.

Following the Brexit vote, we’ve seen some incredibly strong ROIs from employing this kind of strategy.

A brand new opportunity in Google Shopping

Back in 2017, the European Commision (EC) landed yet another fine on Google; this time, due to their perceived anti-competitive practices on Google Shopping. The result of which meant that, for the first time ever, Comparison Shopping Networks (CSS) were allowed to display their ads within the Google Shopping format.

The EC ruling also stated Google had to prove Shopping was running at a profit. Therefore, Google kept a percentage of each bid (believed to be between 20-30%) to themselves. In essence what this means is when you bid £1 on Google Shopping through Google, only between 70-80p actually goes towards the auction. For CSS’, the whole £1 can be spent on traffic.

Suddenly, the market was full of CSS’ offering to put your ads on Google Shopping, promising more traffic for your money. Around this time, Google offered another incentive – a 30% rebate on spend up to £10,000, to be put back into your Google Ads account to be used going forward as ad spend. If you haven’t already moved your Shopping campaigns onto a CSS, we highly recommend you do so sooner rather than later as you are currently spending too much on your Google Shopping!

GDPR frenzy hit us

For marketers customer data is key to running successful campaigns. It allows us to recognise what customers are doing when they land on our site and who are the correct people to target with our ads. But do we have the right to use this information in any way we want? This was a question for the European Commission, who ultimately ruled that no, we
don’t. The GDPR ruling resulted in many minor changes to paid search and social – for example some targeting options on Facebook are no longer available. Facebook and Google reacted quickly to the ruling, and have provided alternative solutions to aid operations.

So what changes in digital marketing where observed following the ruling? Many marketers have noted that, other than having to implement an opt-out feature, GDPR didn’t have quite the detrimental effect on the industry as we might have feared. EU based cookie pools reduced in size, as the “right to be forgotten” was granted to users who had personal data within marketing audiences. However the quality of these audiences did increase, as they know included users who wanted to be retargeted. Some even report ad costs increasing – particularly for Display and Social, as the smaller cookie pools created a higher demand for more interested customers.

GDPR is not something to be forgotten about. You need to get customer consent for numerous advertising formats: Including remarketing, affinity audiences, in-market audiences, demographics, and similar audiences. Even speaking some seven months after the ruling came into effect, companies are still having issues with some of the EU requirements.

That long, hot summer

The long hot summer also had an interesting effect on the digital marketing landscape. Customers (rather understandably) where spending their time and money outdoors in the “real world”, rather than online. Even the high street suffered, with people spending their money on weekend getaways. This, of course, had quite a sizeable impact on sales, and marked an interesting test for retailers, in terms of strategy.

The temptation for many advertisers is to pull back on spend when sales aren’t coming in, and save the budget for peak trading times. However as Luca mentioned in the above video, many retailers took this time to readjust their focus onto the lifetime value of the customer, rather than chasing quick sales. This of course can result in a more reliable source of revenue in the long-run. Conversely however, many brands looked to generate new traffic to combat the low sales from regular sources, by continuing to invest in building brand awareness. With our clients, we found that investing in either strategies (or both) during the slow summer, yielded much stronger results over the Black Friday/Cyber Monday weekend.

And as for 2019...

While there was plenty more 2018 threw our way, these were some of the most notable things we think back to as we reflect. Check out our next blog post, looking forward to 2019 with our predictions for the year ahead, or subscribe to our mailing list below!

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