When canvassing our partner agencies throughout Europe about the future of field marketing, certain issues were raised repeatedly. These included the challenges of recruitment, the emergence of new disruptive technologies such as VR/AR, voice assisted commerce, and Beacon enabled devices. Also of concern was the migration of bricks-and-mortar retail to an online first space. All of these trends, one way or another, place a question mark against long established field marketing practices. As a result, they also suggest the need for innovation and point towards a new kind of approach.
Added to these industry-specific concerns, we have a backdrop of convulsive change taking place at a Pan-European level which is generating wider uncertainty. So before we consider the rise of new technologies, and work through their implications, it’s worth zooming out for a careful consideration of the macro-economic state of play.
A European Retail Snapshot: The Relative Fortunes of East & West
Key economic factors include the continuing chaos of Brexit, a simmering Sino-American trade conflict, and a corresponding decline in the growth prospects for Far Eastern exports. And yet despite these worrying indicators, there is also some cause for optimism; for balanced against this potential turmoil, we can point to a significant increase in disposable income levels prompted by a competitive labour market, corresponding wage rises, and a sustained fall in crude oil prices.The overall picture is further complicated by distinct national differences and legislative particularities. To give a few notable examples, we have France’s recent transition to a more rigorous tax system – with monies being deducted on a monthly basis at source – which is likely to put a dent in consumer confidence. In contrast, Italy’s ruling coalition is set to launch a new poverty relief scheme in 2019 known as “Citizens Income” which will put more money in peoples’ pockets, whatever the wider fiscal implications. Similarly in Spain, we might expect positive growth as a result of a marked increase in the mininmum wage, of 22%, a policy initiative expected to benefit 2.5 million people, either directly or indirectly.
All of these factors have an impact on Field Marketing agencies; some positive and some negative.
These same essential differences are no less evident in last year’s leading retail indicators, all of which show that recent gains and losses have been far from evenly distributed across Europe. What we see instead is a wide array of consumer sentiments at a national, regional, and even local level. Although there is one overarching trend that bears closer examination: a marked divergence in the respective fortunes of East and West.
Nowhere is this better exemplified than in the Purchasing Power Index recently compiled by GfK. Here we see that all ten nations exhibiting the highest per capita gains in terms of disposable income were later-stage entrants to the EU. Foremost amongst the winners are Latvia and the Czech Republic with increases of 10.3% and 9.3% respectively; while Poland can also point to a strong showing with a gain of 7.7%. As a result, these countries have moved significantly closer to the overall European average in terms of income levels (although it would be reasonable to assume that this trend will at some stage plateau).
With specific reference to bricks-and-mortar retail, we see similar patterns of significant growth in the East, with retrenchment and stagnation being more prevalent among the Western nations. This trend is reflected in marginal gains in retail growth for Spain, Germany, Holland, Belgium, Sweden and Denmark; Ireland and the UK. In the year just gone, all of these states have operated within a tight band of 0.4 – 2% in terms of aggregate turnover growth (France being the one notable exception with a salutary performance of 3.6%). Here again, their East European counterparts provide more credible grounds for optimism, with Bulgaria (7.7%) and Romania (7.1%) leading the way.
The Move Online, Emerging Tech, and the Multi-Channel Mix
Pan-European sales figures for 2018 also point to the continuing rise of digital retail. Although of greater interest to field marketers, perhaps, is the continuing blurring of former categorical boundaries. Where once we saw a clear distinction between online and physical sales channels, there is now a fluid conflation of the two. Omni-channel is a term that has been around for 16 years, and some argue that it is a term that was ill-defined yet served up as the cure-all for every ailing retailer. In a recent Forbes article the term “Harmonized Retail” is set to replace “Omni-channel”. It is meant to convey the unified approach of a seamless integration of sales methods, and perhaps most importantly, of recognising the customer as the channel.
The idea is that by gaining a deep understanding of the customer journey across digital and physical, retailers can eliminate friction points and amplify the wow factors and thus harmonize the customer experience.When we look at the Omni-channel retailers who are winning, we see this harmonization in action. Nowhere is this more evident than in the Technical Consumer Goods market, especially in the case of Western Europe. As of 2018, those online retailers who also boasted a brick-and-mortar presence experienced dramatic turnover growth of +24%, six times that of their online-only competitors; a trend that points to the wisdom of a harmonized approach.This creates a new opportunity for Field Marketing agencies as the pendulum swings the other way with online retailers securing actual retail spaces. Unsurprisingly, we find Amazon leading the way in terms of a harmonized approach, once again proving that they are willing and able to reconstruct existing market boundaries. Having recently secured a London base for its first European GO Store, one can expect this move to herald the start of a wider European roll-out, signalling further disruption for the traditional retail market.
Especially with the concept involving, as it does, a complete absence of point of sale, with cameras and sensors registering each purchase automatically before shoppers leave the store. However, as the headline figures show, other brands and outlets are equally convinced of the need for retail innovation, and have already started to see the benefit of adopting ever more fluid and flexible approaches. It’s a trend that we expect to continue, powered by emerging technologies and the enterprise-level software that best articulates these new value propositions. In particular, this will involve the further evolution of the smart phone in a retail context as it transitions from a cost comparison tool to become the agile platform for an augmented shopping experience and digital concierge services. A change that is set to become endemic as these technologies are widely adopted and become ever more advanced. Many of these same developments, and the attendant challenges, were very much on the radar of our Partner agencies. With good reason, the increasing use of Beacon technology, and its broader implications, proved of especial interest. These small wireless transmitters, embedded in mobile phones, allow them to send messages to nearby smart devices by way of low-energy Bluetooth transmission.
This is a new channel of M2M communication that will lead to a further growth in actionable data, as well as allowing for location-specific offers and new forms of consumer address.Among the other implications of Beacon technology is an increasingly acute understanding of how digital marketing initiatives are linked to offline attribution. Online ads, for example, can now be faithfully linked to actual shop visits, consumer behaviours, and aggregate spending. As a consequence, we can expect far greater transparency in terms of ROI.It’s this same granularity that represents both a daunting prospect and a sizeable opportunity for field marketers. As such, it’s emblematic of the challenges posed to the industry by a rapidly evolving retail landscape, as well as begging the question of what they mean for the profession as a whole.
Emulating Retail: The Modern Field Marketing Mix
Having touched on some of the challenges confronting modern retailers, it’s worth considering further the parallels for field marketing. A number of these appear particularly striking and might have wider applicability, moving forward. The harmonized approach, for example, which reflects the combined potency of both digital and brick-and-mortar, highlights the opportunity for Field Marketing agencies to integrate the digital learnings into their offline campaigns. Such strategic insights will become core differentiators for field marketing campaigns that deliver a seamless customer experience and ROI.
Certainly, agencies will have ever greater need of data-driven insights in the coming years; but no less urgent will be the need to embody these findings in forward-looking campaigns that employ high levels of conceptual daring. As successful brands adapt rapidly, so will field marketers need to think fast, and respond accordingly, about how they articulate the value propositions of these same businesses. No small task given the scope of the remit, with brands seeking to position themselves not only as paragons of value and quality, but as ethical champions as well.
Keeping good company
One of the biggest selling points of Field Marketing is the face to face interaction between client and consumer. Research has shown that consumers still prefer buying from people. It is a contributing factor to the fact that online retailers are opening bricks and mortar stores. People buy from People. As such, the challenge of recruitment remains a core focus for Field Marketing Agencies. However, the increase in the minimum wage, and record low levels of unemployment have an affect on the recruitment process.
As a result, our Partners have been working on solutions which you can read more about in our article “Powering Performance”, where we discuss the scale of sales-training for staff as a means to attract and retain the best talent. We found that providing career path objectives, good remuneration and a pleasant working environment helps to ensure that employees are motivated to deliver the key objectives for campaigns, whilst simultaneously safeguarding loyalty and continuity in the work force. Likewise, our research confirmed the wisdom of paying close attention to strategic partnerships, and of picking the right people to work with across Europe. Indeed, it’s never been more important to find skilled counterparts who can help negotiate the specific challenges of a different marketplace. If campaigns are to be audacious and provocative in nature, it’s vital that they translate successfully to the intended location.
This requires the involvement of foreign partners who can pick up on any false notes, and raise red flags, thanks to an intuitive grasp of the resident culture. Even in an age of big data – now more than ever – such contextual expertise represents a clear competitive edge.
Change is the only constant
They say that change is the only constant, yet it is important not to under estimate the importance of continuity with incremental innovations. Field Marketing agencies must continue to have the confidence to play to their strengths, whilst taking strategic steps to pivot to the gradual changes in the market. Only in this way can Field Marketing Agencies make a compelling case to potential clients and pitch themselves as the ideal solution.
They are better placed than anybody to walk this tightrope, safeguarding brand relevancy, even as they generate great interest; cutting through the noise to create a lasting real world impression. Whichever way the future plays out, it’s fair to surmise that the most succesful agencies already do these things with skill and assurance.
