PUBLISHER’S NOTE A STRONGER
A more positive feeling amongst Cautiously Optimistic consumers about their financial situation is driving a moderate recovery in spending, according to the first Barclaycard ‘Where’s Britain Spending?’ quarterly report. Based on actual spending rather than
supposition it is clear that we are entering into an era in which virtually all socio- economic groups place achieving good value for their money very high on the agenda. Tis trend is likely to over to the Christmas spend and into the New Year. Most retailers can expect sales levels to enjoy a filip over the Christmas period but this data and research from Barclaycard points to the need for all retailers, whether direct, multichannel, or bricks & mortar, to emphasise quality and value and to create compelling offers. Here’s why: Growth in spending of 4.2 per cent in
the third quarter of the year is matched by a new confidence barometer which finds that almost two-thirds (64 per cent) of consumers say they are confident in their ability to live within their means each month, and over half (57 per cent) say they feel confident about their financial situation. Following its sharp fall on the back of the economic downturn, consumer spending has shown tentative signs of a recovery over the past eighteen months, but this picked up significantly in the third quarter of the year, when spending growth reached a four- year high. Uncertainty around the economy,
however, and fears over the cost of living are holding back a full-blown spending recovery. Six out of ten consumers feel that, compared with three months ago, they get less for the money they spend because
Issue Number 222 Nov/Dec 2014
of the effect of rising prices, while almost two-thirds say that since the economic downturn they have become more careful to seek out value for money from their spending. Tese concerns have created a ‘new normal’ amongst shoppers who now habitually search for value-for-money in everything they buy, and in doing so have swapped the traditional weekly shop with more frequent visits to the shops where they only buy what they immediately need. As a result, the amount they’re spending per visit is actually falling. According to the Barclaycard report,
the average amount spent per transaction on food and drink fell 6.2 per cent in Q3. Worryingly for retailers, this mentality looks set to continue, with over two thirds (69 per cent) admitting that value for money will remain a key factor, even if the economy recovers. Two thirds (65 per cent) of consumers expect to see the cost of public transport rise and one in six (61 per cent) expect similar increases for groceries and petrol. Yet, the headline rate of inflation has seen costs drop in all these categories. However, this perception doesn’t always match reality. Te headline rate of inflation has fallen in recent months, and the cost of many items, including petrol (which has reached a three-year low), and some groceries, is down as supermarkets engage in a sustained price war. Tose on higher incomes are driving spend on more costly items, with over half (54 per cent) of those earning over £45,000 regularly spending on treats and indulgent purchases. In comparison, consumers earning less than £15,000 are the least likely to say that they will increase their level of spending over the next three months, at just 37 per cent. Barclaycard has identified four main
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It has been a madly busy period here. Planning events like the Bricks meet Clicks dinners up and down the country – really enjoyed Leeds last month, by the way.
CHRISTMAS EXPECTED but the search for value is heightened
• Consumer spending grew 4.2 per cent in the third quarter of the year – the biggest rise since 2011 – as a majority (57 per cent) now say they feel confident about their financial situation
• Worries over the cost of living remain and are holding back full-blown recovery as price rises continue to outpace muted wage growth
• Shopping behaviour is characterised by the search for value, as seen in the rise of discount supermarkets and a fall in Average Transaction Values continues on page 6 >
Inside:
Expanding horizons: where to next for British brands
10 quick tips to a higher performing website
Location, Location, Location In 2015 we’ll be hosting these special
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Publisher & Acting Editor Jane Revell-Higgins
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Website Manager Caroline Casey
Editorial/Content Executive Jane Emerson
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Subscriptions Sarah Cassim
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Direct Commerce is published by Direct Commerce Enterprises Ltd. Every effort is made to ensure that the content is accurate and provides honest representation of the facts. As publishers we can accept no responsibility for errors or misleading claims made by our editorial staff, contributors or advertisers. The copyright for all content of Direct Commerce is held by Direct Commerce Enterprises Ltd and no material may be reproduced without our express prior consent.
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Beyond Christmas: Looking Ahead to 2015
DIRECT COMMERCE ASSOCIATION
Tuesday 18th November The Queen’s Club, Barons Court, West London
Timely topics range from data legislation & security, to funding a growing business; from expanding internationally to deploying DRTV, plus a baker’s dozen of swiftly delivered tips, insights & pointers spanning all channels to market & a lively Business Leader’s debate with special guest Nick Wheeler & there’s more; including the unveiling of the candidates for the DCA Council Co-Chair posts kickstarting the elections; and presentation of the coveted Supplier of the Year Awards. Call 01271 855545 now to secure your place for this action packed day.
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events for CEO’s and marketing directors in Cambridge, Nottingham, Dublin, Plymouth, Ipswich, Brighton & Liverpool as well as London, of course. More opportunities to meet you all will arise via the DCA’s national and regional conferences and seminars too – not forgetting this month’s Beyond Christmas: Looking Ahead to 2015 event on the 18th at Te Queen’s Club. An event which also sets the stage for the presentation of Supplier of the Year Awards. Ten it is on to planning the the ECMOD Direct Commerce Awards dinner which is booked for June 4th next year. Add to that our imminent office move, new systems to get to grips with, and myriad other tasks, there literally hasn’t been a moment lately in which to draw breath. We know it has been much the same for you too as we’ve been engulfed in news – launches, acquisitions – large and small; career moves, new developments – there
CONTENTS 4 NEWS ROUND-UP
10 CHRISTMAS 16 10 QUICK STEPS TO A HIGH PERFORMING ECOMMERCE SITE
18 SENSING THE WAY TO A MORE PERSONALISED FUTURE FOR MOBILE ADS
19 THREE KEY DATA-DRIVEN MARKETING TRENDS: SCV, ANALYTICS AND PERSONALISATION
20 LOYALTY SCHEME RESEARCH SHOWS REWARD POINTS ARE A BIG LURE BUT NOT THE ONLY DRIVING FACTOR FOR CONSUMERS
21 DOWNTON ABBEY AT HOME 22 EXPANDING HORIZONS: WHERE NEXT FOR BRITISH BRANDS? 24 LOCATION, LOCATION, LOCATION: A GUIDE TO TARGETING 20 WHY IS MOBILE COMMERCE IMPORTANT? 26 DIRECT COMMERCE ASSOCIATION 28 LISTS AND MEDIA 30 EXPERT ROSTER 35 THE FINAL WORD
is a massive amount going on out there, more than we can ever hope to squish into these pages, so do check in at our
www.directcommercemagazine.com site which gets daily uploads of the latest news. What runs through most of what we’ve been hearing about is a truly positive current - most are looking forward to seriously good trading levels in the run up to Christmas – and many are banking on solid through-Christmas demand too. Consumers may be cannier and a tad more thrifty these days when it comes to grocery shopping (sorry Tesco but every Lidl helps) and the expectation is that money saved on the day to day “drudge” shopping will be splurged on generous gifts this year. Seems though that we’re all expecting the demand to peak much later which will make for some nail-biting days as we are all getting so much better at swift shipping, deploying click & collect services and giving our customers the luxury of more time to shop for the big day. We wish you all the very best that Christmas has to bring for your business as well as for you and your family when you finally get to join in the merriment. JRH
3
fabulous festive season & an outstanding 2015
Wishing all readers a
NEWS
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