Digital Ads CAN Drive Mass In-Store Sales

By: Tom Murray | Managing Director

Article after article talks about how malls and other brick-and-mortar stores are going out of business left and right due to the Amazon effect, which are certainly true. Those articles then talk about how digital sales are to blame, with more consumers shopping online, which means fewer people are shopping in-stores. This led to the rise of digital marketing, promising sales from digital ads, fully trackable so you know exactly what your ad spend did and how many sales it drove.

However, even with the rise of store closings and rising digital ad spends on Facebook and Google, over 85% of sales still happen in-store and not online.

Many brands and retailers focused their digital ads on driving online sales because it was trackable, and while those ads might have performed well, it typically drove lower performance in their own stores because they prioritized direct response over branding. So with that said, many people started having this idea that digital ads could only drive digital sales, but that couldn’t be further than the truth.

We know it is possible because we’ve done it for plenty of our clients. We’ve successfully drove lift on in-store sales by focusing on three main pillars that are outlined below. Most in-store traffic campaigns either focus on the wrong creative, have barely any type of reporting (especially while the campaign is running), and also lack any overall measurement framework to understand if the entire campaign was successful or not. Here are the three things we recommend focusing on when designing a campaign for driving in-store sales.

1. Focus on product & brand first and foremost.

Driving in-store sales lives and dies by the creative in the campaign. Many brands will focus on their celebrity spokesperson, or use the TV commercial model which is 28 seconds of nothing to do with the brand, and then the final 2 seconds with an end card that surprises you that it was actually an ad for Tide or Bounty all along! Re-using TV ads is an easy way to not drive sales because video viewing behavior is different on TV compared to the digital and mobile mediums.

We've tested various types of creatives such as lifestyle (someone working out, someone hanging with friends, etc) vs celebrity shots vs. straight product shots on the shelf.

We found that product shots drove over 2X lower cost-per-clicks but also 3X lower cost per conversions (store locator visits to indicate intent).

2.  Real-time reporting is a must for mid-flight optimizations.

Real-time reporting is something that most in-store sales do not have. If you get some, it is usually after the campaign ends and just a potential total sales number. We prefer to optimize an in-store campaign like we would a direct response campaign, so we highly recommend looking at daily level store level data broken down by each product SKU. By taking a look at this granular data, we can see what is happening in the campaign, and can make changes during the flight.

Some things that we have seen before in the data include:

• Lifting sales for OTHER brand products (as in products that were not featured in the ad), and that allowed us to recommend different creative as some buyers were getting confused by the creative and were buying a different product. This also helped show that the ads were having an overall halo to the portfolio lift.
  
• We were able to make changes on certain days and track the next 5-7 days after each change to understand the impact and we could see clear winning optimizations. In the previous example around the product shot creative having a lower cost per conversion, we also saw sales lift the most after this creative was launched by over 50%.
  
• Since we typically get data by each individual store, we’ve been able to locate regions that are experiencing lower sales volume, and then we were able to create campaigns for those regions to increase sales in these regions. We have also noticed inventory counts at a store level being low, encouraging the brand's speak with their wholesale partners to re-buy and forecast the demand of the higher media spends.

3.  Running control & exposed experiments can help prove the impact that media drives.

Many marketers just don’t believe that digital ads can drive sales in-store. But there are some that do believe it, but they know it is extremely tough to measure. Designing experiments to help prove the media is the key to unlocking proof that the digital ads are responsible for the lift in sales you might see during the time your campaign is running, and then eventually creating always-on campaigns to support in-store initiatives.

First, we isolate a control vs. exposed group of clusters of stores that are similar in nature (in terms of sales volume). You want to ensure you have a big enough sample in terms of units sold volume, so that way you can get your results back in a few weeks. Ideally, you would have at least a few thousand units sold to gain statistical significance.

After you’ve figured out the regions you will be running in, you need to set up your reporting to be able to measure the lift in sales you create. To do this, you’ll want to make sure your ads are NOT running in the regions for at least a week or two before starting the test, to ensure that people who were exposed to previous ads had a bit of time between seeing an ad.

During that dark period, you should measure the daily average sales over at least a week or two time period to get a baseline. You can then compare that to the actual performance after the test is live to compare the lift in the control and exposed group. Here is an example below to show the methodology (unit sales numbers have been changed from a client of ours, but the lift percentages are numbers we’ve achieved before.

We were able to prove that our ads drove a lift of 51% of sales once our ads were activated, compared to the control group which saw a 7% lift in sales during the same time period. By putting this control vs. exposed measurement framework in place, we were able to prove that our ads drove a lift of sales on the shelf within a few weeks instead of many months, something which has proved historically difficult for most brands.