If you only looked at holiday in-store sales as a guideline to what’s happening with the economy you might think that the recession is still with us.  Visits to retail stores during the holiday shopping season collapsed, despite seemingly broad improvement in the economy and job market.  Measured in-store traffic in November and December was around half the level of the same period in 2010, even though the economy back then was still in the ICU.  But if you factor in online sales and credit card transactions by consumers using mobile phones, smartphones, or some form of tablet computer you’ll find that industry estimates place 2013 holiday-spending growth at close to 5%.  With that in mind, it is obvious that we are seeing a massive shift in how consumers actually buy, and retailers that stick to the old paradigm by desperately clinging to the in-store model are going to go the way of the mastodon.

moneymoversslider2For instance, take a look at the health club industry.  For years fitness club owners have followed the “Membership” or in-store model.  According to Industry Consultant and Guru, Michael Scott Scudder, most clubs still think the following is the way to achieve success.

•    “Checking in” people at a “front desk” by scanning their membership cards. •    Focusing the membership sales process on a “tour of the facility.” •    Offering the solution to their exercise challenges as a couple of introductions to equipment use, then trying to sell personal training.

Given that fitness club membership sales are steadily going down while the number of facilities is growing at an ever-expanding rate, this model reveals itself as a lose-lose proposition.  By continuing to use what Scudder calls “Outbound Marketing”, clubs find themselves trying to inexpensively cover as many markets as possible with a general message, hoping to drive people in the door for a special event.

But the problem here is the same as that confronting other in-store retailers.  The ads that consumers see via outbound marketing are usually static information flyers that do not offer any way to respond except by phsically going to the club.  Ultimately, it is impossible for club owners to discover how many people have actually been reached by the message.

On the other hand, “Inbound Marketing,” which is what is in effect when consumers purchase online, are full of  “calls-to-action” that demand or, more gently, solicit an immediate response from the consumer.  That response usually is reflected in sales or, even more importantly, by the collection of data that can be used for future calls to action.

It seems that Americans are in love with their technology and retailers that align with a buying public that is becoming more and more fascinated by online sales are going to see their revenues increase as online buying continues to grab a larger percentage of overall consumer activity.

Online Sales Pushing Retailers Into Re-thinking Their Marketing Strategy – ©2014 Money Movers, Inc.

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