E-Marketing In, Traditional Methods Out for the Holidays: Study

Retail marketers will shift marketing spend away from print, online ads and broadcast channels to e-mail and search engine marketing to win over consumers during the upcoming holiday shopping season.

Marketers ranked e-mail marketing as the most important activity for holiday success, with search engine marketing (SEM) and search engine optimization (SEO) ranking second and third, according to a 2006 Online Retail Holiday Readiness Report by WebTrends, Inc.

Reflecting this shift in priorities, the biggest up tick in marketing spending for the holidays will be in e-mail marketing (52%), SEM (46%) and SEO (38%). Meanwhile, the biggest slump will be in spending on online banner ads (17%), print advertising (16%) and broadcast advertising (14%), the report said.

The focus on e-mail and SEM initiatives will help marketers understand Web site visitor intent and enable them to leverage behavior-based insights to target customers with relevant messages that strengthen relationships, the WebTrends report said.

Marketers are also increasingly leery of using price-based promotions to generate online revenue from loyal customers during the holidays (23% will not use the tactic compared to 11% in 2005). They will also scale back on free-shipping promotions (45% plan to use compared with 62% last year). In addition, suggested items, gift-idea centers and featured sales-item sections on Web pages to generate revenue from loyal customers will also get less air time.

In fact, three times as many retailers (18%) are opting to use no site features this year, compared to 6% last year. The only features that received a nod from marketers were personalized promotions.

Meanwhile, 80% of retailers use regular customer e-mails to build customer relationships, and the activity that the highest percentage of retailers plan to do in the future is to develop a database of clickstream-based information for campaigns targeted to customers' interests. This will enable marketers to target prospects at the moment of intent and reach them with their campaigns.

However, the report found that although retailers are becoming more sophisticated in using search and e-mail marketing to hook consumers, a great percentage don't know what they are currently using to identify unique visitors to their Web sites—44% compared to 32% last year.

Portland-based WebTrends conducted the survey in June and July, with 300 Internet and multi-channel retailers surveyed.

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