The Financial Shift Towards Digital Marketing In Retail Sector In 2017

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Undeniably digital marketing spend for the retail sector is all set to increase across all channels for the coming year. In the past few years, marketers have witnessed a marked increase in marketing spend for both online and offline channels in the retail sector and the trend continues to grow. Some marketers have already spent more on their websites, digital commerce and digital advertising than on other categories in 2016. These top three categories of 2016 spend illustrate that, while digital has become integral to all marketing activities (online and offline), purely digital marketing investments will garner more attention in 2017.

A survey on retail marketers conducted by Kelton Global shows that:

“59% of retail executives spend less than half of their marketing budgets on digital channels.”

Digital Marketing Spend In 2017 (Projected)

Although it’s been established that digital channels are more convenient and drive better ROI, yet the spend on them still lags. However, on a bright side upto seventy percent of small business (Get Response) admitted that they will increase their digital/web based marketing budget for the coming year.

From the remaining small businesses, 28 percent have indicated that their budget for digital marketing would remain unchanged this year because they are willing to research first and then invest wisely. While 2 percent of them are aiming to reduce their budget. However with the current predicament, more money is expected to pool towards digital marketing.

Signs of caution

Predominantly, the retail sector is aiming to increase its budget and marketing funds allocation but some will go for a cut. Twenty-four percent of marketers at media companies say their budgets will decline in 2017 compared with last year.

The Role Of Mobile

Only 1 in 4 retail marketers believe they are getting the most out of mobile technology. For the coming year, social, email and mobile is expected to drive the spending surge. After social, mobile marketing is expected to drive 50% of digital marketing spend. It can exceed beyond expectations according to the industry.

Factors contributing to the digital advertising increase include:

  • A continuing and consistent shift of offline media spending to digital advertising
  • Decline of organic social in favor of paid social
  • The rising importance of video, which is more expensive than other digital techniques

Online Vs Offline Retail

Despite enjoying prominence and user attention, the online channels have yet to fully establish themselves in some markets and, in markets where they have been established, are typically growing faster than bricks-and-mortar channels. For 2017, the marketing spend and budget distribution will shift slightly more towards online in comparison to offline retails. Let’s take a look at the driving factors for this change



As we can see online channels also have certain limitations that can be overcome by complementing the system with offline channels and also with the automation of the online channels. It is recommended that marketers increase their budget for social media platforms. The criterion would depend on the nature of business, and availability of target audience on that platform. How are you planning your digital marketing spend for the coming year? Share your thoughts

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Mehreen is a social media buff and design blogger, who keeps a keen eye on graphic design trends. She has a passion for experimenting with design ideas, and wouldn’t mind if it means going out of her way to find them in Timbuktu. Follow her on twitter for daily inspirations and findings.

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