More than 20 years after the Internet was opened to commerce, the Census Bureau reported that brick and mortar sales accounted for 92.3 percent of retail sales in the first quarter of 2016. Yes, I know, this is a shocking statistic.

2016 Retail SalesWhile online sales continue to pick up steam, the changing digital landscape has greatly impacted both online and offline sales. To prepare for the “digital divide,” retailers have taken a bullish approach toward investing in digital marketing tools and strategies. To date, though, most are under-performing. A recent study graded more than 600 Internet retailers on how easy it is for consumers to shop, buy, and pay. Almost half of the sites did not receive a passing grade, and only 18 percent got an A or B. With the scales tipped so heavily in favor of offline sales, and trends indicating the increased importance of digital presence, it is incumbent upon marketers to put significant effort toward finding the balance between maintaining strong brick-and-mortar sales while building a successful online counterpart.

This two-part post will address the effect digital marketing has on offline sales and how CMOs can more effectively master strategies for the highest ROI possible.

Digital’s Influence on Offline Sales

Consumers of all ages have become increasingly immersed in the digital world and are empowered to easily access information on demand. According to a Deloitte report published in September 2016, “The New Digital Divide: The Future of Digital Influence in Retail,” 56-cents of every dollar spent in a store is influenced by a consumer’s digital interaction with the product over multiple connected devices. When combined with online sales, the influence of digital interaction rises to 60-cents on the dollar.

Cents Per Dollar InfluenceAlmost universally, customers’ preferred method of locating, buying, and receiving products in-store has been redefined by their online experiences. Consumers today can search online and find exactly what they’re looking for in a span of 30 seconds. No longer do they have to trudge through the mall only to settle for a derivative of what they actually wanted. Thanks to Google, the assortment they want is rendered far more quickly and easily than a visit to the mall.

From the Instagram shopping tool Like2Have.It to social influencer stories on Snapchat, the means by which consumers are saturated with content continue to evolve and disrupt traditional retail marketing tactics. The Deloitte study mentioned earlier predicts that traditional retail structures that remain fixated on competitors’ practices, rather than adapting with the trends as they happen, are destined to remain 12 to 24 months behind in recognizing and meeting their customers’ changing needs. A little more than half of all retailers implement digital strategies like drip emails and targeted re-directs to help drive in-store traffic, but very few stretch the depth and breadth of their data to maximize the return on these marketing investments.

Carry the In-Store Experience Online

Although in-store still dominates overall retail sales, it doesn’t mean consumers are satisfied with the experience. A 2015 study from Accenture asked consumers around the globe to identify which shopping channel needed the most improvement. The top answer, at 34 percent, was the physical store. Close behind, at 30 percent, was the integration of store, online and mobile shopping into a multichannel experience. Only 27 percent said that shopping online via computer needed the most help, and just 9 percent said that the mobile shopping experience needed the most improvement. These findings suggest that many retailers are coming up short in their attempts to ensure that all channels work together and support one another seamlessly.

Shopping Channel Improvement

Consumers want a technology-infused in-store experience that allows them to access services via digital devices before, during and after shopping at the local brick-and-mortar outlet. Here are some of the most important data-driven factors affecting any effort to accomplish this goal.

Branding and the User Experience

Online experiences are every bit as important as in-store experiences, as consumers expect the transition between offline and online to be cohesive, with the brand feel remaining consistent throughout. While most people would think it’s difficult to create a “feeling” in a digital space, the reality is that embracing technology and using a little creativity not only can replicate the essence, but can enhance it as well.

Take, for example, Glidden® Paint’s online Visualizer tool. Knowing that looking at paint swatches and trying to imagine them in your space often results in customers buying a color they don’t like, the Glidden Visualizer allows customers to go online, upload a picture of their room, and drop in any color of the brand’s paint selection to see how it will look in their actual space. Offering a wide variety of price points, it even recommends accent colors, making the decision-making process easier and more fluid for the customer. With online customer support for questions and/or advice, customers can get all the info they need before heading in-store to make the paint purchase quickly.

The popular home furnishings brand Ikea offers a similar online service where customers can choose various design styles for each major room of their house and customize the look from floor to ceiling, all with Ikea products and various price points. This is a welcome digital complement to the store’s notorious in store mini-apartment and room builds.

Glidden and Ikea prove that brands can recreate the in-store experience online, and even improve upon it, helping customers make purchase decisions from the comfort of their own home.

Understanding Proper Attribution

Determining which tactics or media are driving purchases has confounded CMOs for decades. While every marketer knows that multi-touch attribution is the best model, getting to an ROI that clearly quantifies each touchpoint’s contribution requires advanced technical skills, top-notch tools, and a company-wide belief (i.e., support from the CEO and CFO) that the expenditure required to facilitate this is warranted.

Total Marketing BudgetsWith a rapid infusion of digital channels, technology that allows user behavior to be followed anonymously, and in a privacy compliant way, have made advanced attribution systems viable. For the first time, it is possible to observe all touchpoints leading to a conversion, resulting in highly accurate predictions of what particular marketing expenditures and interactions will produce what results. Though these advancements have fueled implementation of intricate attribution systems, the adoption and usage of systems has yet to become common place with CMO’s. Currently at 4.6% of total marketing budgets, CMO’s are rapidly investing more into digital measurement, with Forbes expecting a 376% increase in spend on marketing analytics alone in the next three years.

Getting Personal with Digital Fingerprints

The amount of data one can find and use for marketing purposes is startling. An inordinate amount of data related to demographics, buying behaviors, and even individual preferences on cats versus dogs can be leveraged to strengthen both online and offline branding. The beauty of digital is that marketers can create highly personalized, trackable, campaigns based off thousands of data points. Pair that with each consumer’s unique digital fingerprint, and you reach the height of a highly effective marketing campaign.

An evolved concept from the traditional “digital footprint” that centers around following a user’s online trail, a digital fingerprint indicates a user’s unique online preferences as they embark on highly individualized journeys. Each consumer displays highly personal patterns and preferences throughout their journey. They may rely more heavily on email, spend more time on social, prefer tablets, and so forth. Skilled data scientists who are trained in the new “specialty” of digital fingerprinting can analyze data in a way that allows marketers to create a holistic brand experience for consumers. There are many ways to create a holistic brand experience from a fingerprint, which involves lead nurturing and lead scoring.

Part Two of this post will address the most effective methods of performing these analytical methodologies, specifically as they relate to drip email campaigns and the customer lifecycle funnel.