Online Retailers Invest in Mobile Marketing, Paid Search; Social Media – Not So Much

With retail sales still coming in at the low end of forecasts, online vendors are looking for any edge to beat the competition.  For many of these businesses, the key to sales increases includes mobile applications and paid search.  The recently published State of Retailing Online: Marketing, Social Commerce and Mobile Report released by Forrester Research and Shop​.org contains insights about how these businesses are spending their marketing budgets.

Here is a summary of their findings on mobile apps:

  • Consumers are being offered product and price data, along with store information and coupons.
  • Stores responding to the survey spent an average of $170,000 on their mobile site in 2010.
  • Mobile browsers, to date, generate 3% of traffic and 2% of revenue.

The study also revealed that nearly ¾’s of online retailers are either working on their mobile platform or have one in place.

While the vendors are seeking a boost from mobile marketing, they’re still spending on paid search. The surveyed group reported spending about 40% of their marketing budget on paid search but  variability by industry exists:

  • Apparel, accessories and footwear 42%
  • Beauty and personal care 43%
  • General merchandise retailers 39%
  • Home retailers 34%
  • Sporting goods/​accessories 44%

Surprisingly, online retailers only spend 2–3% of their marketing budgets on social media. For now, these retailers are intrigued by social media, especially because of its low cost. Managers are for the most part still experimenting with this marketing channel and don’t yet agree on which metrics will best measure the ROI from this new format.

[Sources: Stambor, Zak. Paid search marketing remains king. Internet Retailer. 29 Jun. 2010. Web 1 Jul. 2010; Online Retailers boosting mobile marketing initiatives. ChainStoreAge​.com. 29 Jun. 2010. Web. 1 Jul. 2010] 
Kathy Crosett
Kathy is the Vice President of Research for SalesFuel. She holds a Masters in Business Administration from the University of Vermont and oversees a staff of researchers, writers and content providers for SalesFuel. Previously, she was co-​owner of several small businesses in the health care services sector.