Advertising Can Only Take You So Far

Poppy Slater




Outlet Stores


ADVERTISING

CAN ONLY TAKE YOU SO FAR


Interview with Joe Walter and Terry Fetterman







Conversations
between retailers and ad agencies need to expand beyond questions of
creative and media to ensure that messaging aligns with customer
perceptions and experiences.



This installment in Furniture World’s series on retail advertising
features information and advice from Terry Fetterman and Joe Walter of
Tango Multimedia. Their ad agency works with independent family-owned
stores with sales in the $3 million to $20+ million range.


Fetterman spent the first two-thirds of his career working for companies
such as Radius Communications, Comcast and Viacom-owned CBS in TV
advertising and video production sales, management and direct response.


“Before founding Tango,” he recalled, “I also worked for a technology
company as director of sales on the operational side of broadcast
television and early streaming media services.





There are so many ways stores can build rapport with customers and
provide an alternative to scrolling through sofa images accompanied by
boilerplate copy about exemplary customer service and how many years
they’ve been in business.



Joe Walter met Terry years ago following a disappointing experience with a
TV ad buy he made while working at his family’s furniture operation,
Highland Park Furniture.


“One Black Friday weekend,” he recalled, “We invested heavily in TV ads to
bring in customers.


“The spots were a complete failure. It was our first substantial
investment in television advertising, and we were unable to tie any
business directly to the promotion.


“Our print supplier, Banner Marketing, suggested that I speak to Terry
before doing more television marketing. Terry immediately spotted the
flaws in our campaign and suggested a thoughtful, well-designed plan. As
it turned out, my dad, who owned Highland Park Furniture, said, ‘As long
as I live, I’ll never run another television ad! It doesn’t matter how
good the plan is. We spent our lifetime supply of TV money on that last
campaign.’ So, Terry, and I just remained friends. Over a number of years,
I developed expertise in digital ad management as an effective means of
advertising our stores, which ultimately led me to join Tango as VP of
Online Advertising.”

New Advertising Conversation


“It’s not news to most Furniture World readers that access to data allows
retailers to create audiences based on data, track impressions and
clicks,” explained Fetterman. “Today, they can measure the number of
people who were served an ad, walked into a store and purchased.


“These analytics have fundamentally changed the conversation retailers and
their ad agencies should be having. Instead of being concerned with just
marketing and branding, advertising decision-making is increasingly
connected with how retailers buy, merchandise and sell their products.


“Here’s an example. We recently worked with a large retailer whose brand
message emphasized selling products for less than the competition. It was
and is a major pillar of their brand.






Note: Respondents who did not give an answer are not shown. Source:
Survey of U.S. adults conducted Jan. 25-Feb 8, 2021. PEW Research
Center.


“When customers were asked to share their impressions about this retailer,
they explained that the operation delivered an excellent shopping
experience and were impressed with the employees, product quality and
selection. All good things.


“This retailer’s everyday prices were, in fact, lower than their
competitors’. Customers, however, believed the opposite. How was this
possible?


“To correct a mismatch like this takes more than just working with an ad
agency to place clever ads. The shopping experience needs to be
re-aligned. For example, it could be that when shoppers walked into this
retailer’s stores and turned right, they saw a selection of higher-end
items. If a $12,000 sofa is the first thing shoppers see, it makes an
impression. Multiply this by 1,000 and it can become a problem.


“Just moving a display from the front to the back of a store can have a
large effect over time,” noted Fetterman. “And there are many
non-advertising factors like this in retail operations that contribute to
a disconnect between a retailer’s advertised brand and the experience
people have of that brand. Advertising and marketing have become much more
comprehensive and holistic. It needs to be part of any discussion between
retailers and their advertising agencies.”

Video Shift


On the topic of media choices, Joe Walter noted that “the conversation
about television advertising has shifted quite a bit in the past few years
due to the importance of reaching people with video.”


“That’s certainly been the case,” agreed Fetterman. Video has become the
number one source of information for 66 percent of all adults. The TV
budgets we’re managing are shrinking as YouTube and Facebook video
advertising, OTT, CTV and streaming video have grown.


“Even today, some retailers are handling advertising themselves. They
accept the packages offered to them by television, radio and newspaper ad
reps. This is not the best way to optimize an advertising budget. What
advertising reps say is not always the best advice for home furnishings
retailers.


“In 2015,” Fetterman continued, “76 percent of adults watched TV from
cable or satellite. Today, that number has dropped to 56 percent. While
it’s still a lot of people, media consumption habits continue to shift.


“Often, furniture stores use broadcast TV—a combination of ABC, NBC, CBS
and FOX. In any market, one or two stations dominate the local news and
furniture stores choose those stations to carry the majority of their
network television placements. Many store owners believe that their
customers don’t watch cable TV anymore.


“They place commercials from five in the morning until six at night during
the early news, the evening news, occasionally on late-night news and
sometimes on entertainment shows like Kimmel and Fallon. Unfortunately,
most TV viewership is not during those time slots. It’s in prime time.”


Fetterman said that local furniture stores typically can’t afford prime
time, but that isn’t a huge problem because they can still reach people
before they leave for work, then again when they return home, through
local news programming. “On paper, it all sounds good. The problem is that
including travel time, most potential customers leave home at 7 a.m. and
return at 6 p.m.. Retailers are sometimes well served by reducing their
broadcast budget a bit and adding cable TV in primetime when people are
watching CNN, Fox News and MSNBC. Advertise on those three news channels
from 6 p.m. until midnight. Every single furniture store can afford to do
that to better reach folks who work during the day.”

Digital Decision Making


Furniture World asked Joe Walter about current best practices for digital
advertising.


About Google: “Google is foundational to any advertising
program,” he said. “It is the place people go to first when they’re
looking for furniture. When they’re interested in buying, retailers need
their website to show up in that moment. It’s the modern equivalent of
Yellow Pages advertising. Beyond Google, the market a retailer is in, its
budget, and goals dictate what needs to happen next in terms of digital
advertising.”


About Geofencing: “For some retailers, geofencing makes a
lot of sense for a similar reason. It’s a way to effectively communicate
with active shoppers. Even during the pandemic when closing ratios were as
high as 50 percent or more, there were still lots of consumers who walked
out of stores without buying. So, it makes sense for retailers to direct
resources to try to get their shoppers and those consumers who visited
competitive stores to come in and complete a purchase.”


About Competitors: “It’s a mistake to blindly copy
competitive stores’ advertising choices. For example, it’s easy for a
retailer to assume that an Ashley Furniture Home Store operating in its
market area wouldn’t place so much TV advertising if it wasn’t working.
For a retailer with a modest advertising budget, however, television is
often not the best way to go. It’s important to be aware of what
competitors are doing in terms of their media choices, but it’s impossible
to compete simply by copying large competitors.”


About Website Development: “Over the past two years, many
retailers have been patting themselves on the back for finally paying some
attention to their websites. But, there are still a large number of
furniture store websites that underperform.


“Retailers may spend huge sums on rent, salespeople and displays to
support physical locations. At the same time, they tend to shortchange
their websites. If a shopper’s first impression, based on a website
experience is poor, she probably won’t consider an in-store visit. When
that happens, investments in physical locations are wasted.”



Content


Walter suggested that Furniture World readers who settle for just
uploading information provided by their manufacturers are unlikely to
inspire shoppers.


“Over much of the last two years, it’s been a sellers’ market for a lot of
retailers who’ve been able to cut their ad budgets.” Rather than pocketing
that savings, he said, they should fund content creation. Whether they
hire an influencer, post TikTok videos or photograph beautiful in-store
vignettes to replace cookie-cutter manufacturers’ supplied photos, it’s
worth the effort.


“Smart retailers are creating how-to and design videos. There are many
ways stores can build rapport with customers and provide an alternative to
scrolling through sofa images and boilerplate copy about great customer
service and how many years they’ve been in business.


“Most retailers know that they need to create better content. Often
though, that’s where the discussion ends. Store owners hardly have the
time to take care of basic things like hiring, payroll and placing orders,
much less brainstorming about what kinds of blog posts to write.


”The good news for retailers is that platforms such as TikTok and Snapchat
have changed the threshold for what’s considered entertainment. Our
customers have become used to low-fidelity content, so compelling social
media messaging no longer requires fantastic high-resolution images or
professional videography.”





Stories are being continually created inside stores, almost like video
diaries that don’t have to be accompanied by grand explanations or
pitch the next big sale event to be considered great content.



Retailers who visit TikTok can see thousands of submissions from top-100
to small independent retailers. A quick search for the phrase “furniture
store” reveals content that ranges from useful information to playful
clips featuring furniture store employees and customers. “Mrs. Jones came
in and bought a sleeper sofa. Why? That can be your piece of content,”
observed Walter. “Or, a salesperson on-camera can talk about how happy a
recent customer was when she solved her back problem with an adjustable
bed.


“Stories are being continually created inside stores. They are almost like
video diaries that don’t have to be accompanied by grand explanations or
pitch the next big sale event. But not everyone is capable of creating
persuasive content. I would caution retailers against choosing the
youngest person they know to be their social media and website content
person, ”advised Walter. “Just because an intern or junior employee is
using Instagram all the time, it does not mean that they are qualified to
control something as important as a retailer’s social media
communications.”



The good news for retailers




is that platforms such as TikTok and Snapchat have changed the threshold
for what’s considered entertainment. Our customers are used to
low-fidelity content now.”

Smart Solutions


Fetterman remarked, “There will always be challenges as well as
opportunities for furniture stores. In good times and bad, some retailers
find reasons based on current business conditions, the news cycle, or a
collective mindset to cut back on advertising.


“Before making big advertising decisions, it’s wise to take a step back
and ask a few questions. ‘How do we improve today so we can grow? How do
we develop better business and brand focus? How can we reflect our unique
branding via in-store shopping experiences? How might we extend this
experience outwardly through our online and social presence?


“Good decision making requires leveraging data, but, many stores don’t
know how many households there are within 10 miles of their operation.
Neither are they aware of what those homes look like, the demographics and
geographics of the families that live in them or their occupants’ style
preferences.


“We recently worked on a campaign targeting roughly 330,000 women with
household incomes of at least $60,000 in a retailer’s trading area. These
women had an interest in home furnishings, decorating and home
improvement.


“Here’s some context. The typical U.S. household purchases, on average,
$1,900 to $2,300 on home furnishings a year. A quick calculation using an
average yearly spend of $2,000 multiplied by 330,000 households told us
that the targeted group was likely to spend in the neighborhood of $660
million on home furnishings during a one year period.


“The media this retailer used to reach this audience included targeted ads
served via paid social advertising, online advertising, programmatic,
video marketing, OTT, YouTube and print. Impressions, clicks and how many
people from the targeted group entered the store and purchased were
captured. This retailer generated more than $820,000 In sales on a $55,000
ad spend.


“People used to say, ‘Man, if I knew which half of my advertising worked,
and which didn’t, I’d be a genius. Today, retailers can have that
information. It doesn’t matter if a retailer can invest $100,000 on an
advertising campaign or just $2,000. An insightful in-house marketing team
or ad agency can create an articulated advertising program that is
responsive, data-driven, filled with analytics and market intelligence.
But, great advertising can only take a retailer so far. It has to be
accompanied by looking closely at what’s happening when shoppers targeted
by ads visit a store.


“That’s why it’s so important for furniture retailers to have
conversations with their agencies or marketing teams about how consumers
interact with their websites and in-store experiences. These can be
incredibly productive conversations.”



Furniture World is the oldest, continuously published trade publication in the United States. It is published for the benefit of furniture retail executives. Print circulation of 20,000 is directed primarily to furniture retailers in the US and Canada.  In 1970, the magazine established and endowed the Bernice Bienenstock Furniture Library (www.furniturelibrary.com) in High Point, NC, now a public foundation containing more than 5,000 books on furniture and design dating from 1620. For more information contact [email protected]








https://www.furninfo.com/furniture-world-articles/3984

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