The seemingly endless growth in third party online services available to retailers to help them drive brand awareness, launch promotions and generate store traffic is a wonderful thing to see. The availability of LBS services, group buying, aggregated electronic coupon sites, mobile shopping lists, social media, etc. has launched some incredibly creative campaigns.
Independent of the issue of how these third party services – many of which are free to use – are monetizing their business, one question raised by this ecosystem is how retailers and brands can really differentiate their business by using these off-the-shelf services. In some cases, like the Old Spice blitz on YouTube last month, a swing for the fence can actually knock the ball out of the park. However, it’s not clear whether that promotion had any impact on sales at all, though it was surely the most entertaining campaign in recent memory – with the traffic to prove it – to many industry observers.
When the creative use of these services can be matched in hours if not minutes by a competitor (witness the Amazon vs. Wal Mart pricing battle of late spring where they engaged in a sort of negative auction to see which could lose more money on the sale of a book), we enter a world of advertising where engineering resources are needed to provide meaningful separation from what the competition can offer.
That state of affairs is not here yet, as marketers test the waters with a growing number – but still small – of early technology adopters from the consumer side. But brands and retailers will be well-served by identifying proprietary technology solutions which give them a leg up on the competition as they use these interesting services more and more.
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