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Why consumer engagement is key for back-to-school retail campaigns

This piece originally appeared on The ANA's Forward 

Summer break has only just started in most American schools but savvy brand marketers in the retail sector are already preparing to launch their back-to-school campaigns.

Back-to-school shopping accounted for an estimated $885.16 billion in consumer spending in 2018, according to estimates from eMarketer. About one-tenth (an estimated $88.5 billion) of that spending will be in e-commerce, making back-to-school shopping one of the biggest seasonal revenue drivers for retailers, alongside Black Friday and Cyber Monday. But in an increasingly crowded field, where traditional retailers, digital native direct-to-consumer brands, and massive e-commerce platforms are all vying for the dollars that go toward prepping for the start of a new academic year, it's critical for brands to stand out.

To be heard above the din, a growing number of marketers have embraced the need to bring higher degrees of interactivity and personalization to their campaigns. For digital marketers competing across increasingly fragmented audiences on multiple screens and platforms, the need for a personal, data-powered connection is particularly strong.

A competitive field demands brands score top marks

According to estimates from MediaRadar, U.S. retail marketers spent more than $600 million on back-to-school advertising across print, digital, and television advertising in 2018. That number is expected to grow as emerging brands compete for consumer attention with established brands and major retailers who traditionally dominate the back-to-school market, creating an increasingly noisy field for challengers and entrenched brands alike.

A hyper-competitive backdrop is just one reason that retailers are making customer engagement a priority as they plan their back-to-school campaigns. A recent roundup for retail experts published by industry publication WWD placed customer engagement at the top of retail marketers' list of priorities alongside the use of data, both owned and acquired, to connect with consumers on a more personal level.

In the article, commerce marketing analyst Greg Zakowicz called on retail marketers to "provide consumers of today with what they want; a relevant and more personalized experience." In an increasingly fragmented media environment, video and connected TV (CTV) offer a unique opportunity to utilize consumer data to create engaging experiences.

Brands Are Embracing Engagement

Data gathered by Innovid from millions of CTV and video retail campaign impressions confirm that retail marketers are leaning into the format to drive deeper connections with consumers, connections likely to play a big role in the 2019 back-to-school season. The 2018 study conducted by Innovid found a 79 percent increase in campaigns utilizing data-driven video to create personalized experiences. Based on that increase, dynamic data-driven video represented 32 percent of all video impressions served across all categories.

This industrywide embrace of personalization was mirrored among retail marketers who increased their investment in data-driven video advertising in 2018. Innovid saw a corresponding increase in retail campaigns employing data-driven video between 2017 and 2018. This ongoing escalation in brands' commitment to personalization is expected to drive even higher rates of adoption in 2019.

Personalization Pays Off

This focus on maximizing the value of consumer data by creating personalized experiences appeared to pay off, the Innovid study found.

Campaigns containing data-driven video produced significant engagement lift for marketers. Globally, Innovid observed an average engagement lift of 78 percent compared to traditional pre-roll video advertising, which contained no personalized creative or interactivity. The results suggest that consumers are broadly responsive to personalized messages and that efforts by brand marketers to increase ad relevance have been well received. When Innovid researchers narrowed their observations to campaigns from retail advertisers, the results were similarly promising.

Retail campaigns employing data-driven video to create personalized messages driven by geo, store location, weather, and other first-party data saw an engagement rate of 1.3 percent in 2018. That's roughly the same rate as the 1.4 percent across all campaigns globally. Retail brands also saw a 41.8 percent awareness rate and 94.6 percent completion rate, beating the global average of 91.6 percent, showing that retail consumers were even more responsive to personalized data-driven video than average viewers.

Perhaps most significantly, data-driven video produced impressive results for time earned, a figure representing the amount of time that viewers spend with advertiser content beyond the initial 15- or 30-second ad buy. On content from broadcast publishers, retail advertisers were able to earn an additional 63.5 seconds of time during which consumers were voluntarily engaged with their content — more than one minute of attention from target consumers beyond what advertisers had paid for. On non-broadcast content, which tends to be shorter and lends itself to lower attention rates, data-driven video drove an additional 28.3 seconds of time earned for advertisers to make their case to consumers.

Connected TV Is the New Valedictorian

As retail marketers mull the ways in which data-driven video and dynamic personalization can affect their back-to-school bottom lines, there remains one significant elephant in the room that deserves consideration: Over the past year connected television has reached a critical adoption threshold in the United States, meaning that all the benefits of personalization and data-driven video can now be applied to television as well as video ad buys. eMarketer estimates CTV reaches nearly 183 million Americans — a figure representing just over half of all U.S. households. For those households, television now comes with the precision targeting, measurement, and personalization potential familiar to digital marketers. As the adoption of connected TV continues to climb, the opportunity for retail marketers to take advantage will continue to grow.

Innovid observed a significant increase in the number of CTV impressions served in 2018. CTV represented 28 percent of all impressions last year versus just 17 percent in 2017. While advertisers are actively seeking out CTV inventory for its more robust advertising opportunities, it's worth noting that most standard television buys now include a significant amount of CTV inventory. For retail marketers looking to make an impression, they'd be wise to take advantage of this inventory, which already may be in-hand using advanced ad formats to engage directly with consumers.

How Brands Can Make the Grade

Back-to-school time represents a huge opportunity for retailers across multiple categories to capitalize on increased intent to purchase. In fact, a study by Deloitte found that in 2018, clothing and accessories were the top investment, accounting for 55 percent of total back-to-school spending. Ninety-eight percent of parents planned to spend an average of $286 in this category, while school supplies were second, with the same percentage of parents planning to spend on average $112, or 22 percent of total spend.

Unlike most shopping holidays that are isolated to a single day or weekend, the back-to-school season spans weeks or even months, allowing marketers a chance to shape consideration through engaging, personalized messages. Given the potential windfall available to retailers, taking advantage of advanced formats to drive performance across digital and CTV is a must.