In this podcast, Lori, practicing social distancing, sits in the studio by herself, talking with Angie Arnspiger, NaviStone’s head of Business Development about the need to include a physical component to our marketing.
Lori Paikin: Hi everyone. It feels funny to be sitting in the studio alone recording a podcast called Two Gals and Some Data and to be talking about the importance of incorporating a physical component into our marketing strategy when social distancing has become a part of our daily lives. But the show must go on and I feel extra lucky to have Angie Arnspiger, NaviStone's head of business development on the phone and talking with me about data and how you can use data to make more money. Hi Angie.
Angie Arnspiger: Hi Lori. Thanks for having me.
Lori Paikin: Internally we'd been brainstorming topics for this podcast for several months and given the physical component of our solution, we came up with the idea of making marketing more physical, but now we find ourselves trying to chart new territory in a time when it's more important than ever to not be physical.
Angie Arnspiger: That's so true. It is a new territory for all of us, but I truly think it's because we are practicing social distancing that the need of making connections is even more important and we are starting to see new connections everywhere. It has been amazing to see people and brands come together for the common good. I just learned about a retail coalition of brands that are supporting each other in their marketing efforts and the shop online day that just happened last week, it's very inspiring.
Lori Paikin: I hadn't thought about it that way, but it does make sense. There is so much evidence, research and white papers stressing the importance of connecting physically, so I'm going to throw out our first trivia question and Angie, it is a softball. When we are born, which of our senses is the first one to be available?
Angie Arnspiger: Gosh, is it touch?
Lori Paikin: That's correct. I recently read an article from NeuroNation where they shared that experiencing physical contact plays a vital role in our physical and psychological health. Who doesn't need a hug, right, and there's just something different about talking with someone when you can make direct eye contact. But thinking abstractly for a moment, that physical connection expands much farther than we might traditionally think.
Lori Paikin: To your point earlier, let's think about it in the context of marketing because as marketers, that's our goal to make that connection with consumers. In a time when brands are being cautious with their outreach, being sensitive to the stress and concern over the physical and mental health of themselves and their families and their friends, I'm curious if you think that we can expect to see more or less advertising.
Angie Arnspiger: Yeah, I would expect pure prospecting and broad prospecting budgets will decline for a while at least, but I'm really not sure. I had just read an op ed piece a couple of weeks ago that made me think about the millions of dollars not being spent on advertising in the sports industry as a result of the national sports shut out. Seasons being suspended, the delay of the baseball season, the summer Olympics, etc...and that's a lot, a lot of marketing dollars. But then I've seen a lot of advertisers using their marketing budgets but modifying their message as a way to share with those consumers those things they are doing to keep their employees healthy and to provide updates on how they are able to run their business in a safe way when they can.
Lori Paikin: Yep. I completely agree. While many advertisers are planning for immediate cutbacks in their advertising budget this quarter I think you have to consider the industry you're in and consider modifications to your advertising, both content and channel versus cutting it. We're seeing shifts in advertising based on industry. At NaviStone we've been able to see those industries where advertising's increasing and should increase and others where it shouldn't.
Lori Paikin: Think about companies that provide food services. The need for that particular service today is greater than it's ever been and those brands should be advertising and marketing to those consumers that are showing intent. Home decor, home services, those are some other categories where we've seen increases. People are spending a lot of time at home and noticing what they need or what needs to be fixed. Then there's those companies that have cut back and and should cut back. Travel and hospitality, the restaurant and entertainment industries, those are probably two industries that we have seen be the hardest hit, although we are starting to see some things turning around for the better within travel.
Lori Paikin: Last I would say within retail in general. We've seen most nonessential retail stores close and I say non-essential in air quotes because I'm not a fan of that term. But these closures are causing a shift. Retailers are using advertising to drive consumers to their online eCommerce sites. I'm curious what you think about this shift, the closing of physical stores and the increase in website traffic given our need for that physical connection.
Angie Arnspiger: Yeah, it's an interesting question. Over the last couple of years in retail specifically, they've had to focus on the need for physical connection and turning their shopping experience into a experimental environment. So you probably have heard the term retail-tainment a couple of years ago. It didn't really catch on, although the experiences did and what that is is how do you get people in the store to shop and bring value to them? So, for example, there were some high end clothing stores where you can drink wine, you can socialize and skate while shopping for skater shoes. Or even walk a contemporary art gallery that was brought inside a optical sunglass retailer.
Lori Paikin: Yeah, you're right. It's all about that experience.
Angie Arnspiger: Yeah, absolutely. On the other side of this pandemic I imagine stores will get back up and running, absolutely. But the struggle will be to bring those that have been buying online for three months or so back into store, meaning that those stores are most likely they'll have a smaller footprint, a larger focus on this immersive experience and we'll probably see more augmented and virtual reality technologies to help make the in store shopping fun, engaging and unique.
Angie Arnspiger: I have a question for you. You had mentioned earlier that advertisers should not only consider the industry they are in and make modifications to their messaging, but to also consider the channels they market in. What did you mean by that?
Lori Paikin: Well, I have read some conflicting studies about the amount of time consumers are spending online now that we're practicing social distancing. While there are great platforms and apps online that help us all stay connected, we also hear about the neighborhood social distancing happy hours and the desire to just pick up the phone and talk with friends and family. We've also heard that as retail stores are closing, advertisers are shifting marketing dollars online and driving site traffic, but there are some unintended consequences of that shift. With the influx of dollars into online marketing costs for online advertising is actually increasing up to 40% for many. That is leading to higher CPCs, cost per click, and essentially making digital advertising less effective.
Lori Paikin: So you're spending more for the same number of digital impressions because the shift in budget is driving up online bidding. Therefore you really need to evaluate other channels and it's no secret that I'm a fan of direct mail and I'm going to use that as a segue. So Angie, as a consumer, if you've been isolated and haven't been able to make a connection through one of the social platforms or even if you are connected through social platforms, do you think that direct mail can fill some of the void?
Angie Arnspiger: I really do. It's a connection that feels personal and who doesn't love getting mail? Sure, some don't like the junk mail that floods the mailbox at times, but boy letters from friends and family or even relevant advertising always spark an emotional response for me and it's intriguing and dare I say maybe happiness too.
Lori Paikin: Yeah, I couldn't agree more. We continue to hear about the benefits of direct mail and the positive impact it has on the brain. I feel as if I'm experiencing this firsthand. Every day now I really do find myself looking forward to getting the mail. It's emotional. Somehow it makes me feel connected to the outside world and reading through a catalog as just one example is a nice distraction from the Tiger King and quite honestly a nice break from doing a lot of nothing.
Lori Paikin: I want to share a quote that I read a couple of years ago. It was in a research paper titled the Private Life of Mail. It's a long quote, but it's so relevant. "What digital media hasn't changed is people. We are still physical creatures that thrive on human contact and stimulation. Giving, receiving, and handling tangible objects remain deep and intuitive parts of the human experience. Sending a direct sensory experience of your brand can mark a pivotal moment in the customer journey."
Angie Arnspiger: Oh, I love that quote. Having something that you can touch physically is so important right now. You can't go into the store and touch that sweater you're interested in, but at least you can physically touch a direct mail piece that presents that sweater in a beautiful way and gives you the illusion of actually holding it in your hand.
Lori Paikin: Yeah. Do you think that direct mail plays an even larger part in forming connections during this time of uncertainty?
Angie Arnspiger: I absolutely do. You may remember in 2015 there was a study that was released that showed stronger recall and emotional responses to physical ads. Physical media also triggers brain activity associated with value and desirability signaling a greater intent to purchase. So physical mail also proved more effective in activating longer term memory and more accurate recall. The information we use when deciding whether or not to make a purchase is that memory and recall. And did you know that according to the neuroscience of touch survey by Sappi North America neuroscientist David Engleman, but they said up to 84% of online orders now derived from physical interactions with catalogs, magazine advertising and other direct mail pieces. Consumers really do trust physical material more than they do digital.
Lori Paikin: Yeah, I totally agree. I wanted to go back something that you had mentioned a little while ago. You mentioned one aspect of direct mail that consumers don't love. You referenced junk mail. As marketers, we have an obligation to make all of our outreach relevant. So my second softball for you, do you think direct mail can ensure that relevance?
Angie Arnspiger: I do. There are programs like NaviStone that provide the unique opportunity for advertisers to connect with the consumer who are already on their site browsing. They don't have to second guess as to whether now is the time to get a advertisement in front of them and they don't need to be broad with their reach and prospecting. Maybe with decreased marketing budgets they can afford to be broad with that outreach anyway and then need to build their file. But you can still have that personalized connection with consumers who are showing intent through a more physical outreach, which is direct mail.
Lori Paikin: I can't think of a better way to end this discussion. So that'll do it for this episode of Two Gals and Some Data.
Thanks Angie for joining me today and if you want to read more from us, check us out at navistone.com/blog and if you enjoyed today's show, head over to iTunes and leave us a five star review. Thanks for listening.