Google is trying to bring a little more omnisophistication to retailers’ digital marketing efforts.
Last year, the search engine started to record store visits as part of its AdWords program, tracking consumers who agreed to share location information from their handheld devices to see how often people who saw a retailer’s online ad would find their way to a store.
The idea was to help stores that work with Google — including Sephora, Macy’s, PetSmart, REI, Sears Outlet, Ulta and Famous Footwear — assess what kind of off-line return they’re getting from their investment in digital ads.
Today, Google is expected to release data from the program thus far, showing that the number of shoppers who visited a retailer after they saw a digital ad is over four times greater than their other conversions. The research also showed that the number of store visits retailers see is 10 times higher from consumers on mobile devices.
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“Historically, we looked at offline marketing as a driver of in-store [sales] and online marketing as a driver to a store’s Web site,” said Scott Falzone, head of retail industry at Google. “We’re recognizing that the shopper is not only using digital to buy something on the Web site and is not only looking to traditional media to go into the store.”
Mobile has become a powerful “shopping assistant” for customers, who are increasingly browsing for what they’re going to buy before they get into a store, according to Falzone.
Nearly 90 percent of all sales still take place inside a store, but previously there was no tangible way to measure how online activity influenced consumer behavior.
Google is trying to make the most of its strength in paid search and database on consumer activity to maintain its leadership position in online advertising and fend off rivals such as Facebook and, to a lesser degree, Twitter and Pinterest.
Macy’s, which formerly had separate teams that focused on online and in-store initiatives, was able to use store visits data to measure the performance of their Local Inventory Ads from Google. The search engine said every dollar the retailer invested in Local Inventory Ads drove $6 in brick and mortar sales.
As e-commerce transactions and mobile usage during the shopping journey have increased, it’s become harder to know if the store or the Web site should get credit for the sale.
Shoppers can browse on a desktop at work and stop at a store during their lunch break or see something in a store window only to buy it via mobile during their commute home.
Bridget Dolan, vice president of Sephora’s Innovation Lab, said it doesn’t matter where the shoppers start, as long as they ultimately buy something.
“Years ago we decided that the client is one customer and she can buy wherever she wants and we’ll be happy,” she said. “We really think about mobile very much as an assist tool…[and] always thought about the phone as a way to transact in store….It doesn’t matter where the purchase happens.”
Sephora, which maintains more than 350 freestanding doors, about 400 shops inside J.C. Penney Co. Inc. doors, and a significant Web business, saw 18 percent higher store visit rates from mobile clicks compared to desktop since Google began sharing data on store visits.
This proved to Dolan that foot traffic is truly driven by mobile and reinforced the notion that smartphones help drive customers into stores. After starting to focus on mobile and bidding strategies with respect to online marketing, Sephora found a 25 percent higher return on ad spend on paid search for e-commerce sales.