Retailers suffering from promotion fatigue

Retailers are tired of promotions, according to a survey commissioned by Aldata Solution, a global leader in the supply of business solutions to retailers.

The survey found that after two years of focusing on promotions, 46% of retailers surveyed plan to shift their attention to gaining a full view of their customers’ buying patterns both in-store and online.

“The ongoing economic situation has altered the way the retail industry operates and forced a change in tactics in the fight for customer spend,” said Allan Davies, chief marketing officer of Aldata.

“In the next three years, ‘promotion fatigue’ will give way to more focus on a better understanding of consumer buying behaviour and getting a full view of what, how, and where customers are buying,” Davies added.

The survey appears to tally with wine retailers, who are changing their tactics in terms of their approach to discounting.

“Consumers are starting to see through bogus promotions”, Rowan Gormley, founder of Naked Wines told the drinks business.

“Retailers should be going back to their job of being curators for their customers, seeking out quality at every level by sifting through the crud and unearthing the gems rather than relying on promotions,” Gormley added.

“We’ve moved away from the heavy promotional angle we adopted three years ago, where we were offering 50% off some bottles.

"Promotions are often disingenuous and give off a dishonest message. Strong retailers never trade off discounts, as it cheapens your brand to do so,” Joe Gilmour of Roberson told db.

Meanwhile, global wine director for Direct Wines Justin Howard-Sneyd told db: “We’ve not relied heavily on promotions the way some other retailers have.

"It’s important for companies to maintain their integrity, and going down the route of heavy promotions is a slippery slope that’s hard to come back from.”

Lucy Shaw, 18.04.2011