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Home / Business / Companies / Retail

Desperate retailers take marketing battle online

By Susie Mesure
12 Dec, 2006 04:00 PM3 mins to read

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KEY POINTS:

A new front has opened up in the festive promotional battle as many of Britain's high-street retailers resort to guerrilla marketing to fight the onslaught from online rivals and stave off having to bring forward their post-Christmas sales.

House of Fraser, Gap, Selfridges, Habitat, Next, HMV and Dorothy
Perkins are among retailers that have e-mailed discount vouchers and promotional codes to thousands of potential customers. Such offers have been widely circulated via the internet, clogging up inboxes and sparking a rush on certain stores - most notoriously Threshers, the off-licence chain that learned to its cost the potential dangers of viral marketing.

Retail analysts said high-street chains were trying to entice the burgeoning army of internet shoppers back to their stores amid mounting evidence that people are shopping online from home rather than venturing outside.

Matt Smith, co-founder of The Viral Factory, a viral marketing agency, said viral marketing was "a way for retailers to respond to the shift online last Christmas by getting people to come back to their shops".

Paul Smiddy, at HSBC, added: "Against a dull retail background, companies are looking to secure sales where they can. E-mailed offers are a way to stimulate sales without telling people and investors that you are one step away from a profit warning. They don't draw attention to the fact that you are desperate for sales."

Some retailers see themselves as victims of the phenomenon, which invites abuse because e-mails can be so easily forwarded.

Dorothy Perkins offered internet subscribers to its newsletter 15 per cent off all purchases until midnight tomorrow if they use a special code.

"Someone must have forwarded their code on to someone else and this e-mail was obviously passed on to a lot of people," said a spokeswoman for the chain. She added that a 15 per cent discount at Miss Selfridge, a sister company, had been "forwarded on virally". The parent group will honour the offer.

Robert Dirskovski, head of interactive media at Direct Marketing Association, said: "E-mail marketing has come of age. It shouldn't be a surprise that big retail groups are using it."

But some analysts urged caution. "These things can explode. If they can't control the distribution [these offers] can be potentially detrimental to the bottom line," said David Jeary at Credit Suisse.

FootFall, which tracks high-street trends, said the number of shoppers out over the weekend was 10 per cent down on the same period last year, but up on the previous weekend.

And not all retailers have had to resort to viral marketing. John Lewis, the department store-to-food group, managed a record week, taking £91 million in sales, without any promotions. Marks & Spencer said it "avoided doing things that could catch fire", sticking to "targeted selective promotions at selected customers".

- INDEPENDENT

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