What to make of news this week that Next is ditching print and TV adspend in favour of online?
The retailer’s boss Simon Wolfson told Marketing Week that print, TV and direct mail no longer deliver the level of ROI they once did, while its online efforts are generating “impressive” returns.
To that end, Next – which was late to the online marketing party – will boost its online spend by 125%, focusing on mobile.
This is at the expense of budget for direct mail, print and TV – which will be cut by 51% year-on-year from £23m to £11m.
This has caused a slight stir in some conversations we’ve heard with a few people using it to claim that print and TV are less effective than they once were. But this is the point we say woah-woah-woah.
Next is not the first advertiser to ditch longer-term brand building for short-term performance metrics – and that is what is happening here. The business, probably panic-stricken, is responding to a serious high street challenge.
But like businesses before it – take Tesco for example – it will, we believe, adjust its investment in future. Because right now it seems to be confusing the digital transformation of its business with its online marketing strategy.
Next might enjoy some short-term uplift by investing in online and mobile – and we’re not saying it shouldn’t invest in this area – but if it ignores the longer-term brand building stuff, especially in the retail sector, then it can probably wave goodbye altogether.
For reference, there is plenty of robust research from Newsworks and Thinkbox to back up our point of view. Mr Wolfson should give it a read before running blindly in the wrong direction.
