The COVID-19 pandemic has had an indelible impact on the physical retail industry.

Non-essential retailers around the world, including department stores, sporting goods, and apparel retailers, have been forced to close their physical locations as a public safety measure to help mitigate the spread of COVID-19.

Those stores that have remained open, including grocery stores and drug stores, have faced long lines, supply chain shortages, and other assorted challenges that come with trying to do business during a pandemic.

Here in the United States, states are starting to lift social distancing restrictions in an effort to stimulate the economy as social distancing and other preventative measures prove effective in flattening the curve. That means non-essential retailers are opening back up for business while essential retailers may be seeing shopping patterns start to return to normal.

RevTrax co-founder Seth Sarelson

As this happens, retailers are going to start shifting their focus to marketing channels that can drive more store traffic. Rakuten Advertising recently sat down with Seth Sarelson, co-founder of RevTrax, an Offer Management Platform that links online engagement to in-store sales, to discuss how retailers can properly leverage the affiliate channel to adjust to the new normal.

How has the consumer mindset changed since the pandemic started?

As we begin to reopen, many consumers are uneasy about being in close physical proximity to others in a retail environment. The consumer is going to want every trip to count, which means that there’s a greater risk of consumer dissatisfaction if they travel all the way to the store to buy something, only to find it’s not in stock.

The affiliate channel can help guard against this. To maintain customer satisfaction, inventory data should be integrated into a successful marketing strategy to give consumers the peace of mind that comes with knowing they can get what they want from the store, when they want it.

Similarly, consumer price sensitivity varies across categories and is evolving at a rapid pace due to the uncertainty of future economic conditions. As a result, retailers need to have flexibility with their pricing while being careful not to over-discount.

Why does the affiliate channel make more sense right now, as we enter the recovery period, when it comes to driving store traffic and sales?

Between the locked-in ROI and the significant scale, there’s no better way to reach consumers to drive in-store sales than the affiliate channel in this current environment.  The platform supports reopening on a local level, at national scale, with dynamic content based on a consumer’s location, store inventory levels and promotional sensitivity.

How can retailers leverage the affiliate channel to drive store traffic and sales in a safe way?

All budgets, including marketing, are under more scrutiny than ever. Wasted spend is going to be cut – this is why it’s critical to leverage pay-for-performance channels that lock in ROI such as affiliate.

Rakuten Advertising offers three in-store vehicles to do this – cardlinked offers, coupons and rebates. RevTrax powers the coupons and rebates offering in partnership with Rakuten. Our platform helps retailers leverage dynamic offers that are informed by inventory levels and consumer promotional sensitivity to ensure that we are helping retailers drive incremental in-store sales.  Our solution enables retailers to work across all publishers in the Rakuten Advertising network with click-level tracking and can handle SKU-level offers as well as returns.  There’s no retailer integration required, and it is very easy to get started.

What types of strategies might work best right now and why?

The key is to not over-discount.  So many retailers have discounted themselves out of business and we know that discounting isn’t a binary exercise.

Brands don’t need to necessarily discount more. They should instead be smarter about personalizing offer values for each consumer. We are seeing tremendous price sensitivity variation between categories, with a drastic increase in price sensitivity in healthcare, personal care, baby and toddler categories. In contrast, a category like animals & pets remains relatively price insensitive. These shifts also represent an opportunity for advertisers to get consumers to switch entrenched shopping behaviors.

One of the most interesting observations we’ve seen is clustering of consumer behavior between different groups of consumers based on promotional sensitivity. Retailers need to abandon the site-wide offer and realize that offers should vary based on individual consumer promotional sensitivity. Instead of creating one offer, retailers should create a variety and leverage a platform to determine who should get each offer value. This will increase margin and decrease dependency on deep discounting.

How do you expect mobile engagement to change in this new retail environment?

This is a transformative event for adoption of mobile payment and mobile promotions. More consumers are likely looking to avoid physical contact with paper money or coupons. This presents an opportunity for retailers to leverage smartphone tools such as mobile wallet offers and mobile payments to reduce the number of physical contact points in a store and provide a better in-store shopping experience. Our advice to retailers is to ensure that any offer content can easily be added to a mobile wallet.

How do you adjust your marketing language driving consumers into stores, while accounting for consumer sensitivities?

Lead from a place of empathy and delivering value. Brands should lean into their core values and have a consumer-centric mentality. Public health and safety should be prioritized above all. If the consumer isn’t comfortable, she isn’t going to visit your locations. Once that’s established, focus on value and don’t be so quick to over-discount across the board. Segment your customer base and take a targeted approach to offers that is more likely to motivate each individual consumer.

To learn more about RevTrax, visit their website or connect with them on Twitter or LinkedIn.