Retail ads increase in diversity

Print continues to reign as the media of choice for advertising home textiles, but the crown is slipping as retailers experiment with other ways to lure consumers into their stores.

This year's exclusive Home Textiles Today Advertising Survey shows that 37 percent of ad dollars spent for advertising home textiles goes to print, compared with a high of 51 percent in 1997.

Meanwhile, the percentage of dollars going to other media has moved like a kaleidoscope changing colors as retailers test the effectiveness of each.

The winners appear to cover both ends of the spectrum from old-fashioned to new-fangled. The percentage of ad dollars going to the time-honored yellow pages has jumped since 1997, to 21 percent. Internet advertising wasn't even on the radar screen in 1997; now it accounts for 4 percent of ad spending — a small amount, but probably growing if retailers' plans are carried out. Just over a third of the retailers said they will increase their Internet-related spending next year.

In general, spending on non-print media is projected to increase next year. In addition to spending for the Internet, more than a fifth of retailers will increase their spending for television, and 8 percent plan to increase radio ads.

Overall, advertising spending is claiming a median of 5 percent of revenues this year. It has hovered at the 5 percent level since 1997, occasionally slipping to 4 percent of sales. No real changes in overall ad spending are foreseen for 2002 — more than 80 percent of retailers said their ad spending will hold steady next year.

Just about three-fifths of retailers said they receive some co-op help for advertising from their vendors. A median of 10 percent of their ad budgets come from that source.

Most advertising — 57 percent — advertises sales, as opposed to ads designed to create an image or promote a brand. Coupons are still cool. Over half of the retailers offer discount coupons, either offering a percentage off or dollars off. The median percentage discount is 20 percent and the median dollar discount is $10.

When it comes to print, about three-quarters of the retailers use print ads running in a newspaper Monday through Friday, and more than half cited this medium as their most frequent means of print advertising. About half also advertise in the Saturday or Sunday editions.

About a fourth of retailers report using local or regional magazines, roughly the same number as in 2000.

Direct mail is still an important part of the advertising media mix — 16 percent — for home textiles retailers, but it seems to be losing its grip on those all-important ad dollars. Rising postage costs may account for the downward trend in the use of direct mail, from a high of 23 percent posted in 1996 to hovering around the 15 percent mark since 1999. Some 11 percent of retailers said they will increase their direct-mail spending next year, however, while 8 percent plan to cut back.

Retailers are most self-reliant when it comes to ad preparation for print — 71 percent said they do it themselves. But for television, radio and Internet preparations, they rely more on the station staff or another outside provider.

For most of the retailers that use television and radio to advertise, it has become a less frequent venue. About a fourth of the retailers uses television or radio advertising only once or twice a year. Another 15 percent to 17 percent advertise on radio or television three or four times a year. On the other hand, 14 percent said they run radio ads daily; and 17 percent said they run television ads daily.

Retailers have designated 8 percent of their budgets to television ads, with the majority of them running on network or cable channels. Local television station ads accounted for 29 percent, and Spanish-language ads for 6 percent.

The percentage of stores with websites has been increasing steadily over the past few years. This year, just over a third report having their own website. About two-fifths of the retailers with a website said they update it at least once a month. Daily updates are part of the routine for 11 percent of retailers, and 6 percent said they update their sites several times a day. More than half of those with websites maintain them with their own staff. Almost a third said they have a dedicated staff member working full time on their site.

And though only 17 percent currently allow visitors to place orders online, almost half said they were planning to add online ordering within the next six to 12 months. The remaining retailers said they have no plans to do that.

Of those that don't yet have websites, 30 percent said they will be up and running within six to twelve months, while another 31 percent are considering a Web launch.