About McArthurGlen
Since introducing factory outlet retailing to Europe in 1995, McArthurGlen has become Europe’s leading developer, owner and manager of designer outlet villages. The company operates 18 sites across Europe, partnering with top brands to offer year-round discounts of between 30-70% in attractive, out-of-town village environments.
Twelve of McArthurGlen’s designer outlet villages are owned by international asset management company Henderson Global Investors (HGI), the sponsor of this project.
Case Study
| Client: | McArthurGlen |
| Sector: | Retail |
| Discipline: | Communications Audit |
| Period: | October 2008 - January 2009 |
Situation
McArthurGlen had been marketing its European sites under the tagline 'Guilt-Free Shopping' for nearly 3 years.
However, a simultaneous change in marketing leadership and agency relationships meant this approach was now due for re-appraisal. And, before the incoming team began to develop a new campaign, HGI’s Asset Managers wanted an independent assessment of the performance of the standardised communication strategy in Europe, to determine whether it was delivering the desired benefits to the business.
Task
GSP Consulting were commissioned to work with BWP Group - a specialist retail marketing agency - to evaluate the impact of McArthurGlen’s 'Guilt-Free Shopping' campaign on the performance of three designer outlet villages in Troyes (near Paris), Rome and Berlin.
Action
Copyright © GSP Consulting 2009
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Before developing a framework for capturing marketing effectiveness at each village, we sent data briefs to country marketers and head office personnel to discover how much information existed within the organisation which could help us establish a causal link between marketing inputs and business outcomes. In all, three years of business, marketing, media and campaign cost data were requested, as well as copies of creative executions and campaign evaluation reports.
We knew we would also need to source time-series data from external sources, so we approached a range of organisations for local demographic, media and competitor information. For example, we asked a pan-European media monitoring company to provide competitor creative and expenditure estimates, while facts relating to indigenous populations and macro-environmental forces were bought in from local research organisations.
When the data arrived, it was translated, organised, checked and standardised for data modelling. Firstly, media expenditure, footfall and sales data were analysed to discover whether a correlation existed between these variables. Then, external data such as population profiles, regional economic trends and competitive expenditure data were introduced into our models to determine whether these factors had influenced footfall and sales at each outlet.
A summary report was produced for each designer outlet village, with a clear overview of all the marketing expenditure and activities undertaken by each village and an evidence-based impact assessment of the Guilt-Free campaign on each village's footfall and sales.
Results
The ‘Guilt-Free Shopping’ campaign coincided with a period of growing sales and footfall at each village, however there was no evidence of a direct relationship between the campaign and key business performance indicators.
From the outset, two strategic issues had hampered both implementation of the campaign and any subsequent assessment of its effectiveness.
1)
2)
the campaign was only partially implemented across Europe because the concept of ‘guilt’ is tied up in complicated socio-cultural nuances (religious, for example). Marketers in France, Italy and Germany considered ‘Guilt-Free’ to be unusable as a messaging strategy, which meant the campaign became little more than a set of high fashion images and a layout for advertising.
McArthurGlen didn't put measures in place to assess effectiveness and efficiency. Isolating the effects of advertising is typically difficult, expensive and time-consuming. To do so successfully, companies must create a framework for measuring a campaign’s ability to deliver its objectives prior to implementation. In this way, incremental sales and/or behavioural effects may be attributed directly to the campaign while other factors, such as competitor activities, regulatory changes or even financial crises, can be taken into consideration so their influence on the company’s performance can be fully understood.
For Henderson’s asset managers though, the main question was to understand the degree to which McArthurGlen should balance a standardised communication programme - bringing control over the brand image closer to corporate HQ and delivering economies of scale in marketing - with the needs of local businesses in driving consumer preference and competitive differentiation.
To this question, we were able to issue a clear, unequivocal recommendation for a change in strategy. The evidence overwhelmingly supported a decentralised approach to marketing, where each village would work to an individual marketing plan and have complete autonomy over communication. In this way, key differentiator’s, such as the village environment, would receive much greater prominence in campaigns, alongside the core 'big brands at reduced prices' message.
Further recommendations were focused on developing cost efficiencies - in areas such as media planning and purchasing - and highlighted examples of sharp and incisive delivery found in each country, particularly in the areas of customer events, consumer research, digital communication and customer loyalty.
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