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VAT rise increases focus on targeted marketing campaigns

Research released today from affiliate network LinkShare, reveals that targeted marketing campaigns will be the most effective way to win business after the vat increase in January.


VAT rise increases focus on targeted marketing campaigns

30% of marketers claim that mass marketing techniques will give way to individualised campaigns in 2011.18% expect to see an increased emphasis on measurement and ROI, already watchwords of the post-recession environment. One in five also says that advertisers will have to look for more efficient and results-driven online marketing techniques to redress the balance of reduced marketing budgets.

For consumers this means a visible increase on the bottom line of everything from day to day purchases to white goods, cars and houses. But for retailers the impact is still to be seen, with some commentators claiming that consumer spending will be affected and that sales may suffer, either online or in-store.

LinkShare believes that the VAT rise doesn’t have to have a negative impact on retailers: in fact, for some, it will offer an opportunity to build relationships with their consumers and demonstrate a new level of value.

“One of the biggest motivating factors for online shoppers is value,” says Liane Dietrich, MD of LinkShare UK.  “Whether it’s a straight price comparison or an extra bonus in terms of free shipping or gifts, there is a strong perception that online offers a better range of options than the high street. The increased VAT rate can be another string to this bow – retailers who choose to offset or absorb the VAT increase could stand to benefit not just from an increase in sales but also in greater customer loyalty.”

The research also showed that one in three (37%) consumers will show signs of curbing their spending habits once the rise kicks in. With companies like Sony already focusing on the pre-Christmas sales period with VAT-back offers and incentives, the retail community clearly feels that now is the time to start engaging over the question of imminent price increases.

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