Paid search and email marketing lead retailers’ lists of effective customer acquisition channels, however, social media and mobile marketing are gaining traction and budgets. That’s according to the annual State of Retailing Online 2016: Marketing and Merchandising report, conducted by National Retail Federation and Forrester that surveys retail eBusiness executives at large and mid-sized retail companies, about digital marketing investments, mobile marketing efforts, and website merchandising tactics.

Released at Shop.org’s Retail’s Digital Summit the study also found that 92% of retailers surveyed are investing in social media marketing to some degree this year, second only to email (94%). Social media is not only a cost effective tool for many retailers, but it is also driving revenue.

“Although email and SEO are tools frequently used by retail marketers, it was not a surprise to see that social media is gaining traction with retailers as they continue to further connect and engage with consumers,” NRF Senior Vice President and Shop.org Executive Director Vicki Cantrell said. “Retailers are not only increasing their social media budgets, but they are looking at new ways to update their online content and stay on top of new trends to continue to grow their customer acquisition online and in-store.”

When it comes to paid social media specifically, 68% of retailers surveyed say they were seeing increased conversion from their paid Facebook efforts and 40% claim the same from paid Instagram efforts.

The study also found that mobile marketing continues to be a key area of investment for online retailers. Sixty-five% of retailers surveyed plan to spend more on mobile marketing in 2016 than in 2015, specifically through smartphones. Retailers noted that their email subscribers open an average of 45% of emails on smartphones, ahead of an average of 41% on desktop devices and just 14% on tablets, underscoring that email is a top traffic driver to a mobile site.

Site merchandising connects all the dots for retailers looking to improve their customers’ online shopping experience – even across touchpoints. This year, 55% of retailers surveyed are increasing their online merchandising budgets and 44% are increasing their staff dedicated to web merchandising.

“Customer-obsessed retailers are wisely investing this year to revamp their checkout process, as well as the overall site design – across desktop, smartphone and tablet devices,” Forrester Vice President and Research Director Fiona Swerdlow said. “Many also are upping the ante on developing rich content to meet their customers’ needs, even if creating, managing and keeping that content fresh isn’t always easy.”

Sixty-three% of retailers are investing specifically in content this year to ensure that customers are provided with imagery, peer reviews and other online assets to help them choose the right product and confidently hit ‘buy.’ Retailers’ next challenge: Optimizing this rich content for smartphones.