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Respondents expect great strides in collaborative capabilities

SECTION TWO

Key Takeaways:

    • Don’t Mistake Activity for Impact.

    • There is a Natural Lifecycle for Shopper Marketing.

    • Go Forward with a Map and a Sextant.

    • Overcome the Barriers to Genuine Collaboration.

    • Master Execution for Competitive Advantage.

  • 4.

    Overcome the Barriers to Genuine Collaboration

Collaboration is Critical

“If we do not show manufacturers that we collaborate [well]… we will be at a disadvan- tage because manufacturers will spend shopper marketing dollars with our competitors.”

  • Grocery Retailer

“We want to understand our key accounts inside and out – what categories they want to drive, their core customers, needs states and shopping occasions. We think we have built a lot of credibility by finding activations to address their specific issues.” – Manufacturer

A successful shopper marketing program cannot be developed in a vacuum. Manufac- turers cannot fully understand a retail banner’s marketing needs without retail coopera- tion, and they cannot obtain the detailed data to create customized insights without the retailer’s willingness to share. Moreover, they cannot gain sufficient access to potential consumers without the retailer’s shopper relationships.

Retailers cannot benefit from the manufacturer’s shopper marketing resources, insights, and programs unless they work fairly with their partner. Retailers also need the top-of- mind awareness of manufacturers’ brands.

Ultimately, good collaboration creates a competitive advantage for both manufacturer and retailer.

Manufacturers and retailers in our survey agree that effective collaboration is critically important to their shopper marketing efforts and are investing to improve their capabilities. Although less than 20 percent of manufacturers and retailers rated their current shopper marketing collaboration as “very developed” or “mostly developed,” most are planning to grow this capability aggressively. Within three years, 65 percent of manufacturers and 80 percent of retailers plan to significantly enhance their collaboration abilities.

Current and Planned Development of Shopper Marketing Collaboration

Manufacturer

Reta i l er

Respondants reporting (%)

100%

80%

60%

40%

20%

Not at all developed

A little developed

Moderately developed

Not at all developed A little developed

Moderately developed

Mostly developed

Very developed

Not at all developed

Moderately developed

A little developed

Mostly developed

Moderately developed

Very developed

0%

Mostly developed Very developed

Mostly developed

Currently

In Three Years

Currently

In Three Years

n = 88

n = 15

Source: 2008 GMA/Deloitte Shopper Marketing Study

24

Both manufacturers and retailers fall short in areas their partners rate as important

SECTION TWO

Yet Collaborative Performance Falls Short

Despite efforts to become better at collaboration, both manufacturers and retailers report a significant gap between what collaboration means to them and how their partners act.

Importance vs. Effectiveness of Partner’s Collaboration Abilities

Manufacturer

Planning annual programs and promotions

5

Measuring and demonstrating results

4

Collecting and delivering shopper insights

3

2

Executing shopper marketing programs

1

Applying shopper insights to shopper marketing programs

Designing fresh, unique in-store experiences

Translating between manufacturer and retailer customer segmentation models

Identifying and addressing emerging consumer trends

n = 90

Importance of Collaboration

Effectiveness of Retail Partners at Collaboration

Retailer

Planning annual programs and promotions 5

Measuring and demonstrating results

4

Collectingand delivering shopper insights

3

2

Executing shopper marketing programs

1

Applying shopper insights to shopper marketing programs

Designing fresh, unique in-store experiences

Translating between manufacturer and retailer customer segmentation models

Identifying and addressing emerging consumer trends

n = 15

Importance of Collaboration

Effectiveness of Manufacturer Partners at Collaboration

Source: 2008 GMA/Deloitte Shopper Marketing Study

For example, manufacturers think it is critically important that retailers be able measure and demonstrate results of programs but rate retailers poorly in their ability to do so. Retailers say manufacturers often fail to bring cohesive plans for developing insights into actionable programs that would be of mutual benefit. In fact, both manufacturers and retailers see a big gap on every dimension we asked them about. Neither side thinks the other is doing enough to make the relationships work.

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