X hits on this document

78 views

0 shares

0 downloads

0 comments

5 / 27

Shopper marketing brings shoppers into the marketing plan, and the marketing plan into stores

SECTION ONE

large and mature. In most categories, volume growth is in the low single-digit range. Incremental thinking about brands and conventional category definitions can no longer carry the day.

  • Fragmentation of consumer demand and the emergence of relevant “micro” market segments stand at odds with traditional investments in brands and mass advertis- ing. As a result, today’s metrics measure the success of activities that are increasingly irrelevant. Without reliable metrics, marketers are understandably wary about shifts into new media or unfamiliar marketing strategies.

  • Interactive media allows consumers to express a huge array of desires and preferenc- es. The Internet, mobile devices and other emerging media are changing shoppers’ behavior on the fly. Marketers are trying to respond, but with little history to guide their choices.

  • Much of the hard work that marketers spend building their brands’ value proposi- tions gets undermined through conflicting messages, inconsistent execution of in- store programs, and misalignment of retailer and manufacturer goals.

  • Changes in the retail landscape complicate consumer decision making and the chal- lenges of marketing through this channel. Manufacturers face retailer consolidation, the rise of private label products and increasing assertiveness of banner strategies. All of these factors influence marketing strategies and tactics at the “moment of truth.”

While none of these trends are new, their combined year-after-year effect increases the challenges manufacturers and retailers face when trying to connect with consumers.

It is time to fundamentally change how we approach these mounting challenges. There is new thinking in the industry today – shopper marketing – which has generated some promising results.

What is Shopper Marketing?

Many alternative definitions exist throughout the industry. However, marketers should define shopper marketing from the shopper’s point-of-view:

Shopper marketing is the employment of any marketing stimuli, developed based on a deep understanding of shopper behavior, designed to build brand equity, engage the shopper (i.e., an individual in “shopping mode”), and lead him/her to make a purchase.

The premise behind shopper marketing is that manufacturers and retailers can together create a more engaging shopper experience, influencing shoppers at the point of purchase where they make most final buying decisions. Shopper marketing is about using insights, specifically targeting the core shop- per of the banner or store cluster, to deliver the right environment, right products, right packaging, right prices, and right marketing communication—combined to satisfy the shopper in a way that was not traditionally possible.

When done well, a shopper should feel like the store was designed just for him/her. He/she will visit more frequently, dwell longer and make better product choices.

Shopper Marketing is the Next Evolution

With the advent of shopper marketing, the prevailing go-to-market strategy has entered its next stage of evolution.

In the 1970s and 1980s, brand management emerged as the dominant marketing para- digm. After that, came category management, which has shaped merchandising and planning processes for nearly 20 years. For so long, these two fundamental concepts have defined the “selling” of consumer products. But with everything that has changed since 1970, it’s hardly surprising that a new concept is emerging.

At the heart of shopper marketing is the idea that manufacturers and retailers can orches-

2

Companies rate in-store activities among the highest in ROI

SECTION ONE

trate the marketing mix to satisfy a targeted shopper making a specific trip to a specific store. The goal of shopper marketing is a better shopper experience, which in turn leads to sales growth and heightened loyalty to the brand and the store.

Shopper marketing requires much more granular insights, closer collaboration between manufacturers and retailers, and better integration of cross-functional areas than tradi- tional approaches. To effectively market to shoppers, companies must generate targeted insights for specific shopper segments, specific trip missions and even specific stores. They must be able to link shopper and consumer insights to develop solutions that delight both shopper and consumer alike. Commercializing these solutions requires much deeper relationships due to the need to share sensitive data and co-develop scalable, executable programs. Shopper marketers need to work seamlessly with brand and category market- ers as well as sales and trade promotions teams to deliver fully integrated programs that meet the needs of the manufacturer, retailer, and shopper.

Shopper marketing is not a destination; it is a means to an end. It fills a critical void in the industry’s goal of 360-degree marketing which integrates all marketing elements and stimuli into a single holistic story. It allows marketers to ensure that shoppers’ in-store experiences align with out-of-store brand connections. In short, shopper marketing helps marketers look at the whole picture of the people who buy and use their products.

While shopper marketing is a relatively new idea, industry experts and the participants in this study believe it will soon become the dominant concept for in-store selling. Of course, just as category management built on (but did not eliminate) brand management, so too shopper marketing builds on brand and category management. In fact, these disciplines will come to greater expression as shopper marketing enables better connections with consumers via their shopping experience.

The Promise: Returns & Relevance

While the executives we interviewed are understandably reluctant to publicize returns from investments in shopper marketing, the evidence from our research indicates that shopper marketing programs come out on top when compared to traditional in-store programs. In the 2008 GMA/Deloitte Shopper Marketing survey, 73 percent of the participating manu- facturers and 86 percent of the retailers rated shopper marketing programs among the top four activities that deliver a meaningful return on investment (ROI). Furthermore, 19 percent of the manufacturers and 50 percent of the retailers rank in-store activities as first in generating ROI.

Comparative ROI for Marketing Mix Elements

Manufacturer

Retailer

In-Store Activities Trade Promotions/ Displays Television

In-Store Activities

Print Interactive/Web

Interactive/Web Out-of-Store Couponing/FSIs

Radio

Print Radio

Television Out-of-Store Couponing/FSIs

Sponsorships Mobile Outdoor/Billboard

Mobile Outdoor/Billboard

Sponsorships

0%

20%

40%

60%

80%

100%

0%

20%

40%

60%

80%

100%

Percent respondents rating component in top 4 for ROI n=74

Percent respondents rating component in top 4 for ROI n=14

Note: In-Store Activities include communications/advertising, couponing, shopper centric activities, and comarketing programs that are in-store Source: 2008 GMA/Deloitte Shopper Marketing Survey

3

Document info
Document views78
Page views78
Page last viewedFri Dec 09 06:11:18 UTC 2016
Pages27
Paragraphs1979
Words20503

Comments