With media fragmentation driving them to it, brand marketers are finally waking up to the fact that retail is an incredibly attractive venue for reaching consumers.
“The potential of the store to create impressions and build brand equity is tremendous, and it should be thought of like any other marketing media,” Deloitte Consulting concluded in a 2007 Shopper Marketing study for the Grocery Manufacturers Association.
The report set out to determine the state of the emerging discipline. And what it found is that it is growing quite nicely: shopper marketing budgets are increasing by 21 percent, compared with the two percent growth of marketing budgets overall.
“Companies consider shopper marketing a competitive advantage and market leaders have started mobilizing their shopper marketing efforts by allocating more funds, restructuring their organizations, investing in technology and resources and re-evaluating their collaboration efforts with partners and service providers,” the study reported.
Of course, the allocation of more marketing dollars closer to the point of purchase is great news for packaging. As the focus on retail intensifies, marketers are considering packaging strategically more important in that it’s one of few in-store elements they can readily control.
But there’s one key difference for brands operating with a shopper marketing mindset-in this context, you can’t just seek to drive preference for your brand; you have to start with shoppers and retailers and then roll their needs back into your brand.
Retailers demand more
Retail consolidation is one reason. Fewer retailers now dominate the landscape and as they’ve become more powerful they’ve made demands on CPG marketers to think less about brand objectives and more about their own.
“As they have shaken out and concentrated, retailers have become brand builders,” says Al Witteman, managing director of retail strategy for TracyLocke, the Dallas-based marketing agency. “They’re doing what CPG companies did in the ’70s and ’80s, which is target the shopper, develop segments and understand their attitudes and behaviors.”
Sure, retailers want to be successful with individual brands. But, according to Witteman, they’re really more concerned about success across categories and with their customers.
“They are demanding equity products and programs from their [suppliers] to customize and differentiate themselves as brands,” he says. “I’ve seen some manufacturers continue their brand- and consumer-only push and the retailer says, ‘Hey I’m not here to build your brand. I’m here to build my category with my shopper, and, oh, by the way, if you want to sell your product to me you need to align to that.’”
Getting the retailers’ ear
There are ways, though, for brands to catch the ear of these prominent retailers and find commonalities in their differing objectives. One way is to tout your experience across multiple retailers; it’s perspective that any one retailer customer simply doesn’t have.
Another method, according to Julie Quick, vice president of account planning for Saatchi & Saatchi X, is to demonstrate that you have category competencies other brands don’t.
“Go deep in the business you’re in. That’s what your retail partners are counting on,” she says, offering the example of a leading CPG company that has taken ownership of understanding mothers.
“Retailers know this company is a mom expert in categories that range from cosmetics to laundry. And so when retailers want to understand mom, this is the supplier they call,” she explains. “It’s a good example of where, as a manufacturer, you want to be famous for something with retailers, because they’re looking for a deeper understanding of their business.”
CPG companies like Unilever are doing just that. Since 2005, the brand owner has released a series of “Trip Management” studies for retailers that report on the changing landscape of shopper missions. The research has detailed types of retail shopping trips (2005), offered insights on Hispanic shoppers (2006), Baby Boomers (2007) and, earlier this summer, reflected on how retailers might win shoppers over in turbulent times (their advice? work on the shopping experience).
Unilever’s goal is to provide value to its retail customers with shopper insights that can guide their assorting, merchandising and marketing efforts and increase the type of visits they may be losing or most want to gain.
Of course, this strategy makes tremendous sense for big CPG companies because they have a larger portfolio (and budget) to leverage. But brands of any size can develop shopper insights, expertise or category solutions that might curry favor with a retail customer.
Help is an upstart brand of over-the-counter medical products that launched this March with a shopper solutions orientation that any retailer can appreciate. The product name clearly and immediately explains the problem the product solves (e.g., Help, I Have a Headache describes the pain tablets) and a stripped down package design eliminates the complexity common in the healthcare category, making Help brand products effortless to shop. (See Packaging that Sells, p.42)
The insight to simplify the shopping experience is something the founder of Help stumbled across when, one day, he discovered that shopping for headache tablets amidst “shouting” product claims and complicated packaging made his pain worse. He later found a 2005 Campbell Soup Co. shopper survey that confirmed his experience, revealing that the OTC medication aisle is the most unpleasant aisle for consumers to shop.
Consumer or shopper?
One thing Help clearly understands is that there’s a significant difference between reaching out to a consumer and a shopper. Consumers have traditionally been analyzed and understood through demographic or psychographic variables, and that’s important information for a marketer. But it’s just not accurately descriptive of a shopper.
“The shopper is a consumer in a different state of mind. She’s on task and in the moment. She’s on a mission,” explains Saatchi’s Julie Quick.
The same consumer can become a different shopper in different retail formats depending on the purpose of her trip (e.g., a convenience store visit for a candy bar has emotional motivators versus a weekly grocery stock up for the family, which is a functional concern).
And while shopper insights are needed to understand how to act on those different mindsets, the greater implication is that effective shopper marketing is not about creating brand preference but, rather, about meeting in-the-moment shopper needs.
The challenge, according to Laura Jakobsen, senior director of brand strategy at Hornall Anderson Design Works in
“If I’m a cereal and I’m shelved next to a box ‘cut’ horizontally in the middle, I might do something vertically to stand out,” she says.
Retailers need CPG help
It would be logical to think retailers-ripe with loyalty card and other in-store data-would naturally lead the charge in mining such shopper information. And some of them are. But many lack the ability to properly interpret such data and deliver effective insights.
“There is an overabundance of shopper research tools, data and analytics, yet the true synthesis of findings to insights are not mastered by most,” says Lily Lev-Glick, vice president of research services for the New Jersey-based LG&P In-store Agency. “I don’t think most people working with this data truly understand the distinction between facts and findings and insights.”
And while Glick believes it’s a challenge that both retailers and brands face, others say that the strength of interpretation is currently on the side of CPGs.
“Retailers are behind the power curve,” says Saatchi’s Quick. “When retailers study shoppers they do it at the macro [level], so they appreciate the depth that manufacturers can dive into on a category or segment basis. Retailers are looking to brands for leadership.”
Just as Unilever has done with its Trip Management studies, leading CPG companies are taking up that mantle.
“Best in class companies are spending on shopper insights because it’s the new currency,” says TracyLocke’s Witteman. “Not only are they spending on shopper insights but they’re innovating against shopper insights-and not just promotion and communication ideas but products and packaging as well.”
Shopper insights in action
A good example of that, he says, is All Small & Mighty laundry detergent.
“One of the insights was that the shoppers-the heavy laundry users-called the large size of all laundry detergent a ‘hernia jug’,” he says. “So there was a lot of brainstorming to say, ‘Hey what can we do with this package. Can we put a handle on it so it hangs on the outside of cart? Can we put it on the second shelf?’”
The ultimate solution, of course, was to famously offer the detergent in a concentrated form and in a downsized package that innovated the way people could shop for laundry. The new smaller format is easier for shoppers to hold, carry and, once at home, to store.
“You can have the same brand essence, but understand that you’ve got to communicate that message differently to the consumer versus the shopper in-store,” says Witteman. “Shopper insights and product and packaging innovation based on that are really the new currency for building and activating your brand at retail.”
Not everyone can simply reinvent their packaging, though. There are also simpler, strategic executions of shopper insights. For instance, Julie Quick says it’s important to gather insights on what the shopper needs to know in order to buy you.
“Rather than focus on decision criteria, it’s more about deselection criteria,” she says. “Shoppers are master editors. Their primary job is to find out what to tune out so they can figure out what to tune in.”
If they deselect by brand, for instance, you need to consider whether brand identity is the largest element on your package. If the next deselection step is type or form, you need to assess whether those elements are easily identifiable. If they deselect on product attributes last, well, then maybe that information doesn’t need to be on the face of the package at all (a hard thought for most marketers to swallow).
“What we see is that brands are very fine tuned, as if they’re the only product on the shelf, in the category or in the store, when, in fact, the bigger question is whether there are cues that help distinguish the product for the shopper and help her deselect quickly,” Quick says. “Brand marketers need to make sure the shoppers’ deselection criteria maps to their package design.”
It becomes critically important when retailers’ “clean store” policies, which minimize the number of displays and other in-store communication, restrict brands to where packaging is often the only thing speaking for them inside the store.
“With clean store policies on the rise, packaging has to work harder to close shoppers,” says Quick. “The challenge is to provide functional communication as well as emotional inspiration.”
Mountain Dew is one brand that has managed to balance those two elements well, she says. The brand’s limited-edition series of aluminum bottles feature bold graphics in what Quick says is a “fun new way to engage”.
“If we spend too much time fine tuning packaging, we don’t spend enough time having fun with packaging and remembering it’s a way to surprise and delight the shopper and give them fresh ways to engage with the brand,” she says.
And with all there is to gain with an effective shopper marketing program, there’s also a caveat in that these programs must still be part of a holistic effort-they shouldn’t operate in a vacuum.
“Shoppers may finalize certain aspects of their decision at the shelf like quantity, flavor or brand-and that is where we have an opportunity to influence them,” says LG&P’s Lev-Glick. “But the process starts way before they enter the doors of the retailer.”
From how shoppers segment attitudinally to their emotional needs states in a category, to loyalty and even the DNA of the channel or retailer they shop in, says Lev-Glick “in order to be effective at the point of sale we need to understand the complete path to purchase.” BP