Shopper marketing evolves

06 May 2011

NEW YORK: Brand owners such as Colgate-Palmolive, PepsiCo and Procter & Gamble are modifying their approaches to shopper marketing.

Speaking to The Hub Magazine, Jim Figura, Colgate-Palmolive's global vice president, consumer research and insights, suggested perceived value is an essential component of meeting customer needs.

"In the oral-care category, about 75% of shoppers already know what they're going to buy and the other 25% usually buy what they bought before," he said.

"This means that it is much harder to get shoppers to switch to your brand at the shelf."

Product proliferation has also caused a decline in loyalty levels across many sectors, so that forging a bond based on factors beyond low prices becomes a challenge.

"The solution is to simplify the selection, offer more relevant choices to the shopper and make sure the packaging very quickly communicates relevant information," said Figura.

"As a manufacturer, that means we have to stay really focused on giving the shopper value, while making sure that we are getting the kind of lift we need, and a good return-on-investment."

Procter & Gamble, the parent of Tide and Pampers, is adopting a holistic model, shifting considerably beyond promotions to encompass areas like design, packaging, marketing and consumer insights.

"We work with our customer business development group to make sure that that whole shopping experience starts off by making it simple," said Marc Pritchard, P&G's global marketing and brand building officer.

"We then look at how to guide people, and how to delight them not only with simple navigation and information, but also the overall design aesthetic and the experience.

"So, it's kind of like moving that whole shopper-marketing craft to a new level."

Scott Finlow, vp, shopper and channel insights at PepsiCo Beverages North America, argued that traditional techniques still yield enormous benefits in building knowledge.

"The best way to understand shopper behavior is to develop our basic empathy for them. That involves spending time with them in their lives and on their shopper journey," he said.

"We want to understand how we can innovate to provide solutions to shopper problems. This really turns the innovation process on its head. We want to move the shopper upstream in our innovation process."

PepsiCo's studies have revealed the "mission" of each buyer - for example, a "quick trip" versus "stocking up" - shapes how likely they are to purchase a soft drink.

More broadly, the rise of new media is exerting a growing impact, fragmenting the audience and supplying unparalleled opportunities for targeting at the same time.

"Shoppers can be making informed decisions before they actually get to the store, so the role of the store in the shopping experience is changing," said Finlow.

Analysis conducted by Google covering popular habits during the 2010 holiday period showed a cross-channel strategy is becoming increasingly important.

It found 51% of consumers simply attended stores and bought products at least once, while 45% completed a transaction solely on the web.

But 35% also undertook research on the web and then acquired goods via a bricks and mortar outlet, and 14% went to a physical shop prior to snapping something up online.

Elsewhere, 21% had sourced information through the internet, used offline retailers to see the item concerned, and then ultimately obtained it from an ecommerce platform.

"Marketers and retailers realise that it's not just the last click that influenced the purchase," Dan Schock, Google's retail industry director, said.

"But maybe a visit to the store or the search that they did two weeks ago."

Data sourced from The Hub Magazine/AdAge; additional content by Warc staff