Shopper marketing has potential for brands

26 April 2010

NEW YORK: Shopper marketing offers a unique way for brands and retailers to connect with consumers, but requires a highly nuanced approach to be successful.

The Retail Commission on Shopper Marketing, a trade body which boasts members including Coca-Cola, Wal-Mart and Supervalu, has published a new report seeking to add more rigour to this discipline.

Alongside input from its members, its findings were based on the views of senior executives from firms like Mars, Johnson & Johnson, Kimberly-Clark, Hershey, Hewlett Packard and Clorox.

In the first instance, it aimed to provide a clear definition of what shopper marketing entails, as a lack of clarity in this area is thought to have delayed the more widespread uptake of this strategy.

"Shopper Marketing is the use of insights-driven marketing and merchandising initiatives to satisfy the needs of targeted shoppers, enhance the shopping experience, and improve business results and brand equity for retailers and manufacturers," the study said.

More specifically, the consistent use of "research-driven knowledge" to understand the path to purchase – drawn from sources like scanners, loyalty cards, ethnography and qualitative studies – was said to be integral.

While consumers were argued to display certain common traits, focusing on particular customer segments can also deliver a "stronger, more lasting connection" and help retailers and manufacturers align their goals.

Finally, a holistic model that encompasses not only the in-store and e-commerce context but which also attempts to influence the initial choice of retailer and brand must be developed.

For example, advertisers looking to engage with busy mothers should offer "simple solutions" and fresh, healthy products that save time and money.

Reaching this audience can encompass everything from using websites like Twitter to promoting goods on in-store TV, as well as running deals on multiple purchases and distributing coupons at checkouts to build loyalty.

While the rivalry between national brands and own-label alternatives can put retailers and their suppliers in direct competition, collaboration must be at the centre of all shopper marketing programmes.

This is because store networks possess loyalty card and other data that manufacturers have no way to access, while brand owners have a more nuanced understanding of individual categories.

As such, a meaningful exchange of information can serve to benefit both sides, while such a partnership can also deliver benefits in terms of the funding and execution of shopper marketing schemes.

To achieve the best results, manufacturers need to adopt the marketing and segmentation models of retailers, providing for consistency across the in-store environment rather than a series of short-term tactical exercises.

Retailers must also ensure that they overcome the "historic shortcoming of in-store marketing" and offer engaging executions, an area where brand owners can provide an expert perspective.

"Shopper marketing planning" underpins all of this activity by establishing the common needs of retailers and suppliers, outlining the approach to communications and determining how to measure success.

"The potential benefits of shopper marketing extend well beyond short-term incremental sales to include cost reduction, profit growth and long-term revenue gain," the report concluded.

"They also include improved customer loyalty, shopper satisfaction and brand equity, efforts that historically have not been associated with in-store marketing but for which the retail environment has emerged as an ideal vehicle."

Data sourced from Retail Commission on Shopper Marketing; additional content by Warc staff