Shopper Marketing
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Shopper marketing is "understanding how one's target consumers behave as shoppers, in different channels and formats, and leveraging this intelligence to the benefit of all stakeholders, defined as brands, consumers, retailers and shoppers." [1]
Shopper marketing is therefore not limited to in-store marketing activities, a common and highly inaccurate assumption that impairs the spread of the industry definition described. Unilever defines a shopper insight, an insight upon which shopper marketing is based - as a "focus on the process that takes place between that first thought the consumer has about purchasing an item, all the way through the selection of that item." [2]
Shopper marketing assumes that consumers and shoppers are not always - or even often - the same. For instance, a shopper for pet food products is highly unlikely to be the consumer.
In shopper marketing, manufacturers target portions of their marketing investment at specific retailers or retail environments. Such targeting is dependent on congruency of objectives, targets and strategies between the manufacturer and a given retailer or a given type of retail environment.
A significant factor in the rise of shopper marketing is the availability of high quality data from which insights may be gleaned to help shape strategic plans. According to recent industry studies, manufacturer investment in shopper marketing is growing more than 21% annually [3].
For instance, Procter & Gamble, according to the company’s financial statements, invests at least 500 million dollars in shopper marketing each year [4]. Procter & Gamble's Wal-Mart Customer Team as well as ThompsonMurray (now Saatchi & Saatchi X), are considered by many as the original pioneers in true Shopper Marketing.
The following statistics have caused the reapportionment of marketing investment from consumer marketing to shopper marketing (it must be noted that what follows is ultimately very misleading; each brand performs differently based on shopper need states, shopper trip types, retailer formats, brand importance, brand relevance and a host of other factors:
- 70 % of brand selections are made at stores [5]
- 68 % of buying decisions are unplanned [6]
- 5 % are loyal to the brand of one product group [7]
- Practitioners believe that effective shopper marketing is increasingly important to achieve success in the marketplace [8]
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[edit] Partial areas
Shopper marketing is rooted in consumer marketing and the principles of consumer marketing often apply to shopper marketing. For instance, shopper marketing refers to the marketing stimulus reaching the shopper, which is based on an understanding of the shopper’s buying behaviour. Like the traditional marketing mix, shopper marketing can be divided into four P's: product; price; place; and promotion.
- Product: size, shape, color, material, packing, packing messages, and graphics.
- Price: discounts, bundled offers, price communication, and coupons.
- Place: store concept, lighting, shelves, and placing of special presentations.
- Promotion: packing promotions, store promotions, promotion communications, special presentations, in-store TV, floor stickers, as well as advertising on shopping carts and baskets
[edit] Buying behaviour data
Several different data collection methods provide information on the shopper’s buying behavior of a given brand: observations, intercepts, focus groups, diaries, point-of-sale and other data.
Observations made before entereing a store, in the store, and after exiting a store clarify when, what, where, why, who and how shopper behavior occurs.
Issues to be noted consist of, for example: the length of the buying process, the items the shopper noticed, touched, studied, the items the shopper bought, as well as the purchase methods influencing the process. Interviews help uncover motives guiding the buying behaviors. The matters commonly clarified are: the likelihood of product substitution and the identification of substitutes; values and attitudes; desires and motivational factors; as well as lifestyle and life situation. Point-of-sale data provide information on which products were bought, when and for how much (and sometimes by whom when a frequent shopper card can be used).
[edit] Segmenting shoppers
When conducting shopper segmenting, the market is divided into essential and measurable groups, that is, segments on the basis of the buying behaviour data. Shopper segmenting makes it easier to answer the requirements of individual segments. For example, price-sensitive and traditional shoppers clearly differ from one another as far as their buying behaviour is concerned. Segmenting makes it possible to target marketing measures at the most profitable shoppers.
[edit] Examples of Shopper segmenting
- TESCO [9]
- Finer Foods
- Healthy
- Convenience
- Price Sensitive
- Mainstream
- Traditional
- Social Shoppers
- WAL-MART[10]
- Brand Aspirationals
- Price Value Shoppers
- Trendy Quality Seekers
- Price Sensitive Affluents
- One Stop Shoppers
- Conscientious Objectors
- SAFEWAY[11]
- Value-Seeking
- Variety-Seeking
- Brand-Seeking
- Simplicity-Seeking
- Discovery-Seeking
- Quality-Seeking
[edit] References
1 Hoyt & Company, LLC May, 2006
2 Advertising Age October 01, 2007: What's In Store: The Rise of Shopper Marketing:
http://www.matthiasmoneyboard.com/documents/articles/Advertising%20Age%20-%20The%20Rise%20of%20Shopper%20Marketing.pdf
3 GMA/Deloitte Consulting LLP 2007 Shopper Marketing Study Results:
http://www.gmaonline.org/publications/docs/2007/shoppermarketing.pdf
4 Nielsen Media Research:
http://www.mediabuyerplanner.com/2006/08/29/nielsen_instore_ads_sway_68/
5 POPAI Consumer Buying Habits Study:
http://www.ogilvyaction.com/Pages/ShopperMarketing.aspx accessed 7/2/07.
6 ECR Research: http://www.oxfordsm.com/research.php?shopperMarketing
7 TESCO: A CASE STUDY IN SUPERMARKET EXCELLENCE July 2004
http://www.coriolisresearch.com/pdfs/coriolis_tesco_study_in_excellence.pdf
8 Category Segmentation. Consumer segments TBA April ‘07. SOURCE: Hoyt & Company
9 Category Segmentation. Consumer segments TBA April ‘07. SOURCE: Hoyt & Company
http://hubmagazine.com/archives/the_hub/2007/mar_apr/the_hub17_hoyt.pdf
