Shoppers dictate the future

Aperio FMCG ConsultingShoppers dictate Manufactures and Retailer’s future

By Jenny Loomes, Aperio Associate Consultant

In a world where shopper and consumer behaviour is proving to be very difficult to predict, it is becoming increasingly difficult to market effectively and more efficiently to consumers.

As manufactures aim is to sell more product to more shoppers more often at a profit, retailers want more feet in their stores, bigger basket spend, healthy category margins and shopper loyalty. Retailers and manufacturers must combine their efforts to understand the segment that dictates both their futures – the shopper.

Changing shopper behaviour at the point of purchase in favour of your product requires a new way of thinking and marketing. An integrated marketing approach is required where customer, brand, trade and shopper marketing teams deliver on the shopper’s emotional and functional needs at the point of purchase in one seamless strategy: Shopper Marketing provides the route map for such a strategy.

Retailers and manufacturers must combine their efforts to understand the segment that dictates both their futures – the shopper.

Understand Shopper Decision Making

Shoppers want us to help them make an informed decision and this requires us to navigate their decision making process. We need to understand what the shopper is trying to achieve through the shopping process (functional and emotional needs) and how they go about making their purchase decisions. We need to understand the touch points in their shopping journey and where things go wrong or right for your brand (existing blockages or opportunities).

None of this can happens unless manufacturers and retailers have a good understanding of who their shoppers are.

With all the research and data sources available today there is enough information to draw insights to guide our understanding of the shopper decision making journey.

Loyal is not always Loyal

We had a client who believed they had a strong loyal shopper base, however upon delving further it was found that these ‘loyal’ shoppers may purchase a product repeatedly, but only when it is discounted.

There is a big difference between a shopper being loyal to a brand when there is discount involved and a shopper purchasing a brand repeatedly even at full price. A loyal shopper purchasing five months’ worth of laundry detergents when on promotion won’t be back in the detergent aisle for another five months, this leads to brand value erosion. This shopper also sets a new perceived value for your brand and will only purchase when it is at the price point acceptable to them.

 

The aim of Shopper Marketing is to move away from the price agenda and start focusing on the product benefits and brand value to the shopper.

 

Shopper Marketing in AfricaLet’s take liquor in South Africa, especially in the certain categories it is a habitual grab and go shop. The shopper knows where the category is they habitually shop, they grab their brand of preference and leave. No exploring takes place. Why? We have not given them enough reasons to spend more shopper seconds in the different categories in store.

Retailers and manufactures have been following the same rigid approach when it comes to liquor store layout, merchandising and shopper communication.

No shopper engagement is encouraged. In a recent study published in the Progressive Grocer, Napa Technology looked at ‘What motivates Wine Shoppers’. After interviewing 40 Wine Retailers they concluded that a ‘try it before you buy it’ sales tactic led to increased sales of premium wines between 15 and 20%. Shoppers were also spending more time in store, willing to spend more on wines they could taste first and overall store loyalty increased.

Shopper Values

The bottom line is: shoppers are “savier” and more adventurous. At the same time they are shopping with a new set of values. Most shoppers don’t equate value with price alone. Many consider deeper values that act as filters, guiding purchase decisions across many categories.

These values include:

  • Simplicity: “Make my life easier”
  • Real Value: “Make a difference to me”
  • Deserved Indulgence: “Give me relevant choice and empower me”
  • Engagement at POP: “Don’t confuse me, save me time”
  • Contribution to the environment: A brand's carbon footprint

Opportunities to turn these insights into action require timely understanding of how shoppers use these filters to select where they shop, what to buy and whether or not your company and its brands are on or off their new radar.

Why Shopper Marketing?

Shopper Marketing asks the shopper questions, what, where, why, who, when? This tells us more about the shopper’s behavior in terms of shopping missions, shopping mode, basket size, touch point interaction, why not, where not, and the overall decision process. The answers result in developing strong brand propositions relevant to the shopper to assist us in binding our shoppers emotionally and functionally to our brands.

The Shopper is at the heart of all activity that drives true differentiation and builds shopper loyalty for both manufacturer and supplier in store. The pressure on retailer’s margins, active suppliers efforts, coupled with more informed and discerning shoppers, means that strategic Shopper Marketing is no longer an option it’s becoming mandatory.