Shopper marketing takes many forms, including simple in-store off-invoice allowance reflections flagged at the shelf, club card discounts, in-store and FSI coupon programs, sweepstakes promotions, product samplings and tastings, giveaways, and combinations of two or more of these activities, as well as other campaigns focused directly on the shopper.
Large consumer packaged goods companies have learned one of the keys to successful shopper marketing is to target a specific program to a specific retail chains customer base. For example, chain A's customers might respond strongly to in-store coupons, while Chain B's shoppers barely participate or go for such campaigns.
Medium-size and smaller food and grocery companies, especially those in the natural and specialty foods space, tend not to seek out this data from retailers--and it is most often available--but rather will create a shopper marketing program, such as coupons or product sampling, and roll it out to all of the retail chains and independents in a market.
While sometimes this can work, more often by using this cookie cutter approach not only do natural and specialty foods' manufacturing and marketing companies miss out on all the sales gains they could achieve in a chain-specific shopper marketing program, they also spend far more money out of their budgets than is needed in order to receive less than successful results. In other words--this cookie cutter approach more often than not results in less bang for the promotional dollar buck than if the marketer would have taken a little more time to gather the available data from each chain and customize the shopper marketing program accordingly.
For example, if there are three major chains in a market, and Chain A's shopper data shows its shoppers respond best to in-store coupon programs, that's the way to go with that retailer.
Conversely, lets say Chain B's data shows such programs get a minimal response from its customers. However, Chain B's shoppers buy big when club card promotions of 15% -to- 20% discounts are conducted. Your road map for Chain B should be clear. No coupons please.
Lastly, lets examine our hypothetical Chain C. It happens to be an upscale regional chain of 90 stores. The upscale retailer's data shows its customers really don't respond all that well to price promotions of any kind--off invoice, in-store coupons, club card deals and the like. Rather, what turns Chain C's shoppers on, and gets them to purchase more, are food tastings or sampling events, especially when the product is gourmet or healthy.
Chain C's shoppers are foodies, and they like quality and new items. Give them a taste of something new in-store, and do so with flair, and they will buy two or three packages regardless of price.
Obviously then, using in-store coupons or a club card program would be a big mistake with this chain. Rather, a marketer wants to allocate its budget for tasting events, as that's where the action is with Chain C's shoppers--and increased product trial and sales.
As you can see, we went from a one-size shopper marketing program for all three hypothetical chains--which is more common among natural and specialty foods' marketers than it is uncommon--to a customized in-store shopper marketing program for each of the three chains.
The key to being able to do this retailer-specific shopper marketing is obtaining the data from the chain. However, if the data isn't there, a marketer can obtain plenty of good anecdotal data on which shopper marketing programs work best from category managers and merchandising managers at a given chain.
These experienced folks know what has worked and not worked in the past, and want marketer programs to work. Therefore, if asked, which often isn't the case, they will generally share all they know about what types of shopper marketing programs are effective in their stores.
In other words, all shopper marketing campaigns are not created equal because every retailer has a unique customer base. For a campaign to be successful, marketers should tailor it to their shoppers’ preferences and include media that influences them to purchase.
For example, according to findings released by Worthington, Ohio-based BIGresearch, a marketing intelligence firm, at the Promotion Marketing Association’s recent first annual Shopper Marketing Summit, 71.6% of Kroger shoppers say coupons influence their grocery purchases; while 59.2% of Safeway shoppers say the same. That's a significant difference in coupon use when it comes to the two respective chains and getting optimum bang for the promotional dollar buck.
The consumer packaged goods research firm conducted a study of shopper marketing looking at these two chains, the number one (Kroger Co.) and number three (Safeway Stores, Inc.) supermarket chains respectively in the U.S.
The data is valuable for food and grocery product marketers, sales promotions managers, National and regional sales managers, brokers and others who create shopper marketing programs.
Even more important is to remember and use the concept of chain and retailer-specific shopper marketing based on learning as much as can be learned about a particular food retailer's customer base and what shopper marketing programs they tend to respond to best. This is true whether the shopper marketing program is in-store only or a combination of in-store and external promotional activity. After all, it's all about getting the best return on investment a marketer can.
Below are some key findings about Kroger and Safeway shoppers, which BIGresearch presented at the recent Promotional Marketing Association's Shopper Marketing Summit:
>Although Kroger shoppers are more influenced by coupons than Safeway shoppers, this form of media is most likely to influence both groups in their grocery purchases. Newspaper inserts follow (51.1% for Kroger shoppers and 48.5% for Safeway shoppers). In-store promotion rounds out the top three as 45.9% of Kroger and 43.5% of Safeway shoppers said the media influences their grocery purchases.
>Kroger shoppers said that the in-store promotion that influences/greatly influences them the most is product samples (60.6%) followed by shelf coupons (47.8%) and store loyalty cards (47.6%).
>Product samples (58.5%) are also most likely to influence/greatly influence Safeway shoppers; however, reading product labels (48.9%) was second for them. Store loyalty cards (46.6%) came in at #3.
>Grocery shoppers “date around.” More than one-third (34.3%) of Kroger shoppers buy their health and beauty products at Wal-Mart. 22.5% of Safeway shoppers pick up their prescriptions at Walgreens.
>More than 75% of both Kroger and Safeway shoppers indicated that gas prices are impacting their spending. 28.8% of Kroger and 28% of Safeway shoppers said that they are spending less on groceries as a result of fluctuating gas prices.
BIGresearch arrived at this data by surveying 7,500-plus respondents and then averaging their responses together to obtain the percentages reported above. As with all survey research, remember you can generalize somewhat to the general population from a sample, especially a large one, but it isn't always the case.
Our key point in offering the Kroger and Safeway data from the research firm's survey isn't so much to give you that specific information or data, that's gravy. Rather, it's to illustrate the importance and power of obtaining retailer shopper-specific data both from specific retail chain's and outside sources, as well as garnering as much anecdotal information a marketer can from retail category managers, merchandising managers and local market region brokers, who have lots of experience setting up shopper marketing programs with specific chains.
Do this, and as a shopper marketing practitioner you will not only generate more trial of new products and increase promoted product sales during the shopper marketing campaigns, but you also will dramatically increase your ROI on each shopper marketing campaign you do.