Focus on shopper marketing

Shopper marketing (iStock)The Lab is proud to announce our partnership with the In-Store Marketing Institute. We’ve partnered to provide our clients with greater insight into the shopper marketing field, and the Institute will be an integral part of our Retail Experience Center which is opening in 2010. We sat down over email to discuss what shopper marketing is and why it’s so important to retailers right now.

Lab: Shopper Marketing seems like hot new buzzword for marketers—for our readers who may not be familiar with in-store marking, how do you define it?

Institute: You’re right that “shopper marketing” is a hot area. So hot, in fact, that a fair amount of time and energy is being spent on a workable industry-wide definition by some of the major study groups, such as our “Retail Commission on Shopper Marketing.”

We’ve seen dozens — literally — of definitions, and understand that different brand marketers, retailers and agencies will put a slightly different spin on it, depending on their point of view and business model. The Institute came up with a definition two years ago that appears in our very popular glossary, and we believe it still does the job:

Shopper marketing is the use of strategic insights into the shopper mindset to drive effective marketing and merchandising activity in a specific store environment. Key elements of effective shopper marketing include:
-An organizational culture that embraces shopper insights as a key component of the marketing strategy

-Strong collaboration between retailer and brand marketer, in which both sides work toward mutually beneficial objectives

-The development of programs that, in addition to driving sales, can build brand equity for both product and retailer by engaging shoppers in relevant ways.

Lab: What do you find is the biggest misconceptions people/marketers/agencies have about marketing to consumers in-store?

Institute: Well, the basic  “consumer/shopper” dichotomy still confuses some people.  There are classic products such as dog food where the consumer clearly is different from the shopper. But even when they are the same person, marketers must come to understand that the consumer mindset is different from the shopper mindset.

P&G’s A.G. Lafley put it into a broader perspective when he wrote about the “Moments of Truth.”  The Second Moment of Truth was the one that marketing and advertising imagery traditionally focus on:  The experience of using or consuming a product.   But Lafley and P&G realized that a “First Moment of Truth” mattered at least as much:  The moment “when consumers stand in front of a store shelf … and decide whether to buy a P&G brand, or a competing product.”

For example, a traditional detergent TV commercial will cover any number of performance features and benefits along with images that raise brand recognition.  But in-store, you only have a few seconds to convey any particular message so, after doing proper research, you try to identify the thing  (i.e. “it’s concentrated” — ergo, you can use less — ergo, the bottle is easier to carry) that resonates loudest with someone in a quick-decision shopping mindset.  This is the “insight.”  You then try to find the right in-store display or advertising vehicles that will help activate that insight.

Researchers can find lots of insights for you. What is really difficult, however, is identifying which insight actually matters most to shoppers, and the best way to activate it in-store.

P&G is now taking it all a step further with its “store back” program. The goal is to ensure that P&G’s advertising and marketing partners place the retail environment at the forefront of their thinking when they develop new proposals.

“It means you have to have the end in mind when you’re coming up with the idea. If it doesn’t work at the store, it’s a miss.”

Rather than have agencies “rework” ads for the retail environment, the idea is to bring the shopper-marketing insight work into the upstream ideation process.  It’s a simple idea — but revolutionary in its potential impact.

Lab: What role do you see emerging media technologies and practices playing in the future of in-store marketing?

Institute: Emerging media will play a significant role in the future of in-store marketing, especially technologies that can help marketers deliver targeted messages to specific consumers. Traditional media, whether you’re talking about TV advertising or P-O-P displays, simply wasn’t designed for targeted messaging, either at the individual-shopper or even just the store level. Digital signage networks can cost-effectively bring the message down to the store-level, and devices such as personal shopping assistants can customize information for the individual shopper. Both of those technologies, however, require significant financial investments, which is why most retailers have been reluctant to adopt them, and why many third-party operators have failed to develop sustainable business models.

That issue can be circumvented with mobile marketing through smart phones, which doesn’t require any physical infrastructure, isn’t limited by location and, perhaps most importantly, can create a two-way dialog with consumers anywhere along the path to purchase.

Lab: What brands are doing shopper marketing well? – who are the ones to watch?  who are the leaders?

Institute: Kraft Foods has done an impressive job on two fronts. The company has adopted new technologies to present time-starved consumers with helpful meal ideas through a very popular iPhone app. And they’ve addressed that same consumer need for “meal solutions” in stores by creating specific programs in collaboration with a number of key retailers.

Procter & Gamble, of course, has been a leader in this area, and realized much earlier than most manufacturers that the need to “delight the shopper” sometimes takes precedence over delivering a more traditional brand message. That’s why much of their work with retailers involves category, aisle or department “reinventions” that don’t necessarily result in any overt exposure for its own brands. More recently, other manufacturers such as Frito-Lay and Dr Pepper Snapple Group have devoted more resources to such “brand-agnostic” initiatives. They understand that an improved shopping experience, as well as a stronger relationship with key retailers, can have a great impact on long-term sales.

Lab: What’s next for in-store marketing?

Institute: In-Store Marketing has a way to go before it gets all the way to bright. Manufacturers and retailers, for example, are just beginning to tweak their organizations so they’re properly aligned for collaboration.  More and better measurement metrics and ROI benchmarks need to be developed and refined.  And while we’re seeing a surge of interest in cross-channel marketing and the “path to purchase,” there’s a lot of work to be done in understanding which combinations of touchpoints truly influence in-store decision-making —  The Web? Mobile? Coupons? Sampling?
Those are just a few of the bigger issues. Unraveling those mysteries should keep us busy for, oh… the next few months, at least!

Learn more about the In-Store Marketing Institute.