There’s been a lot of media huff and puff lately about the growth of online shopping in Australia. But the larger revolution – albeit quieter from a media point of view – is the change in shopper behaviour before they purchase, brought about by the ability to search online for product information before they even get to a store.

This has implications for the ‘path to purchase’ and for impulse purchases. As the degree of prestore search increases, so does the degree of planning.

I thought it worthwhile having a look at this and its implications for what stores will need to do in order to retain a role broader than being a mere transaction zone. The game SHOULD be much bigger than just range and layout, which are hygiene, navigation and deselection (narrowing down) factors, they’re not strategy. Once you’ve got your range and layout right, then what are you going to do to increase your category sales in an environment where shoppers are getting harder to influence?

THE PATH TO PURCHASE IS BLURRING

Traditionally the path to purchase was thought to be prestore and instore.

Prestore was when shoppers were making lists and were the passive subjects of advertising and promotional stimulus. Prestore was about consideration.

Instore was where the shopper was influenced on which of their considered products in a category they would buy. Instore was where the conversion happened.

Now the model is blurred. We have conversion happening prestore, and consideration happening instore.

The advent of mobile search and compare is creating consideration at shelf, not just conversion. An example is a shopper standing in a shoe store looking at training shoes. The shopper can whip out their mobile phone and price compare the shoe in the store they are in versus somewhere else. And if the somewhere else is nearby they may change their store choice. You’re then relying on your store staff service and sales capabilities to keep the shopper in your store. Or they might be looking at a shoe on shelf and if a staff member isn’t available, look up the product information online using their smartphone.

This isn’t just for the ‘few’ who have smartphones, by the way. Australia has one of the highest smartphone penetrations in the world, currently nearing 40%, and set to hit 60% by the end of 2012.

THE ‘FIRST MOMENT OF TRUTH’ – JUST ONE OF A SERIES OF TRUTH MOMENTS

P&G are largely credited with coining the expression the ‘First Moment of Truth’ to describe the shopper experience at shelf, where theoretically all the prestore and instore marketing and category management efforts come together to create a purchase decision at the shelf (or offlocation display).

Now we have not only a First Moment of Truth, but a Zero Moment of Truth (prestore) and a Second Moment of Truth (post store, when the purchased product is actually trialled).

Google’s recent report (April 2011) on the Zero Moment of Truth (ZMOT), whilst not expressing a new idea, has probably been the first to articulate it clearly.

It identifies the shift in shopper behaviour by differentiating advertising and promotional stimulus (considered passive) from online and mobile search (proactive).

The ZMOT is when a shopper actively searches for product information online. This may be from a retailer’s website, manufacturer’s website, product reviews, social media such as Facebook, and blogs (which are a form of organized word of mouth), among other things a search engine may dig up. ZMOT is everywhere because it can be accessed whilst mobile, and it’s not just for high involvement purchase categories like cars and entertainment systems. Shoppers are actively searching prestore in product categories ranging from plasticware to pet food.

The Second Moment of Truth (SMOT) – product trial, usage and experience – has an impact on ZMOT. Users of a product when they get it home may post a comment about the product (and their purchase experience) on a social media website, or a product review on a blog or website. These reviews then contribute to the next shopper’s ZMOT findings.  In a recent report from IBM it was stated that a shopper is more likely to believe a review from a stranger than what a retailer or manufacturer says about a product. This demonstrates the need/role for informal product advocates and ambassadors (rather than paid celebrity sponsors).

Whilst marketers can’t control what shoppers post for SMOT, smart marketers in manufacturing can use ZMOT tools – including offers – to mitigate retailer clean store policies.

So now we have a model where advertising stimulus and promotions (Stimulus) may be prestore or instore. The ZMOT is everywhere (accessed prestore, instore, in transit) as is the SMOT. The First Moment of Truth may now be online, or in bricks and mortar stores, or multichannel (eg order online, pick up instore or order instore, have delivered to your home).

I haven’t figured out how to draw this yet in a pretty diagram. Stay tuned. It’ll probably look like one of those communication network diagrams like a cloud with lots of lines where everything connects to everything else.

THE DEGREE OF PLANNING IS INCREASING

The more ZMOT proactive product search that occurs, the greater the degree of pre-store product planning.

Depending on the channel, category and trip type, there may be a lot or a little impulse. On average in Australia across a number of shopper research projects in the past few years, we’ve found that most categories in grocery are planned down to product or brand level between 60% and 70%. That is within a specific category.

But this doesn’t mean you can’t get switch, upgrade or impulse instore, or that a shopper doesn’t buy other categories/products on impulse. We know that around 80% of shoppers deviate from (add to) their grocery shopping list once instore. That is, they come in for 4 things totaling $20 and wander out $50 and 8 items later.

What it does mean is that you need to work harder to interrupt them within a given category.

Interestingly, the recent Coles and Woolworths smartphone apps have a number of functions that will actually increase the degree of planning (My List, My Specials, where items are located in my store so I can find them faster etc) with fewer of the apps to increase browse time/impulse/engagement (recipe finders being the main one at this point).

In an environment where retailers have trained shoppers to expect low prices as the cost of entry and promotional strategies have simply shifted the majority of a category’s sales to on promotion (and deflated category value in the process), the crying need instore is for INTERRUPTION. Shoppers want to discover, be surprised, delighted, and informed … this requires engagement and theatre.

THE NEED TO PLAY TO EMOTIONAL, NOT JUST RATIONAL

In ‘The Buying Brain’, Dr AK Pradeep emphasizes that 95% of human decision making is unconscious and emotional not subconscious and rational. He outlines 7 shopper experience dimensions. In no particular order, these are Information, Interaction, Entertainment, Community, Education, Simplicity, and Self Worth. These serve as a useful ‘retail health’ scorecard for a brand or category.

It’s evident from this list that grocery retailing only really talks to simplicity (ease of shop) at the moment, with perhaps some bits of information and some Community (charity) activities. But supermarkets have work to do on the interaction, entertainment, education and self worth dimensions.

When you look at the traditional point of purchase drivers (range, space & layout, visibility & display, price, promotion and persuasion) there are 3 that are rational (range, space, price) and 3 that are more emotional (display/theatre, promotion, persuasion).

Clean store policies are effectively stripping the emotion out of a shopping trip that for many is already a grudge trip or considered a chore.

When we run shopper research typically the retailers want to understand what their range and layout should be, and most of what shoppers want is not just a layout that makes sense but typically category information, samples, tastings and demonstrations. They want things that will help them with solutions and keep them entertained.

Interruption and engagement – the levers to pull for impulse sales and category growth – will come from more theatre; better thought through relevant/tailored/interactive promotions that pull levers other than price, and from personalized service.

In the brave new world of shopper-controlled retailing, the retailers who retain relevance will be those who can interrupt, surprise and delight by playing to emotions.

Back in June last year we discussed how pharmacies are retail stores and thus in competition with other retail types. And that you need to determine your retail point of difference is, then find the right tools and platforms to promote it.

Here we’re going to look at what the different retail positions are so you can identify which one/s are right for you to use.

Why Shoppers Visit Pharmacy Is Different To Other Retail Types

Summarised in Figure 1 are the main different types of shopping trip by major retail channel. You can see that Distress (which is NOT price sensitive) and Script Fill are unique to pharmacy. Services is also unique to pharmacy, in the types of services that are offered.

Figure 1: Main Trip Types by Retail Channel. © ShopAbility 2011

SHOPPERS CHOOSE YOU BASED ON THE TYPE OF PHARMACY YOU ARE

Our article series on the different kinds of pharmacies (inner city, traditional community, suburban one stop, shopping centre generalist, discounter, medical centre) highlighted the differences in why shoppers choose you.

This is summarised in Figure 2. The key column to pay attention to is the What’s Most Important to Your Shopper, as this is the basis for your retail position.

Figure 2: Pharmacy Channel Segment Overview. © ShopAbility 2009

Each segment has its opportunities and challenges. And the challenge if you’re a retail banner is that you will have stores covering different segments, which means you need to allow flexibility for stores to do local area marketing that will play to their segment type.

MAIN RETAIL POSITIONS, AND SOME EXAMPLES

The key retail positions are Range, Service, Price/Value, and Experience.

Below is a map of these and a summary of the pharmacy segments. This enables you to see where each pharmacy segment should logically position itself. And for nearly all of them it is NOT price, because supermarkets can’t own that and you can’t compete in the long term … the exception is Discounters.

Note that there are different types of Range (breadth vs depth, specialist, innovation) and Service (speed, excellence, range of services offered). Depending on your pharmacy type you could position on Range – but in a couple of selected categories where you would go deep (eg Baby if you’re located  in a mortgage belt or near a hospital/maternity ward) rather than trying to own breadth of range across everything.

You can position across two (eg range and service) but from a communications point of view it’s stronger to select only one. It doesn’t mean you don’t do the others, but you need to pick one to be known for.

RANGE BREADTH EXAMPLE: BUNNINGS

Bunnings owns range breadth. People go to Bunnings just to browse. Shoppers expect that they will be able to get everything hardware and DIY related at Bunnings because of the strength of this positioning  While Bunnings now also offers a lowest price guarantee, they built their business on the strength of their range (and have started acting on Experience/Advice as well).

Another example of range breadth, and depth, positioning is  Dan Murphy’s, who are now Australia’s largest retailer for premium wines.  Dan Murphy’s has used range to position itself as a destination for wine in the Australian market. The strength of this positioning sees shoppers go out of their way to visit a Dan Murphy’s store, often travelling up to 20 minutes. While they also have a lowest price guarantee this has been replicated by 1^st Choice and therefore is not the primary point of difference for them.

Range innovation is exemplified by Ikea, who are renowned worldwide for their innovation and leadership within the home furnishings market. IKEA are known for their constantly redesigned, affordable range and unique store layouts and display.

SERVICE EXAMPLE: MCDONALDS SPEED OF SERVICE

It’s not called fast food for no reason – McDonald’s are in the business of fast service (although their internal mantra is QSCV – Quality, Service, Convenience, Value). In a recent campaign, McDonald’s promised drive thru service in under 3mins or your next Big Mac free … putting their money where their mouth is and reinforcing their speed of service position. This sort of positioning is an opportunity for shopping centre pharmacies where speed of script drop-off/script fill is of paramount importance

SERVICE EXCELLENCE – NORDSTROM DEPARTMENT STORES

A US-based luxury department store known around the world for their exceptional service levels Nordstrom was one of the few large department store retailers in the US to survive the GFC relatively unscathed as it’s not just about range and price there.

Led from the top the company has placed excellence in customer service at the heart of their strategy, with a 75-word ‘service mantra’ placing the needs of the shopper above the needs of Nordstrom, and  ‘The Nordstrom Way to Customer Service Excellence’ the handbook which contains the secret to their unsurpassed levels of customer service.

SERVICES OFFERING: WALGREENS, CVS, RITE AID (USA)

Walgreens is a US based drugstore chain which offers its customers a range of complimentary services which drive foot traffic, including optical, health checks, flu shots and passport photos as well as instore clinics … go to the doctor instore and get your script filled in the same place

Script fill services include automated script fill including mobile applications for this as well as an instore express script fill service

CVS and RiteAid (other US drugstore chains) have store-in-store GNC Livewell areas, staffed with GNC experts.

PRICE/VALUE OPERATOR: COSTCO

Costco uses its buying power to buy in bulk and sell to their members at significantly cheaper prices. They range everything from canned tomatoes to Gucci jeans and Tiffany diamond rings. They job lot (ie 60% of their stock is ‘short term only’ rather than core range, promoting a ‘treasure hunt’ mentality on bigger ticket items.

Shoppers must be a Costco member to shop in these stores … like Campbell’s Cash N Carry, on steroids. Minimal shop fit out so all savings go into providing lowest cost. Retail pricing model is cost price plus 15% … across the board.

Price/Value operators are generally no frills, with minimal if any service. Another example is Aldi, renowned for its bag-your-own groceries and minimalist shopping experience.

EXPERIENCE AND EXPERIENTIAL POSITION: APPLE STORES

Apple stores have some of the highest $ sales per square metre in the world, and it’s because they focus on the experience rather than trying to overtly sell you something. Aside from having fabulously design friendly hip products to promote, Apple retail stores deliver on their position of experience in two ways:

1. The level of experience of their employees is demonstrated in-store at their Genius Bar, their technically service department
2. The experience their shoppers have in-store trialing the latest Apple offers. Shoppers are encouraged to engage with the products and return with their Apple products to attend tutorials in-store.

Best Buy (consumer electronics chain, like Good Guys or JB Hifi) in the USA is another example, with their Geek Squad service centres. Dick Smith (DSE) are trying to own this position in Australia with their ‘techxperts’ positioning.

This positioning is relevant for retail channels with a lot of complex and little-understood categories (many pharmacy categories eg vitamins fall under this label).

So they’re the major retail positions by which you can differentiate yourself. Strive for uniqueness – a point of difference is only unique if your competitors can’t do what you do either as well as you do or in the same way.

Imitation is the sincerest form of flattery … but, in business, it can also take away your competitive advantage.

You should always aim to be unique, not replicable (nor replicate others).

Next time we’ll look at the best tools and vehicles to promote your point of difference, once you’ve determined what it is.

Until next time!

Working within the Shopper Marketing discipline we are often asked for the purchase decision hierarchy (PDH), consumer decision tree (CDT) or shopper decision tree (SDT) for a particular category. This raises a number of questions… Are they the same thing? Is there just one per category? What implications and applications do they have for retailers and manufacturers?

PDH, CDT or SDT?

The terms PDH, CDT and SDT are often interchanged and typically thought of as the same thing. But are they? As the name indicates the CDT is from the perspective of the consumer rather than the shopper. Whereas, the focus of the PDH or SDT, is the shopper.

Building brand equity in the mind of the consumer and creating consumer demand is the domain of the marketing department within a supplier or manufacturer business. They create demand for brands, give consumers a reason to believe that their brand has a unique point of difference and reason for being. This does not mean that the shopper is inconsequential to a marketer; it just provides another dimension for them to consider. Shoppers are the people who are making the decision at the point of purchase. They make the ultimate decision as to what goes into the trolley or basket. They are the ones navigating the shelf and selecting from the range presented. Therefore, it makes more sense, from a retail execution point of view to consider purchase decision hierarchies (otherwise known as shopper decision trees) rather than a consumer decision tree.

ONE PER CATEGORY?

So, is there just one per category? It is highly unlikely that there is. In our experience, there are different shopper segments that exist within a category and for each of these segments there is a different focus or priority. They may be price sensitive which means price will be higher on their PDH. They may be highly visual, meaning packaging and brand becomes key in their decision making process. Others could be looking for functionality and convenience so packaging functionality, such as the ability to reseal or the contents being individually wrapped, may influence their decision. See below for a simplified example of how this might work for a particular category.

The segments that exist are likely to vary by category so the key is to understand your shoppers and what is important to them. Quantifying the segments will allow you to understand not just how many of each shopper type there are but more importantly the value they represent to the category. Understanding the number and the value they represent will give you a picture of the most dominant PDH which will give you something solid to work with.

Purchase decision hierarchies are not usually as simple as those shown above. There are often a number of lenses or influences that come into play before the shopper reaches the store or the shelf. These variables again will vary by category but could include anything from the number of people they are buying for, their level of involvement with the category, to health concerns or even the mood the shopper is in. These lenses or influences can be represented above the hierarchy to demonstrate other considerations that influence the decision prior to the shelf. They can be shown as per the example below:

What this demonstrates is that purchase decision hierarchies can be more complicated that first anticipated. It isn’t typically as simple as a ladder with four variables, there are lenses, influences and shopper segments to take into consideration but once you unlock the puzzle it can be a powerful tool for both retailers and manufacturers…but not just as the basis for shelf layouts. PDH have impacts on packaging, marketing communications, point of sale, etc which we will examine now.

IMPLICATIONS AND APPLICATIONS

So, how can PDHs be used? Understanding shopper segments, and their value will help you to establish a dominant PDH, however it will never be a case of one size fits all. PDHs have different implications and applications for retailers and manufacturers but in both cases they present opportunities for development of the category and the brands and products that make up the category.

The most common application for a PDH is within shelf management and the development of shelf layouts. That said, within some categories it can be dangerous to lay out a category to represent a literal translation of the PDH as this can make the category difficult for shoppers to navigate and rather than assisting the decision making process will only act to confuse shoppers.

It is important when developing a shelf layout to understand not only the decision-making process but also the beacons and navigation aids that shoppers use to visually segment the category and make sense of the shelf. In a category we examined recently functionality was the highest variable on the PDH however shoppers navigated the category by brand. Where the shelf was laid out according to functionality, shoppers found it difficult to find what they were looking for. Rather, their preference was for brand blocking which, in this case meant colour blocking, and aided navigation. From there they would look for the functionality of each of the products within the brand ranges.

Another valuable outcome of understanding the PDH for retailers is the opportunity that arises for store clustering. Understanding shopper segments and catering to these segments through layouts and ranging developed according to the variables prioritised within their PDH can lead to category growth, increased profitability and greater shopper satisfaction.

Other opportunities come from understanding the PDH to develop category navigation aids and point of sale which may help to enhance the shopper experience.

From a manufacturer point of view, the application of the PDH is even more diverse. Understanding how different shopper segments make their shopping decisions can assist with new product development, packaging design and brand messaging. Uncovering a segment that is, for example, more visual than price sensitive may provide an opportunity for a premium offering with greater focus on stimulating the senses rather than competing on price.

It can also help to understand the elements of packaging requiring increased emphasis and those that may be dialed down. Strong communication of a variable that is high on the PDH can act to differentiate one brand from another, strengthening the brands reason for being and giving it a unique point of difference, in turn aiding value growth as price potentially becomes less important.

Purchase decision hierarchies can often be more complex than they appear on the surface, however, once unlocked can be a very powerful tool for retailers and manufacturers alike. They are even more powerful when shopper segments can be identified, quantified and a value attached to each segment. Retailers and manufacturers who can harness this information to develop ranges, layouts, products and communications which are tailored to these segments will drive category growth and value.

Until next time!

Back in February 2010 we discussed the evolution of category management into shopper marketing in our article ‘Where To Shopper Marketing?”. In that article, we outlined some of the key themes coming out of shopper marketing conferences in the USA as being:

• Tailored, not Mass
• Occasions and Trip Types, not just Product and Price
• Emotional, not just Rational
• Integration, not Isolation
• Impact, not just Activity.

These themes were emphasised and brought to life in more detail at the recent Shopper Marketing Live event at Darling Harbour, which drew over 1,000 industry professionals. They also correlate strongly to some of the key findings that came out of the 2010 POPAI/ShopAbility Shopper Marketing Industry Benchmark Survey.

Here’s my wrap up of the key outtakes from the conference, with some implications. Everyone will have a different take depending on what sessions they attended, but I’ve had a crack at capturing the recurring themes cross-session. We’ll discuss each of these areas in more detail in subsequent articles (and post my findings from the upcoming Shopper Insights in Action conference in Chicago in July).

SHOPPER INSIGHTS AND BEHAVIOUR

• Insights are fundamental: The best shopper marketing programs have an insight at their core. This may be either a consumer or shopper insight, translatable into a ‘big idea’ that can be calibrated across touchpoints
• Who and why are equally important, if not moreso, than what and how. The insights and research programs you run should focus here
• Emotional, not just Rational: Dr Pradeep in one of the conference’s highlights outlined 7 shopper experience dimensions (in no particular order – Information, Interaction, Entertainment, Community, Education, Simplicity, and Self Worth). These serve as a useful ‘retail health’ scorecard for a brand or category. It’s evident from this list that grocery retailing only really talks to simplicity (ease of shop) at the moment, with perhaps some bits of information. But supermarkets have work to do on the interaction, entertainment, education and self worth (including role of charity) dimensions
• More Emotional, not just Rational: Rod Slater’s presentation highlighted that different categories and areas of the store provoke different emotions.  There are opportunities for marketers who can make their brands ‘happy’ in inherently ‘sad’ categories, and the opportunity in frustrating categories is to at least make them neutral
• Which tools?: There are a number of tools ranging from trackers to bespoke research to data – figuring out what info is important and relevant for you is the challenge
• What to measure?: Likewise there are lots of ways to measure, figuring out the most important things to measure is critical so you don’t get stuck in analysis paralysis. To paraphrase Bryan Gildenberg from Kantar Retail, measuring is important but figuring out which things to measure is more important.

SHOPPER MARKETING PROGRAMS & ACTIVATIONS

• No longer one size fits all: shopper segments, specific by retailer, by trip type and occasion are the name of the game as the market increasingly fragments
• Niching opportunities: likewise, specific shopper type and localisation opportunities will become more important (viz the SupaValu example of diabetics – small number of them but fiercely loyal to store). Specialist retailers are growing faster than the generalists in Australia so the strategic and profit/margin (not volume) opportunities will be in tailoring your offer
• Blurred shopper and consumer in a blurred path to purchase: shopper is a mindset, not a geography. The rise of mobile and on-the-go shopper marketing means there is no longer a linear ‘path’ to purchase
• The Zero moment of Truth: likewise, the rise of digital means just getting the instore execution right is not enough as the Zero moment of truth can occur in home or on the go. That is, anywhere. The implication is that shopper marketing programs need to be THROUGH the line (not just above or below it), incorporating out of store, on the go, instore.

ENABLERS & SUPPORT

• Top down support from the Executive is critical for success
• Collaboration: between manufacturers and retailers is an essential element, not a nice to have. This requires two-way info sharing to understand business needs and objectives on both sides
• Funding: the train has left the station. Stop arguing about where it sits, cobble some dollars together and just get on with it … you can adjust your structure later, although you do need at least one shopper ‘champion’ in the business and a centralised department of some sort is even better
• Cross departmental communication: is required to activate through the line. Silos will no longer work. To paraphrase both Bryan Gildenberg from Kantar Retail and Di Shelton from Coles, get together the people that ‘know stuff’ with those that ‘do stuff’
• No silver bullet: There are no templates for success at this early stage, just different experiences and ideas. The role of the POPAI Shopper Marketing Industry Council is to turn the ideas and experiences into tools and templates over time.

They’re my main takeouts. We’ll build on these over time, with more case studies, once the results of the 2011 POPAI/ShopAbility Shopper Marketing Industry Survey are in. In the meantime, we welcome your feedback about Shopper Marketing topics and discussions you’d like to see.

STOP PRESS

The 2011 POPAI/ShopAbility Shopper Marketing Industry Survey is now in field and calling your name! Have your say in the new and improved 20 minute online survey by clicking on the survey link at www.popai.com.au before closing date 1 July, 2011. Participants will get a free copy of the findings report, valued at $495.

Following on from our Rise to the Occasion article last year, about occasion based shopper marketing opportunities, let’s take a look at the opportunities winter presents.

HIBERNATION BEHAVIOUR

People are more likely to stay in during the winter – even in subtropical towns like Sydney and Brisbane – because they don’t want to venture out ‘in the cold and rain’. Unless they’re going to the snow. This is why restaurant patronage generally drops during the winter … people ‘go out’ and socialise in the summer and ‘stay in’ during the winter.

So how can you leverage these natural behaviours?

Play to the ‘quiet night in’, particularly for girls – flannelette pyjamas, DVDs and popcorn. As a bundle. Or you could go one step further and do what the breast cancer guys have done by creating a group ‘girls’ night in’, book-club style with champagne.

For mass merchants and discount department stores it’s all about ‘rug up’ items for indoors – blankets, throw rugs, heaters, warm pyjamas (again). And slippers. And of course you’d bundle it all up as a ‘stay warm this winter’ deal.

WINTER WARMERS

So here we’re talking about Dinner Tonight shopping trips, but for heavier and heartier fare.

Stews mean you can do bundles of recipe ingredients. Heavier pasta types such as gnocchi can also be bundled with other ingredients.

And it’s soup season, as well as pudding style ‘hot’ desserts. So there’s a 3-course meal suggestion that will drive AWOP – soup, stew and pudding.

If summer is synonymous with BBQs, what dining/entertaining occasion can we create or leverage for winter? The Great Sunday Roast? Traditionally the Sunday Roast (or baked dinner, depending on what state you come from) was family oriented, but what’s to stop it being promoted as a big night in with friends, thereby tapping into Entertaining shopping trips?

In liquor, it’s all about dark spirits – bourbon, scotch, dark rum. And red wine, to go with those Sunday Roasts. Stretching it a bit, you could include fortifieds such as port and sherry (which aren’t just gifts for Grandpa).

SNOW HOLIDAYS

This is all about the après-ski back in the chalet … a form of entertaining as the nature of ski and snow trips tends to be just as much social and friends as it is family.

Stocking up and entertaining in the ski chalet sense is about alcohol … red wine (and bottle openers), ingredients for gluhwein, sparkling/champagne as well as cheese/dips/pates etc – opportunities for cross-channel bundles here.

If you’re a mass merchant or specialty retailer the snow holiday opportunity revolves around snow and ski gear rather than food. Apparel, boards, poles etc. Plus some of the ‘rug up’ items discussed in Hibernation. You could get greater spend by bundling it all together as a series of package deals – apparel deals, gear deals.

JUNE LONG WEEKEND

Some hardy souls in this country still go camping in winter (generally coastal destinations where it’s slightly more temperate).

Camping trips generally involve more cooking for oneself than do snow holidays (where people eat out more). So there’s an opportunity here to package up a series of meals for several days of camping … the BBQ meal, the burgers and hot dogs meal, the roast meal (again!) … including packaged desserts (ie frozens).

Similarly to the snow holidays, for mass merchants and specialty retailers the opportunity is around bundling camping gear. Everything from eskies to travel rugs to thermos to tents. And entertainment – games for the kids to play in the back of the car, board games for the adults.

SNIFFLING AND SNUFFLING

Let’s not forget that winter is also ‘cold season’. Sales of tissues, sinus and cold/flu treatments go up, an opportunity for a ‘cold and flu family bundle’ or similar.

People not only get colds in winter, they generally feel more sorry for themselves and therefore get more massages and remedial therapies – in the summer people have too many fun things on, and are too busy and social to be sick!

So the principles are to look at the natural occasions the season provides, and create bundles for the whole occasion, rather than just promoting single items.

And then there are all the instore ‘theatre’ opportunities – snowflakes, log fires etc -  that these winter occasions provide …

In other articles we’ve discussed marketing to consumption occasions such as Valentine’s Day, Christmas, lunchbox, breakfast etc. Here we’re going to look at marketing to trip types. Ie the type of shopping mission the shopper is on.

OCCASIONS VS MISSIONS

Or, the difference between consuming and shopping.

Occasions are how and when the products being purchased are consumed. Eg breakfast, lunch, dinner, snack, and events such as parties and bbqs. Consumer marketing targets the end consumer of a product to get them to consider the brand.

Missions, or trip types, are the type of shopping trip the shopper is on. So shopper marketing targets the shopper, not the consumer (as we know they’re often different – think pet food and baby).

To date there has only been limited occasion based marketing to consumption occasions (as opposed to the major retail occasions like Christmas) and very little if any marketing to shopping trip types or missions.

So let’s have a look at what some of the trip types are and what can be done to target shoppers on a specific type of shopping trip.

MAJOR TRIP TYPES BY CHANNEL

Below in Figure 1 is a list of the main trip types in some different retail channels. This is an indicative, not exhaustive list and the vertical order of the trips does not necessarily represent largest to smallest.

Figure 1: Main Trip Types by Retail Channel. © ShopAbility 2011

From the above you can see that the trip types differ by channel (but note that Entertaining as a trip type pops up in 4 of the 5 channels). The nature of that trip type may also differ a little per channel.

Destination trips are for something specific. Eg a Destination trip in a supermarket may be for a few catalogue sale items (ie Huggies on deep discount) or because a shopper has run out of something. The ‘run out’ of an item type of Destination trip also applies to convenience stores, but the sale or catalogue aspect is less likely to. However in mass merchants Destination trips will unlikely be about ‘run out’ and mostly about ‘sale’ or on a mission for something specific ie ‘basic black pants for work’.

Certain categories may skew to certain trip types. For example Stock Up in liquor is more about beer slabs and wine cases (particularly in Big Box discounters) and less about spirits and rtd. Entertaining trips – well, you’ve seen it yourself at the checkout when someone has a trolley full of softdrinks, chips, crackers, cheese and dips.

Interestingly though, who is on what trip type doesn’t necessarily skew to certain lifestages. Whilst it might be tempting to think that SINKS and DINKS (single/double income no kids) have higher disposable incomes and more time to entertain, young families also do a lot of home entertaining because taking the kids out somewhere is both a hassle and expensive.

And it’s not just SINKS/DINKS on ‘Dinner Tonight’ trips either. Shopper studies we’ve done have shown that large households with lots of mouths to feed are likely to have a mum in the supermarket a couple of times a week looking for inspiration and a quick solution for tonight’s dinner.

How they shop by trip type obviously differs. For example, Dinner Tonight trips are about easy all-in-one-place solutions where on Stock Up shops shoppers are looking for inspiration, experimentation and variety of meal types. And certain trip types are more likely to get more impulse than others. Shoppers on Stock Up trips (approx 30% of supermarket shopping trips) will do an aisle-by-aisle shop regardless of what’s in each aisle. These are the shoppers and trips likely to result in the most impulse.

What this all means is that by marketing to trip types you’ll be able to talk to a fair portion of the shopper base at once, in a way that is relevant to them.

MARKETING TO TRIP TYPES

Know where they go

Stock Up shoppers are likely to shop every aisle, where Top Up shoppers will only shop certain aisles and categories, and Dinner Tonight shoppers basically do a ‘perimeter’ shop around the outside categories of the store – fresh fruit & veg, delicatessen, bakery with a couple of dips into the centre store meal solutions aisles for Taco kits etc.

This information will help you figure out what to put where in the store – offlocation displays, hangsell, co-located products, dual located products.

Shopper research can help you with this information.

Know what they buy per trip

By mapping the categories to the trip types, including ‘what else’ they buy -  essentially what’s in the basket -  enables you to bundle categories and products together to create a solution (don’t do yourself out of dough though by discounting too heavily on behaviours the shoppers are already doing).

It will also assist in helping understand what impulse displays could go in or near which aisles … the classic ‘beer and nappies’ Tesco type scenario applies here.  As well as the obvious, such as salad dressings with the salads, chilled or shelf stable desserts near the pasta, salty snacks near the softdrinks etc.

Instore intercept interview research can help flesh this out for you, mapped against basket data.

Don’t just limit it to what they see instore

Instore executions such as offlocation displays against your trip type can be supplemented with banners, instore media and creating solutions by placing key items next to each other. But you also have an opportunity to talk to a specific trip type before the shopper even embarks on it.

What can you do pre-store to market to Entertaining or Dinner Tonight trips? (Stock up and top up are a bit harder).

Catalogues, websites, social media/advocacy groups and potentially selected above-the-line media could all work to promote bundles against these trips (proof of the pudding being both the majors’ focus on family meals).

In other words, you can not only make their shopping experience more pleasant and interesting by putting things where they expect for their trip type, but provide unexpected impulse opportunities and promotions that make sense in the context of their shopping trip for extra sales.

Imagine you are sitting on the veranda of your beach front home of 20 years in a quiet neighbourhood in a small coastal Queensland town. Your family are with you, at least the youngest of your kids, the eldest have left home and are living at other small coastal towns, going about their daily lives.

You are waiting, waiting for the arrival of the worst cyclone in years, worse than Tracy in the Northern Territory so many years ago. You have done all you can, battened down windows and secured doors and personal effects, the best you can anyway. You are waiting for the unknown. You are waiting for what the weather forecasters are saying is gale force winds, lashing  rain, high tides, flooded rivers and roads.

Fast forward 3 weeks.

No house, no furniture, no car, no personal effects. The insurance is coming. Your family are around you.

But you have to live, eat and drink. Australia gave generously to help our northern neighbours, and so we should have. What happens as you slowly rebuild your lives, and your house, and your life style?

How do shopping patterns change when we are faced with this type of crisis – not just for food, but for clothing and the other necessities of life? Food is one of the basic requirements of life, and a routine that generally supports a strong family unit. Three meals a day plus snacks, bring it on so we can at least get back to a routine.

I am not a philosopher or an expert in human behaviour, however when you look at  Maslow’s Hierarchy of Needs (see diagram) that we all learnt about at school or uni, certain things start to fall into perspective. At least the bottom three ‘rungs’ are thrown into complete disarray, without any structure or time frames for remediation. These then rattle into the top two Needs. Looking through this lens allows us to understand how standard or regular behaviours, including shopping behaviour, will do a complete somersault after a catastrophe such as those we have experienced in Queensland and Victoria.

We are not trying to commercialise a drastic situation, far from it, what we are trying to frame is how we can best help support the changes in shopping behaviour brought on by these events, and start to understand any short or long term changes that require our assistance or support.

The damage caused by catastrophes such as those we have experienced in Qld and Victoria in recent months have highlighted the fact that consumption (as well as production) of food will be destabilised for some time to come. Consumption and shopping behaviour are inextricably linked as one precedes the other.

So how do these events affect shopper behaviour? How do people now change the way they shop for food, or do they? If they do, is it reversible?

Retail stores generally bounce back pretty quickly after major calamity, make no mistake there is a lot of hard work to do to restore the normal shop footprint, but they generally have access to the width and depth of resources needed to restore order. Simply a matter of scale as well as purpose.

From a Shopper perspective there are most likely two scenarios that cause change in purchase behaviour:

1.    Pre Event

Assuming enough advance warning is given of the arrival and nature of the incident, how will Shoppers prepare for any impact? What will they buy to either stock up or use during the incident?

2.    Post Event

Like #1, the majority of Shopper behaviour will be triggered by the degree of trauma and the overall effect on their individual situation, what does disaster recovery look like for me?

“During Event” is surely a “non-event” as people grapple with the circumstances that prevail at that particular moment. It’s a personal thing requiring situational management. It is also not channel specific, so if I cannot get my (Pauls) milk in a northern Queensland Woolies I’ll go to the nearest P&C or route store to but it, getting milk is the key, I don’t care where from or which brand.

So what type of products would most people look to purchase during a Pre-Event store visit to prepare for an oncoming incident? Some are more obvious than others, and to a large degree this is pantry stocking in its purest form without the price incentive, but here we go…

• Water – plain fresh water, as large a container as possible or multi packs
• Drinks – soft drinks etc but also juice and functional products
• Snack foods such as muesli bars but also chips etc (experience from Katrina in the US shows that this category exploded both before and after)
• Confectionery
• Quick centre store ‘easy’ meals – pasta, rice, cereals, biscuits, soups, tinned food, sauces etc
• Fruit and vegies
• Frozen meals but think of the power outages
• Dairy especially milk
• Ice – often underestimated (for filling eskies and bathtubs)
• Disposable party ware – plates, knives and forks, napkins etc
• Paper – towels and toilet paper
• Hygiene products – fem hygiene, medicinals and wound care
• Emergency kit items – torches, batteries.

The slant is recognisably towards convenience, life and durability of products,  ease of preparation as well as nutrition but I think ‘fast gut fillers’ would also rate highly. It is more about survival than elegance and table manners.

Most of the categories listed above would also feature heavily in the Post Event shopping list, and clarity of the situation after the individual circumstances are clear would affect what is bought, how much etc. So a few extra Post Event categories may also be:

• Meat
• Fruit and Vegies
• Baked foods, bread
• Household cleaning
• Laundry
• Pet
• H&B
• GM – really dependent on the effect on individual household. Hardware would be a key thought but you’d probably go to a specialist rather than a top up grocery range.

So as people move out of survival mode, the Shopping behaviour starts to return to normal, the caveats being the degree of devastation and the effect on each household. For a time frequency of shop would likely increase as shoppers find and increasing number of items that have been disaster affected, resulting in a number of small top up shops.

The categories may be obvious but there is another level of behaviour that also needs to be included in the frame – that of price. To a large degree, there is no price elasticity during Pre or Post Event periods as people will pay what they need to survive, a basic assumption.  But where the effect is far reaching and people do not have access to either a normal household routine or the ready cash to restore their life balance, what happens to purchase behaviour?

Purchase more specials but only of those things they NEED

• Housebrands
• Smaller packs
• Substitutes such as quick service restaurants (Maccas) if they are trading
• Do without or survive with what I have left.

If you have a look at the latest offering from the Nielsen Global Consumer Confidence Index for the December 2010 quarter, on a global basis most people have chosen to downgrade their spending and buy cheaper grocery brands.

This covers all of the major global economies, most of which suffered a worse fate than Australia did at the hands of the Global  Financial Crisis. So GFC, flood, fire, cyclone, earthquake -  don’t worry about what it’s called – it is easy to see how these life changing events quickly turn into purchase changing events .

That is the sad and unfortunate thing, many of these events are out of our hands but have far reaching effects, way past the individual and the community. We have all contributed personally to Relief Funds as have our employers, the question is what can we do from a business and commercial perspective to better assist shoppers and their changing behaviours during these awkward times?

They’re the words promotional marketing agencies see on most briefs for ‘target market’. “Main grocery buyer”.  Aka women 25-54.

OK, so the two major supermarkets average 75% female shoppers. But to assume that’s the same in all stores, and that they all shop the same way, means the majors are missing opportunities to tailor activities – more profitably – to specific shopper types and shopping trip types. Vanilla is not the only flavour of milkshake.

Over the past few years that we’ve been running shopper research we’ve noticed that household makeup (how many people in the household, ie how many mouths to feed) and lifestage (eg SINK/DINK, young families, older families, empty nesters) have a far greater impact on shopping behaviour than does age, income, or geography.

Let’s look at how this plays out.

WHO REALLY SHOPS IN SUPERMARKETS?

Actually, males represent 48% of grocery shoppers overall, it’s just that their overall frequency of shopping trip is lower than females. But this changes by household type. Supermarkets located in areas with a lot of SINK/DINK households (single/double income no kids – like the South Yarras, Neutral Bays, Fortitude Valleys, Holdfast Shores, Subiacos) will often have up to half of their regular shoppers being male. This is because the guys are either shopping for themselves and their partner (male or female) or shopping for the household (particularly share households of guys – and it’s not unusual to see two male housemates doing the shopping together of an evening).

There’s a reason that such a high proportion of the major phone networks’ mobile phone traffic between 4 and 7pm is ‘I’m standing in front of the X category, which is the one that we buy?’ phone calls. And it’s not the women making them.

Blokes shop a bit differently to women – they’re generally less concerned with getting the absolute right brand/product (unless they’ll get in trouble). Near enough is good enough. And they’re more open to impulse, and to pester power from the kids.

So what?

This is part of the argument for store clustering – changing your execution store by store depending on who the majority of shoppers are in it. If you know which stores have higher proportion of young blokes you’d dial up on easy and RTE meals, and offer impulse snack bundles for a start.

HOW DO THE LIFESTAGES DIFFER?

Herewith some gross generalisations (it does vary per category) but this should give you an idea.

SINKS/DINKS: tend to have more disposable income so as a rule they are less price conscious and more into quality and gourmet items and anything new/different/sexy. Obviously because they don’t have kids they’re not buying baby aisle to begin with. As a result they are more likely to have pets, particularly small dogs, that are treated anthropomorphically (like they are small humans). So stores in SINK/DINK areas are likely to overindex in pet treats and premium pet foods, as well as categories involved in entertaining (eg high end dips, premium salty snacks and crackers). They are least likely to buy on promotion or private label as they’re looking for quality cues (depending on the category, of course). They don’t buy on volume as they’re more likely to live in apartments with smaller pantries, fridges and cupboards – so big bulk packs won’t fit! This is single serve land – which of course comes at a price premium.

Young families: are all about baby, school, nutrition and some sports. Shoppers for young families will buy based on what they know the kids like and will actually eat. Because there are more mouths to feed, and often a mortgage, budgeting starts to come into play. They’re more likely to have a repertoire of brands that they switch between (so if you’ve always got one brand in a category on promotion all you are doing is merely switching a ‘given’ sale down to the lower priced brand on promotion. Time to review your promotional slotting and frequencies!)

Older families: tend to be more volume based (particularly if they have teenage boys).These guys are your classic 2L milk and 20pack toilet roll territory (note – SINKS/DINKS and Empty Nesters aren’t). Almost the opposite of SINKS/DINKS in behaviour, they’re after economies of scale because they’ve mostly got the storage space to hold it all (not that it lasts long with ravenous teenagers about). Whilst they’ll have certain brand preferences in certain categories, mostly it’s about feeding the masses as cheaply as possible so you tend to see a lot more private label in these households’ cupboards. Often catalogue monitors, they might switch stores if there are enough of the right bargains in one catalogue to justify it.

Empty Nesters: longstanding loyals to brands they know and that have stood the test of time, they’re looking for value for money but also service and acknowledgement … ‘they know me and what I like’. They will pantry stock on a bargain (but then, you’re just pulling the sale forward in a lot of categories). They are less open to trial, demonstrations and sampling (where SINKs/DINKs love this) and more likely to buy mainstream than premium brands.

So if you know what the majority of your store’s shoppers are, you can tailor not only your range but also your promotion and marketing mechanics to suit.

And even if you are in an area with a reasonably even split of household types, you can rotate your promotions and marketing programs around the various household types – you don’t have to assume that the same promotion is going to suit everybody.

It just gives you more strings to your bow, or weapons in your promotional arsenal.

Next time we’ll look at trip types and shopping missions, and how you can market to those.

Until then!

Yes the hot cross buns may be out already but there is at least one retail occasion between Back To School and Easter. It’s called Valentine’s Day.

Back in a September RW issue last year we wrote a roundup of occasions that can be leveraged at retail. Among the ‘Gifting’ occasion set we listed Valentine’s Day. On thinking about it though, I reckon Valentine’s is also a ‘consumer’ occasion focussed around food – primarily dinner, but also breakfast.

Why?

In Gary Chapman’s Five Love Languages – which are effectively relationship style preferences – he lists Gifting as one of five different love languages. The others are Acts of Service, Quality Time, Compliments/Affirmation, and Physical Touch.

So current Valentine’s Day retail focus – with its avalanche of flowers, chocolates and jewellery – really only talks to one of the love languages – Gifting. But receiving gifts isn’t necessarily everyone’s preferred way of feeling loved, particularly on a day where it’s expected and therefore obligatory and worse, perhaps grudging on the part of the giver.

Preparing the object of one’s affection a special dinner, breakfast or picnic means you are talking to people whose preferred love language is Acts of Service (time, effort and thought put into preparing the meal) and/or Quality Time (sharing the meal together).

So you’re covering more bases. And this is where the grocery channel comes in. Grocery can own the FOOD side of Valentine’s Day.

Yes supermarkets can try to compete in the flowers and chocolates sphere, but you’re going to be the poor cousin competing for ‘specialness’ with specialty florists, chocolatiers and department stores. We know from a gifting research study we did recently that recipients value ‘specialness’ and givers don’t like to look ‘cheap’.

This means that whilst you can include flowers and chocolates in your Valentine’s Day retail execution, they shouldn’t be the focus when you have a real point of difference with food.

This could  be end to end, from providing menu ideas for 2 and 3 course dinners through to table decorations. You could even put your Valentine’s Day menu and recipe builders online so planned shoppers come to the store with the list based on your suggestions (which of course would be some of the more profitable items rather than those merely on special).

For Acts of Service, effort is more likely to be shown by preparing meals from scratch rather than buying something pre-prepared. (However you should still provide some dessert options like Sara Lee etc). But if you’ve got some pre-suggested menus you could bundle recipe components together for a price point – and in their own display – with a campaignable marketing message eg  “Make their Valentine’s Day special by making them dinner”.

You would set it up as a total display instore  – not just the food, but the setting – a bit of theatre with a table & chairs, table cloth, glassware, crockery, cutlery, candles, napkins and some foodstuffs (eg wine, cheese, fruit platter). The display would be messaged per above, or with something like “Create a Valentine’s Day they’ll remember – all you need is right here”. The menus and recipes would be readily available on this display and at the relevant product points throughout the store.

Who knows, you might even sell some general merchandise as a result of this kind of display.

Aside from dinner, there’s also a breakfast alternative, like a kind of souped up breakfast in bed. Or a Valentine’s Day picnic, which you could set up with a rug, hamper, plateware, and relevant foodstuffs.

Simple stuff, and effective – but we’re not seeing a lot of it out there.

So who is going to be the first to own the Valentine’s Day ‘great dinner in’ occasion?

Happy New Year!!

And happy Xmas. And happy Easter. Happy Mothers’ Day. Happy Fathers’ Day. Happy Birthday.

Happy anything!

Or at least we hope they are happy from a trading perspective as the ‘jolly’ season we have just had was far from the jolly of old. It was a tough hard Xmas for most retailers, the toughest in decades, characterised by slow sales, irregular traffic flows, extreme price discounting, bargain hunting shoppers resulting for many in negative L4L sales and poor profits (if any). This has been a tipping point for many retailers (Colorado for example), and the best is still a way off.

As a population we are now saving more than we have for decades as the uncertainty of what the future has in store economically really takes hold of the average household (lets not talk “working families” will we, after all we all are in working families and that term has been done to death!). More saving = less spending = less retail $. Fairly simple equation I would say, whether GST is applied to online sales from overseas or not.

Consequently the economy will shape many of the trends for 2011 – what happens with interest rates, oil prices, exchange rates, balance of payments etc will really have a profound effect on what we spend and what we save.

The other big influence will be the political landscape, especially the State (new Govt in NSW J and maybe Qld) and the Federal political scene and the influence that the minor parties and independents may have on how many hair brained schemes to support illogical and insignificant projects are introduced and implemented. The uncertainty and mistrust that is at voter level has a direct influence on our spend/ savings rates – think water prices, think gas prices, think electricity and solar rebates. The list goes on and on.

Far from being a political statement, the realisation that our spending power and spend rates are directly influenced by these factors, amongst others, needs to be taken into account when we discuss the 2011 Trends.

We would challenge that many of the Trends lists that are regularly touted at this time of year are really just part of the evolution of Retail in general, and may have been slowly or quickly evolving over the last year or three, and are now top of mind because more than one company are doing it. If you think about many of the trends you read about you will recognise what they are talking about in the context of your category, or one of your retail customers.

Or some expert has said that this “is the next big thing”  - the faddish part of trends – and it will take the world by storm. Add a catchy name and you have a TREND.

Here are ours, but you too can do it in the comfort of your own home as well!

Trends 2011

1.     Bring ‘healthy’ home: The ‘real food’ revolution. The surge in heritage and artisan foods such as meat, bread cheeses and F&V, and bringing the farm closer to home has been growing for a few years. This has partly been driven by the belief that the chains have cut quality and nutrition by mass producing the end product, allied to the growth of the ‘natural’ movement. There has been a renewed popular demand for hand cut meat, WW and Coles are now including it in their new store formats for example. Have a look at Pattison’s Cakes, a step way above Bakers Delight.

2.     Advocates I can believe in: People are after an association or endorsement that they can relate to, a celeb that they can look at and associate with (I can do that/ cook that/ drink/ eat that if they can) to give them a reason to choose to support a brand, store, category etc. Look at Master Chef, coffee with Vittoria and Al Pacino, tyres with Grant Hackett. It’s started to go way beyond the old co-branding with the aspirational message with watches and cosmetics. It’s a lot more casual and warmer and not as idealistic, and appeals more to the mainstream shopper. How can I extend my comfort zone in the kitchen and use my healthy foods, per in Trend 1.

3.     Shop anywhere with mobile technology:  the new wave of apps are here to stay and will continue to grow. Iphones will shortly have the largest market penetration and therefore usage. Where to shop, where to eat and for how much, how to shop, direct marketing, social media, shopping sites, special offers and personal messages, all available on a small screen in your pocket or hand bag…the list goes on. This is communicating and making decisions on the move, at any time on any day, anywhere. Shoppers are no longer just in the store (or online). The ‘path to purchase’ is no longer linear, rather cyclical where shoppers enter and exit at a number of points. Shopper marketing will therefore have concurrent multiple single touchpoint opportunities and the bigger but more complex opp of integrating through ALL touchpoints. Death to Smoochy – sales and marketing silos are no longer going to cut it in shopper world that is increasingly fragmented.

4.     Social Media Selling:  the rise and rise of unique “retail” on line offers that require engagement by groups of people – a form of viral marketing online –  to get the deal on one product or service for one day only, rather than by a 1:1 transaction with one retailer at any time you want to buy something. It puts the current model upside down and goes against that traditional promotional tool Price. It also drives loyalty by the thousands as people find out what’s hot for today only. Look at Foursquare, Groupon and Scoopon to name a few.

5.     Mainstream Marketing lives: whilst we all like a bit of indulgence and excess at times we are all mostly “mainstream” by behaviour and lifestyle. What we mean is that we are creatures of habit and mostly do the same things around the same times and in the same ways – we ALL don’t lead James Packer lifestyles unless we inexplicably win the lottery. With that in mind, the fact that we all don’t want the latest App or Face Book message or on line offer will slowly dawn on marketers. Marketing to Mrs Betty Average will always be part of the marketing mix required to communicate ACROSS the shopper and consumer landscape regardless of age, socio economic profile, demographics, heritage, race and religion.

6.     Micro Category Development: fix my, not everybody’s, problem. The counter trend to Trend 5.  Gluten intolerant people could be as high as a 1:10 of the Australian population, and that is a whole lot of people who are after selected products to help with their take on a healthy lifestyle. Then there are the people who want to loose weight, those that want to gain weight and those that want to stay the same weight but eat a lot more of a healthy mix of food. Don’t forget the aging population that will be looking for the anti-aging creams, the memory loss pills, the joint functionality pills, all of those herbal remedies that do add value to large groups of the population. Alternative non-medical medicines?  How do these categories and segments, both current and emerging, gain the profile that they require to appeal to and make shopping easier for these micro groups of people?  As in #5, it really is a non-denominational equation and something that all retailers and suppliers need to address and address quickly. Where ‘unique skus’ might once have been deleted based on low hurdle rates, we see that unique skus will play an increasing role – and it’s one of profit, not volume.

7.     Value = Quality/Price …or is it … Value, value, value? The word that is commonly quoted and used as some mystical theorem that has a past in medieval witch craft and sorcery. Value is really what the Shopper makes of each purchase. It is the personal approach and decision making criteria that each Shopper has to each transaction each time a purchase is made. As we saw over Xmas, deep discounting is a law of diminishing returns, becoming less and less effective. So where do you go from there? How can you create value at every shopper touchpoint by recognising the role of each, and providing and appropriate EXPERIENCE to match?

8.     The Shopper is finally here! Big time, but not necessarily in a spending sense. More that there is finally a strong view amongst a beach head of marketers that understanding the Shopper above and beyond the pure transactional relationship, or in their role as a Consumer, is a requirement when engaging with Retailers, or most importantly with Shoppers themselves.

Is that all you may ask?

Most humble soothsayers at least develop 10 or 12 or even 15 trends for the next 12 months that are supposed to inspire and astound us with their insightfulness and thought provoking discourse. Not us we say!

We really want you to think about what is going on out there in your categories and segments and decide on what matters to your business the most. Our trends are real but they all should be quite evident to most of the thinkers reading this column. Most trends are, if you really look at and think about what is happening out there. Talk to your peers, talk cross functionally in your business.

Are your business challenges about developing new channels, about developing and implementing category development programs, is it about more considered promotional spend that is not Price driven, is it about using insights to drive Shopper behaviour and therefore Sales and margin, is it about developing new segments and sub-segments targeting emerging Consumer requirements or just doing a damn sight better to engage with your current Shoppers in your current shelf sets, or is it about taking a more holistic view of how to appeal to shoppers at all points both in the store and out of it?

2011 will go down as a water shed year in more ways than one.

Is your business up to the challenge?

SHOPPER MARKETING UPDATE:

As a result of the POPAI/ShopAbility Shopper Marketing Industry Benchmark Survey 2010, POPAI has set up a Shopper Marketing Working Group subcommittee which Norrelle Goldring is chairing. The charter of the group is to tackle challenges impeding the progress of the shopper marketing function. The working group consists of brand manufacturers, retailers and agencies cross-channel and cross category. Stay tuned for updates throughout the year!