The challenge of integrating insights about consumer behavior with point-of-sale practices
It started on Tuesday 16th and ended this Thursday 18th, Shopper Marketing Expo, the principal Shopper Marketing fair in the world, which takes place in Chicago (USA). On the first two days of the event, the main debate centered upon the challenge of integrating consumer insights and shopper marketing, in order to define strategies which guarantee the maximum efficiency in communication with the shopper (the person who is effectively responsible for the purchase made at the POS) throughout the entire path to purchase, transforming intention into real conversion, and how to do this with operational efficiency; starting from a clear definition of the roles within companies, especially in respect to the creation and execution of points-of-sale actions.
On Wednesday 17th, the Shopper Marketing Best Practices panel – The Path to Purchase Begins At-Home: In-Home Insights that Drive In-Store Purchase Decisions – led by Art Sebastian, director of Shopper Insights and Development of Categories, from the American firm, Kraft Foods, discussed how his company is managing to integrate its communication strategies and transform the corporate marketing silos in order to tackle the opportunities in shopper marketing.
It’s a case which clearly illustrated how consumer insights can be transformed into marketing platforms to define clear shopper marketing strategies: Kraft identified three consumer behavior trends – People are cooking more and more at home, the sandwich is a constant presence in these “at-home meals” and making a quick snack is increasingly turning into a habit.
The data clearly indicated that there are three marketing platforms to work on: cooking, snacking and sandwiches. Here is where integration gains life: to attend to each platform, marketing and shopper marketing actions were conceived. For the “cooking” platform, the marketing strategy was to launch products that inspire and facilitate the lives of those preparing the dishes, such as sauces and easy-to-use but very tasty ingredients. Apart from this, the brand bought the sponsorship of culinary programs on TV and reformulated the site in order to offer recipes.
But how did the shopper-dedicated team use this insight to guarantee the conversion? Above all, it didn’t use in the store what was used on the TV or on the Internet. What the Kraft team did was to offer a solution to the shopper: it created special display areas for cooking products in the stores, where shoppers could find everything they needed to satisfy the motive that took them to the store in the first place. According to the director of Kraft, growth in sales was in double figures in all its test stores.
This example shows that an integrated vision generates solid results. When each link of the chain (in this case, marketing and shopper marketing) understands its role, the strategy is preserved without the tactical actions repeating themselves at each point of contact. This is because “to integrate” does not mean “to repeat”, but rather to understand which solution delivers at each moment of the interaction with the consumer or shopper.
This action by Kraft at the POS was only possible because there was collaboration from industry with their clients, the retailers. Furthermore, collaboration is yet another subject that is on the agenda here in Chicago, in the same way in which it has been strongly influencing the way in which industries and retailers are planning their actions in the United States and in Brazil. Collaborating with the client means building confidence, which presupposes the sharing of information, sharing the risk and a reaping of the satisfactory results for both sides. And retailers are open to this.
In the main seminar of the day, and open to all participants at the event, Joseph Magnacca, president of Walgreens and of Duane Read, showed how the biggest American drug store player sought an alternative, within the English model, in order to continue raising its sales by store. Basically, the recipe was to abandon the American model of “real estate”, in which the location of the stores and their enormous coverage seems to guarantee success. Following the British model, Walgreens stores are being reformulated, one by one, to attend to the needs and requirements of the shoppers of each neighborhood – a segmentation that has created standard specific stores for Latin quarters, Afro-American neighborhoods, for seaside towns and touristic places.
In the case of Duane Read, a partnership with the cosmetics industry created specific areas for looking after nails in New York and its vicinity, where it was noticed that, despite the crisis (or perhaps even because of it), women continued to be vain and to bet on nail polish to make themselves more attractive. Among the proposed actions, Walgreens relaunched its program “Web Pick up – Buy on line, pick up in store”, a convenience that proved to be very important in certain regions. The video (www.youtube.com/watch?v=Co4Lv2OkGP8) makes it clear that the solution responds to the needs of the shopper, and not the consumer.
Furthermore, based upon the understanding of the shopper, and specifically the main shopping missions of these in the chain store, Walgreens structured its in-store communication proposal upon three pillars, which also put the reformulation of the visual merchandising and store layout on the agenda: “What I need, How I feel, How I look”.
The examples of Walgreens and Kraft show what everyone is after: understanding the mind of the shopper, and revealing his/her inner world. The available tools are varied: neuromarketing, research applied psycho-analysis, eye tracking. In these, and in several other cases, shared here at Shopper Marketing Expo, these techniques were widely applied in order to help brands and to understand shoppers.
What the results quite conclusively reveal is that the mind of the shopper – our mind – functions in narrative, which means, for the strategy to make sense at the decisive moment of the purchase, the message has to be cohesive, and no longer the traditional model, that bets on bribing the customer with discount coupons, or that offer prices to generate the conversion, and which is based on the belief that the intention to buy – generated by a TV ad – can manage to knock down all other barriers that interrupt the path of the shopper to the checkout.
Here in Chicago, we took part in discussions that sought to create a new model which manages to conquer the true loyalty of shoppers each step of the way, taking into account that it is a feeling, rather than a behavior. But to feel, one needs to connect, and the connection only occurs when there is a real exchange of experiences, when there is satisfaction of the needs and, especially, when there is confidence, built in a relevant way, in each step along the path to purchase.
* Rafael D’Andrea and Juliana Nappo
Originally published at Meio & Mensagem website in 10/18/2012