Is It Time to Reset Your Shopper Marketing?

Is your investment in Shopper Marketing working? Turns out, most people aren’t sure.

In a 2015 survey, conducted by the Path to Purchase Institute (P2PI), only 25 percent of consumer product marketers said shopper marketing delivers incremental sales growth to their companies. Meanwhile, 14 percent said it hasn't produced any significant growth and the remaining 62 percent still have not adequately measured the impact.

In short, if your shopper marketing has not worked as well as you hoped, you have plenty of company. Fortunately, the solution to the problem is fairly simple: start paying closer attention to the store.

It is no secret that the marketing industry has always been easily distracted by consumer trends and technological fads. At the same time, few resources are allocated to in-store marketing-a below-the-line activity that is traditionally perceived as effective at driving volume, but not necessarily instrumental in building brand.

These two realities have led many shopper marketers to become so preoccupied with newer, trendier elements of the "path to purchase" — online product research, social media, e-commerce — that they've lost sight of the place where the path most often ends: the brick-and-mortar store.

Yes, shopping behavior has changed dramatically and the path to purchase is far less linear than ever before, requiring many diverse steps or, on the flip side, beginning and ending with the click of a button.

Yes, there's an increasing chance that the shopper’s journey will end online without a single trip to a physical store. 

However, nine out of 10 times, the path to purchase still ends inside a brick-and-mortar store. What's more, 90 percent of the product searches on Amazon.com ultimately result in purchases at a physical location—suggesting that digital searches are currently serving as the gateway to brick-and-mortar shopper conversions.

Need more evidence?

In February 2015, Walmart announced an alarming change to its marketing strategy-they instructed product vendors to scale back on displays and in-store promotions. In lieu of focusing on these components, vendors were encouraged to invest their money helping the retailer re-emphasize its “Every Day, Low Prices” strategy. Shopper marketing took a back seat to pricing.

Vendors began feeling the impact almost immediately. Mondelez International reported that the decline in first-quarter revenue was “largely due to a change in a large customer's in-store strategy." Kellogg Co. similarly acknowledged that display reductions at one "large customer" had "adversely impacted" sales. Both companies said they were working with the retailer to find middle ground that would bring back lost display opportunities.

In-store kiosks have a greater impact
on purchase decisions than previous
experiences with the brand.

What’s the Lesson?

It is a mistake to develop a shopper marketing plan that emphasizes these newer stages of the path to purchase and forgets the iconic assets of traditional retail.

Walmart’s strategy missed the goal of shopper marketing—brands can't influence shopping behavior if they are not VISIBLE in the marketplace.

Resetting your Shopper Marketing

So, how do you reset your shopper marketing strategy so it will achieve its full potential? You can start by addressing three truths about today's marketing landscape that most organizations are hesitant to embrace:

1. Brand destiny rests largely in the hands of the distribution channel. In a recent survey conducted by IRI, millennial consumers claimed that in-store kiosks have a greater impact on their purchase decisions than previous experience with the brand. This fact should send chills up the spine of any brand marketer who's still focused on using consumer media to build awareness and consideration.

Today's shoppers have less brand loyalty than their predecessors, making them far more likely to be influenced by in-store marketing. Gone are the days of building up brand awareness and purchase intent through external channels. Brands now need to make their case right where the decisions are being made—inside the store.

2. Retail visibility is the new brand advertising. Roughly 140 million shoppers visit Walmart every seven days. To reach the same number of consumers in one week via television, you'd have to advertise during nine of the 10 highest-rated series. For a fraction of that cost, marketers can achieve equal or greater success by developing eye-catching product displays.

It comes as no surprise, but media consumption is on the rise. But consumption today takes place across so many media channels and programming types that it's next to impossible for a brand to target its desired audience affordably. "Mass media" isn't quite a misnomer yet, but it no longer delivers the uniform audience that it once did. Only inside a store do fractured audiences become whole again.

3. Renaming old consumer-centric thinking as “shopper marketing” ignores the first two truths. A leading reason why shopper marketing hasn't reached its potential is that too many companies have done nothing more than rechristen their traditional retail practices — using the term as a fancier synonym for the same old trade promotion, account-specific activity or in-store marketing.

Securing secondary placement for a product display is not shopper marketing.True shopper marketing focuses on the development of "on-site insight.” This is the deep understanding of both the retailer and its shoppers that turns in-store executions into strategic shopper marketing programs.

How Brands Achieve Success

Of course, the easiest way to gain such on-site insight is to collaborate with the retailer. Unfortunately, “shopper marketing” all-too-often fails to invoke genuine collaboration. Instead, it mostly involves manufacturers delivering their own brand-focused programs while retailers pursue their own brand support efforts.

Even when formal collaboration isn't possible, smart marketers will still employ retailer-specific business intelligence and unique shopper insights to develop innovative programs that cannot be executed at another chain — the kind of tailored offering that the retailer is unable to turn down.

Here's the key: Think past your brand. Focus on the category, the total transaction, the unique shopper solution that will drive sales and brand equity for both you and your retailer partner.

Make no mistake: This is not an easy task. Modern shopper marketing involves greater cross-functional alignment within the organization to develop marketing strategies that are effectively translated into the store environment.

In today’s crowded retail environment, marketers need to employ a new mindset: "If it doesn’t increase brand visibility, it’s not worth doing.”