Archive for December, 2014

Savvy shopping tactics

My name is Rob and I am a shameless shopper….

… there, I’ve said it.  I am unashamed to say I will split a big shop into two smaller £40 shops to take advantage of a loyalty programme.  I make use of multiple online grocery accounts to utilise free delivery coupons.  On an ongoing basis, I plan our family meals for the week, then I use a price comparison site to compare the price of high ticket items before deciding where to shop.  I am not on my own however, and if you do not employ at least one of these tactics, you are in the minority.

This is not shameless shopping, this is savvy shopping and this is the landscape within which we operate.

The savviest tactic of them all, and the one that has caused the most seismic shift in the UK grocery landscape, is the rise of multichannel shopping.  Shoppers shopping across multiple channels to better meet their food & grocery shopping needs.

Multichannel shopping is primarily driven by the desire to save money; paying reduced prices for goods and making money go further by reducing waste.  This has driven more frequent, smaller basket missions, and has seen the power shift into the hands of the shopper, as they pick and choose where to shop to best meet their needs.

Take me for example.  I shop online to bulk buy cupboard staples.  I top up throughout the week as required across the supermarket, hypermarket and convenience channels (depending on which one best fits into my plans that day).  I visit a food discounter each week to bulk buy soft drinks, and I visit a high street discounter for toiletries and household products.  This is typical multichannel shopping behaviour.

The retailers I visit also cover a diverse spread.  A recent addition to my repertoire of retailers has been Waitrose.  Thanks largely to the influence of his grandparents, my 2 and half year old son has taken a shining to Waitrose apple and elderflower sparkling water.  Sadly, I kid you not.  Having been bought up myself on Rola Cola and Council Pop (that’s tap water, to anyone who hasn’t heard that expression), it pains me to say one of my most common shopping trips is to head to Lidl to buy soft drinks for myself before heading across the road to Waitrose for the “sparkly juice” my son is currently favouring.  Although the driver may be unusual the practice is not, with many people now shopping at both food discounters and the high end supermarkets.

So what drives shoppers between channels, and as such fuels this multichannel landscape?

The key driver for mutichannel shopping is to save money, however the convenience multichannel shopping brings should not be underestimated.  Shopping across multiple channels may take up a larger amount of time than one large weekly shop, but the key for shoppers is how this time is used.

Thanks to retailer expansion, shoppers are now better able to visit stores in a location and at a time convenient to them.  Visiting a town centre store during the working day, an out of town store on the way home from work, even conducting a top-up mission at the petrol station.  This may appear time poor, but it is time convenient for the shopper.

Each channel has strengths to pull shoppers in, and weaknesses that encourage shoppers to look elsewhere.  Supermarkets have tried to find a solution that best meets the needs of all, while discounters, convenience stores and online have grown by better meeting one or two distinct needs.

So what does that mean for us? Well, firstly, until George Osborne, Ed Balls or Russell Brand find a solution, the majority of the British public are still some way off seeing a rise in their disposable income.  Therefore we can expect shopper focus to remain on price, meaning we need to ensure the value of our products is communicated above the line and in-store.

Secondly, some of the tactics learnt during the recession will remain as good practice.  Multichannel is here to stay, so we need to ensure we have dedicated strategies in place to meet the distinct needs of shoppers in each channel.

Finally, savvy tactics cost shoppers’ time and energy.  As prosperity improves we can expect shoppers to place more emphasis on higher quality products and the experiences they have within the stores they visit.  Therefore, to achieve growth, we need to understand in-store behaviour and the drivers behind it.  We must then adapt our offer to ensure the drivers are met in-line with the behaviours we have seen.

Overcoming the barriers to implementing shopper

There are very few companies who don’t now recognise the importance of the shopper as a business stakeholder; yet despite their importance, a truly shopper focused business culture is still something of a rarity. So why is this? What are the barriers to shopper centricity and what needs to change to create this culture?

Barrier #1

Lack of shopper insight

In recent years, the shopper has become a more important stakeholder than ever. The shopper has the power to choose, and the fight for retailer loyalty is failing. Meeting shopper needs is therefore more important than ever, and we can’t do this if we don’t know what those needs are in the first place! Yet most organisations are still lacking in shopper data. Without the right insight, we can’t engage with customers and develop shopper orientated category, customer and brand plans. We should have 360 degree insight; covering everything from shopper confidence & macro retailing trends right through to the detail of how our packaging operates in a shopper context. If you truly understand how your shoppers think and behave along the journey, you will uncover new opportunities, and can use this for your own commercial gain.

Barrier #2

Shopper strategies have to be implemented into another business

The other difficulty with “shopper” in contrast to “consumer” is the challenge of the chain! We have to gain buy in from our retail partners, as well as our colleagues. We often have some great ideas, but struggle to get traction with retailers. The secret to this is early retailer engagement in the project process. Work in partnership with them, suggest shopper marketing initiatives that fall in line with their corporate calendar rather than your corporate agenda.  Design research programmes together, with agreement for testing from the outset. To truly drive top to tops, we should be working with retailers on initiatives that fall outside of our own category and brands (e.g. helping them with their on-line store design or creating a vision for a certain part of the store). The long term benefits of this will be a stronger voice at the table, which in turn will help you to drive your internal agenda.

Barrier # 3

Business Silos

Most businesses will work in silos to a greater or lesser degree. Marketing and Sales often work separately, and shopper will typically sit within the Sales function of an organisation. This means that shopper focused thinking rarely gets included in the marketing and brand planning process. Yet it’s essential that Brand Managers and Marketeers DO adopt shopper thinking. How can we develop NPD and packaging when we don’t know how it will stand out on-line or on shelf to shoppers? How can we advertise to shoppers through Shopper Marketing without understanding their mission and mindset when exposed to this material? Unfortunately, this way of working won’t change unless organisations drive shopper thinking from the top down. Shopper checkpoints should be built into all business processes; with clear KPI’s set for each function. This will require having more shopper experts within the organisation who understand this and help to drive

it within the business.  HR functions must implement shopper performance metrics into appraisal systems if business cultures are truly going to change towards this way of thinking.

Barrier #4

Benefits of shopper implementation are not widely understood

In many cases, the reasons why Marketing functions don’t implement shopper thinking into their planning is due to a lack of understanding as to HOW and WHY shoppers are an important stakeholder for them. Even if we DO have the insight at our finger tips, we need to educate and prove the value of ‘shopper’ to our colleagues through running training programmes and showcasing best practise case studies. This is a large undertaking, and will again require experts who have the back up from senior leadership to drive it.

In summary, having a shopper focused culture within our organisations will be crucial if we want to win with shoppers in the future. This will require investment into shopper insight, changes to how our businesses are structured and top down support to ensure it is embedded into the business culture.

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