Recently Markus Ståhlberg & Ville Maila were interviewed by Wes Isley, editor U.S. custom content publisher Pace Communications (http://pacecommunications.com/). The interview was about the Shopper Marketing Book and Shopper Marketing Sector. The main objective of the interview is discussing how the supermarket industry can benefit from the shopper marketing strategy.
We thought of Sharing the interview exclusively with all the Phenomena blog readers even before the interview was published online. Here goes:
1. The book features more than 30 articles from retailing and marketing experts worldwide. How did you and co-author Ville Maila select the experts and articles that appear in the book?
To answer to this question we need to go back to the origins of the book. Phenomena has practiced shopper marketing since 2003 and by 2007 we recognized a clear need for defining what shopper marketing really consisted of. We saw that there were specialist companies emerging everywhere that represented actually quite extensive spectrum of marketing and sales related services, from packaging design to shelf-space optimization. We started getting touch with people we knew around the world and also approached previously unknown companies about their possible interest towards contributing to the “milestone in shopper marketing” as we called the project back then. Since many of the author-candidates we approached had never heard about the company, it was initially rather difficult to build credibility for the project. To be honest the author selection followed quite simple pattern of contacting large number of interesting companies and cherry picking the best quality material from the resulting articles.
2. The articles stress that shopper marketing is different from traditional grocery store advertising and marketing. Rather than attempting to change shopper behavior, it aims to understand behavior and respond accordingly. Are more supermarket retailers and manufacturers adopting this new approach or is there resistance? If there is resistance, what are the reasons?
On general level, I don’t think there is any reason for retailers to object with shopper marketing as such. After all, it means that manufacturers are investing to their shoppers in the store instead of the brand’s target group outside the store and to increasing purchase decisions instead of building the brand. Only reason to object for retailers is of course one of the main drivers of shopper marketing in the manufacturer end; gaining more space and attention in the store for their products.
I would actually disagree with the point of not trying to change shopper behaviour. Key insight about shopper marketing is that shoppers are somewhat unconscious in the store and if the brands did not try to change their behaviour, they would always buy the same products. In other words, the way I see it is that from shopper behaviour point of view, shopper marketing’s key benefit is to make it easier to make purchase decisions, i.e. to change shopper’s behaviour for their own benefit.
3. Perhaps the main takeaway point is that there is a difference between “shoppers” and “consumers.” Are retailers readily embracing this distinction? Why or why not?
Categorically speaking, retailers are much more interested in shoppers, not in consumers. Shopper marketing is actually a built-in ideology to retailing – retailers have always practiced shopper marketing. I think a better question would be, should the retailers pay more attention to consumers as well?
The question applies much better for manufacturers, who generally haven’t seen a difference between the shopper and consumer. When the manufacturers were in power until the 90s, the consumer ruled the scene and once retailers took over, suddenly also shopper became an important topic of discussion.
4. As a shopper, I like the emphasis on improving the supermarket environment because it seems the basic design never changes. Why are grocery retailers and manufacturers slow to make these kinds of changes?
Logistics rules in fast moving consumer goods (read, Every Day Low Price is the most efficient method of gaining shopper loyalty). You can ask yourself – if there was a supermarket chain with 30 % higher prices, because of fancy logistically inefficient store-design – would you shop there? It’s all about getting the stuff in and out as efficiently as possible. I would not foresee drastic changes to supermarket layouts in near future.
5. I like the idea of breaking out of the traditional category approach to grocery store design because I currently must travel the entire supermarket to get ingredients just for one meal. Will we ever have a “breakfast solutions” section, for example, that includes milk, cereal, bacon and eggs, all together in one spot?
This is a nice idea, but what if somebody wants eggs for baking? Where should she go – would there be eggs in multiple locations within the store? Or would it just be stacked only based on the common usage occasion? In the previous case, it would be a logistic problem and probably the square inches of shelf used would not be very efficient. In the latter case, I doubt whether a person wanting do her baking would really see why she has to visit the breakfast section to find eggs. There could be some niche store concept that support this kind of ideology, but I don’t think it is in sync with logistics driven mass retailing.
6. I confess that when I shop, I’m on a mission to get in and get out, so I’m unlikely to watch TV screens or otherwise linger at the point of purchase. How can shopper marketing successfully address that kind of behavior?
We have been thought to follow the ideology of efficient logistics. This varies between different markets, however. For instance in China and Asia in general shopping is considered to be entertainment, which of course has a drastic effect on which concepts succeed. Regarding the question about shopper media, I do think it has huge potential in helping shoppers to make their purchase decisions. When considering shopper marketing, it is all about volumes (actually it’s very similar to other media). The idea is not that 50 % of shoppers will buy the product because of the ad – it could be considered very efficient if only 1 % responded (e.g. from 30.000 shoppers, 300 would buy).
As a remark, it is important to understand that there are very few SKU’s that are purchased by more than 15 % of all shoppers. I recently witnessed an analysis of one major retailers customer data, which showed that out of their 15.000 bar codes there were only 50 products that were bought by more than 15 % of people and of these many were unbranded products, such as cucumber or tomatoes.
The key elements of success, in my opinion, for shopper media is that it is considered a sales building tool instead of a brand building one and that it is optimized for the purchase decision process that takes 5 seconds.
7. You stress gathering accurate research data and using it effectively to be successful at shopper marketing. What would you say to the argument that “times are tough, and we can’t afford it right now?”
I would ask, what can you afford? Shopper marketing aims for increasing purchase decisions and as such is a sales building tool producing immediate results. So I would ask where do you put your money to?
8. In the case of some other grocery marketing strategies, sharing personal shopping habits with retailers and manufacturers has not translated into tangible benefits for the shopper. How will a shopper marketing approach differ?
Shopper Marketing aims to understand shopper behaviour and to make it easier to make purchase decisions. This will be beneficial for shoppers only if the shopper’s purchase decisions result in consumer satisfaction. So it is all about giving you the correct reason to buy a product that you will potentially like. In the end, successful shopper marketing should result in repeated purchases, or loyalty towards the product and brand.
9. Another key to shopper marketing success is getting support between all stakeholders: retail, manufacturing, marketing, sales. What advice would you give to someone who sees the potential of shopper marketing but who needs to persuade skeptical team members?
I don’t think you need much to convince retailers or sales to shopper marketing. For the marketing department, it definitely requires the biggest change in mindset. Briefly, marketers should understand that they must start focusing on two completely different worlds, that of consumers’ (which they already master) and that of shoppers’. Succeeding in both requires mastering two arts, instead of one. The biggest and most common mistake is to apply the rules of consumer marketing to shopper marketing. For manufacturing shopper marketing means bigger volumes, which is hardly a problem. However, the most efficient medium for shoppers is the package – that reaches 100 % of the target group. Using packaging as a medium involves manufacturing as well through tricky and costly design changes. For manufacturing the best guideline is to compare the investment (through labor and direct costs) to buying media. Media is expensive and you pay a high premium to an external media owner. Your packages are owned and controlled by you and you only pay the direct costs associated with the work and materials, with no premium at all. Therefore efficient use of packaging as a medium should usually be a better investment than traditional media.
About Shopper Marketing Book
World’s first book on Shopper Marketing combines the perspectives of 35 internationally recognized shopper marketing experts, among them Phenomena’s top specialists.
Shopper Marketing is compiled of articles written by 35 individual contributors from around the world. The book is edited by Markus Ståhlberg and Ville Maila. Markus is the CEO of Phenomena Group Ltd, and Ville is the Planning Director.
Contributors include among others:
Simon Uwins / Tesco plc, Paco Underhill / Envirosell, Herb Sorensen / TNS Sorensen, Matt Nitzberg/ dunnhumby Ltd, Lubov Kelbakh / Nestlé Rossiya, Gordon Pincott / Millward Brown, Jim Lucas / Draftfcb, Brian Harris / The Partnering Group, Al Wittemen / TracyLocke, Gerardine Padbury / IGD, David Sommer / MEC Retail, Gwen Morrison / The Store (WPP), Clemens Steckner / G/D/P Marktanalysen, Toon Van Galen / Ratera & van Galen, Scott Young / Perception Research Services and 20 more!