Way to Shop­pers` Mind, Heart & Wal­let!

Point of Purchase - - CONTENTS - Au­thor - KEN BAR­NETT is global CEO of Mars Ad­ver­tis­ing

Shop­pers are be­com­ing tech savvier than ever, they are fast, fickle and hard to catch in a world which is close to be­com­ing ‘dig­i­tal­dom’. It’s there­fore es­sen­tial that we learn the tricks of the trade. Here is an in­ter­na­tional piece on how you can cap­ture you ‘Dig­i­tal and so­cial shop­per’, read on and know a lit­tle more about this com­plex be­ing.

Han­dle With Care

Do what’s right for to­day’s dig­i­tal shop­per -- not just what’s on-trend.

Any mar­keter would be ex­cited about the over­ar­ch­ing po­ten­tial ben­e­fits that emerg­ing me­dia pro­vide. We can’t help but be en­thu­si­as­tic as we con­tem­plate the what-ifs.

What if we could tar­get com­mu­ni­ca­tions to a brand’s most valu­able shop­pers? What if we could per­son­al­ize each com­mu­ni­ca­tion? What if we could de­liver the com­mu­ni­ca­tion based on the shop­per’s lo­ca­tion? In real time? All the while mea­sur­ing to un­der­stand the tan­gi­ble busi­ness impact and ac­quir­ing data to op­ti­mize fu­ture initiatives? On top of that, add the ben­e­fits of be­ing both green and cost-ef­fi­cient.

There are, how­ever, some alarm bells rem­i­nis­cent of the ir­ra­tional ex­u­ber­ance of the dot-com years when we hear peo­ple speak of “the dig­i­tal path-top­ur­chase” — im­ply­ing that this is a strate­gic foun­da­tion. Par­tic­u­larly dis­con­cert­ing are state­ments like the re­cent dec­la­ra­tion in an IPG Me­di­aLab trend re­port that “2011 is the year that our tra­di­tional me­dia and con­sumer tools be­gin to dis­ap­pear — 2011 is the year loy­alty cards, cable boxes and fea­ture phones jump the shark; at the same time, mo­bile, gam­ing, and dig­i­tal be­hav­iors are now ma­jor­ity ac­tiv­i­ties across all de­mo­graph­ics.”

While we em­brace the op­por­tu­ni­ties dig­i­tal af­fords for com­mu­ni­cat­ing with shop­pers, state­ments like th­ese may ac­tu­ally im­pede suc­cess­ful in­te­gra­tion into the shop­per’s path. First, they tend to silo emerg­ing me­dia. Sec­ond, while we ap­pre­ci­ate the en­thu­si­asm, it is im­por­tant to in­te­grate emerg­ing me­dia in a man­ner that re­flects the pace of the con­sumer’s abil­ity to ab­sorb them— dig­i­tal is not a “one size fits all” propo­si­tion.

Lastly — and most im­por­tant — the hy­per­bole tends to di­vert at­ten­tion away from fo­cus on the shop­per and onto the me­dia we use to com­mu­ni­cate with that shop­per. This is ex­actly the op­po­site of what should be hap­pen­ing. The shop­per is the hero.

The best ap­proach is to start with a thor­ough un­der­stand­ing of our con­sumer as a shop­per and work back along the path to un­der­stand the best com­bi­na­tion of on­line and off­line ways to en­gage with them. Put sim­ply, if it doesn’t work for the shop­per, it doesn’t work. In this process, the fo­cus is al­ways on do­ing what’s right ver­sus what’s on­trend.

Con­sumers as Shop­pers: How do we de­fine what’s right? One of the most im­por­tant rea­sons for the de­vel­op­ment of shop­per mar­ket­ing is to un­der­stand how one’s core tar­get con­sumers be­have as they morph into a shop­per mind­set

— i.e., the “need states” or “shop­ping modes” that de­ter­mine what they buy, where they buy it and why. As most know, the most com­mon need states are driven by time, money, care for fam­ily and care for self. Un­der­stand­ing shop­pers based on their needs pro­vides a con­ve­nient way to seg­ment them that cuts across de­mo­graphic lines and en­ables mar­keters to com­mu­ni­cate in much more com­pelling and rel­e­vant ways.

For ex­am­ple, let’s look at two home­im­prove­ment seg­men­ta­tion case stud­ies. One il­lus­trates the de­mo­graphic ap­proach while the other demon­strates the needs-based ap­proach. What do we learn from the de­mo­graphic ap­proach? The fol­low­ing are quotes from the find­ings:

“Se­niors have higher pur­chas­ing rates than other gen­er­a­tional seg­ments and boomers re­main a key seg­ment in the home im­prove­ment sec­tor.”

“Boomers and se­niors are sig­nif­i­cantly more likely than younger gen­er­a­tions to have pur­chased at least one item on their last visit.”

“Af­flu­ent shop­pers are also more likely to have pur­chased some­thing com­pared with lower in­come house­holds.”

“Un­til Gen Y emerges as a buy­ing force in the com­ing years, the older gen­er­a­tional co­horts will re­main the key driv­ers of growth in the next five years.”

“Most are in the store to buy but many buy on im­pulse.”

“Eight per­cent of all shop­pers will walk out empty-handed dur­ing a given store visit de­spite the fact that they came with the in­ten­tion to buy some­thing.” What do we learn from the needs-based ap­proach? There are two types of home im­prove­ment shop­pers: “plan­ners” and “taskers.”

“Plan­ners” typ­i­cally take on rel­a­tively big home-im­prove­ment jobs. They have an emo­tional con­nec­tion with their work and a sense of pride and con­fi­dence when they are suc­cess­ful. They plan and price projects down to the last bolt. They know ex­actly what they are do­ing be­fore they start. They value ex­pert ad­vice. They pre­fer a highly in­ter­ac­tive, high-touch and re­spon­sive shop­ping ex­pe­ri­ence. For this seg­ment, most learn­ing takes place with hu­man in­ter­ac­tion from a trusted source.

“Taskers” want to get a spe­cific job done — of­ten in an emer­gency. They are task-ori­ented, with a goal to re­pair or main­tain. They are not deeply en­gaged and just want to com­plete the job as fast as pos­si­ble to get back to the tele­vi­sion set.

At times they will not even read in­struc­tions or take di­rec­tion. They want to find what they need and get in and out quickly.

Based on th­ese de­scrip­tions, what is the best way to mar­ket to each seg­ment? For ex­am­ple, if all you knew were the de­mo­graph­ics, would you de­velop an app for track­ing progress on the pro­ject to meet the “plan­ner’s” needs? Would you de­velop an in-store finder app for the “tasker”? What is the bal­ance be­tween lead­ing shop­pers by pro­vid­ing a dig­i­tal tool they un­der­stand and can use ver­sus leap-frog­ging their dig­i­tal ca­pa­bil­i­ties?

The best ap­proach is to do an in­depth anal­y­sis of how “plan­ners” and “taskers” think in each key phase on their re­spec­tive paths-top­ur­chase and struc­ture me­dia and mes­sag­ing ac­cord­ingly. How­ever, the “de­mo­graph­ics only” ap­proach is prob­lem­atic be­cause of its lim­ited scope and lack of mean­ing­ful in­sights. Nor­mally, when con­fronted with this sit­u­a­tion, it is ad­vis­able to add the needs-based di­men­sion in or­der to be as rel­e­vant as pos­si­ble.

Path-to-Pur­chase: There are only three ob­jec­tives for path-to-pur­chase mar­ket­ing: on the list; in the cart and in the heart. The brand’s ob­jec­tive for the pre-shop phase is to get on the shop­per’s list. How this is accomplished will vary by brand but may in­clude cre­at­ing aware­ness, why your prod­uct is right for a par­tic­u­lar shop­per seg­ment or where it can be pur­chased. It may in­clude ed­u­ca­tion on prod­uct ben­e­fits or an in­cen­tive to pur­chase.

Tra­di­tion­ally, th­ese types of needs have been ad­dressed through ad­ver­tis­ing, par­tic­i­pa­tion in re­tailer cir­cu­lars or free-stand­ing inserts. The dig­i­tal ver­sions of th­ese tools ramp up the con­ve­nience fac­tor with search­a­bil­ity, auto-down­load­ing of coupons, mo­bile re­tail apps, pric­ing com­par­isons and geo-ag­gre­ga­tion of re­tailer web­sites based on shop­per zip codes.

How­ever, the most sig­nif­i­cant and in­flu­en­tial fac­tor in the pre-shop phase is word-of-mouth af­fir­ma­tion em­pow­ered by so­cial net­work­ing. For ex­am­ple Ad­ver­tis­ing Age re­ported that 68 per­cent of Mil­len­ni­als (80 mil­lion peo­ple!) check with friends be­fore mak­ing any ma­jor de­ci­sion.

Sim­i­larly, a Baby Boomer con­firmed that, de­spite the pre-launch mil­lions spent on movie ad­ver­tis­ing, a friend’s opinion of the movie was usu­ally the de­cid­ing fac­tor in whether he would go or not. A mis­step by a brand or re­tailer is im­me­di­ately chron­i­cled on Yelp for all to see. The les­son: your tar­get shop­pers’ friends and com­mu­ni­ties can in­stantly wipe out mil­lions of dol­lars in mar­ket­ing ef­forts if your brand (or ser­vice) is not re­spon­si­ble and re­spon­sive.

The “shop” sec­tion of the path has a sim­ple brand ob­jec­tive — get your prod­uct in the shop­per’s cart. Price and pro­mo­tion are the tra­di­tional stan­dards and — par­tic­u­larly in a price-sen­si­tive econ­omy — play an ob­vi­ously crit­i­cal role. Both re­tail­ers and mar­keters are begin­ning to em­brace some in-store dig­i­tal initiatives — from hand­helds to touch screens — but smart­phoneen­abled tac­tics have the strong­est growth tra­jec­tory.

Presently, th­ese mo­bile initiatives are fo­cused pri­mar­ily in three ar­eas: a) im­prov­ing the shop­ping ex­pe­ri­ence by help­ing shop­pers find the right prod­uct (e.g., Mei­jer’s “Find It” app or Ro­bi­tussin’s “Re­lief Finder”); b) pro­vid­ing in­for­ma­tion to help shop­pers val­i­date a pur­chase; and c) pro­mo­tion — in real time. Smart mar­keters view the in-store direct-to-con­sumer brand con­nec­tion that mo­bile pro­vides as a nec­es­sary hedge against re­tailer de­ci­sions that could dis­ad­van­tage a brand in-store. Ac­cord­ing to the Hub mag­a­zine “Shop­per Mar­ket­ing Up­date,” (Ready at Re­tail, July/Au­gust 2011) 86 per­cent of shop­per mar­keters ex­pect that most of their dig­i­tal ef­forts over the next three years will be in mo­bile.

A word of cau­tion on the mo­bile con­nec­tion: This is an area where ir­ra­tional ex­u­ber­ance reigns. Sta­tis­tics vary wildly as to ac­tual US smart­phone pen­e­tra­tion and growth projections. The best num­bers we have heard (from eMar­keter) peg cur­rent smart­phone pen­e­tra­tion at 31 per­cent of to­tal US mo­bile users and pro­ject this to grow to 43 per­cent by the end of 2015. In other words, bar­ring a sig­nif­i­cant price drop in smart­phone plans, ex­pect growth to be mod­est, es­pe­cially with un­em­ploy­ment over nine per­cent.

The ob­jec­tive of the post-shop sec­tion of the path is to get one’s brand in the shop­per’s heart — to earn that shop­per’s per­sonal loy­alty and his or her ad­vo­cacy for one’s brand. The post-shop is the area where com­bin­ing dig­i­tal me­dia and so­cial net­work­ing has the power to be trans­for­ma­tive for mar­keters and brands. The ideal sce­nario is not only to gen­er­ate sat­is­fied users but to ex­ceed ex­pec­ta­tions so that th­ese users will be­come your ad­vo­cates on so­cial net­works — which now to­tal 150 mil­lion users in the US — 63.7 per­cent of the on­line pop­u­la­tion.

The post-shop com­po­nent of the path com­pletes the loop and feeds the preshop for re­peat pur­chases and in­creased loy­alty. To do this suc­cess­fully, there must be a re­turn-on-in­vest­ment for the shop­per be­yond the value of the brand. This could be emo­tional or fi­nan­cial, de­pend­ing on the shop­per’s needs.

For ex­am­ple, best-in-class cos­metic com­pa­nies do ev­ery­thing they can to make their shop­pers feel beau­ti­ful, not just sell them prod­uct. The value shop­per ap­pre­ci­ates coupons or free­bies while the sta­tus shop­per wants to be in an ex­clu­sive group. The technophile wants to be first on the block with the new­est tech­nol­ogy. Costco is one of the best in the busi­ness at pro­vid­ing val­ueadded to its mem­bers, while Ama­zon has the abil­ity to an­tic­i­pate needs and en­sure the high­est pos­si­ble de­gree of per­son­al­iza­tion.

Con­text mat­ters: Your shop­per has a mar­ket­ing spam fil­ter. In fact, most are now re­sis­tant to in­tru­sive or in­ter­rup­tive ad­ver­tis­ing. Of 300 mil­lion reg­is­tered phone users in the US, 200 mil­lion are on the Fed­eral “Do Not Call” list. Eighty-six per­cent say they bought DVRs specif­i­cally to skip ads. An­other 44 per­cent does not open direct mail.

In other words, peo­ple don’t want to be sledge ham­mered; they want to be en­gaged and guided via rel­e­vant con­ver­sa­tions. Mes­sages that help a shop­per with a prob­lem or meet a need at the time it is needed are ac­tu­ally wel­comed and some­times even shared. Dig­i­tal mar­ket­ing is es­pe­cially ap­pro­pri­ate be­cause it’s eas­ily per­son­al­ized, lo­cal­ized and real-time.

Clos­ing the op­por­tu­nity gap. De­spite the hype, ev­ery­one is not to­tally into dig­i­tal. There are still large seg­ments of con­sumers that have yet to max­i­mize the op­por­tu­nity. This is why best-in­class mar­keters must care­fully blend both on­line and off­line to com­mu­ni­cate ef­fec­tively on the path-to-pur­chase.

When do­ing so, we would en­cour­age you to un­der­stand and mon­i­tor the evo­lu­tion of your tar­get shop­pers in the dig­i­tal realm. Where are they now? Are there early adopters who can direct you on which tech­nolo­gies will take hold with your tar­gets? In addition, un­der­stand the role of dig­i­tal on the path-to-pur­chase for your brands and cat­e­gories. Where on the path are crit­i­cal de­ci­sions made? What is the most rel­e­vant con­text for the brand and shop­per to en­gage? Which dig­i­tal ex­e­cu­tions pro­vide a real or per­ceived ben­e­fit to your shop­pers?

Com­mit to data ac­qui­si­tion and an­a­lyt­ics. Do you use ev­ery touch­point as a chance to cap­ture data and learn more about your shop­per? Have you es­tab­lished key per­for­mance in­di­ca­tors? Are you score­card­ing re­sults? Have you se­lected the most mean­ing­ful met­rics? Most im­por­tant, have some fun. Add dig­i­tal com­po­nents to more tra­di­tional ex­e­cu­tions. Work with your re­tail­ers. Ex­per­i­ment. Have con­ver­sa­tions. Play games. Let your brand’s per­son­al­ity out of the box. Then learn from it

The ob­jec­tive of the post­shop sec­tion of the path is to get one’s brand in the shop­per’s heart — to earn that shop­per’s per­sonal loy­alty and his or her ad­vo­cacy for one’s brand. The post-shop is the area where com­bin­ing dig­i­tal me­dia and so­cial net­work­ing has the power to be trans­for­ma­tive for mar­keters and brands.

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