Last week I was both lucky and excited to travel to Dublin to Keynote at the 2013 Shopper Marketing Conference, hosted by Ireland’s leaders in in-store marketing, Visualise. I say I was lucky, because until the week before my partner Mike Anthony was slated to speak but emergency surgery kept him from travelling.

I was joined on stage by a number of exciting speakers, including Graham Kinsella of Dunnhumby; Visualise’s own Eoghan (pronounced Owen in case you are struggling!) Phelan; Rob Thurner of Burner Mobile; and Ken Hughes of Glacier Consulting. In a well-attended event, the audience – which was composed of leading brands, retailers and agencies – was treated to a number of insights into the behavior of Irish shoppers and advice on how to influence this.  Here three shopper marketing lessons which most resonated for me.

Lesson #1 – Get the right message on the right media

Graham Kinsella shared how Irish shoppers had become more promiscuous over the last few years and how they increasingly are citing in-store media as the most relevant influencer of their purchase behavior. Whilst 45% shoppers use a shopping list when shopping, Graham told how many use this as only a guide and that the final decision is often influenced by what they see in-store, meaning that the choice of message and media needs to be optimized to ensure impact.

This message was graphically hammered home as Eoghan Phelan showed the response of Irish shoppers to examples of in-store creative. In a focus group environment, Irish housewives were seen to strongly reject consumer-focused messages about the brand, favoring clear massages that delivered a clear reason to buy. In his presentation however, Eoghan was at pains to show that communication does not have to be all about price: He demonstrated the incredible power of emotional messages in-store by showing shoppers’ response to images of Santa Claus on Coke’s 2012 Christmas campaign.

Rob Thurner supported this general theme to demonstrate the value and application of mobile in communicating to shoppers whilst giving practical tips on how to use the latest tech in an elegantly crafted and delivered presentation.

Lesson #2 In-store communication must ‘pinch nipples’

If anyone saw me tweet this last week they might now be hoping for an explanation. This was forth-coming from behavioral economist Ken Hughes, who has made watching shopper behavior his life’s work. As a world-leading speaker in the field, Ken brilliantly brought to life the key theme of his presentation: That shoppers, like ordinary humans, DON’T behave rationally.

He showed that whilst shoppers can behave outrageously in stores, most of us are operating on auto-pilot with low levels of engagement as we shop. He gave evidence of how, the longer we shop for, the faster we move and the quicker we make decisions. He also demonstrated how the average shopper might spend no more than 30 seconds in a category and as little as 2 seconds buying a product.

In this environment he urged marketers to use creative communication to arrest shoppers and engage them quickly – to effectively pinch them and bring shoppers out of auto-pilot. He showed how emotional messaging, guilt and, in one example, scent can stimulate people to stop, look and buy.

Lesson #3 – Shopper marketing –it’s a global revolution

Following so many great speakers, each delivering such high quality messages, I was impressed that the audience was really up for participating in discussion with me whilst I was presenting. Almost all of the audience agreed with me that shopper marketing was becoming more important in Ireland and many manufacturers are investing in building teams and competence in the area. It’s clear that in Ireland, as elsewhere, the impetus to market to shoppers as well as consumers and retailers is not just ‘smart marketing’. In Dublin, just as in Barcelona,  marketing to shoppers also makes great financial sense – no-one disagreed with the proposition that just breaking even on in-store investment could double profits.

I’m equally convinced that organizations globally are struggling to integrate shopper marketing into their organizations effectively, and in discussions with some manufacturers after my presentation, it was clear that our  five-step “Total Marketing” approach  seems to be as practical and implementable in North-Western Europe, as it has proved to be in other regions of the world.

I hope you’ve find these  shopper marketing lessons useful. If you’d like to see the complete presentation that I gave, please  click  here!

In the blog last week I wrote about the truths shopper marketers need to know behind two of the commonly believed myths in the field. This week I explore the next two: that shopper marketing is just about large super-organized chain stores, and that it’s an evolution from trade marketing and category management.

Myth three: Shopper marketing is only relevant in large stores like Walmart

False: Shopper marketing is marketing. Shopper marketing’s focus is on getting people to behave differently when they are buying and people buy in a massive array of retail environments. We’ve already learnt that shopper marketing can influence people before they head to store, so it’s fair to say that shopper marketing can influence someone’s behavior regardless of the store that they choose.

Let’s take an example: Some years ago we were working with a baby nutrition company. Most of their sales were made in massive hypermarkets and as a result most of their investment was focused on activities to get people to buy more in hypermarkets. The trouble was, when shoppers walked into a hypermarket, they already had a brand in mind. When we followed people through the stores, guess what happened? 98% of them bought the brand they’d planned to buy. All that investment in big stores was changing the behavior of exactly 2% of the population! But when we looked at the very few occasions when a mom decided to change brands, we found these shoppers were 70% more likely to go to a pharmacy. A small amount of careful investment in pharmacies, we concluded, might have a much greater impact in the long term that the massive volume of money spent with hypermarkets.

Implication: Ignoring the potential to influence people’s behavior in independent stores, online or even in less important retailers limits the potential of your brand. Have all your shopper marketing efforts only focused on big retail is therefore going to limit your returns. Make sure you understand the retail environments that are important to growing your brands and invest there, even if it isn’t your biggest customer.

Myth four:  Shopper marketing is part of an evolutionary change

False: Many have argued that shopper marketing is the logical extension of the movement from category management, into in-store marketing and finally to today’s shopper marketing. It isn’t. Shopper marketing is the process of creating and implementing a marketing mix which changes shopping behavior in order to drive consumption. Just because it employs tools that have been developed in category management or in in-store marketing as part of its marketing mix, it doesn’t follow that it is has evolved from these tools. Shopper marketing has become important because marketers recognize the truth behind the first myth: that consumers and shoppers behave differently, so different marketing approaches are needed to get the required response.

Let’s take an example: A couple of weeks ago I highlighted the work that had been done in revitalizing Old Spice as an example of great shopper marketing. This has nothing to do with in-store activation, and everything to do with the insight that in order to get men to stop using their wives’ or girlfriends’ body wash, one has to persuade these shoppers to buy body wash for men. The key element of the marketing mix to make this happen was effectively communicating to women that their partners smell like girls. So good old fashioned advertising, and a cool online campaign did the job that in-store activity would probably have failed to do. This isn’t category management – it’s marketing, with a different outcome.

Implication: Companies that assume that re-branding the trade marketing team “shopper marketing” is all that’s needed will continue to enjoy the same results they have had to date because nothing will have changed. Successful companies realize that shopper marketing demands a fundamental change in the business model, business processes and organization structure. In return for their investments, these successful companies are enjoying sustainable and profitable growth.

If you’d like to learn more about how shopper marketing is transforming the way companies market their brands, pick up a copy of The Shopper Marketing Revolution today!

Shopper marketing is just over a decade old and for many retailers and manufacturers it’s becoming increasingly important. But shopper marketing remains poorly understood by many and as a result, many common myths abound. In this week’s blog and the next, I want to deal the four most common shopper marketing myths, and explore what’s really true, what shopper marketers need to know, and what de-bunking each of these myths means for the modern marketer.

Myth one: Consumers and shoppers are the same

False: I’m yet to work in a category where all the people who buy a product also use it. The proportion of a category sold to shoppers who are not consumers varies enormously from a very large percentage to a very low one. But even when the shopper and the consumer are the same physical being, the behaviors of consumption (drinking a product) and shopping (buying a product) are massively different.

Let’s take an example: I like to drink a cold beer after a game of rugby with my friends, personally. I prefer to drink a more ‘premium’ brand like Heineken over any old beer. These preferences, and the consumption they create, are born out of years of positive “post-rugby-cold-Heineken” experiences – I’m a “premium beer consumer”. Now let’s think about me as a shopper: every few weeks, it’s my turn to buy the beer for the team. Logic suggests I’ll buy Heineken, but when I stop to buy the beer on the way to training, I find another beer is on promotion and in the chiller in a large format pack. Since I’m buying for a bunch of guys, as long as the beer is not a brand I’d actively reject – I’ll buy the promotion to save money (I know – I’m a “cheapskate, deal-buying shopper”!).

Implication: Marketers who assume that activities that build brand equity in the mind of a consumer will automatically drive sales are often disappointed. Different consumption and shopping behaviors are driven by different stimuli – so they require different activities to deliver the required results. For campaigns to be really successful separate, and yet linked, consumer and shopper components are needed.

Myth two: Shopper marketing only happens in-store

False: We are always shopping – especially today when we interface with brands in so many different ways. In actual fact the process of shopping begins long before we go to a store – it starts with a consumption gap (you can read more on this in one of Mike Anthony’s recent blogs):  he second I realize a product is absent from a regular cycle of consumption, I consider buying it, or I ask someone else to. At that moment the shopping process has begun and long before a shopper walks into the store, they first have to think about how urgent the trip is and which stores are most likely to ensure the trip is successful.

Let’s take an example: On the odd occasion I’m home to bath by one-year-old I notice we are down to our last “night-time” diaper. I mention this to my wife;now she has a choice: to wait until she does our regular shop or to send me around the corner to the local c-store. If it’s the latter two things will happen; firstly we will spend more per diaper (the C-store only has small packs and they are priced at a premium) and secondly we won’t use our preferred brand because the local C-store doesn’t stock it.

Implication: Marketers who believe that all that’s needed to deliver shopper behavior is a few well-sited displays or promotions in a key retail chain often get lower returns on their investment. Those who are able to prioritize shoppers and shopper missions are able to close sales faster, more easily and at less cost because they know how to lever their total marketing budget both outside and inside the store.

Next week I’ll deal with the next two myths that are most commonly associated with shopper marketing: that shopper marketing is just about large super-organized chain stores, and that it’s an evolution from trade marketing and category management. Find out the truth behind these myths, that all shopper marketers need to know by subscribing to my blog.

I love the way sites like Vimeo and YouTube give me access to shopper marketing cases from around the world. The thing is, how do you know the cases you come across are examples of ‘great shopper marketing’?

Let’s take two examples. The first is a case a friend shared with me from P&G in the UK a couple of weeks ago, titled “P&G Neat Cuts – Win 1 of 100 £100 haircuts – Shopper Marketing by Capture”. The offer is simple – buy any hair care product at a 33% price discount and claim the opportunity to win a free haircut.

Is this ‘good’ shopper marketing? 

In our new book, “The Shopper Marketing Revolution“ Mike Anthony and I lay out the case for shopper marketing to be defined as:

“The systematic creation and application of elements of the marketing mix to affect positive change in shopper behavior in order to drive consumption of a brand”.

At first blush, you could argue this promotion is an example of a marketing activity targeting shoppers: it targets shoppers of hair care brands, gives them an offer (which is part of a marketing mix) to induce them to buy from a selection of brands which presumably will be used by consumers in the home.  Is it shopper marketing though? Well not really, it’s only actually an example of part of the potential marketing mix used to change a purchase behavior. This is a bit like saying that advertising is ‘consumer marketing’ – it’s just not!

But semantics aside, is this case actually any good? 

Well, if the goal of shopper marketing is to increase consumption of a brand, one has to test this by asking, “how many existing consumers will use more of the brand more often?” or “how many new consumers will it acquire?”  The answer to the first question is “unlikely”: Giving me a price cut or indeed, a haircut is very unlikely to drive me to wash my hair more often, so no new consumption will come from this.

The activity may attract new consumers, BUT, what sort of consumers will it acquire? Deep price cuts appeal most to a segment of the population known as ‘deal buyers’. These guys either choose the cheapest product on offer, or choose from a portfolio of brands based on the best available price. In most cases this means that the ultimate consumer who uses the product is not likely to be brand loyal. The net effect then is a temporary blip in market share that is quickly eroded as the next brand in the portfolio offers a deal.

You might argue that this is a reasonable short-term outcome, but since most brand managers are responsible for brand profitability, this sort of activity can have pretty ruinous effects on the bottom line. P&G is a profitable company, delivering a 23.5% EBITDA margin, but slashing prices by 33% guarantees a loss of at least 9.5%. This is a heavy price to pay for short-term market share gain don’t you think?

What is great shopper marketing then?

Now my second example, the Old Spice “I’m on a horse commercial”; of course the appeal of this advert is it’s bizarrely fun, but behind it is a fantastic shopper marketing case study.

It’s such a good example because it meets the four criteria I lay down for great shopper marketing:

1. Great shopper marketing is insight led: Clearly the team behind the Old Spice ad had two killer insights which drove the campaign:
   1. Women buy shower gel for their male partners, and;
   2. Males in a relationship with females will often wash with whatever is in the shower, even if they end up smelling like a girl!
2. Great shopper marketing encourages a change in purchase behavior: This campaign, and the many that followed, encourages the girl to buy something specifically for her guy. This increases her portfolio as a shopper, driving new sales.
3. Great shopper marketing encourages new consumption: Whether guys saw the ad or not, and indeed, whether they liked Old Spice or not, with a ‘male’ product in the shower, they are likely to use this instead of the ‘female’ one. This drives new consumers to the brand, a sure-fire way to boost consumption.
4. Great shopper marketing delivers superior returns on investment: The Old Spice team choose to use prime-time TV and viral videos as the lead element of their marketing mix, which indicates heavy investment. But think about what this investment delivers: literally hundreds of thousands of incremental purchases of shower gel. These new sales, and the profits they create massively increase the probability of real ROI.

What’s great about this case is that it shows that getting shopper marketing right is not rocket science; it’s simply about knowing what consumption you want to create, how shopper behavior needs to change and then defining what activities will make that happen.

Read “The Shopper Marketing Revolution” (available for the Kindle now on Amazon.com) to get practical, step-by- step advice on how to make your shopper marketing great.