Shopper Culture

Upcoming PRISM Panel Discussion

We are looking forward to some interesting dialogue around PRISM at this year’s ISMI Expo in Chicago next month. (If you don’t know PRISM, click here). Earlier this month, the In-Store Marketing Institute began soliciting questions from the industry which will guide a panel discussion at this year’s event. The panel will be comprised of :

• Steve Bratspies, Senior Vice President of Marketing, Wal-Mart Stores Inc.
• David Calhoun, Chairman & CEO, The Nielsen Company
• Sandy Douglas, President & COO, The Coca-Cola Co., North America Group
• Peter Hoyt, Executive Director, In-Store Marketing Institute
• Renetta McCann, Chief Executive Officer, Starcom MediaVest Group
• Bob McDonald, Chief Operating Officer, The Procter & Gamble Co.

Over the last year, as Integer has participated in the PRISM consortium, we have definitely formed our own opinions on how this tool will impact our business. It will be interesting to get a gauge on thoughts and considerations from the rest of the industry. Particularly interesting is the mix of perspectives, hearing from manufacturers, retailers and agencies. 

What will be the level of adoption amongst different key players? What does this really mean for traditional media planning vs retail planning? How will third party data around store traffic and compliance influence conversations between manufacturers and retailers?

Really hoping for some intriguing discussion.

Mother nature helps change shopping behaviour

July was a bit wet in the UK. According to the met office, rainfall was "generally well above average". When it rains in the UK, people generally don't fancy going to the shops much.   Figures just out from the Interactive Media in Retail Group (IMRG) - a leading industry body for global e-retailing - show that UK Internet retail sales rose to £4.2bn in July, up from £2.3bn in the same month a year earlier.

The weather wasn't the only contributory factor. Improvements in retailer web site design and greater penetration of broadband Internet connections make the experience far better for the shopper, so we are seeing a shift in behaviour to greater shopping on-line. This can only be a continuing trend as a greater number of consumers become more and more comfortable with taking their on-line research all the way through to purchase.

This July year on year increase also comes in spite of five Bank of England base rate increases over the same period which many analysts were expecting would have had a negative impact on the overall level of retail sales in the UK.  The increases though do seem to be driven by discounting and summer sales, tactics a number of retailers have used this summer to get Brits spending.

Tension around sustainability

There is a number of growing tensions and emerging paradoxes in the world surrounding sustainability.  One in the US at the moment revolves around some basic food staples - principally those that use corn as an ingredient.

The US is currently experiencing growing interest and support for the production of corn based ethanol because;

- It promises a reduction in the dependence of petroleum resources from other nations.
- There is a perception that it will reduce carbon emissions from driving*.

Trouble is, the use of corn for the production of ethanol is reducing supply for use in food production, causing a rise in the price of some food products.  Food manufacturers are now competing for their raw ingredient with ethanol manufacturers and the increased prices they have to pay are finding their way to shoppers.

Hence the tension.  Wherever you stand on the corn based ethanol issue, it's difficult to ignore the pull, that will only increase, between what we need and want to buy as shoppers and the impacts and effects of our purchases in other areas.  Where will the tipping point come?  When will the realization that the cost of our weekly food shop is rising because of our growing thirst for cleaner cars? How, as shoppers and consumers, are we to balance these tensions?

Our Shopper Culture Study looked at the issue of sustainability and we concluded that, while there is growing awareness of the need to be more responsible, it is not yet a mainstream issue in the US. 

But, will the increase in basic food staples start to raise the consciousness of such effects with US shoppers? 

How much does it have to hurt the purse or wallet each week for people to start asking questions?

What impact will it start to have on other nations (like Mexico) if the US starts to take the bulk of corn production (corn is of course the base of tortillas, a basic food staple in Mexico). What impact will US consumption patterns have on other cultures?

A development that we will be keeping an eye on in the coming months and years.

*For a counter view, that creating ethanol from corn is actually more damaging to the environment and is seen as Unsustainable Subsidized Food Burning, click here.

HBO pop-up pharmacy

What happens when your brand doesn't actually sell any goods but wants the impact of a retail storefront?  Take a look at HBO who just opened a fake pharmacy storefront in Times Square.

Via The Denver Egotist.

Consumers Sip, Rather than Gulp, Green Kool-Aid

Interesting article found today on Marketing VOX regarding the world of Green and how much consumers actually care. Based on a new Yankelovich study, the article points out that despite a glut of media coverage, a relatively small percentage of consumers are really passionate about being Green.

Yankelovich illustrates the degree to which all consumers - from “Green-less” to “Green-Enthusiasts” - are likely to buy a product based on its green features:

• Green-less (29%) Unmoved by environmental issues and alarms
• Green-bits (19%) Don’t care but doing a few things
• Green-steps (25%) Aware, concerned taking steps
• Green-speaks (15%) Talk the talk more than walk the walk
• Green-thusiasts (13%) Environment is a passionate concern

While the largest percentage of Americans are “unmoved”, those “passionate” can still be a valuable niche.  At 30 million strong they are nothing to snicker at, they simply should not be viewed as a mass audience.

Further, this is, to a large degree, a corporate driven movement based on good PR, and the reality is that as “organizations are required to meet strict federal and state environmental regulations - often at huge expense - it makes sense to try and leverage “new and improved” green product to consumers.”

As more marketers are finding Green is not just the color of money anymore, it'll be interesting to see which campaigns hit on the right message for the right audience and which just throw it out to the masses , to find the message falling mostly on deaf ears.

Post-Shopping Regret

This quote came into today on an email from the Henley Centre HeadlightVision. Dr. Michelle Harrison was quoted in an article in The Daily Mail entitled Beware post-shopping regret as saying ...

“Consumption is becoming laced with guilt. Going forward, I suspect that shoppers will continue to feel ‘I’m entitled’, but they will begin to feel guilty about overdoing it. We’re still a long way from women wanting fewer shoes, but I can see changes in the way we feel about shopping.”

The article talks about a growing phenomenon that is gripping the shires in the UK called Post-Shopping Regret - or PSR. The article was a particular dive into the world of dresses and shoes, but it got me wondering as to in how many other categories this particular phenomenon might bubble up? How many Apple iPhone users for example are starting to feel it now that their first bills are turning up from at&t in a box?

How far do we push our need for indulgence and when do we begin to feel some regret of our actions? By creating engaging and exciting store environements, discovery, exploration and theatre, could we push shoppers too far, get them too carried away and find we're growing a new field of opportunity for theropists?

So what do you find you shop for and then feel a twinge of regret afterwards?

Are there any sacred surfaces in store?

The POP Times recently wrote about Maybelline's conveyor belt media test. 
Conspicuously absent from the article is any mention of the clutter factor or any shopper point of view. 

It's got me wondering whether this kind of in-store is truly necessary, helpful or welcome by the actual target audience. 

And one could argue that the harried checkout experience is more about last minute impulse purchases and simply checking out, than it is a place for brand messages.  Not to mention the fact that loads of groceries will be piled upon the belt.

The reality is that as long as the retailer and advertiser feel they are reaching shoppers with impact the program will move forward.  It will probably test well in terms of reach, frequency and recall.  But will we truly hear the shopper's point of view?

Download pop_times_article_august_2007.pdf   

Conventional wisdom and coupons

I found this piece the other day on busting some conventional thinking in the world of coupons. It is based on an analysis of redemption trends that ICOM has undertaken on their rather large, 20 year old redemption database.

The analysis is based on the redemption of coupons issued in direct mail rather than any other medium. The base for analysis was over 6,300 DM programs that have been undertaken and the 425 million coupons they have issued in the US and Canada.

The myths as they tell it are:

Myth #1: Short-term expirations drive immediate sales.
Finding: Consumers need more time. A short expiry often cuts redemption far more than any increase in value can make up.

Myth #2: Higher value always equals higher redemption.
Finding: Value alone isn’t enough. Maximum redemption comes from an optimal value-expiration swet spot.

Myth #3: Store brand users aren’t worth pursuing with target coupon offers.
Finding: As store brands upgrade their quality, fewer store brand consumers will be price-centric and more will be quality and feature conscious. They’ll often redeem targeted offers at rates as high as other competitive users.

Myth #4: Targeting the most loyal users of a competitor’s product yields the best return on a coupon program.
Finding: Light to moderately loyal competitive users are more likely to try a new product and will do so on a lower-value coupon offer.

Myth #5: The presence of a sample is a requisite for driving high redemption rates.
Finding: There are other factors much more likely to drive redemption rates. Some of those include expiration, value, current vs. competitive user, and frequent vs. infrequent coupon user.

Myth #6: The current users of a product don’t need long expirations to get them to redeem a coupon offer.
Finding: Even for current users, to gain more than two-thirds of potential redemptions, offers must be six months at minimum, and in the 10-12 month range for personal care categories like skin and beauty products.

Myth #7: Coupon clutter is pervasive in all delivery strategies.
Finding: Escalated volume is not a factor in targeted coupons mailed directly to homes. Notably, targeted promotion redemption rates are up in this sector for household products and pet products.

Myth #8: Coupon offers on frequently purchased items are redeemed quickly, so an expiration of less than six months will do.
Finding: Targeted offers with expirations shorter than six months in general have only half as many redemptions as longer term offers.

Myth #9: Current and competitive product users need the same coupon value to be motivated.
Finding: In any product sector, current users typically require much less offer value to drive them to purchase. Sectors vary, but it often takes 40% less value to move a current user than a competitive user.

Myth #10: Americans and Canadians share the same coupon redemption behavior.
Finding: There are shared traits, but the difference in absolute redemption rate is substantial. Americans receive 10 times more mail than Canadians and are less likely to respond to offers. Canadians favor contemplation over quick action and require longer expiration terms. The net result: the decline in overall coupon redemption rates is steeper in the United States.

I think most of these are probably intuitive, but some are interesting. Particulalry the difference across the boarder.

This kind of analysis, based on actual bevhaiour, is incredibly useful and another example of the need for longitudinal approaches. Understanding the impact of time, for example, on the rate of redemption is powerrful from a campaign plannig perspective and the strategy you use for your coupons. Being able to understand the time/value trade off makes for some interesting potential changes to strategy.

Follow the pack

The NY Times wrote an article confirming yet again the primacy of primary packaging.  This type of news will only fuel the discussion around the role of in-store communication.  Faced with a pinch from a cluttered out-of-store environment on the one hand and clean-store pressure on the other, it's no wonder the one space brands have complete control over is being reinvented so often.

What does this mean for your brand?