Promo - January 2008 - (Page 24)

Stop and Shop If consumers are having an easier time finding that loaf of bread or catching a sale on a favorite snack, there’s a reason. It’s all part of a growing focus on marketing to shoppers. Manufacturers are projected to boost spending on shopper marketing at a compound annual growth rate of 21% through 2010, according to a new study by the Grocery Manufacturers Association and Deloitte Consulting LLP. Retailers, too, are expected to increase budgets by 26% a year through 2010, the study found. “Clearly, [shopper marketing] is where manufacturers and retailers are placing their bets,” says Nick Handrinos, a partner at Deloitte and lead author of the study. So what’s driving the growth? Competition, a cluttered environment and the growing understanding of the importance of capturing the attention of huge numbers of people moving through grocery stores. “The store is a marketing canvas,” Handrinos says. “The notion that ‘I have a volume of audience in a certain medium I can stimulate with market- MONEY IS FLOWING TOWARD SHOPPER MARKETING ing messages’ is sort of a new idea.” For example, 127 million people visit Wal-Mart each week, nearly double the 68 million people who watch the evening news on ABC, CBS or NBC, the study notes. Seventy percent of purchasing decisions are made in-store, with 68% impulse-driven. “We are hearing most retailers and manufacturers say, ‘Where can I capture my customer?’” says Greg Warren executive vice president, managing director of agency MediaVest. “In-store is a good time to reach them. It is, in a sense, the last mass medium.” The report, “Shopper Marketing: Capturing a Shopper’s Mind, Heart and Wallet,” evaluates the state of shopper marketing in the CPG industry, examines barriers for manufacturers and offers tips on how to make the tactic work. Spending goes toward everything from shelf signs, in-store sampling, displays, loyalty programs, checkout coupons and direct mail. “What is important is how long you can keep customers in the store and keep them entertained and show them new opportunities,” says Stephen Sibert, the GMA’s senior vice president of industry affairs. “It’s about taking advantage of that shopping trip.” Wal-Mart, Kroger, Target, Publix and Wegmans are cited in the report as the most effective retailers in meeting consumer needs. But there are challenges. Some 54% of respondents reported a lack of shopper marketing skills and experience. More than 67% cited a lack of funding and 58% indicated that program execution were major obstacles, according to the report. The key to building effective shopper marketing programs lies in transforming the marketing and sales organization. That includes deciding how budgets are developed, how teams are structured and how programs are executed among other things. The study offers the following tips to help manufacturers collaborate with retailers to improve the shopper marketing experience: • Know your retailer. Align your program with the firm’s overall marketing plan. • Build strong relationships. • Offer solid shopper insight. • Create innovative programs, products and services. “There’s evidence in the marketplace of where the money is going,” Handrinos says. “This is real and we will start to see really good investments happen.” The study is based on surveys of more than 30 manufacturers and retailers and follow-up one-on-one phone interviews conducted from June to September by Deloitte Consulting LLP on behalf of the Grocery Manufacturers Association. —Amy Johannes CAPTURING A SHOPPER’S MIND, HEART AND WALLET • 70% of purchase decisions are made in-store • 68% of in-store purchases are impulse • Only 36% of manufacturers collect shopper insights data • 28% of manufacturers and 43% of retailers plan to signiﬁcantly increase resources to collect shopper data over the next three years • Personal care accounts for the largest number of shopper marketing programs, followed by packaged and processed food, household products, beverages, health care and fresh food. Source: GMA/Deloitte Consulting 2007/Shopper Marketing Study Results 24 January 2008 / WWW.PROMOMAGAZINE.COM / Promo http://www.promomagazine.com

Table of Contents Feed for the Digital Edition of Promo - January 2008

Promo - January 2008 Contents Editor's Note Viral But Virtuous Slap Shot Power Chords Tuning In Auto Play Trekkies Unite Commentary Retail Report: Get In Here! Generating Store Traffic Yankee Candle Shopper Marketing What Seniors Want Cyber Stumping Party Hearty Q & A: Paper Trail Ambush Marketing The Agency Center Resource Center Back-End Foundation Index of Advertisers

Promo - January 2008

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