View stunning SlideShares in full-screen with the new iOS app!Introducing SlideShare for AndroidExplore all your favorite topics in the SlideShare appGet the SlideShare app to Save for Later — even offline
View stunning SlideShares in full-screen with the new Android app!View stunning SlideShares in full-screen with the new iOS app!
Meet Our Bosses, The Ivanovs: Olga and Igor… Olga is 35 y.o Igor is 37 y.o. They have one child
P&G is focused to build full understanding of consumer, shopper and environment Talk to people Visit people at their homes Observe people In-store Register and analyze purchases Conduct Quantitative studies Model and predict consumer and market behavior
They lag behind some aspects (lower ownership of durables, PC etc.)
Russians are highly educated, doing skilled work vs. other countries Source: TGI, 2005, age 15+ USA NCS 05/06, age 18+ % Russia Poland USA High education - urban women - urban male 32 38 11 9 25 26 Employment - urban women - urban male 58 75 36 52 57 70
2009 – She purchases more cosmetics and skin care products. Shopping for beauty is considered as “time for myself” and is expected to be a pleasurable experience.
Source: TGI Russia, 2009 FOM fact-book 2009, MCA 2003 Usage of cosmetics (%), 2000-2009 Women 45+ Moscow Russians are heavily beauty focused 57 89 Being well dressed is important, % 41 90 Be attractive for men is important, % WE Russia
What did we learn regarding Crisis Impact on Russian Consumer?
2008 Crisis Hit 2008-09 economic changes have affected Ivanovs’ welfare
Purchasing Power in Moscow, St Petersburg and the top cities won’t decline significantly:
Absolute income level is high.
Unemployment risk is lower.
Consumers have alternative sources of income.
Share of FMCG in consumption basket is lower to save on.
While small cities are more strongly affected by the crisis:
Township enterprises are suffering financial difficulties. leading to consumption crisis in regions.
Retailers are revising their plans in regions.
Families living in big cities are not as affected by crisis as their friends in smaller cities of Russia Novosibirsk Krasnoyarsk Vladivostok Ekaterinburg Volgograd Saratov Moscow St.Petersburg Kazan Samara Izhevsk Omsk Chelyabinsk Perm Ufa
The Ivanovs reflected financial constraints in their spending behavior
Cut down on out of home entertainment
Postpone some home improvements
Started saving on non-essential food and clothes
Shopping behavior became more rational
Source: Crisis Tracker consumer research
The Ivanovs are stressed, more than ever before 1) Life is very busy 2) Now they have less possibilities to pay for free time and retreat Source: TGI and Crisis Tracker (COMCON) Russian consumers saved on: Eating out 38% Leisure, travels 24% Hobby, sport 23%
The Ivanovs changed their shopping behavior: P&G crisis tracker JFM’2009 % consumers Changes In Product Usage Russia Ukraine 2009 2009 Switched to cheaper stores 18 24 Switched to cheaper brands 16 16 Up-sized 9 10 Down-sized 3 4
How could we together improve the lives of Russian Consumers post-crisis?
Opportunity for joint collaboration between Retailers and Suppliers to improve in-store experience:
1. Help to organize departments & categories according to SHOPPER NEEDS
2. Drive PRODUCT AVAILABILITY on-shelf
Shopper behavior differs by trade channel She does BIG time-consuming shopping for WHOLE FAMILY in Hypermarkets She EXPECTS PROFESSIONAL HELP in baby Stores She BROWSES AND LOOKS FOR INFO/EXPERIENCES in Perfumery She COMES TO SOCIALIZE to Open Market She makes ROUTINE purchases at BEST PRICE in Discounter She is ready to PAY MORE for BEST QUALITY in Pharmacy
Design right Shopping Experience for each channel
Right Shelf based on Shopper Decision Tree
Right Category Adjacency within the Department
Right Promotional Strategy
EXAMPLE: Grooming Category Re-design in KARUSEL
Male Grooming Category Shoppers
70% of shoppers buy Blades & Razors from the main shelf
Highly planned purchase - above 70%
High level of loyalty on Blades&Razors (retailer loses 66% if OOS)