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shopper centric Document Transcript

  • 1. RE SE ARCH REP ORTShopper-Centric success I t’s like being a mini General Manager without latter to the extent that one’s shopper marketing the authority. That was how the head of shopper initiatives extend to packaging and pallet changes. marketing at a major consumer packaged-goods According to the survey, most (80 percent) company described her job to us last month. companies do not succeed in these types of endeavors. She went on to explain that the job requires her to This is because they think that just restructuring boxes, work with virtually every department in the company responsibilities and communications process flow plus and often convince them to disrupt their normal adding a little training will be sufficient. procedures to make shopper marketing What they do not anticipate — or 5 “work” in their organization. don’t feel it is necessary to address — is It’s a tough job, but she stays the underlying, broad resistance to because she knows shopper marketing is these types of changes that inevitably making a difference. Reveries.com survey comes from those with a vested interest respondents agree with her. Virtually all respondents with experience in shopper barriers in preserving the status quo. Actually, this is so common that marketing report one or more significant to shopper change-management experts have been benefits they would not have achieved able to codify this resistance into five without shopper marketing. For example, marketing common barriers. 43 percent cited “improved sales”; 32 percent “better meeting shopper and how to Barrier #1. I don’t know where we’re going with this, so I’ll keep doing needs” and 30 percent “improved retail customer relationships.” address them. what I know. Other ways in which this barrier manifests itself are represented The indications are that none of in the following quotes from the MMBY CHRIS HOYTMM these companies was able to achieve Reveries.com survey: these results without considerable & G A I L P E T E R S E N , P H .D “This may be fine for a company disruption to traditional approaches. like P & G or Unilever, but I don’t see how When asked, “What changes, if any, has your it applies to my brand.” company made to overcome the [internal] barriers to “I don’t really get the difference between the shopper the success of shopper marketing?” — all respondents and the consumer. It’s a given that all consumers shop reported that their companies did various things that so what’s the big deal?” significantly changed the game for most departments. “We have been meeting our objectives for five Thirty-nine percent said “required that shopper straight years without shopper marketing…and we’re marketing initiatives are now an integral part of the not about to blow up our organization for something annual brand planning process,” while 29 percent said as indefinite as attempting to grow share through “re-engineered to assure close internal and external retailers.” collaboration and alignment on shopper marketing These comments are typical of people when first initiatives.” (see table I) exposed to a new initiative where they can’t see the The message from these responses is that shopper benefit to change. They literally fog out. It’s called the marketing cannot be treated as a bolt-on. To become first wall of resistance. truly proficient at shopper marketing, one must How does one overcome this first wall or avoid now be prepared to cope with core changes that change and what success will look like. With respect involve the entire organization — Sales, Marketing, to shopper marketing, this means top management Market Research, Customer Marketing, Advertising, understanding of — and commitment to — the concept, Consumer Promotion and even Manufacturing — the and a clear vision of why marketing to one’s target 34 THE HUB MAY/JUNE 2007
  • 2. TA B L E 1. What changes, if any, has your company made to overcome barriers to shopper marketing? Required that shopper marketing initiatives are now an 39.2% integral part of the annual brand planning process Reengineered to assure close internal and external collaboration and alignment across departments on shopper marketing 28.8% initiatives (marketing / sales / promotion / agencies, etc.) Put marketing execs on key retailer account teams 22.9% Provided specialized training and education 22.9% on shopper marketing via outside experts Changed or added promotion agencies because 22.9% of their expertise in shopper marketing Established a separately funded, dedicated 20.9% shopper marketing function Changed incentives to align marketing and sales objectives 17% Added promotion agency representation 9.2% to certain key account teams Assured funding for shopper marketing initiatives 7.8% via a corporate tax or other form of dedicated funding Other 15.7%S O U R C E : Reveries.comconsumers as shoppers as opposed to just consumers behavioral change of almost all managers andis important. employees in almost all frontline departments, it must The vision should be kicked-off with an initial, be sold-in through a way that makes everyone want toeye-opening and attention-getting event that lets achieve its objectives and willingly participate.people know it’s not business-as-usual. One company Barrier #2. When those people over in “Frozen” getdid this by dedicating its entire annual meeting to on board, then maybe I’ll join in. Shopper marketingshopper marketing, while another insisted that all is particularly difficult to plan and implement inemployees shadow shoppers on different types of companies that organized into separate operatingshopping trips. groups because it requires that these groups fully The vision must be communicated through mul- integrate to succeed.tiple mediums, repeatedly and often over an extended In these types of environments, people often havetime frame. Systematic, top-down attention must be a “what’s-in-it-for-me?” reaction when confrontedfocused on the initiative until it becomes part of the with the idea are often are most concerned withD.N.A. of all stakeholders. In uncertain times, people what they might lose — whether this be autonomy,look for role models and examples of what the new control, resources or just plain personal comfort. Aperformance looks like — smart leaders know this and parochial view emerges that puts the interest of theirpublicize those efforts in every forum possible, such particular operating group ahead of the interests ofas town halls, e-mail memos or small celebrations. the company. One must then translate the overall strategy so In addition, there can be an inherent resistancethat employees, at every level, understand how it to change, particularly if they are already meetingapplies to their jobs and benefits them to extend their objectives. Sometimes, an elaborate rationale isknowledge base and learn new skills. constructed as to why their brands are not suitable to Bottom Line: Because shopper marketing — if be portfolioed — and marketed — with those of otherdone correctly — requires new learning and operating groups. MAY/JUNE 2007 THE HUB 35
  • 3. Meanwhile, the initiative bogs down because it to Sales for developing consumer insights for categorydoesn’t get the full support of a leadership team acting management recommendations.as one voice. People, lower down, sense the dissension With respect to shopper marketing, the reality isand hang back, saying, “If they can’t agree, I’m not that it cannot be successfully planned or implementedgoing to risk my career on this.” Resources get held without informed Marketing Department participationup, diverted, or otherwise committed, and the general and cross-functional collaboration.confusion often leads to inertia Because shopper marketing inherently involves To avoid this resistance, top management must retail, and because many in marketing are trained tobe sure that all operating groups are on board and view anything having to do with the word retail ascommitted to the success of the initiative — flesh out tactical, they default the effort to Sales and pay littleall issues and objections before the launch. attention to it. This is why so many companies make Insist that all operating groups present a unified the initial mistake of forming a dedicated shopper-front — not only to their own organizations but also to marketing department comprised solely of salespeoplethe rest of the company in total. Have frequent review and then compound it by having the departmentmeetings with operating-group leadership to assure report to Sales.continued cross-departmental integration and to stay Anticipating and avoiding the negatives associatedon top of problems and opportunities. with this barrier requires a corporate commitment In addition, reinforce corporate commitment by that elevates shopper marketing to the same level ofproviding the right resources to the right people. If importance traditionally ascribed to consumer (brand)necessary, make personnel changes that signal to the marketing. It also demands the re-training and re-rest of the organization that the company is committed to education of all Marketing Department personnel onshopper marketing and fully intends to see this through. the role retailers can play in helping them achieve Bottom Line: Top management can’t just give lip their objectives.service to shopper marketing; they have to be hands- Shopper marketing initiatives must become anon and actively drive the effort. integral part of the annual brand planning process — Barrier #3. What do you mean I have to start cited by Reveries’ survey respondents as the mostworking with retailers? That’s not in my job description! important step that shopper marketing practitionersFor most companies, the biggest hurdle with respect have taken. Methodologies and tools that help breakto getting an effective shopper marketing program off traditional thinking should be provided and marketingthe ground is getting Marketing on board. executives should be put on key retailer account teams In fact, more than 55 percent of the respondents to as a prerequisite to general management responsibilities.the Reveries.com survey on shopper marketing noted Bottom Line: Marketing must become aligned withthat one of the most important factors in becoming an the business imperative through new organizationaleffective shopper marketing organization is “Marketing structures and skills.Department understanding of the strategic potential of Barrier #4. I’ll join this effort as long as I stillretail and pro-active participation in developing get my comp and bonus the way I’m used to. This isshopper marketing initiatives.” where many implementation efforts fall down—not Why has this proven so difficult for some? measuring and rewarding people’s performance in With the difficulty in reaching one’s target consumer line with the new, required goals.today — caused by media fragmentation and consumer People are very rational and efficient with theirperception of marketing overload — marketers are time. They essentially say, “It’s not what you tell melooking at all varieties of alternative media. One would to do, it’s what you measure me on that counts.” Forthink that marketing in the one place — the retail store — example, top management undercuts their effortswhere they can be assured of reaching 100 percent of when they tell people they must now collaboratetheir target consumers at least four times per month across functions but still reward people on individualat a time when consumers are focused on selection performance for acheiving the same goals as in previouswould command at least as much of their attention as years.cell phone or blog marketing. As a result, people may pretend to go along but, Marketing involvement has proven to be particularly in the end, do what they know will affect their walletschallenging for some because Marketing has remained and even their promotions. The mixed message againso steadfastly removed from retail. Marketing Depart- confuses people and they go back to their defaultments, in many companies, have abrogated responsibility setting (i.e., what has worked before).36 THE HUB MAY/JUNE 2007
  • 4. T A B L E 2 . What does shopper marketing “success” look like in your company or client, in terms of hard benefits? Improved Sales 42.7% 45.3% Improved Loyalty 18.3% Improved ROI 17.7% Improved Share 13.4% Improved Trial 3.7% Other 4.3% S O U R C E : Reveries.com Beyond the impact of formal reward systems, in knowing the types of initiatives that deliver thewhich are sometimes difficult to change, leaders make highest return-on-investment.the common mistake of ignoring more informal rewards. It is for this reason that once one decides toThese can include public recognition of actions, both embark on a shopper marketing strategy, sustainabilityat the group and individual level, which specifically becomes imperative. Ways to address:demonstrate the new skills and business performance • Use all of the tools previously mentioned — athat are desired. clearly articulated vision, attention-getting corporate Bottom Line: Align the formal compensation/ kick-off, ensuring that all leadership is on board,reward system closely with the new strategy while constant training, retraining, education and follow-using the power of informal rewards. up, aligning incentives with objectives and frequent Barrier #5. This too shall pass. It’s a fact of life recognition of accomplishments.that most employees have lived — even suffered — • Continually re-calibrate the objectives sothrough many business initiatives in their careers. that they always stretch participants and keep theTwo that come to mind immediately are DPP (Direct momentum strong. A common, frequent error inProduct Profitability) of the early ‘80s and ECR (Efficient this regard is declaring “success” too soon in anConsumer Response) of the early ’90s — both now environment where people may just be doing thedefunct, although initially positioned as great panaceas. minimum to show they are cooperating. As soon asIt is as a result of these types of initiatives — plus many management turns it focus away, the organizationothers that are corporately sponsored and then not lapses back to its old behavior.followed through — that employees become cynical and Bottom Line: Keep the momentum going and alwayscall them the “flavor of the month.” This is the second be on the lookout for new, hidden barriers. Re-calibratewall of resistance — passive-aggressive cosmetic the effort and keep the hammer down. ■compliance. “We’ll go along until the rah-rah wearsoff, then it’s back to business as usual.” This begs the question of whether shopper CHRIS HOYT is president of Hoytmarketing is going to go the way of DPP or ECR or & Company, a Scottsdale, Arizona-whether its potential justifies the relatively significant based marketing/sales consulting andinvestment companies will have to make to become training organization that specializestruly excellent at it — an investment to which we have in shopper marketing. Chris may be reached at (480) 513-0547 or atbriefly alluded in this article. chrishoyt@hoytnet.com. For those who are still in the throes of makingthis decision, know that because profitable shopper GAIL PETERSEN is an associate ofmarketing is data-base driven, the lead your competitors Hoyt & Company and specializeshave established will be difficult to overcome. For in organizational development and change management. Gail may beevery year your competitors gain experience with reached at (480) 585-6644 or atshopper marketing, they are that much further gailpetersen@hoytnet.comahead in knowing what works and doesn’t work fortheir brands in specific accounts and formats and MAY/JUNE 2007 THE HUB 37