Shopper path to purchase three biggest decisions you can influence

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Shopper path to purchase three biggest decisions you can influence

  1. 1. Copyright © 2011 The Nielsen Company. Confidential and proprietary. Shopper Path to Purchase: The Three Biggest Decisions You Can Influence Jeanne Danubio, SVP Consumer and Shopper Analytics Perry Hassen, Director Consumer and Shopper Analytics
  2. 2. • Industry Challenges • Shopper Framework • Digital Influence • Benefits • Case Study Shopper path to purchase 2
  3. 3. Poll question #1 In your opinion, what best describes the industry’s definition of “shopper”: a) Clear and well understood b) Ambiguous and not well understood c) The same as “consumer” and used interchangeably d) The same as category management and used interchangeably 3
  4. 4. Consumer Shopper What’s the  difference? 4
  5. 5. Comparing consumer and shopper needs Consumer Needs Requirements that I need fulfilled by the products I buy for me & my family e.g. healthy, durable, filling, tasty Shopper Needs Requirements that I need fulfilled as part of the shopping process e.g. variety, value, convenience, experience 5
  6. 6. The struggle with shoppers Shopper Insights has a reputation for being confusing and not actionable • Limited distinction between shopper and category management • Lack of focus on shopper decisions that can be influenced • Lack of store-level and shopper-level tools to take action where shopper marketing happens Unclear Unfocused Imprecise 6
  7. 7. • Industry Challenges • Shopper Framework • How it works • Digital Influence • Benefits • Case Study Shopper path to purchase 7
  8. 8. Consumers DEMAND Shoppers BUY 8
  9. 9. Connecting consumer and shopper behavior The “path to purchase” is actually a cyclical decision-making process that connects consumer demand to what shoppers buy DEMAND BUY PLAN PLACE PURCHASES EVALUATION CONSUMPTION the path  to purchase 3 biggest decisions you can influence 9
  10. 10. Connecting consumer and shopper behavior Successful shopper marketers use superior insight around the cycle to best impact each decision in their own banners’ or brands’ favor DEMAND BUY PLAN PLACE PURCHASES EVALUATION CONSUMPTION CONSUMER INSIGHTS SHOPPER INSIGHTS MEDIA & SOCIAL  INFLUENCES SATISFACTION DRIVERS CONSUMPTION NEEDS & PATTERNS SHOPPER SEGMENTS TRIPS &  MISSIONS STORE CHOICE DRIVERS PRODUCT &   PLACEMENT PRICE &  PROMO CONSUMER SEGMENTS the path  to purchase 10
  11. 11. Finding clarity on five critical knowledge drivers: Understanding the path to purchase DEMAND BUY PLAN PLACE PURCHASES EVALUATION CONSUMPTION CONSUMER INSIGHTS SHOPPER INSIGHTS MEDIA & SOCIAL  INFLUENCES SATISFACTION DRIVERS CONSUMPTION NEEDS & PATTERNS SHOPPER SEGMENTS TRIPS &  MISSIONS STORE CHOICE DRIVERS PRODUCT &   PLACEMENT PRICE &  PROMO CONSUMER SEGMENTS the path  to purchase SHOPPERS TRIPS & MISSIONS STORES & MARKETS CATEGORIES & PRODUCTS PRICE & PROMOTION 11
  12. 12. Key areas of focus The Right Store Experience The Right Shoppers and Missions The Right Value The Right Products and Placement Building Stronger Relationships Shopper / Trip Segmentation and Identification: engaging your store or brand’s most valuable shoppers and trip missions, through effective and unique ways to segment, identify and reach them. Store Experience and Shopper Conversion: maximize shopper engagement and conversion, and grow in-store marketing ROI by managing store and aisle layout and experience - from navigation paths, to shopper-centric store and aisle design, to more effective use of in-store marketing strategies. Range and Assortment Optimization: attract and convert the right shoppers, for the right trips, and maximize the size of their basket, by managing the right product & category assortment. Price and Promotion Optimization: manage the value perceptions of your brand or store to attract and convert more shoppers and maximize basket size and sales margin, by choosing the right price and promotion strategies to meet all objectives. Shopper Loyalty and Retention: build loyalty and retain more key shoppers by monitoring and managing shopper habits, shopper satisfaction and loyalty as well as equity and image of banners and brands. Key areas of focus 12
  13. 13. • Industry Challenges • Shopper Framework • Digital Influence • Benefits • Case Study Shopper path to purchase 13
  14. 14. Poll question # 2 Which digital application will have the greatest influence on the way shoppers shop for CPG in the next 5 years? a) Product search b) Online circulars c) Social media d) Mobile planning tools e) Ecommerce 14
  15. 15. As we start to tackle  ‘digital shopping’ in  relation to CPG: how much do we  see, and how  much remains to  be seen? 15
  16. 16. The changing retail landscape 16
  17. 17. Consumers live across channels 1. Integrate digital; not independent 2. Multi-channel insight is critical 3. Cross-platform assets a must 17
  18. 18. New dynamics within a common framework Consumer based cross- channel insight is critical Digital Ad and Flyer Effectiveness Web / Mobile planning Influence Sales Share vs. Competition (all channels) Consumer Sentiment, needs, and Satisfaction Marketing Perception Consideration Purchase DigitalPhysical ConnectedOffline DEMAND BUY PLAN PLACE PURCHASES EVALUATION CONSUMPTION 18
  19. 19. A world of change,  a world of challenges… but above all a world of  opportunity So what is beneath that  iceberg? 19
  20. 20. • Industry Challenges • Shopper Framework • Digital Influence • Benefits • Case Study Shopper path to purchase 20
  21. 21. Clearly defining shopper management… fuels retailer collaboration CPG Brand Marketing Objectives Common ‘Sales’ Objectives Retailer Shopper Marketing Objectives ‘Category Management’ ‘Shopper Management’ Requires a mindset change: From “selling more of my brands or categories to the shoppers in your stores” To “using my brands and categories to bring more shoppers to your stores, more often” 21
  22. 22. Focus on key decisions you can influence… results in more effective and efficient marketing efforts CPG Brand Marketing Objectives Common ‘Sales’ Objectives Retailer Shopper Marketing Objectives Brand Demand Brand Consumption In-store Product Choices Trip Planning Channel / Store Choice 22
  23. 23. Deliver precision at a store and shopper level.. drives shopper activation CPG  Brand  Marketing  Objectives Common  ‘Sales’ Objectives Retailer Shopper  Marketing  Objectives Broad Consumer and Market Focus Precise Shopper and Store Focus Depth of Effective Insights 23
  24. 24. • Industry Challenges • Shopper Framework • Digital Influence • Benefits • Case Study Shopper path to purchase 24
  25. 25. Copyright © 2011 The Nielsen Company. Confidential and proprietary. One Size Does NOT Fit All! A Case Study in following the Path 2 Purchase
  26. 26. Case study situation and objectives Retailer X is focused on growing share of wallet among their top 3 Shopper Segments. The Retailer’s strategy is to expand purchasing in stock-up and fill-in trips. Retailer X is partnering with a leading manufacturer in Home Cleaning to provide insights and recommendations that will help drive the Retailer’s shopper strategy. Situation Provide actionable recommendations for the retailer’s top segments that: • Can be influenced pre and in-store • Are at the store and shopper levels Objectives 26
  27. 27. DemandDemand 5% 10% 13% 16% 24% 32% Segment Name “Tag Line/Motto” Distribution HH’s $ Key Characteristics Cul-de-Sacs & Play Dates “What can I buy today?” 23% Young, Affluent Families Enjoys Shopping – Experimental Willing to pay more for quality products Performance Patrons “Only the best!” 27% Older, Affluent Empty Nesters Willing to pay more for quality products Buy and trust only name brands Diligent Deal Seekers “Let’s make a deal!” 16% Blue Collar, Large Families Take pride in searching for the best deals Willing to sacrifice to save money Convenience Connoisseurs “I have better things to do.” 12% Middle-Age 1 member households (High Male) Disinterested shoppers - Just want to get the job done Always go to the same few stores Pragmatic One-Stoppers “Stick to the list.” 12% Older & Low Income Disinterested shoppers Makes list and buys only what they need Proud Penny Pinchers “Make every cent count.” 10% Lower Income, Blue Collar Families - Ethnically Diverse Take pride in searching and finding the best deals Take time to browse the entire store All shoppers are not the same 27
  28. 28. Profile top shoppers Demographics • Young, Affluent, University Educated • Families with Younger Kids • Ethnic Skew Key Qualities • Experimental & Likes to shop • Seen as a “leader” in trying new products and giving product advice • Willing to pay more for quality & trusted Brands Media Preferences • Internet is the Media Trusted the Most, followed by Radio & Magazines • TV & Newspaper Score Low Other Facts • Family & Referral heavily influence buying behavior • Cares about the Environment • Likes to save money, but has no time to look through flyers • Highest Total Store Loyalty to Retailer X – Highest Segment Penetration – Most Productive Segment • Heaviest Cleaners Buyer Anywhere – Opportunity to convert shoppers & expand purchasing in Retailer X Cul-de-Sacs & Play Dates DemandDemand 28
  29. 29. Kitchen/General Cleaners 26% 63% 74% 37% % Buyers % Dollars Light Buyers Heavy Buyers Focus on buyers who matter most Total All Outlets Avg $ Per Buyer $7 $34 DemandDemand 29
  30. 30. Retailer X Share of All Outlets Kitchen/General Cleaners 10% 9% 6% 8% 8% 6% Cul-de-Sacs & Play Dates Performance Patrons Diligent Deal Seekers Total Kit/Gen Buyers Heavy Buyers Size the opportunity $5.1MM Opportunity In Closing Gap DemandDemand 30
  31. 31. Understand the category PlanPlan Source: Category Fundamentals – Household Cleaners Trip Mission Distribution: Total Non-Food Kitchen & HH Cleaner Stock up Routine Fill-in Special Occasion Special Offer Leisure/ Indulgence Shop For Today Emergency Essential Key Category Shopper Metrics: Trip Trigger Power: LOW Best Channel to Buy: Supermarkets Activation Moment: Reminder Shopper Involvement: MODERATE Decision-Making Autonomy: MODERATE Price Perception: Neither Increasing nor Decreasing Private Label Influence: MODERATE 54 44 33 38 1 2 3 4 0 0 4 7 3 3 2 1 For Fun/ To Browse 31
  32. 32. Where do they buy? • “Good Value for Money” is the most important store choice driver for Household Cleaner buyers • Warehouse Club is disproportionately important to Cul-de-Sacs & Play Dates Heavy Buyers All Outlet Share All Products 7% 17% 12% 27% Retailer X Warehouse Club Total Kit/Gen Buyers C-d-S & PD Heavy Buyers PlacePlace 32
  33. 33. Find the best stores PlacePlace 33
  34. 34. Have the right products • Top category attributes – Wipes – Multi-purpose – “Green” – Citrus/Lemon Scent – Bottles (over Triggers) – Store Brand, particularly in Wipes • Higher Level Benefits – Convenience – Sustainability – Value Purcha sesPurcha ses 34
  35. 35. Narrow the search • Baby Care (Diapers, Food, Needs) • Refrigerated Pasta • Ethnic Specialties • Candy Kits • Protein Supplements Purcha sesPurcha ses 35
  36. 36. In‐store Shopping  Influencers Auto-pilot POS/Promotion attention Pack browsing New product attention Staff recommendation Price comparison Shopping companion Advertising Buzz Others’ preference Coupon Pre‐store Shopping  Influencers Data are in percentages Colors are indexes to Total Non-Food: Green – Above Norm (>120) Grey – Parity (80-120) Red – Below Norm (<80) 8 6 6 3 55 25 18 4 2 21 3 Influence category buyersBuyBuy Source: Category Fundamentals – Household Cleaners Kitchen/General Cleaners category is purchased 66% more on deal among the desired segment… 36
  37. 37. • Leverage technology to build a relationship – Shape buzz & reach via social media – Distribute coupons via smart phone – Email time & money saving tips – Offer “sneak peak” deals on new products • Customize – Carry the right Items in the best stores – Focus on high potential shoppers with relevant promotions – Merchandise & promote differently in high warehouse club stores Pre-Store In-Store Recommendations Message on Relevant Benefits “Saves Time,” “Saves Money,” “Helps the Earth” 37
  38. 38. Copyright © 2011 The Nielsen Company. Confidential and proprietary. Thank you!

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