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The role of facts in marketing

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Colin Harper, the Head of Insight for the IPM explains the huge gap between what shoppers actually do, vs what marketers think they do.

In the headlong rush for the new, integration with existing techniques can be lost, and a focus on what can be achieved by ensuring that one incentive works as hard as possible, goes at the same time.

Colin suggests that working across barriers as the IPA also suggest gets by far the best result, and flagged areas already under test, as well as those to come.

Published in: Business, News & Politics
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The role of facts in marketing

  1. 1. Spot the WMDs in your organisation
  2. 2. Donald Rumsfeld <ul><li>There are known knowns; there are things we know we know. We also know there are known unknowns; that is to say we know there are some things we do not know. But there are also unknown unknowns -- the ones we don't know we don't know </li></ul><ul><ul><li>Intelligence reports -- now shown to have been false -- that Iraq possessed WMDs were the main reason for going in (Rumsfeld February 20, 2011 CNN) </li></ul></ul><ul><ul><ul><li>Cost of War to the US - $816,543,398,098 </li></ul></ul></ul><ul><ul><ul><li>Cost of war to UK - £9,240,000000 </li></ul></ul></ul>
  3. 3. Colin Harper 2011 <ul><li>There are known knowns; there are things we know we know. We also know there are known unknowns; that is to say we know there are some things we do not know. But there are also unknown unknowns -- the ones we don't know we don't know. Lastly, there are things we think we know, that are actually untrue </li></ul>
  4. 4. “ Facts” can have quite a hold <ul><li>“ John Frum” appeared in 1936 in Tanna, Vanuatu in the South Pacific Ocean and predicted the arrival of cargo by plane for them </li></ul><ul><ul><li>Cargo Cultists built planes and runways to welcome this </li></ul></ul><ul><li>John Frum today is both a religion and a political party </li></ul>
  5. 5. Boeing won’t be worried though The arrival of US forces in WWII was the &quot;First Coming&quot; for them and they now await the second In 2011 the cultists say that Christians have been waiting 2,000 years for the second coming and for them a mere 70.
  6. 6. A single misused “fact” can waste an enormous amount of time and resource <ul><li>Before you laugh consider for a moment whether you are actually in possession of all the facts yourselves </li></ul><ul><li>When you start to consider techniques to use have you sub-consciously already ruled some out since you “know” they don’t work </li></ul><ul><li>Or use others since you believe that they do – without benefit of evidence </li></ul>
  7. 7. New Platforms for Growth Based on re-visited “facts”
  8. 8. Building on the last white paper In Place of Sales Driven Discounts there are Collaborative Promotions as a platform for fmcg growth
  9. 9. £14.2 Billion Store Marketing £14.2 Billion Shopper Marketing Brand Marketers Building Long Term Brand Growth Margin and Value Growth is very important Brand Sales Teams Making the Sales Volume Target this year using retailer tools Retailers Meeting their sales targets from brand spend (retaining their own margins)
  10. 10. Mutual objectives <ul><li>Brand Marketing long term growth sharing budget from sales…… </li></ul><ul><li>Sales need to develop sales this financial year delivering….. </li></ul><ul><li>Retailer growth down the aisle and increased store traffic </li></ul><ul><li>Based on greater shopper engagement </li></ul>
  11. 11. 40% of people had next to no impact from price discounts - you said 12% Discounts Mode at 11-20% Source: IPM fast. MAP Marketing Gap
  12. 12. Nearly 60% of people had next to no impact from promotions you said 18% You thought more people used promotions than discounts - Mode at 20-30% Source: IPM fast. MAP Marketing Gap
  13. 13. Marketers are way out <ul><li>There are 50% more light/non-users of promotions than there are of discounts </li></ul><ul><ul><li>Promotion reach outside of this is very similar for promotions and discount </li></ul></ul><ul><ul><li>But for different people </li></ul></ul><ul><li>There is much more scope for promotions than you think </li></ul><ul><ul><li>They typically cost less in incentive terms than discounts and seem to be more effective </li></ul></ul><ul><ul><li>Promotion incentives reward actions – discounts reward everyone for simply being there </li></ul></ul>
  14. 14. Promotion types most used Coupon from pack Coupon from other sources Price Discounts Source: IPM fast. MAP Marketing Gap
  15. 15. Current Research Approaches – 3 Brands <ul><li>On pack “Pick me up” sticker has similar impact to price discounting </li></ul><ul><ul><li>8% redemption </li></ul></ul><ul><li>Switches on the supply chain and store staff in advance of couponing </li></ul>
  16. 16. One promotion can trigger much more than one discount <ul><li>Couponing </li></ul><ul><ul><li>34% of people search their mail for coupons or offers – marketers expected only 12% </li></ul></ul><ul><ul><li>38% of people open and read a letter if they even think there is a coupon there </li></ul></ul><ul><ul><li>44% of people have used a coupon in the last 12 months – marketers said 13% </li></ul></ul><ul><ul><li>Over 70% of Morrisons store managers said they were increasing their stock on display because a coupon distribution impacting their store was due to arrive* </li></ul></ul>*IPM/TNT 2011
  17. 17. <ul><li>Delivered to the catchment area of stores that are stocking, where the managers have been advised and actively support </li></ul>
  18. 18. Why are stores important? Most people are honest Source: IPM fast. MAP Marketing Gap
  19. 19. But stores don’t deliver for shoppers! 88% of mis-redemption instances caused by lack of product Source: IPM fast. MAP Marketing Gap
  20. 20. New listing in this store selling at 50% rate of leading company product Out of stock 7 days later
  21. 21. Matched area testing <ul><li>Trial Results available November/December 2011 </li></ul><ul><li>Webinars and small discussion groups (Think Tanks) available from then </li></ul>
  22. 22. Picking the right incentive <ul><li>There is nothing wrong with using money the trick lies in the presentation of the benefit… </li></ul><ul><ul><ul><li>Scrappage Scheme rather than Discount </li></ul></ul></ul><ul><li>But get the correct value </li></ul><ul><ul><ul><li>The average value according to Valassis is currently (2010) 93 p </li></ul></ul></ul><ul><ul><ul><li>People either respond to coupons, or they don’t* </li></ul></ul></ul><ul><ul><ul><ul><li>20p coupon 38% 50p coupon 42% £1 coupon 54% £5 coupon 55%* </li></ul></ul></ul></ul>*Source: IPM fast. MAP Marketing Gap
  23. 23. Incentives choice is separate from media choice and additive <ul><li>The right incentive can drive a number of actions down a chain </li></ul><ul><ul><li>Provided, of course, they know it is coming their way </li></ul></ul><ul><li>The IPA say that “Advertising coupled with a sales conversion channel such as sales promotion or direct marketing is the most effective combination to drive hard business success. </li></ul><ul><li>Posters are advertising and JC Decaux already know it works with price discounts……. </li></ul>
  24. 24. NORMATIVE DATA 15% 7% CREATIVES SHOWING A BRANDING MESSAGE Pre During Post
  25. 25. 18% 15% NORMATIVE DATA CREATIVES SHOWING A PRICE PROMOTION MESSAGE Pre During Post
  26. 26. Incentive + message = engagement <ul><li>IPM working with iMotions to measure the emotional impact of an added incentive to a communication </li></ul><ul><ul><li>DM and Promotion, it makes no difference it is the engagement with the message that matters </li></ul></ul><ul><li>Reviewing alternative incentives to money </li></ul>
  27. 28. Be cautious about your choice of promotion media Source: IPM fast. MAP Marketing Gap You badly over-estimate Social media But get e-mails right!
  28. 29. Ultimate E-Mail Targeting <ul><li>E-mail lists (2 million) of active profiled promotion/samplers redeemers </li></ul><ul><ul><li>Hive </li></ul></ul><ul><li>Knowing their first and second preference stores for grocery, DIY, Health and Beauty </li></ul><ul><ul><li>Presents an opportunity for brands to grow a retailers business </li></ul></ul><ul><ul><li>Alongside retail media such as posters </li></ul></ul><ul><li>Identifying the best way to contact retail stores and managers </li></ul><ul><ul><li>Including e-mail lists </li></ul></ul>
  29. 30. <ul><li>Are you interested in being kept abreast of “In Place of Price” to be extended outside of fmcg? </li></ul><ul><li>Are you interested in being kept abreast of iMotions emotions tracking to identify key elements of a promotions message on a communication? </li></ul><ul><li>Are you interested in being kept up to data with Ultimate E-mail Targeting results and profiling </li></ul>
  30. 31. Moving On Promotions as core, not peripheral
  31. 32. Source: IPM fast. MAP UK Marketing in Action Study 2011
  32. 33. Costs can be addressed <ul><li>Working with fixed fee companies </li></ul><ul><ul><li>Costs for activities can be both predicted, and a fixed cost applied </li></ul></ul><ul><ul><li>Are you aware of this – and are you interested </li></ul></ul>
  33. 34. Platforms for Growth Based on what you told us you wanted to know about
  34. 35. Defining the total market <ul><li>Coming early 2012 </li></ul><ul><ul><li>Size of the Total Promotions Market </li></ul></ul><ul><ul><ul><li>Market Dynamics </li></ul></ul></ul><ul><ul><ul><li>Market Concerns </li></ul></ul></ul><ul><li>Under discussion for late 2012 </li></ul><ul><ul><li>The Promotions Hand Book </li></ul></ul><ul><ul><ul><li>Market Sizing </li></ul></ul></ul><ul><ul><ul><li>Impact of techniques updates </li></ul></ul></ul><ul><ul><ul><li>Usage of techniques in the last 12 months </li></ul></ul></ul><ul><ul><ul><li>Spend </li></ul></ul></ul><ul><ul><ul><li>Legal latest </li></ul></ul></ul>
  35. 36. Loyalty The most important category marketers wanted to know about
  36. 37. Is Loyalty Important? IPM fast. MAP UK Retailer Loyalty Study
  37. 38. What does this mean? <ul><li>Retailer loyalty schemes appear to make big difference to their performance </li></ul><ul><li>Is this because they are focused away from their core customer needs – driving high churn </li></ul><ul><ul><li>Retail Week research 2011 </li></ul></ul>
  38. 39. What better looks like Source: IPM fast. MAP UK Retailer Loyalty Study
  39. 40. 40% use loyalty schemes to buy more Source: IPM fast. MAP Marketing Gap
  40. 41. Waiting for Sponsors On Line Couponing – The Undiscovered Country The second most important area marketers wanted to know about
  41. 42. Events – working with the BCSC The third most important area marketers want to know about
  42. 43. The Source of Trial Source: IPM fast. MAP UK Marketing in Action Study 2011
  43. 44. The Tr é s Belle creative ran on 6 sheets in both test malls and in both high streets in June 2008. Tr é s Belle: irresistible, inspirational and unavailable
  44. 45. Comparing advertising: prompted ad recall Mall shoppers were significantly more likely to be able to recall seeing posters that they had passed during their shopping trip than those interviewed outside. Ad recall in malls was almost 3 times greater than the high street. 12% Source: Dipsticks Base: 530 shoppers Prompted advertising recall 30%
  45. 46. Summary: Power of 3 Compared with consumers outside shoppers in the mall… - Are 3 times more likely to buy - Are 3 times as likely to be positively aroused - Are 3 times as likely to recall targeted advertising
  46. 47. Are events better when you have a better environment?
  47. 48. <ul><li>Would you find a Promotions Handbook useful in your job/for your company </li></ul><ul><li>Are you interested in being kept abreast of Loyalty – Building from a Firm Base </li></ul><ul><li>Are you interested in being kept in touch with Events as a Driver to Growth </li></ul>
  48. 49. Remove the Weapons of Marketing Destruction from your organisation Working with IPM Insights

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