Shopper Marketing 101 – Product Availability

Which would you buy?
Which would you buy?

With all the talk surrounding advances in shopper marketing, many marketers might be tempted to forget that the biggest single influencer of shopper behavior is product availability. Put it this way, if a shopper can’t find the product, she won’t buy the product and chances are, she’ll buy a substitute instead.

With the vast majority of purchases being made on the home shelf in stores and off the regular page online, ensuring your product is present and visible is the first responsibility of the shopper marketing team. This might sound like a glib statement but ensuring product availability is surprisingly tough to get right and astoundingly easy to get wrong.

Here’s a few simple rules every shopper marketer should bear in mind.

Make sure it’s ‘there’

Ok, I know this is really basic but a shopper can’t buy your product if it’s not for sale where they are shopping. This doesn’t mean that your product has to be everywhere – I’m not suggesting that anything less than 100% distribution is a failure. What I am urging, though, is that brands understand who their target shopper is, what he wants to buy and where he wants to buy it.

This means that range and distribution targets should be set with the target shopper in mind and not just based on the efficiency of any given route-to-market. In today’s grocery markets the tectonic plates of retail are shifting; big-box, one-stop shops are giving ground to online outlets, discounters and convenience stores. Waiting for these channels to become significant for your brand may make your brand insignificant as the shoppers who are flocking to these environments choose your competitors and not you.

Shopper marketers are stewards of a brand’s future and their challenge is to always ensure that there’s a product available to the brand’s shoppers, wherever they choose to shop.

Just because it’s ‘there’ doesn’t mean it’s ‘there’

Be super careful of relying on inventory reporting for peace of mind. The fact that a product might be showing up as being in distribution doesn’t necessarily mean that it’s available for purchase. As a sales guy years ago a lot of the time I wasted in stores was spent hunting through stock rooms trying to find that box of Twix that had been delivered but hadn’t made it to the shelf.

In online stores, shoppers expect to be able to receive everything they want at the same time, so if your product isn’t in-stock, even when it’s on the page, there’ll be a bunch of folks who choose the other brand that is there.

As a shopper marketer, the only time you can relax is when you know your product is available to buy, in the right place and in sufficient quantity to meet your shoppers’ demand. (I know that means, like, never!)

Just because it’s ‘there’ doesn’t mean that it’s fit for purchase

Have a look at the pic I posted above, now have a look again – which bottle would you buy? The one full to the brim or the one that only looks part full? I’m guessing you and I would come to the same conclusion – the one that’s full!

As shoppers we always want the best, so apparent product quality is a must. Damaged and dirty goods turn us off and whilst a committed shopper might look for a perfect pack, others may just as quickly switch to something else. The same holds true online, perhaps more so, if the product imagery doesn’t look outstanding, some shoppers will go elsewhere.

As a shopper marketer, doing your level best to nail the quality of your presentation in store is a great way to win shoppers for your brand.

Just because its ‘there’ doesn’t mean I can see it

Shops are busy places and shoppers are busy people, in the average superstore, shoppers will browse a category for 30 seconds – that’s 30 seconds to find your product amongst the other 200 or so products on sale. In surveys we’ve done, shoppers often cite not being able to find a product on shelf as the key reason why they switch brands. Scarily, in many of the cases, the product was on shelf, just not in a place where it was easy to find.

On a website, particularly one that sells grocery products, getting visibility is going to get harder: Here algorithms determine what shoppers see. As these algorithms get smarter, so the pressure on shopper marketers will increase. But for shopper marketers, obsessing about how visibility can be constantly improved is far more likely to pay greater dividends than the next big thematic activity.

So what does all this mean?

An awful lot of ‘shopper marketing’ initiatives seem to focus on the short-term delivery of great communications gimmicks or super, shiny, new promotions. Indeed one team I work with currently spends over 80% of their time working on promotions alone.  Interestingly though, as we’ve worked through a re-organization process, the team has learnt the true RoI their efforts and it’s not pretty.

Uncovering the true value of product availability by contrast has had a profound effect on way this team thinks and on the way they will organize themselves. Their new plan is to focus over half of their resources on continuous improvement of product availability. I think this is the mark of a true shopper marketing team; one that knows that marketing to shoppers requires the use of the full range arrows in their quiver – availability, communication and offer.

In our book, “The Shopper Marketing Revolution”, Mike Anthony and I explore what it takes to make a great shopper marketing team and we talk extensively about getting product availability right. Incidentally, the book is available to shoppers globally, just click here!

Are you wasting money on in-store displays?

Have you ever been told by your friendly retail partner, “We have millions of shoppers, invest in our in-store displays and you’ll have access to this huge audience”? Chances are that if you’ve worked with any of the world’s major retailers you have.

in-store displaysFor many this has become a powerful rationalisation for expenditure in-store, especially as media fragmentation and retail consolidation fuelled a boom in point-of-purchase advertising. Indeed POPAI – the industry’s leading association, continues to heavily promote the benefits of in-store displays by publishing studies claiming that in excess of 70% of purchase decisions are made in stores.

Regular readers will know I’m not an advocate of this point of view, but I recently came across a post by Herb Sorenson, one of the world’s leading thinkers in shopper behaviour, which puts a very different spin on the value of in-store displays. In Herb’s post “The Incredibly Shrinking (In-Store) “Audience”” he presents an extremely well researched case that your in-store displays might only engage a tiny proportion of shoppers.

Herb suggests that as little as one in 140,000 shoppers are likely to engage with a specific in-store display. If this is true why invest in-store displays?

The evidence: shoppers will never see every in-store display

There’s a commonly held view in retail that a small proportion of products that account for the bulk of a store’s sales. Herb reckons this to be around 5%. With many shoppers buying less than five items in-store, it stands to reason few of us visit every part of the store. Herbs research tells us that shopper visit about 33% of a small supermarket just over 12% of a superstore. So potentially 80% of the ads in an average-sized grocery store never get seen.

The evidence: shoppers can never see every in-store display

Stores might be stuffed full of displays but having eyes located on the front of our heads means that we have a limited field of vision – a cone of 130°. So this means that even when we are surrounded by messages we could only ever see a third of these. As a result we miss nearly 93% of all in-store displays. Weirdly, we did some research a few years ago into the way mums shopped for milk powder in Asia and one of our key findings was that only 6.9% of people noticed a milk powder display.

The evidence: shoppers can never engage in every in-store display

Shopping is not like watching TV, we aren’t static and focussed on one thing. When we shop, we move our gaze every tenth of a second, Herb shows. It’s suggested that people are often working on autopilot in stores. This has been proven to be the case by the behavioural economist Ken Hughes (click here to see him talking). Ken shows us that few of us are engaged in the shopping process until we need to be.

When we do engage, we focus. This means we miss even more of what’s going on in-store. When we focus, our attention is drawn into a cone of just 2° – just 1/4000 of our total field of vision.

The inference – very few shoppers engage in an in-store display

Putting all Herb’s evidence together, the picture is fairly scary. For instance think about Tesco UK. Their website boasts that they service 75 million shopping trips a week. Let’s pretend, for fun, that this means they have 75 million shoppers a week. Using some of Herb’s numbers 15 million pass any given display, of which a third might notice it in their field of vision. That’s potentially 5 million shoppers who might see your display BUT only 1200 will actively engage in it.

If you think about what a display might cost in Tesco, the cost per impression is looking pretty high – but is it a waste of money?

Making in-store displays work

A few fundamental lessons can be drawn from all this:

  1. Target your shopper carefully – know who you want to communicate to and focus on getting your message across to them. Randomly targeting a message in store is unlikely to work so specificity is likely to deliver better results.
  2. Put your messages in places where they will see them – if you want to change someone’s behaviour, you first have to understand their current behaviour. If you’re targeting a shopper who habitually visits a part of the store – site messages in that part of the store and prioritise work in the home shelf if that’s where most sales are made.
  3. Use the whole field of vision – hoping that someone will focus on a tiny part of the shelf is unlikely to work. So avoid small pieces of point-of-sale material. Instead, use large blocks of colour and big, simple, pictorial messages to draw them to your brand.
  4. Use multiple media – hoping that one message will get through is unlikely to reap rewards so combine multiple media to get the message home. Combining old and new technologies like mobile-in-store with point-of-sale materials, colourful category themes and effective promoters reduces the chances you’ll be missed.

We’ve helped hundreds of managers develop inventive in-store solutions that drive better returns. If you suspect you could get more from the store, contact me to arrange a conversation about how you might do that.

Share this post with your colleagues:

Why Are Grocery Stores So Dull?

Why are grocery stores so dull?I’ve been spending a lot of time in grocery stores recently. Over the last six months I’ve visited supermarkets and hypermarkets in two continents and in seven different countries.  You’d think that in such a diverse world, with so many cultural differences, that our grocery stores would reflect our diversity and differences, wouldn’t you?

And yet when I compare grocery stores in Spain and Singapore, Udine and Udon Thani, Dublin and Driotwich I’m often faced with exactly the same picture: aisle after aisle of uniformly presented shelves full of evenly stacked and ubiquitous products. The similarity between the places we shop in is striking and at the same time it’s stultifying!

Do  grocery stores have to be so dull?

On a recent trip to Ireland, I got to spend some time with Ken Hughes from Glacier Consulting, and it was that meeting that got me thinking about this. Ken is a behavioral economist, which means he’s interested in how our behaviors influence the economic choices we make. He applies this expertise when looking at the way we shop. He has watched shoppers, measured their brain waves, even tracked the speed at which trolleys are pushed through stores and all of his research leads to a singular conclusion – when we shop, we do so on auto-pilot.

Studies time and again bear this out; as grocery shoppers we pay little attention to our environment, only seeking out the products we actually want in a category most of the time. Ken likens this to using the grocery store as an extension to our pantries – we just reach into stores and grab what we want, without really thinking about it.  So of course we find shopping dull – for many of us it’s dead time.

But does the in-store environment of grocery stores we shop in need to be dull?

Dull environments sustain habits

Ironically, a dull environment may be exactly what we need. A dull environment may not be sexy but it is extremely predictable.  Predictability supports habits.

We actually buy a relatively limited range of grocery products every year and we tend to buy from portfolios of brands we trust – in effect many of us buy grocery products habitually. Many shoppers habitually go to the same store every week for their groceries and many of us will be familiar with the sensation when go shopping that we can’t really remember where we’ve been in the store and how our carts managed to get so full. The conclusion that shopping is habitual for many people is therefore unavoidable.

Retailers and manufacturers like this. For good reasons: it helps them plan; predictable habits support accurate forecasting which leads to effective inventory, logistics and production planning, all of which keeps costs down.

So dull, predictable environments are good for manufacturers and retailers, right? Well, no!

In order to grow, habits need to change

You don’t have to be a student of physics to have heard Einstein’s definition of insanity: “Doing the same thing over and over again and expecting different results.” This should be invoked often in the world of consumer goods marketing, because whilst the industry craves predictability, it needs growth to thrive. Unfortunately, the only way to grow is to encourage shoppers’ behavior to change, either by getting people who don’t buy to buy or buy getting those who do buy, to buy more, more often.

To do this, shopping environments need to be dynamic.

Creating a dynamic shopping environment

One of the coolest things about online retail environments is they have the potential to be in permanent flux. As my needs change and develop, Amazon’s offer (for instance) changes to reflect my changing behavior. Bricks and mortar stores are not so flexible, so creating a dynamic in-store environment  of grocery stores is a much bigger ask. It requires a much higher level of collaboration between manufacturers and retailers to be successful. Together they need to:

  1. Identify the shopper behavior they want – do manufacturers and retailers want shoppers to trade-up, buy in greater volumes, join the category for the first time or (yes) stick to what they’ve always done?
  2. Ensure that the store can deliver – store operators (and their suppliers) need to be honest about what can be achieved in a grocery outlet. Will shoppers notice the new bigger idea? Are they prepared to take the extra time to learn about the category? Will they be upset if you mess with their habits?
  3. Define what needs to happen to change behavior – behaviors change as a result of stimuli – if you provide the right stimuli, behaviors will change. So together, retailers and manufacturers need to learn what stimuli really work.
  4. Make change a habit – shoppers will adapt to changes in retail environments quickly, so what was once an innovation rapidly becomes wall-paper and new habits get formed. To continue growing, marketers and merchants have to consistently innovate.

At engage we’ve made it our mission to help consumer goods companies to improve their engagement with consumers, shoppers and retail customers. If you are facing a growth challenge, contact us, to learn how we can help.

Carrefour Gets it Right: Excellent in-store execution in Italy

In-Store ExecutionAlmost a year ago I posted a blog explaining why I thought Carrefour might fail in China. This was based on a series of store visits to Carrefour Shanghai. Earlier this year a visit to another Carrefour store in Barcelona  did relatively little to change my views. Readers of both posts will probably conclude I’m not much of a Carrefour fan, so imagine my surprise when I visited stores in Northern Italy that demonstrated that Carrefour can get it right – their in-store execution was spot-on!

Back to basics

The stores I visited were both in Udine, a major regional center in the Northern province of  Friuli-Venezia Giulia and they showed that when Carrefour gets back to the basics of effective retailing, they can really nail it in there outlets.

What I saw in the outlets was that Carrefour can:

  • Deliver excellence in fresh foods
  • Create great in-store environments
  • Make their offering regionally compelling
  • Deliver a coherent pricing strategy

Excellence in Fresh

I love shopping in Italy’s supermarkets, not such much because they are fabulous retailers but more because they really do have the best fresh food offers in the world. Italians demand the best in fresh produce so in any store you will find a great deli offer, fantastic fresh meat and fish and a fabulous choice of seasonal fresh veg. The Carrefour stores I saw were best in class in this whilst working to a globally recognizable footprint.

Carrefour’s MacelleriaAnother example of excellent in-store execution is in Carrefour’s “Macelleria” (Butchery), where shoppers queue to get their hand cut hams from a team of well-trained, efficient staff, in a well-laid out and fully-equipped deli station. And whilst the station itself does little to re-create the glamour of shopping in a family-owned specialist, it does a great job of delivering on Italians’ needs in terms of choice, freshness and appropriate pricing.

With many Italians are still eating as a family, especially at lunchtime, the right offer in fresh foods brings shoppers back to the store frequently whilst encouraging greater expenditure on affordable luxuries every trip.

Great in-store environments

Carrefour YoghurtYogurt is a pretty tough category to make interesting as often chilled units do little to convey a sense of theatre or to communicate shopper needs effectively. So this execution of the yogurt category got me excited. Not only is it clearly differentiated but also it does a great job of communicating the needs reflected in each segment cleanly and clearly.

This clever execution no doubt has hugely positive impact not only on total sales, but also in driving traffic into higher value segments.

Regionally relevant offers

The Flavors Of Your Land
“The Flavors Of Your Land”

Shoppers all over the world seem to respond positively to the availably of not just generically available global brands but also to products that fit local tastes and preferences. This makes the supermarket experience just a little more personal, and offering a curated choice of regional product can differentiate a global retailer from its competitors, building local loyalty.

The people of Friuli are rightly proud of their excellent wines, which are produced in the western hills of the province. Carrefour’s wine fixture gives prominence to this – offering as much space to regional wines as is given to all other wines combined.

I particularly like the communication here. The sign says “The flavors of your land”.

Coherent pricing strategy – delivered

Carrefour Pasta AssortiaToo much of Carrefour’s focus in other countries is on promotions and whilst in these stores there were plenty of offers, one didn’t feel that the core message was ‘cheap’. What was interesting however was the clever use of pricing to encourage active comparison and to facilitate choice. These stores did this in two ways – the first very clearly, the second much more covertly.

Carrefour makes no bones about offering a strong house brand but the way these stores communicated the value point of this brand was very clever. In key stable categories (Pasta, Biscuits, Oil), the different tiers of pricing were clearly on show.

In an approach that apes Tesco’s “good, better, best” strategy, known brands were compared on fixture with own label products. This is a far less cynical approach to own branding than that traditionally used by retailers – it offers shopper a clear choice without undermining the value of a known brand. The effect is a great profit-driving outcome as Carrefour can both capitalize on the higher cash profit of the known brand whilst also leveraging the higher percentage margin or its own brand – another example of excellent in-store execution.

Carrefour WhiskeyThe second, more covert strategy is shown on the whiskey fixture.

Here higher value product is given prominence in the hotspot – lower cost brands being sited either at the bottom or the top of the fixture. Placing high value items between shoulder and hip-height draws attention to the higher cost alternatives, driving trade up – another great outcome for brand and retailer alike.

Does excellent in-store execution mean a brighter future for Carrefour?

There’s a lot here that isn’t on show in many Carrefour outlets and it should be. Over dependence on promotions, a lack-luster fresh offer and poor merchandising have done a lot to undermine the retailer in recent years and performance has reflected this. If what the Italian business unit is doing is an indicator of the future, then better result should follow. All of the strategies shown here demonstrate a much clear focus on securing shopper loyalty and improving the profitability of the overall offer, which is to be applauded. The test for Carrefour is whether these in-store strategies can be efficiently applied in markets globally.

The manufacturer’s challenge:

What I’ve seen in Italy is a far cry from executions in perhaps more key markets like China, Spain and Taiwan and many manufacturers have struggled to gain traction in collaborating with Carrefour to enhance in-store execution and drive an agenda that extends beyond price and margin. Cases like these can be used to address this and effectively demonstrate what can be achieved within the group.

If you are struggling to get better traction with Carrefour and want specialist advice on how to do this in your market, feel free to contact me or my colleagues at engage.