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In the age of customer centricity, at least a nominal one, it is curious to define and bring forward the role and responsibilities of shopper marketing and marketeers. In age of the customer, when customer is the king, is there really a need to have a shopper marketing strategy and shopper marketeers? Well, for one, customers and shoppers might not always be the same person, and quite often they're actually not. For example, men might be your actual shopper profile for a women or baby product in house-hold shopping. And depending on your category and sales channel confusing two of those can be quite dangerous and expensive. Moreover, customer communication efforts might be, and most often are, spread out across different stages of customer lifecycle. So even in the case when they are a same person (shopper is also the customer), the focus of the marketing communication efforts might different - it might be during the the pre-purchase stage (building awareness or creating the interest), purchase on the point-of-sale (decision making and action taking ), or post-purchase (loyalty building and feedback providing). And this is where the second difference between general consumer marketing and shopper marketing seems to emerge - most shopper marketing roles and definitions tend to focus only on the phase of the purchase (decision and action making) and usually when in store. Where traditional advertising may start a consumer’s path to purchase journey, shopper marketing is the closer - it is present at the critical “last mile” to purchase that all other advertising primes. However, focusing only on the purchase phase, might be short-sighted as it neglects and obstructs the very purpose of shopper marketing.
Focusing only on the purchase phase, might be short-sighted as it neglects and obstructs the very purpose of shopper marketing.
Definition and Purpose of Shopper Marketing
Turns out that getting to an agreed upon and broadly accepted definition of shopper marketing is tricky to nail. If one looks at the definitions available online and positions of posted shopper marketing roles, you'd come to a couple different versions and understandings of what it is supposed to do and what is it that it's supposed to deliver. However, there are common denominators in all of these definitions, and those can be used to shape a purpose of shopper marketing.
- Shopper marketing relies on shoppers' insights
- Shopper marketing focuses on the path-to-purchase
- Shopper marketing creates a behavioural change in a target shopper
- Shopper marketing also drives incremental consumption
- Shopper marketing encourages habitual changes in shopping behavior
- Shopper marketing facilitates habitual changes in consumption behavior
- Shopper marketing is aligned with the long term goals of the brand
- Shopper marketing delivers a measurable ROI
Building up on these, we can conclude that what shoppers marketing does is that it leverages shopper's insights to create a marketing mix, which applied across the path-of-purchase needs to create incremental consumption increase, but as well longer lasting change in consumption behaviour in terms of habitual shopping change in favour of the specific brand and category, creating measurable ROI and growth. So, the purpose of shopper marketing, short-term is to create incremental sales or increase in consumption, but the true, long term, and more important purpose is the shopping behaviour change.
The purpose of shopper marketing is habitual shopping behaviour change
If there is no change in shopping behavior then there is no growth. It’s as simple as that. There are many shoppers whom we wish to keep buying as they normally do, but they wont’ drive growth of our brands. If you are a marketer and need to grow your brand (who doesn’t?) then shoppers need to behave differently. One purchase is nice, but if the shopper switches back to their old habits the next week then the gain is small. If the change is made permanent, habitual, then long term growth is assured. At least that's what the shopper marketing premises claim.
Short-sightedness of Shopper Marketing and Shopper Marketing Roles
A short-sighted person can only clearly see objects that are close to them. Short-sightedness in decision making and business context refers to not thinking enough about how an action will affect the future or simply not seeing beyond the immediate and obvious, often nearest point or event in time.
Creation of habitual purchasing is often a well desired outcome of shopper marketing activations and activities. This is especially true for consumer packaged goods. CPG brands and retailers form both a perfect and busiest playground of shopper marketing activations. Habitual buying behaviour occurs when involvement is low and differences between brands are small. Consumers in this case usually do not form a strong attitude toward a brand but select it because it is familiar. The product is perceived as commodity and doesn’t provide much difference from its rivals. Customer under habitual buying behavior goes for the products which they are buying regularly and where they don’t give thoughts before buying it. A repeat customer usually seek a mix of the following variables, convenience, price, quality, service and value. A repeat purchase can be a result of limited availability such as during travel. Repeat customers are not immune to competitors' tactics or bad reputation from the brand they are using. They will change brands if certain variables are missing or when there is a clear better option available. So their consumption preference is quite conditional and fragile.
What is evident, is that most roles, strongly emphasise todays' performance - conversion, traffic, basket increase, while disregarding the future one.
One of the simplest example of habitual buying is purchase of goods of daily needs. The purchase of milk or bread in the nearby store is the example of habitual buying behavior. Another example of habitual buying is when despite several brands of beverages or cola items, people develop preferences for a few brands or flavours which they continuously buy. Toothpaste is something we purchase frequently, without paying much attention to, and we often don’t look further than packaging and pricing. We tend to stick to the one brand unless motivated by promotions and point of purchase displays. Some consumers will seek bargains, even if the quality is not satisfactory and may become repeat purchasers, purely based on price.
Habitual buying is great, and most if not all marketeers will be very happy with that result. Most of the roles, however, aim even lower than that : "The role develops and executes customer specific retail programs intended to drive traffic, increase basket, and/ or increase conversion" says one of the job postings for the position of Shopper Marketing Manager. Another elaborates on the main task to be "Translating insights and developing integrated programs, including media-to-shelf, portfolio and customer programs to engage and convert the shopper". "The role develops and executes customised programming intended to accomplish one of 3 things: Drive traffic, increase basket, or increase conversion" claims third one. What is evident, is that most roles, strongly emphasise todays' performance - conversion, traffic, basket increase, while disregarding the future one.
Habitual buying is great, and most if not all marketeers will be very happy with that result. Most of the roles, however, aim even lower than that
From Habitual Buying to Brand Loyalty
Perhaps, the nominal shopper marketing role's short-sightedness or strong present-time focus relies on a popular theory of cumulative advantage according to which each time you choose a product, it gains advantage over those you didn’t choose. In short, research into the workings of the human brain suggests that the mind loves automaticity more than just about anything else—certainly more than engaging in conscious consideration.
Perhaps, the nominal shopper marketing role's short-sightedness or strong present focus relies on a popular theory of cumulative advantage according to which each time you choose a product, it gains advantage over those you didn’t choose
Given a choice, it would like to do the same things over and over again. And that is why a driving reason to choose the leading product in the market, therefore, is simply that it is the easiest thing to do: In whatever distribution channel you shop, it will be the most prominent offering. In the supermarket, the mass merchandiser, or the drugstore, it will dominate the shelf. In addition, you have probably bought it before from that very shelf. Doing so again is the easiest possible action you can take. In light of this proposition it makes sense to make sure the customers buys your product just today, and every time, and habits will develop by themselves.
Repeat purchase behaviour does and will definitely foster the creation of habitual buying and somewhat will aid the creation of higher customer loyalty. It will however, be much smaller as the 'path' to loyalty was driven by habitual buying and / or convenience & price rather than brand. Thus, it will be more conditional - some will call it, in case it is based on promotional / rewards - 'mercenary' loyalty and if it is based on inertia - simply because it's convenient or there are exit barriers or switching costs 'inertia' loyalty. In any case, neither mercenary nor inertia loyalty constitutes a true loyalty since the customer is lacking an emotional stake - based on brand values and emotional connection.
In any case, neither 'mercenary' nor 'inertia' loyalty constitutes a true customer loyalty.
But we do get to an important point - ultimate goal of shopper marketing activities and activations should be to gain / create customer brand loyalty as habitual purchasing and habits can only go so far. Relying on habits makes sense when all other things are equal (including competitors). Believing that, by only focusing on conversion and sales today will build your cumulative advantage in the future, seriously discounts the activities & activations of other brands and competitors both today and tomorrow. Moreover, such theoretical proposition, which favours the category or market leaders, does not provide any options to contenders. It pre-supposes that market leaders simply by being everywhere and anywhere, convenient, will continually keep the leading market share, as buying once, twice, three or more times moves the consumer into habitual buying. This is, evidently, far from being true, as not only new innovative ways of satisfying consumers needs will create disruption in the habitual purchasing, but more importantly only habitual customers, and not brand loyalists will react to more attractive - price & value offers from competitors.
Believing that by only focusing on conversion and sales today will build your cumulative advantage seriously discounts the activities & activations of other brands and competitors.
Brand loyal customers are the foundation for a stable and increasing market share. Businesses who establish a loyal customer base enjoy reduced marketing and transaction costs, reduced customer turnover expenses and increased positive word of mouth. Building brand loyalty at an early age or at the beginning of the consumer buying cycle will generate life-long benefits for businesses. Consumers do not have the time to examine every product choice or service provider, which is why they prefer to stick to brands they trust, have had previous positive experiences with or that offer them incentives.
Shopper Marketing in E-Commerce : Missing Half of the Story
Short-sightedness of shopper marketing's focus only on today's performance, conversion and traffic is nowhere more evident than in e-commerce. Large CPG brands, which invest heavily into dominant shelf space, advertising, traffic on retailers, and as such, by logic of habitual buying, should have a rising or equal market share, actually have been loosing it to much smaller brands. According to data from IRi, $20 billion market share value has shifted from big U.S. CPG brands to long tail indie brands in the past six years.
$20 billion market share value has shifted from big U.S. CPG brands to long tail indie brands in the past six years.
So, despite the heavy marketing investments, crafty shopper marketing programs and shopper marketing initiatives, large CPG and many other large brands have been loosing market share to a large number of, direct-to-consumer brands. While CPG brands have been pouring money into advertising of their shelf-space on 3rd party e-commerce platforms such as Amazon.com, niche brands have been building and fostering direct consumers relationships and developing brand loyalty. If shopper marketing premises of shopper marketing activations, translating to habitual purchasing and customer loyalty, are correct, why are then CPG brands loosing e-commerce customers? Part of the answer lies in the fact they've been short-sightedly using old marketing premises in a new retail environment and focusing only on today's performance while ignoring the future one. They've been focusing on pre-purchase and purchase phase while ignoring post-purchase phase where majority of consumer loyalty is developed.
While CPG brands have been pouring money into advertising of their shelf-space on 3rd party e-commerce platforms such as Amazon.com, niche brands have been building and fostering direct consumers relationships and developing brand loyalty.
Traditional CPG brands have made it a top priority to maintain shelf presence and manage retailer relationships, yet in this new digital era when two-thirds of U.S. consumers expect to be directly connected to the brands they buy, it is the customer relationships that CPG brands should be managing. When the sales channel shifts from the physical to digital, so does the shopper journey, which effectively resets their selection process. When someone that is used to buying Bounty paper towels because it was the best option for her at the local grocery store is suddenly faced with new options when she switches to online grocery shopping, suddenly she is given a chance to reevaluate her options and give some consideration to private label products with a competitive price tag and innovative value proposition. At that moment, in CPG e-commerce competition moves from shelf space presence to post-purchase experience, as consumers' primary motivation for doing online grocery, aside for expanded choice, is time saving and convenience.
In CPG e-commerce competition moves from shelf space presence to post-purchase experience, as consumer motivation for doing online grocery, aside for expanded choice, is time saving and convenience.
Focusing on Post-Purchase to Drive Loyalty
Obviously, acquisition is important because you can’t have a repeat purchaser if they never make that first purchase, but ignoring this very profitable customer segment by ignoring the post-purchase experience as the main driver of repeatability of purchases will directly negatively influence the revenue growth potential. According to the U.S. consumer survey done by IBV (Institute for Business Value) in 2011, out of 3 phases of brand experience (pre-purchase, purchase and post-purchase) respondents clearly marked the post-purchase phase as the most influential over their retail brand relationships and their willingness to promote a given retailer to other consumers. Consumers have made it clear that brand experiences during the post-purchase phase have the greatest overall positive or negative impact on their brand relationship with retailers and their inclination to shop that retailer over competitors. So, it’s imperative that you remain ever aware of the fact that after you’ve thanked your customer for her order, you’re just beginning the most influential phase of his brand interaction with you.
Consumer expectations in post-purchase phase are the key to overall positive or negative experience and brand relationship
The length of delivery time, how your product is packaged, the quality and variety of provided print materials, the ease of exchanges and returns—it all contributes to your brand perception and experience as a whole. Several post-purchase factors, such as convenience of tracking order, on-time delivery and ease of customer service, play vital roles in influencing customer loyalty. Same findings were confirmed by IBM Consumer Expectations Study Insights done in 2016 and 2017, consumer expectations in post-purchase phase are the key to overall positive or negative experience and brand relationship. Of course, an evaluation of the experience is always in comparison to your brand promises, but also relative to other retailers' performance in this segment. Namely, it is the collective performance of all retailers customers interact with within a single market that shapes implicit customer expectations and market performance averages.
The length of delivery time, variety of delivery options, tracking visibility and communications, how your product is packaged, the ease of exchanges and returns—it all contributes to your brand perception (promises you make) as a whole.
Relationship Doesn't End At The Check-out - It Begins There
The post-purchase is an essential, yet often overlooked, stage of the eCommerce customer journey. Given that across the board repeat customers account for 40% of store’s revenue, it’s important to have a strong post-purchase strategy in place in order to provoke repeat engagement, encourage referrals, and drive more revenue. Obviously, acquisition is important because you can’t have a repeat purchaser if they never make that first purchase, but ignoring this very profitable customer segment by ignoring the post-purchase experience as the main driver of repeatability of purchases will directly negatively influence the revenue growth potential.
Opportunities for a differentiated and brand unique experience are there. Now, retailers can extend the customer hand-holding post-purchase with beautiful branded interfaces, delivery visibility, and personalised content. By streamlining customers’ paths to purchase and bringing them back directly into the loyalty loop, brands can convert one-time shoppers into lifelong brand advocates. There is a whole world of things to do and experiences to optimize between the moment the customer choses to buy — and the moment the goods are delivered into that person’s hands.
By streamlining customers’ paths to purchase and bringing them back directly into the loyalty loop, brands can convert one-time shoppers into lifelong brand advocates.
When a customer makes a purchase online, there’s an “experience gap” from the time the customer checks out to when the product arrives. This is the new moment of truth for online shoppers. Providing a positive experience at this time of anticipation is a tremendous opportunity for retailers to deepen their relationships with customers and build loyalty for their brands. Formulating and executing the right post-purchase strategy for your business can make or break you—getting it right can give you indispensable brand recognition, priceless word-of-mouth, and repeat customers you’ll need to thrive.
To be able to close the expectations vs. reality gap in the post-purchase companies need to both determine the implicit customer expectations from an online shopping experience and audit their own.
To be able to close experience and the expectations vs. reality gap in the post-purchase phase, companies need to both determine the implicit customer expectations from an online shopping experience and audit their own to know where they stand in contrast to the market averages and start defining and planning corrective actions. The research and insights into country by country implicit customer expectations from an online shopping experience with particular focus on the post-purchase experience is at the heart of the SO DIGITAL GLOBAL E-COMMERCE BRAND EXCELLENCE PLATFORM. It audits the most influential phase of customer brand relationship by contrasting the customer shopping experience across stages of delivery, tracking, packaging - out of box experience, returns & refunds ( the reality) versus brand set expectations (the promises).
Shopper marketeers will find interesting that some of our data points treat marketing activations, inserts, messaging, personalisation and other marketing communication aimed at increasing customer lifecycle value.
SO DIGITAL GLOBAL E-COMMERCE BRAND EXCELLENCE PLATFORM is a management tool that helps companies formulate, evaluate, and improve their e-commerce strategies by providing a systematic assessment of competitive performance of post-purchase experience across markets. Trained researches in target countries perform actual purchase of products from target e-retailers, recording their every step, while answering standardised scale based scorecard with average 200 data points to provide insight into comparative performance of leading e-retailers on selected dimension
To start driving your eCommerce growth by focusing on post-purchase experience contact us today for a free no-commitment one-on-one walk through of the solution & service and use client case of Nike (EMEA). Improve the post-purchase experience for your customers to ensure the relationship doesn’t end at checkout.
SO DIGITAL | GLOBAL BRAND EXCELLENCE SOLUTIONS is a technology company based in Amsterdam specialised in serving headquarters of global brands. We are proud partners of leading global digital growth brands like Nike (EMEA) and Uber (EMEA), but also other brands like TomTom (WHQ) and AS Monaco. With offices in Amsterdam, Berlin, Barcelona and Balkans we help global brands reduce complexity cost of global branding by delivering speed, scale and efficiency in execution across markets.
Mike Anthony, Linkedin Pulse, "What is shopper marketing? A shopper marketing definition that adds real value" https://www.linkedin.com/pulse/what-shopper-marketing-definition-adds-real-value-mike-anthony/
Nishat Mehta, "Shopper Marketing: How To Optimize The 'Last Mile' In Consumers' Path To Purchase" https://www.forbes.com/sites/forbescommunicationscouncil/2018/11/28/shopper-marketing-how-to-optimize-the-last-mile-in-consumers-path-to-purchase/#29746541103d
Blog, Consumer Behaviour : "Repeat purchase behavior vs brand loyalty" https://michael683.wordpress.com/2017/05/07/repeat-purchase-behavior-vs-brand-loyalty/
Mike Anthony, Engage Consultants, "What Does Great Shopper Marketing Look Like?" http://www.engageconsultants.com/recent/what-does-great-shopper-marketing-look-like/
A.G. Lafley Roger L. Martin, HBR.org : "Customer Loyalty Is Overrated" https://hbr.org/2017/01/customer-loyalty-is-overrated
Patty Odell, Chief Marketer, "The Four Tiers of Loyalty :Where Do Your Customers Fit In" https://www.chiefmarketer.com/the-four-tiers-of-loyalty-where-do-your-customers-fit-in/
Shep Hyken, "Customer Inertia Is Not Customer Loyalty https://hyken.com/customer-confidence/1045/
Richard Yao "A Moment of Truth for CPG Brands" https://medium.com/ipg-media-lab/a-moment-of-truth-for-cpg-brands-614e5baf5fde
Robin Lewis "The Long Tail Theory Can Be Reality for Traditional Megabrands" https://www.forbes.com/sites/robinlewis/2016/05/31/the-long-tail-theory-can-be-reality-for-traditional-megabrands/
Kayla Holland, "Repeat purchase behaviour vs brand loyalty: what’s the difference?" https://kaylahollandblog.wordpress.com/2017/04/25/repeat-purchase-behaviour-vs-brand-loyalty-whats-the-difference/