Growing_online_in_2013_presentation
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Transcript of Growing_online_in_2013_presentation
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© IGD 2012
Special Analysis, November 2012
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© IGD 2012
Growing online in 2013
• Understand how people are behaving pre, during and post online shop
• Drive transactions across the web by building brand through better alignment of marketing and sales activities
• Get resource right: it’s not about the structure, it’s what you do
• Tailor for the online shelf, recognising its unique features in an omni-channel environment
• Take advantage of more flexible fulfilment models to devise unique product and pack solutions for shoppers
• Get to grips with the numbers and the growth drivers to stay ahead of the market
“You can’t cannibalise what you haven’t got”
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Shopper behaviour has changedHow are shoppers are using the internet for food and groceries, products
and brands?
50% compare prices
35% read reviews
37% check availability
39% find the nearest store30% play a game or enter a
competition
21% write a review
13% scan a product code for information
24% follow a company on a social network
30% get a discount voucher
10% scan a product code to buy it
Source: IGD ShopperVista, Connected Shopper
The internet and technology, especially mobile, is changing the way people shop. Much shopper marketing spend is on in-store activation material; with many decisions being made before people reach the store (physical or web) retailers and manufacturers should consider how to allocate this spend effectively.The traditional purchase loop above will continue to be disrupted as smart phone/tablet penetration increases and younger, Generation Y individuals become a core shopper demographic.
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There are many ways to talk to shoppers
Foodie.fmMySupermarketManufacturer
Sites
We know the shopping journey is changing, so how are you talking to shoppers throughout the decision and purchasing process? There are many touch points in the online environment that can be used to drive transactions, by attracting new shoppers, building loyalty, increasing frequency or encouraging impulse.Each touch point should not provide a hard sell, but it is possible to offer and suggest routes to purchase across the web.
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Build brand and sales onlineUnlike the physical environment, online marketing offers an opportunity to drive transactions directly as well as building brand equity .We identified many touch points in the previous slide, and below are two examples from P&G (left) and Unilever (right) of manufacturers building brand equity online. Alongside sweating their own digital assets effectively, they are also providing a route to purchase with buy it now functionality, highlighted in the red boxes.
Source: P&G, Unilever
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Dedicated and joined up resource is critical to succeed
Source: IGD Online Trading Capability Survey 2012
Not doing this Part way there
Co-ordination of marketing and sales activity to develop a long-term strategy
Established
When it comes to human capital for online, only one in three businesses have dedicated resource behind the channel – see the chart below. This remains an area of weakness with retailers consistently telling us that manufacturers with dedicated resource are growing significantly ahead of those without this in place.
Dedicated resource that manages online customers, champions internally & co-ordinates activity
Resource across finance, supply chain, shopper marketing, research, IT to support sales team online
Building brand as well as sales works best when marketing and sales functions work collaboratively to align campaigns and tactics. This more joined up approach can be achieved through aligned internal KPIs, joint teams and thinking from an online perspective.Our Trading Capability Survey shows that most manufacturers are only part way to achieving co-ordinated sales and marketing activities – see the chart below.
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Tailoring the online shelf continues to evolve
Source: Sainsbury’s @ IGD Category Management Conference
Basic Advanced
While getting imagery right online is a basic capability, it remains critical, and can provide growth free of promotional dependency. Sainsbury’s and Heineken re-worked the pack shots opposite, with resulting sales up by a third.Other UK retailers including Tesco, Asda and Ocado are embracing this opportunity. As the online shelf continues to evolve providing a tailored digital solution that inspires shoppers in the category could provide continued growth.
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Unlocking the power of analytics
While transaction or loyalty data gives you an end of shop basket snapshot, web analytics give a picture of how your products find their way in or out of shoppers’ baskets:
•Who viewed the product but didn’t add?
•Where did the shopper expect to find the product?
•Where did they add it from?
•Who was searching and gave up?
Your products and offers need to be where your shoppers are; do they find your product through search, browsing, favourites, from their mobile device, or more likely a combination? The advance of Web analytics could provide a much more accurate picture, capturing information as people shop, rather than a snapshot of their basket at the checkout.We have identified that only 13% of businesses have a robust process in place to evaluate and calculate ROI online. In 2013 web analytics could be a game changer in this area.
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Flexible fulfilment will increasingly shape the offerDark stores are standalone warehouses, often laid out like a store, but with no shoppers and a degree of automation. They are used exclusively to pick online orders. Retailers will continue to develop these facilities through 2013 and beyond.
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UK in focus: market set to double
Source: IGD Research, All market data is for year to April, inclusive of VAT
5 year growth+97.7%
CAGR+14.6%
It is important to understand your online business in all markets:Do you know your sales online versus other channels?Do you know you share online versus in-store?Do you know your margin online versus in-store?
While the UK is advanced, many markets are also set to double in 5 years, so understanding the growth drivers is key:Are your initiatives joined up to target the 4 screen shopper?Have you considered the implications of a click and collect roll out for food?Are you ready for a time when you can tailor promotions more?
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IGD can help you build capability online
Source: IGD Research
BRAND, MARKETING
& INNOVATION CUSTOMER MANAGEMEN
T
FINANCIAL MANAGEMENT
CATEGORY LEADERSHIP
STRUCTURE & PEOPLE
SUPPLY CHAIN MANAGEMENT
SHOPPER UNDERSTANDING & ACTIVATION
CAPABILITY SHIELD
Our Online Trading Capability Shield, industry benchmark data and manufacturer scorecard can help you identify areas of strength and weakness versus your peers when it comes to your ability to sell online.
Get in touch to find out more:[email protected]
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Next steps.....
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This special analysis report was prepared by
Richard Wallace, Senior Business Analyst
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