Xtreme Shopper Marketing beginning a new generation of ...

GfK Interscope 1221 Post Rd East Westport CT 06880 www.interscopellc.com September 2011

Xtreme Shopper Marketing

Winning in a new generation of shopper behavior

GfK Interscope Xtreme Shopper Marketing

Xtreme Shopper Marketing September 2011.pptx © Copyright GfK Custom Research North America 2011. Proprietary and Confidential

GfK: 75 Years Of Innovation Has Made Us A Leading Global Market Research Company

SalesIn 2010: $1.9 Billion

EmployeesMore than 10,500 full-time staff globallyMore than 900 full-time staff in North America

GrowthAveraged 15% per year over last decade

Global Reach150 operating companies in more than 100 countries on five continents



Our Mission: Helping Clients Win At The Point Of Sale

Proven real world ROI for brands, categories & retailers

Building capabilities and collaborative relationships

Flexible team of marketing, sales & research vets with end-to-end solutions for building brands through the point of sale

Passionate, analytically driven pros with blue chip credentials

Getting beyond “what”

to “so what”

and “now what”

Fusing consumer, shopper & category into actionable growth plans

Connecting cross-

functional experience in 100+ categories



Our 2011 Proprietary Shopper Marketing Research Integrates Both Shopper And Practitioner Viewpoints

Industry thought leadership benchmarking of Shopper Marketing & Insights practitioners

5+ years running, 2006-2011

Web-based questionnaire

Completed by manufacturers, suppliers & retailers

– 250+ respondents– 130+ companies– A “who’s who”

of our industry

New for 2011!

– Global expansion

Online survey of diverse set of shoppers and categories across seven countries

– US n= 1,000– EU n = 2,225 (across

France, Germany, Poland, Russia, Spain, and UK)

Focus on macro shopping attitudes and behaviors, both bricks & clicks

Building longitudinal perspective, running since 2009

++



The Confluence Of Two Macro Trends Is Reshaping Shopper Behavior

Internet ubiquity

Explosion of mobile smartphones/ tablets

One of three are barely able to meet expenses

Only 15% living comfortably

Hard economy Technology



These Forces Have Fueled Emergence Of A New Shopper Profile

With more technology, tools, resources, and information than ever before, a new breed of shopper has emerged, determined to stay in control and “win”

at the game of finding the best value– Across broad range of

categories

Source: GfK Futurebuy, 2011



% Agree(Top 2 Box)

(US)

Xtreme Shoppers Are Innovative, Proactive, And Feel In Control Of Shopping Process




% of Shoppers with Xtreme Profile/Behaviors (US)

Xtreme Shoppers Are Becoming The “New Normal”

Approaching 40% of population and expanding rapidly

Because Xtremes are defined by their attitudes and behaviors and not demographically, their growth potential is vast

Source: GfK Futurebuy, 2011, all respondents



The Xtreme Shopper Crosses Traditional Demographic Boundaries

Household SizeEmployment StatusAge Profile

Source: GfK Futurebuy, 2011 Source: GfK Futurebuy, 2011 Source: GfK Futurebuy, 2011

All ages

Across employment status

All HHD size/stages



Xtremes are more optimistic

1 of 3 Xtremes say they are better off than a year ago

1 of 2 believe they will be better off in 12 months




% Agree (Top 2 Box)

(US)

% Xtreme Shoppers Doing More of Shopping Behavior (top 2 box)

(US)

For Xtremes, Loyalty Takes A Back Seat To A Relentless Pursuit Of Value

Source: GfK Futurebuy, 2011 Source: GfK Futurebuy, 2011



% Xtreme Shopper Incidence

Xtreme Shopping Is A Global Phenomenon

Xtreme incidence varies broadly within individual European countries




Feeling The Wrath Of The Xtreme Shopper?

“Netflix’s decision to raise prices by as much as 60% is turning into a horror show.”AP Technology writer



This Emerging Shopper Mindset Has Profound Implications For Shopper Marketing

Shopper Insights

Time and Touchpoints

Shopper Marketing Leadership



Shopper Insights



Shopper Intimacy Is Increasingly Elusive

From: Simple, linear To: Multi-stage web

SelectingSelecting brands POPbrands POP

EvaluatingEvaluating needsneeds

Advocating Advocating WOMWOM

MaximizingMaximizing value postvalue post--

purchasepurchase

SourcingSourcing info, products,info, products,

channelschannels



Dizzying Arrays Of Shopper Touchpoints

Google/other –

product and store location

Store circulars/flyers

Opinions of friends/family/colleagues

Product packaging

POS displays

Product samples

Product literature

Sales attendants

Product demos/classes

Info desks

Info kiosks

Info broadcasts

Direct mail flyers –

from retailers

Newspaper flyers –

from retailers

Newspaper flyers –

from brands

Direct mail flyers –

from brands

Shopping sites

Retailer websites

Brand websites

Discount websites

Ebay, Craig’s etc.

Consumer opinion

Flyers online

News/magazines

Special interest groups

Local community

Social media

Online

MailIn-store

Word of mouth

Shopper TouchpointsOn premise



Leading Firms Are Shifting Insights Strategies To Meet The Challenge

From: Broad and Centralized

To: Selective, Deep, and Collaborative

Manufacturer develops and delivers to retailer

Broader and more one dimensional (i.e., in-store drivers across mass customers)

Single, siloed methodology

“Tried and true”

methodologies

Developed in partnership w/target retailers around key issues

Narrower and deeper studies (i.e., end to end purchase behavior for category)

Multi-methodology learning plans

Aggressive use of emerging, technology-

enabled methodologies

SelectingSelecting brands POPbrands POP

EvaluatingEvaluating needsneeds

Advocating Advocating WOMWOM

MaximizingMaximizing value postvalue post--

purchasepurchase

SourcingSourcing info, products,info, products,

channelschannels



The “Listen”/”Ask”

Loop Can Elevate Insight Generation

20



Spontaneous Structured

Unexpected Controlled

Conversational Inquisitorial

Inspirational stories Projectable results

Exploratory Confirmatory

Qualitative Quantitative

More passive More active

More about the consumer More about the brand

Focus groups, ethnography Surveys, Concept Tests, Conjoint

Foundation for insightful “asking” Insights for inspired “listening”

Distinct But Complementary Activities



Shoppers Want To (And Will) Be Heard

An estimated 60% of Fortune 1000 companies have some form of online

community for customer relationship building purposes

They have the tools and technology to make a major, immediate impact

Blogs, discussion boards and social media apps allow people to instantly let others know what they think of the brands they experience

Instant feedback, means no ‘cooling off’

period–

consumers can publish their woes (or thrills!) within moments



insightengage customers to obtain business, market and competitive insight:

focus groups, ethnography, product testing, concept & message testing, surveys, product trial and more

innovationachieve customer-driven innovation to inform product, marketing and operations:

crowd sourcing, ideation, collaboration, virtual brainstorms, co-creation and more

advocacyform a personal connection with customers to build scalable brand advocacy:

ambassadorship, WOM, CRM, social media propagation, sampling, immersions and more

Community Value Proposition



Needs DiscoveryInspiration Lab

ActivatedKnowledge

Quantitative ResearchSegmentation

CMO-NPD ImmersionProduct Ideation

Product Optimization

Creative DesignDevelopment

Low Risk DecisionCommunityActivities

CMO Gut-Check Verbatims forPR Opportunity

How Does It Work?



Mobile Is A Transformational Force

My alarm clock

My TV

My PC

My calendar

My scheduler

My phone

My e-mailer

My Facebook page

My wayfinder/GPS

My pedometer

My traffic reporter

My price-checker

My “phone” is…

My favorite waste of time!

My news source

My calculator,

My eBay window

My shopping list,

My Amazon access

My music player

My radio

My weather radar

My book reader

My camera

My photo album



Mobile Is A Two-Way Force

From: Manufacturers/RetailersTo: Shoppers & ProspectsFrom: Manufacturers/RetailersTo: Shoppers & Prospects

From: Shoppers & Consumers

To: Manufacturers & Retailers

From: Shoppers & Consumers

To: Manufacturers & Retailers

Outbound SellingOutbound Selling

Inbound InsightsInbound Insights



Accessing and engaging shoppers with mobile solutions at a geo-tagged point of experience enables richer insights than other traditional means can provide.

Unfiltered self-expression is the currency of mobile culture. Consider the content of posts around

Twitter #tags and Facebook mobile not to mention location-based social networking services like

FourSquare or Flickr. Mobile research can evoke similar consumer generated content.

@ point of experience

personal

Unique Strengths Of Mobile Research



Mobile Research Applications

Shopping Ethnographies– Real time pre, during and post shop– Mystery shopping

Mobile Diaries– Ongoing feedback in the moment– Photos, video, location– Ad effectiveness

GPS Location Tracking– Shopper pathways across retailers

Exploratory– Eyes and ears into everyday life– Out of the box insight into innovation



Limited battery life

Smartphone are portable

High quality Camera

Well suited to short

‘time wasting’ tasks

Phone specific

strengths

Frequency of lost & damaged

handsets

Slow, expensive and unreliable

3G network

Phone specific

weaknesse s

Eyes Wide Open

http://www.clker.com/clipart-12836.html



Page 33

Business Need –Aligning Immediate Consumption Need States With Purchase Occasions To Improve Shopper Marketing ROI

GPS Tracking In-Store Ethnography

Once in store: deep-dive into the shopper’s decision making process

Before the store: how this purchase fits in their life journey

Activation

Retailer specific assortment &

marketing programs: before & during the

store visit

+



Page 34

Rules Of The Road –

Shopper Insights Adopt A “Listen”/”Ask”

Approach

Boost research ROI via insights assessment to “connect the dots”

and prioritize gaps

Evaluate potential of mobile research methodologies to collect insights in real time

Consider tagging Xtreme shoppers to isolate their distinct behaviors and needs

Increase utilization of multi-methodology learning plans– i.e. online, plus in-store, plus mobile

Ensure that learning plans cover the increasingly important post-purchase attitudes and behaviors



Page 35

Time and Touchpoints



Page 36

Core Shopping Process Is Fundamentally Changing

Complex, non-linear purchase behavior web

Unlimited information requires “screening”

decision making dynamic̶ Quickly “rule things out”

vs selecting in

Two way dialogue

Declining loyalty

Balance of power shifts to shoppers

From: Getting to “YES”

To: Getting past “NO”

Linear path to purchase

Limited information and touchpoints

“One way”

communication

Higher loyalty

Balance of power with manufacturers and retailer



Page 37

As Players Try To Squeeze Out More Growth, Big Ideas Are Taking Center Stage

Analyzing everything

1995

Beginning customization

2000

Shopper insights

2005

Big ideas and shopper marketing solutions

Getting the facts

1990

Today



Page 38

Customization On Steroids: Co-Creation



Page 39

Coke Freestyle Expands Choice

125 flavorsavailable

125 flavorsavailable



Page 40

Post-Purchase Programs Aim To Build Lasting Shopper Relationships



Page 41

Post-Purchase Emerges As A Vital Step On “The Path”



Page 42

Best Practice Manufacturers Have Expanded Their Potential Touchpoints

At ShelfAt Shelf

Across StoreAcross Store

OnlineOnline

Mass MediaMass Media

PromotionPromotionOutreachOutreach

MobileMobile



Page 45

P&G’s Connect And Develop Program Takes An Extreme “Outward”

Approach To Innovation

$3 Billion

Revenue

Goal

$3 Billion

Revenue

Goal



Page 46


Shopper Marketing Programs

Time– Expand touchpoints into pre (co-creation)

and post-purchase spaces

Touchpoints– Don’t relay on today’s loyalty programs– Build relationships via programs based on

big ideas– Execute across broad range of integrated

touchpoints



Page 47




Page 48

Digital/Mobile Technologies Will Dramatically Change Shopping Behavior - US/NA (% Agreeing Will Happen In…)

Digital/Mobile Technologies Will Empower Shoppers To The Detriment Of Retailers/Manufacturers -US/NA

(% Agreeing Will Happen In…)

Emerging Digital/Mobile Technologies Are Affecting A “Sea Change”

At An Accelerating Rate

A change increasingly viewed as detrimental to manufacturers and

retailers

Source: GfK Futurescope, 2011 Source: GfK Futurescope, 2011

61%

Agree next

2 years



Page 49

Digital/Mobile Technologies Will Replace Many Traditional Tactics In Next Few Years

(US/NA)

Digital Technologies Will Dramatically Shift Shopper Focus to Price

(US/NA)

Digital\Mobile Predicted To Displace Many Existing Tactics And Heighten Shopper Focus On Price




Page 50

Readiness for the Digital/Mobile revolution appears weak, however

Only modest progress in readiness and commitment is evident vs. 2010

My Organization Is Prepared to Manage Impact of Digital/Mobile

(US/NA)

My Organization Dedicates Adequate Focus/Resources to Leveraging

Digital/Mobile (US/NA)

Leadership In digital/Mobile Is Necessary To Be Leading SM Player

(US/NA)

Digital/Mobile Leadership Widely Viewed As Prerequisite For SM Leadership

Source: GfK Futurescope, 2011Source: GfK Futurescope, 2011 Source: GfK Futurescope, 2011



Page 51

2010 Top Digital/Mobile Tactics In Use - US/NA

(% respondents actively using tactic)

2011 Top Digital/Mobile Tactics In Use - US/NA

(% respondents actively using tactic)

Source: GfK Interscope Futurescope Survey, 2010

Mobile Tactics Rose In Prominence In 2011

Four of top 6 tactics in 2011 have mobile component

Internet coupons/offers

Digital savings loaded to loyalty card

Social media rewards opt-in programs

Internet-based shopping lists

Mobile websites

Coupons sent to mobile phone

Internet coupons/offers

Mobile websites

Participation in retailers’

mobile marketing effortsDigital savings loaded to

loyalty cardQR codes on in-store

displaysShopper assist apps on

mobile phones

Source: GfK Interscope Futurescope Survey, 2011



Page 52

The Industry Lacks Best Practices for Leveraging Digital/Mobile In-Store

(US/NA)

Best Practices Remain An Elusive Outage For Much Of The Industry

Source: GfK Futurescope, 2011

80% Agree that the industry lacks best practices for leveraging Digital/Mobile

in-store



Page 53

Leadership In Digital/Mobile Is Necessary To Be A Leading SM Player (% strongly agree/agree)

Industry Lacks Best Practice Perspectives For Leveraging Digital/Mobile Technologies

(% strongly agree/agree)

The Digital/Mobile Leadership Gap Is A Universal Phenomenon




Page 54

My Organization Has Established A Group To Focus On Digital/Mobile

(US/NA)

Where Does Digital/Mobile Management Reside In Your Organization? (US/NA)

(Top Responses)

Significant Uptick In Creation Of Dedicated Digital/Mobile Groups Is Evident

The marketing function is the dominant “owner”

of Digital/Mobile within their organizations




Page 55

“My Organization Is Prepared To Manage Impact Of Digital/Mobile”

Establishing A Dedicated Digital/Mobile Function Appears To Significantly Boost Readiness

Even with a group, absolute readiness levels remain a concern

Source: GfK Futurescope, 2011



Page 56



Digital/Mobile leadership vital to credible SM leadership

Void of industry leadership spells opportunity– And risk if not seized

Start with real commitment– Including assigning clear

ownership in organization



Page 57

Questions? Comments? Ideas?

Joe Beier(203) 571-1443

[email protected]



Page 58

An Organized And Fast/Easy Shopping Experience Is Universally Sought Across Both Bricks And Clicks Environments

Online shoppers put more emphasis on safety and information

Ideal Attributes Ideal Attributes –– InIn-- store Shoppingstore Shopping

% Rating in % Rating in Top 5Top 5

Organized 54%

Friendly 44%

Clean 42%

Fast 41%

Orderly 35%

Easy 32%

Ideal Attributes Ideal Attributes –– Online ShoppingOnline Shopping

% Rating in % Rating in Top 5Top 5

Fast 65%

Easy 58%

Organized 55%

Safe 47%

Effortless 43%

Informative 40%Source: GfK Futurebuy, 2011 Source: GfK Futurebuy, 2011

Xtreme Shopper Marketing beginning a new generation of ...

Documents

Transcript of Xtreme Shopper Marketing beginning a new generation of ...