Learnings from journey research experts

Take-aways from two insightful events from late 2017.

As briefly mentioned in an earlier post, in the last quarter of 2017, two global players, McKinsey & Co and Geometry*, who have been looking at journeys for the last eight years or so, broadcasted respectively a podcast and a webinar, to share observations and reflections about their journey research practice. Talking to colleagues and clients, it seems that the two events have been largely unnoticed which is a shame considering the insights they uncovered. Let me share a topline summary.

McKinsey & Co: being in the initial consideration set is critical for success

Looking at data from more than 125,000 consumers in about 30 categories, McKinsey & Co found out that only 3 of the 30 categories were ‘loyalty-driven’, while the other 27 were ‘shopping-driven’. In other words, they demonstrated that loyalty was a myth for a majority of categories. Within those 27 categories, the dominant behavior was ‘switching’: 58% of shoppers were buying a different brand from one purchase cycle to the next. The key conclusion they drew was that it was critical for a brand to feature in the ‘initial consideration set’: 70% of brands were actually chosen out of this short-list. Therefore, the battleground for brands was what they call the ‘active evaluation’ phase when people switch to shopping mode and draw upon past experiences, external influences and biases to list brands that could fulfill their needs.

I don’t disagree with their conclusion but, as a shopper marketer, I’m also interested in the 30% of brands selected later on in the journey. In between the lines, it tells me that activating shoppers along the journey to displace incumbents can generate positive outcomes.

Geometry: the levels of risk and involvement are key variables to segment purchase behaviors

Building on the analysis of 66,000 shopper journeys across 38 categories, Geometry found out that differences between categories and markets were based on the effect of only a couple of variables. The starting point is that no shopper wants to make a bad decision. Against this statement, Geometry identified two criteria that discriminate people’s behaviors: firstly, the level of risk associated with the purchase decision and secondly, the level of involvement in the buying process. When you map journeys against those two axes, three behavioral typologies appear: ‘guesswork’, which is low risk/low involvement; ‘copying’ which is some risk and some involvement; and ‘research’ which is high risk/high involvement. While diverse behaviors can be observed, understanding the dominant behaviors in a category and a market can help shape the overall strategy to meet the needs of the majority of shoppers.

Once again, this is a very interesting finding for shopper marketing: if the two variables above – or proxies – are present in your dataset, you can focus your activation efforts on the main behavior in your category and ultimately increase conversion.

The above paragraphs are only short summaries and I strongly encourage you to read the full transcripts and associated reports.

McKinsey podcast: “Driving business growth by zeroing in on the consumer decision journey“. December 2017.

Geometry webinar: “Shopper marketing: Purchase journeys, behaviors and pre-triggers“. September 2017.

*Disclaimer: Geometry is my employer at the time I’m writing this post but the views I’m sharing are my own and do not represent those of the company.

Shopper marketing in practice

5 essential questions to address.

In my previous post, I defined what I believe shopper marketing should be about in the digital age. Today, I’d like to discuss how to put the theory into practice.

As much as I have a favorite definition for shopper marketing, I have a preferred framework. It is articulated around 5 simple questions: why, who, what, how and how much (3W2H if you like acronyms);

  • Why – any shopper marketing activity starts with a business opportunity – or challenge – and objectives;
  • Who – the next stage is to immerse yourself into the target audience and analyze how and why people behave the way they behave along the journey;
  • What – and, you define the strategy and the creative that can influence those behaviors and try to shift decisions;
  • How – then comes the time to plan and execute the shopper marketing activity;
  • How much – finally, you need to collect the results and assess the performance of your activity against your objectives. Loop closed.

The answers to the 5 questions can be turned into a sentence that summarizes your shopper marketing activity: we want to [why] among [who] by [what] through [how] to achieve [how much].

Let me give you a simple example: we want to increase the sales of yogurts [why] among light users at the moment they buy food for the family [who] by associating yogurts to a healthy breakfast [what] through a multi-brand campaign in hypermarkets, supermarkets and e-commerce during the back to school period [how] to achieve a 0.5-point increase in penetration [how much]. We could certainly put more details behind each of the stages but I guess you get the point.

This is a framework to do great shopper marketing
Shopper Marketing Framework. Meunier E.G., 2018.

You can apply the framework to the two main types of shopper marketing programs or campaigns:

  • Manufacturer-centric shopper marketing – in which we connect with the target shopper of a brand owner as a part of a category development initiative or a brand campaign. The audience is the shopper of the brand owner.
  • Retailer-centric shopper marketing – in which we connect with the target shopper of a retailer as part of a national commercial campaign or a channel/mission-specific one. The audience is the shopper of the retailer.

[In my forthcoming book, I will present the framework in more detail as well as 10 principles to do great shopper marketing based on day-to-day experience.]

Shopper marketing in the digital age

It’s not just about the store anymore.

Defining modern shopper marketing requires understanding the history of both retailing and shopping. Because the discipline is intimately connected to the two.

Since its inception forty years ago or so, shopper marketing has evolved several times to address the changes in the way shoppers behave and how retailers respond to those changes.

Originally, there was retail marketing. And then, in the late 90s, P&G and Walmart created the idea of shopper marketing. At that time, the so-called modern retail was booming and people were visiting large format stores to fulfill all of their needs. Shopper marketing was about creating a campaign like Shakespeare would write a drama: one place, one time, one action; in plain English, the store, the shopping trip, the promotion. The campaign was essentially an ‘event’ to increase sales in large format stores during the weekly fill-up. As defined by P&G, success would come by stopping, holding and closing at the first moment of truth eg in front of the shelf.

Entering the new millennium, retailing was evolving – and shopping too. Shoppers were diversifying their store choices depending on the occasions and the missions. Large-format stores were still dominant for the regular stock-up trip but other – often smaller – formats like supermarkets and c-stores were capturing a significant share of top-up trips and special trips. Unless conveniently located for the shopper, hypermarkets and supercenters were not the first choices to buy a few missing items. And definitely not the place to buy apparel or sports equipment. I should not forget discounters and clubs challenging them all on price and convenience. The competition was fierce. Confronted with an increasingly complex environment, shopper marketers developed increasingly sophisticated programs and campaigns. I remember a manufacturer’s shopper toolkit containing hundreds of pages of guidance and assets across dozens of sections to cover all shopping options you could think about – consumption occasions, shopping missions and retail formats.

People can switch to shopping mode anywhere, at any time

Nowadays, in the omnichannel world we live in, occasions, missions, channels, and formats are still essential but shopping has gone more fluid and ubiquitous. With shoppers getting more familiar and confident with e-commerce, new shopping behaviors are emerging. Breaking the boundaries of physical and digital spaces, shoppers hop from one channel to another to facilitate their purchases or get better deals. Shopping spreads across places, ecosystems and moments. The journey can be long or short, the stakes can be high or low, but covering the entire journey is paramount: what triggers the journey in the first place; what happens – or not – during the planning, buying and consuming stages of the journey; and finally, what influences people’s decisions.

I know that some marketers tend to focus – I could say corner – the journey in the buying phase. Wrong idea. Ignoring the planning phase, when the want and need emerge, is a deadly sin. Across many categories, it is the precise moment when people build the initial consideration set. According to a podcast held recently by McKinsey & Co, the battleground for brands is what they call the ‘active evaluation’ phase when people switch to shopping mode and draw upon past experiences, external influences and biases to list brands that could fulfill their wants and needs. Time is accelerating too. Search, planning, selecting, buying, the upper part of the journey is shrinking. “It used to take time to go from research to discovery to awareness all to purchase,” said Facebook’s Sheryl Sandberg at the last dmexco in Cologne “but now, you have digital and mobile that is happening faster than ever”.

Disregarding the consuming – or using – phase, when the want or the need is satisfied, is a fatal mistake too as it reduces the shoppers’ goal to the act of purchase. People don’t purchase without a reason. They shop to satisfy a want or a need, or according to the ‘Job Theory’, they hire a brand to do a job. Knowing how your brand is doing the job and taking on board comments and suggestions from clients and fans is critical. Together with past experience, social media are more than often the most influential source of information for shoppers. We also have to take into consideration the fact that owning is becoming out of fashion in many categories. Think cars: for the younger generation, what matters is the usage, not the ownership yet the success of alternative transportation options. Overlooking the consuming phase also neglects the fact that the purchase journey is shrinking on that end too. For example, buying and consuming food can be delivered in one act, one place, one time. The industry has already coined this kind of place the ‘grocerant’, the simple contraction of ‘grocery’ and ‘restaurant’. Whole Foods is probably one of the most famous examples of ‘grocerant’ I came across so far.

Shopper marketing is about influencing people when they are in shopping mode

In the digital age, the goal of shopper marketing is to influence the decisions people make, when and where they make them. Using again the analogy with entertainment, modern shopper marketing has more to do with the creation of a TV series than a classical drama: multiple locations, multiple times, multiple actions. The desired output is not a campaign but a holistic experience leveraging the entire marketing ecosystem – brand and retail – along the journey. Creative still needs to attract, connect and close, but at the precise moments when and where brands or retailers have a chance to influence people’s decisions.

Before closing this post, I’d like to propose my personal definition of shopper marketing in the digital age: “shopper marketing leverages insights to influence people’s decisions whenever, wherever and however they are shopping”. If we deconstruct this sentence:

  • shopper marketing starts with insights;
  • it talks to people who are shopping to fulfill a want or a need;
  • the goal is to influence decisions;
  • it takes place along the entire journey – not just at retail.

Quite different from the industry definition but times are changing. What do you think?

Shopper marketing or marketing to shoppers?

Let’s talk semantics for a minute.

When you say ‘shopper marketing’, people immediately think about retail, point of sale materials and promotions. That’s simply because the industry has done very little to evolve the definition of the discipline.

Historically, shopper marketing established itself as the operational component of category management in the late 90s. The term was used synonymously with in-store promotion. Over time, the scope of shopper marketing evolved to encompass all activities taking place inside the four walls of a store. Until recently, the term was mostly employed by the marketing industry to describe retail and trade marketing activities. Shopper marketing was focused on increasing sales in a store during the shopping trip. In other words, pushing the right product, at the right price, in the right place with the right promotion. Fairly basic marketing.

But fundamental changes are now challenging the old definition of shopper marketing coined by the pioneers at the end of the 2000s. The fact is that new technologies are radically transforming shopping. People research products, get usage ideas, seek out deals and review the opinions of peers and experts. Not only for big-ticket items but also for everyday products. Through their mobile devices, they can access content and tools to help them organize, simplify and speed up their purchases. Not only at home or at work but also on the go or at retail. In an omnichannel world, shopper marketing is about influencing people wherever, whenever, however, they are shopping. This means delivering the right proposition, with the right value, at the right moment of the journey and in the right way. Yes, the 4 Ps of marketing, but made contemporary. Shopper marketing is marketing. Marketing to shoppers – so to speak people who are in a shopping mode.

So why using the term ‘shopper marketing’ in the subtitle of my blog while ‘marketing to shoppers’ would be more appropriate? Simply because the expression ‘shopper marketing’ having imposed itself, it would be pointless – and a bit presumptuous – to challenge the most commonly used term in the industry. I will, therefore, comply with general use. But whenever you read ‘shopper marketing’ in this blog, don’t associate the term with point of sale materials and promotions but to the broader holistic discipline of ‘marketing to shoppers’.

A new blog about shopper marketing

Shopper marketing was invented in the late eighties, why writing about it in 2018?

After thirty years of existence, shopper marketing is widely adopted across industries and geographies but the discipline has remained confidential for the marketing community at large. It is not studied in business schools or universities. It’s not discussed in industry events or in the trade press, particularly in Europe where I live.

To give you a personal anecdote: in a recent assignment, I had to do shopper marketing inductions to young graduates in a large multinational company. Among the twenty or so interns I trained, none of them had heard about shopper marketing before. Not a statistically valid observation but a thought-provoking one.

Ironically, shopper marketing is a powerful answer to the challenges those young graduates will face in their jobs. The growth imperative made popular by Byron Sharp and the Ehrenberg Bass Institute for example. Shopper marketing is focused on generating incremental sales. At the core of every shopper marketing initiative, there is a pocket of growth, untapped so far. An unserved or underserved need that can be fulfilled. At a time when flat is the new up, knowing exactly where you can extract additional value can be precious.

I have been practicing shopper marketing for the last ten years and I love what I do. With this blog, I want to share the love and modestly contribute to raising awareness and interest for a strategic yet largely unknown marketing discipline.