Wednesday, April 17, 2013

Coca-Cola Leverages Shopper Insights From Retail Testing Center




Nearly a year after Coca-Cola opened a retail testing facility, the marketer is leveraging the shopper insights gained and sharing them with trading partners so they can grow the sparking beverage category. 

Designer label for 2 litre Coca-Cola bottleThe 15,000 sq. ft. Shopper Experience Innovation Center (SEIC) in Atlanta tests alternative displays, planograms, category layouts and other merchandising concepts.  It is equipped with cameras to record the eye contact, product handling, and traffic patterns of actual consumers brought in for simulated shopping. 

The end game is to have retailers take innovative concepts validated in the lab and install them in their own stores to increase shopper engagement and sales, according to Ron Hughes, director of Shopper Experience Innovation, Coca-Cola Refreshments. 

“When we test with a retailer, it’s a category solution,” he said. So, when suggesting changes to the beverage aisle, those changes apply to the entire category, which includes competing products and house brands.

Hughes was a speaker recently at the Shopper Marketing Summit, hosted by the Path to Purchase Institute in Schaumburg, Ill.  

He gave the example a new display unit that Coca-Cola planned to test in 12 Kroger supermarkets. But the marketer opted to test the unit first in the SEIC. “We learned five things about the unit that we changed before it was produced for the 12-store test,” Hughes noted.



Another test conducted in the facility grouped beverages, sandwiches, snacks and candy in one fixture that was organized for grab-and-go sales. All categories on the display enjoyed double-digit growth increases, he reported.

Having a process is important when considering opportunities related to the shopper experience, he said, but flexibility is even more important. “It’s easy to get another rack, another cooler. What about the shopper? What needs are we fulfilling?”

Hughes said Coca-Cola seeks answers to several questions by testing in its innovation center:
  • Will shoppers say “Wow”? 
  • Is the idea or concept something unexpected or game changing? 
  • Is the solution driven by relevant insights by the shopper, by the retailer or by business operations? 
  • Is it distinctive? 
  • Does it leverage brand equities? 
  • Does it drive brand love? 
  • Does it allow for modularity, flexibility, and convertibility?

Before the facility opened ten months ago, Hughes said he had to go to different stores to conduct tests and then make adjustments “on the fly.” Now new concepts that have been validated in the lab can be quickly and easily deployed in actual retail outlets. 

The innovation center consists of two spaces: a smaller area for convenience, quick-service restaurant, drug and value retail settings, and a larger space for supermarkets. When shoppers enter the facility, it is equipped to look like one  of those formats, with all of the brands represented and the ambience the consumer expects to find in that type of retail environment.

“We try to replicate the channel,” Hughes said. “You would not know this is a Coke facility.” For example, that could mean installing a lower ceiling for a simulated chain drug store or using the type of lighting typically found in a supermarket. 

“Shoppers are well versed in what is an acceptable price,” he said. In terms of food and beverage selection, they say they want variety, but always seem to buy the same thing. 

Food freshness, speed and efficiency, as well as getting in and out quickly, are all matters of concern to shoppers, according to Hughes. Female shoppers may not want to reach up to the top shelf to avoid exposing portions of their bodies. Location, even what side of the street, can impact shopper response.

One of the most important innovations that emerged from testing in the mock retail environment has been the Beverage Aisle Reinvention (BAR) system, designed to lure shoppers down the beverage aisle. Some of the components include: 
  • 2-Liter Neck-Hanging System:  An innovative system that mounts to existing gondolas and makes it easier for shoppers to reach and remove bottles.
  • Strike Zone System:  A horizontal zone at arm level and accented by special lighting that showcases a broader variety of beverages that shoppers often miss.
  • Brand Shelf Set:  A vertical brand-blocking arrangement that uses colors to help shoppers easily spot the soft drinks they are looking for.

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