Tuesday, April 14, 2015

Focus on ‘Moments That Matter’ to Influence Shoppers: Study

There is a new call to action in shopping marketing, says a national study. When deploying these programs, CPG companies should seize the “moments that matter” because consumers focus on them. In-home media such as TV and web sites or in-aisle programs like flyers and signage typically create these moments, says Cadent Consulting Group, which surveyed 1,000 manufacturers, retailers and shoppers.

Meanwhile, the study reported that spending on shopper marketing programs since 2012 has increased by $17.2 billion. It more than doubled from 6 percent to 13.5 percent of the total marketing budget of $225 billion, which represents 20.6% of sales.

“We believe, however, that this may be the high water mark as costs begin to outweigh benefits,” said Don Stuart, managing partner of Cadent. 

While shopper marketing has grown in concert with the path-to-purchase construct, the study indicates that the term “path to purchase” is a misnomer. Typically there is only a point or moment along the cycle that stimulates primary awareness and/or influence to buy. The concept of a complete path-to-purchase cycle for an individual product purchase, while intriguing, rarely meshes with reality. 

Also, shopper marketing spending is increasingly going into price, Stuart reported. “It’s not supposed to, as a rule. It’s supposed to go into equity-building activities. There is a lot of trade money going into everyday price management. But some of the money has shifted over from shopper marketing and moved into the more traditional trade budget.”

Here is Cadent’s thinking: In its simplest state, path to purchase incorporates the genesis of demand and the evaluation of options including outlet, navigation of the store and purchase decision. It has served as a useful model for understanding shoppers and guiding marketing investments.

“But too many people are chasing the whole path to purchase. They are checking off all the boxes, literally treating all of them as equal,” said Stuart.

Recent path-to-purchase models have increased in complexity by incorporating a more complete    purchase cycle and multiple feedback loops through digital. According to the study, shoppers are more likely to focus on key moments that matter, which integrates consumers, shoppers and customers

“Our analysis of discrete points of influence during the purchase process indicates a ‘barbell effect,’” says Stuart. Over half of purchase awareness and influence is generated at home before going to the store and approximately 30% is generated in the aisle or section. While there are core differences by category and product, he said the actual moments that matter typically occur at either end of the shopping trip: at home or in the aisle.

Over the past two decades, Cadent contends that individual silos have been created between traditional marketing and sales that have added cost and complexity. These include shopper marketing, shopper insights, category management, trade marketing, sales planning, customer marketing, trade promotion, digital, etc.  However, it is all one marketing dollar that is being spent to influence both awareness and purchase.

Organizing to capitalize on the moments that matter requires a structure with a strong digital head and the consumer/shopper at the heart, according to Cadent officials, who advise manufacturers and retailers to identify, segment, target and organize against these moments to convert shoppers into buyers in their category or store. 

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