by Herman Manson (@marklives) Michelle van Trotsenburg, Y&R’s former business unit director: shopper conversion marketing, recently presented a talk at the POPAI Marketing at Retail Conference in Cape Town. The event focused on what brands, retailers and shoppers need to do to capture influential trend-setting consumer segments.
Van Trotsenburg (@Michelle_VanT) is a qualified marketer with over 15 years of experience, including heading up the marketing department at the Walt Disney Company in Johannesburg. Her talk identified key trends in the shopper environment, and offered practical examples and case studies on successful shopper marketing strategies.
Give us a quick rundown of the top shopper marketing trends you have identified for 2014.
Michelle van Trotsenburg: I selected six trends which I covered in my presentation that I find perhaps the most relevant and topical in the shopper marketing discipline, especially this time of year. These include:
Brazilification: With the [2014 FIFA] World Cup [having dominated] social, broadcast and print media internationally, it’s a no-brainer for many brands to jump on the bandwagon. As demonstrated by what is now referred to as the ‘Suarez World Cup Controversy’, international brands like McDonald’s, Trident Gum and Whole Foods Markets use real-time marketing opportunities to capitalise on actual events.
Global brands like Coca-Cola also seized the marketing opportunity that is the opening match with their ‘The World’s Cup’ campaign, which saw over 200 000 fan images used for ‘The Happiness Flag’ to recreate a unique design developed by Brazilian street artist Speto, in collaboration with Tec, an Argentinian artist.
Perhaps less relevant in our local market after 2010, Brazilification is a catalyst for many international campaigns and certainly a trend to consider in the shopper marketing space as well.
Personalised engagement — it’s all about me: Personalised engagement has become a key strategic tool for shopper marketers in order to create customer experiences that are relevant, convenient and — most all — personal.
Coca-Cola and their ‘Share a Coke’ campaign can certainly be commemorated in the hall of fame of personalised engagement, but not every brand has relevant platforms to help achieve this level of success.
According to Marketing University, technology for personalisation has enabled brands to make use of services like dynamic insertion, customisation or suggestions for relevant content online. Locally, digital personalisation is on the rise due to the amount of data that brands are able to collect about their shoppers.
In my experience, retailers are leading personalised communication in South Africa. Supermarket chains make use of mobile coupons, personalised congratulatory birthday communication, and targeted messages to rate in- store experiences as shoppers leave the stores.
Disconnecting: In first-world markets, shoppers are always connected and might suffer communication fatigue, resulting in the trend of ‘disconnecting’, as illustrated by KitKat’s ‘No WiFi-Zones’ campaign. Y&R Advertising’s CEO, David Sable, even goes as far as to describe this trend as ‘Unplugging to Reconnect.’ In these markets, shoppers might need a break from the onslaught of marketing communication every now and then to avoid communication overload.
In South Africa there are still huge opportunities to get shoppers to connect more — mobile penetration is very high in South Africa, and brands need to increasingly leverage this trend going forward with relevant and engaging content.
Developing shopper solutions: The marketing budgets of brands have always striven to drive product awareness, to communicate key product features, and to offer consumers a reason to believe and purchase. In this scenario the brand manager optimises the media investment and strives towards reaching a certain ROI — but marketing communication does not necessarily reach consumers in the in-store environment. Grocery shopping is a particular example where shoppers are often driven by the line items of a shopping list or a casual stroll down the aisles.
A typical ‘shopper solution’ is displaying and merchandising complimentary categories/brands together in one area. This reduces shopping time and assists the shopper in their ‘autopilot’ mode because the merchandising acts as a reminder, ie baking utensils with cake mix and cold medicine with tissues and lozenges.
Although this strategy has been deemed very successful in global markets, locally it’s still proving a challenge due to retailers focusing on the brand and the category (displayed on the same shelf to benefit from habitual purchases) and not the shopper. Huge opportunities exist for brands to utilise their budgets to drive shopper centric campaigns that offer shopper solutions. This is relevant for all categories from FMCG right through to upselling Llumar tinting for motor vehicles.
The post-nuclear family: It has become a global trend for children to leave the nest later in life or for parents to move in. This rings true in the South African family as well — the high cost of living is a catalyst for this trend, but there also exists trade-offs by families, who choose to live in poorer areas in order to experience perceived luxuries like cars and DStv, that influence family structures and geographic profiles of shoppers.
Brands and retailers cater for larger families, by offering family-sized product packs, value packs, and ‘buy-two-get-one-free’ offers, but this trend will gain momentum in years to come and retailers have the opportunity to explore it further in order to maximise the ROI of their shopper marketing solutions.
SA malls: In a recent article by Jon Bird, global managing director of Labstore, the concept of physical retail and it’s future in the American retail landscape is called into question. He coined the title of ‘Zombie Malls’ — malls with vacancy rates with 35% or more — and call it the ‘Walking Dead’ of their economy.
In South Africa, however, this is not true. In fact, we are one of the countries with the highest concentration of malls per square kilometre, and the numbers are constantly growing. Location is still a key driver in terms of where shoppers shop and with the influx of malls into township areas, shoppers have more variety and choice than ever before.In your presentation at the POPAI Marketing at Retail Conference, you mentioned the Pick n Pay* smart shopper loyalty card as an example of smart and successful shopper marketing. What was key to its successful roll-out, and can you highlight some of the key stats and figures around its success?
MvT: As mentioned, retailers are in the fortunate position to infuse personalisation into their shopper messaging and communication, and I used the Pick n Pay smart shopper case study* as an example of how retailers have been able to obtain a wealth of data for personalising shopper communication relevant to shoppers.
On the Pick n Pay smart shopper card specifically, Pick n Pay has over 8 million registered Smart Shoppers, over 60% of all sales are driven by Smart Shoppers and, since, inception Pick n Pay has already paid over R1 billion out to members. The adoption of this loyalty programme during the launch phase was staggering and the campaign target (which was to acquire three million customers in the first 12 months) was reached shortly after two months.
In my opinion, one of the keys to their success was keeping it simple and using language that is easy to understand across all shopper profiles.
*Y&R is the advertising agency for Pick n Pay.
You also mentioned taking learnings from global trends and localising them for your brand/market/retailer. Who would you hold forth as having successfully adopted and localised global trends?
MvT: This is a very difficult question to answer — it differs from category, from retailer and from brand. Retailers are again at the forefront of what is happening globally and localising for the SA market from customer service right down to ‘green’ friendly packaging. Global multinational brands face these challenges on a daily basis with brands needing to adhere to global CIs,but communication needs to resonate in the local market.
What are the key factors to keep in mind when localising global insights?
MvT: In order for communication to resonate with local consumers, brands need to understand the intricacies of local target audiences. It is also critical to consider relevancy of messages in a localised context.
You mention disconnecting as a global trend, but that SA isn’t following through on this one. Why do you think that is? Also I would argue that anecdotal evidence suggest that South Africans are thinking more seriously about how connected they are and want to be — maybe we will be talking about disconnecting two or three years down the line?
MvT: The demand for smartphones in South Africa has increased significantly since 2010 as more products enter the market. Currently, the smartphone penetration is at roughly 30%, and it’s set to grow to 45% by 2017.
Unit price has often been the key setback in demand growth for smartphones, but this is slowly changing as cheaper options enter the market. The overall result has been drop in volume sales growth for feature phones, as consumers continue to shift towards smartphones that can afford them easy access to a wealth of information in the palm of their hands.
According to Luke Mckend, Google South Africa manager, around 80% of South Africans have a cellphone, and much of this mobile resource is untapped due to data charges that many can’t afford. As data charges start reducing, South Africans will rely even more so on their mobiles to stay connected so I don’t see the local market ‘disconnecting’ anytime soon.
What are the latest trends in terms of store navigation?
MvT: Extensive research has been done in stores with the likes of technology like eye tracking [enabling] retailers to understand the navigational habits of shoppers. Store layouts have, however, remained very static in the last couple of years. I have found that locally, shoppers get angry when retailers move products and break their ‘autopilot’ shop mode, resulting in them spending more time to locate product categories. I do have a few examples of trends in store navigation in the grocery category:
Retailers are shifting towards a preference for black shelving instead of white, as [it] assists with navigation on the products on the shelf.
De-cluttering of point of sale material in the store.
More promotional offers on shelf, like ‘mix and match’ (buy three and get the cheapest one free), as well as mobile coupon offerings.
Retail store ambassadors — permanent in-store promoters sampling goods in addition to paid for promoters.
What would you say is key to increasing basket sizes?
MvT: Shoppers nowadays have more access to information and, with the number of malls opening in and around South Africa, they are spoilt for choice more than ever before. Shoppers are savvy and are looking for value for money, but are still time-poor and buy on auto-pilot in certain categories. The key to increasing basket sizes is to offer complimentary category solutions to help the shopper buy more, whilst spending less time in the store.
What are the factors that are urging shoppers to covet the importance value so highly in their decision-making process?
MvT: Value is perceived differently, depending on the shopper’s needs and the category that they are interested in. At the lower end of the market, disposable income is a key factor that drives decision-making; but, on the other side of the spectrum, perceived value ranges [from] more than just affordability. A great example would be the decision to buy a new car instead of a used one. There are several factors that influence the purchase, such as reliability, resale value, the actual driving experience, petrol vs diesel — to mention a few that are taken into consideration to quantify the value, and not just the cost.
South Africans are feeling the pinch with the ongoing fluctuation in petrol and food prices, so no matter if you are at the bottom end or the top end of the market, the perceived value is what actually closes the deal and gives them the feeling that they have spent their money responsibly.
If you could offer some key advice for mall operators, what would that be?
MvT: Live and breathe shopper-centricity. Don’t just claim to be focused on driving shoppers into the mall, but actually deliver on it by making every shopping occasion a positive experience. If a shopper is popping in for a business occasion, facilitate the experience from the parking lot/taxi rank right through to the purchase and easy access to leave the mall. Invest marketing spend on creating a sustainable experience — the occasional sidewalk sale is not enough, nor is it enough just getting the shoppers into the mall and then [hand] over to the tenants to close the deal.
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