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Archive for January, 2012

Using DigitaLink Segmentation to Uncover how Connected Consumers Shop

Tuesday, January 31st, 2012

The recent surge of smartphone, tablet and e-reader purchases demonstrates an obvious trend of increased consumer connectivity. With digital media literally at their fingertips, shoppers can collect product and promotional information around the clock, forming purchase decisions well beyond brick-and-mortar store hours. But how many actually use Internet-connected devices (mobile or stationary) in this manner?

Internet users range from those who communicate only through e-mail for work or social purposes, to deal-seekers actively engaging with brands via social media. An understanding of digital media consumption patterns can help manufacturers and retailers direct sales and marketing efforts to passionate online consumers.

Today, we announced DigitaLink™, a new segmentation solution which does just that. Combining Consumer Network Panel data and MarketPulse research, we classified Web users into five DigitaLink segments. The unique profiles are based on the type of device consumers use to connect, online activities, technological comfort level, and attitudes about digital media usage.

DigitaLink divides consumers into the following groups, listed from the savviest digital shoppers to the least:

  • Digitize Me!
  • Show Me the Money
  • Wired for Work
  • Socializers
  • Technophobes

You can learn more about the characteristics and demographics of these DigitaLink segments, in a webinar that I’ll be hosting, entitled “Understanding and Engaging the Digital Shopper.” The webinar will take place on Tuesday, February 7 at 11 a.m. CST.  It will describe the most promising groups to target and explore case study-based strategies for activating online marketing campaigns.

To sign up for the webinar, please visit here.

We’ll live tweet the webinar via @symphiri.  You can also engage in the discussion by leaving comments on this blog.

New Store Philosophy

Monday, January 30th, 2012

With Walgreens announcement that they are converting all 68 of their Indianapolis locations to their “Health and Daily Living” store concept, after piloting it in only 20 Chicago area stores last year, comes the obvious interpretation—it’s working.  The “it” we are referring to is a holistic approach to customers’ in-store experience and elevating their position in their consumers’ lives.  The inclusion of fresh and healthy on-the-go meal options, space for community Health and Wellness events, and a Health Guide all contribute to make Walgreens a destination beyond a traditional and convenience-based Drug Store.

The respected food retailer Wegman’s has embraced this philosophy for years by including unique luxuries like gourmet tea and coffee shops, as well as made-to-order food stations in their standard layouts.  In their customers’ minds, these efforts have cemented Wegman’s as a Saturday family event, a lunch-time staple, and the only destination to fill their family’s pantry.

As consumers, we see this experience-based approach as smart and effective—as industry experts, we see this as imperative.  With in-store traffic down, but basket size up, it is essential to acquire and keep a consumer’s trips.

1.      Are you trying to engage your shoppers in a similar way?

2.     Do you feel your attempts to elevate your position in consumers’ minds has been effective?

3.      What can you offer, and how can you position that offering, to make your store a desired necessity in your customers’ life?

Dollar Stores Hitting a Home Run

Monday, January 23rd, 2012

Dollar Stores 1/20/2012

It’s like the first time your little brother hits your famous whoop-di-doozer pitch over the fence in whiffle ball—you realize that everyone grows up, and you’re going to have to take him seriously (and get a new pitch).  Ladies and Gentlemen, I give you the little brother: Dollar Stores.

For decades, dollar stores have been operating in the shadows, serving a particular customer base with particular products, while larger retailers jockeyed with one another for market share.  Just like your little brother, these dollar stores are no longer smaller than you (the largest retail chain in the US is Dollar General with over 9K stores) and can no longer use your hand-me-downs (P & G is making sizes fit for dollar store shelves, instead of delivering overstock and closeout).

Like any older sibling would, you downplay the success—the wind caught that one, or in this case, the economy gave you a boost.  Well, that’s all fine and true, but they still got a hit—and with plans to double store count (Dollar General) and net sales growth reaching 12% vs. last year (Dollar Tree), dollar stores are confident that they can continue to do it.

While these chains “grow-up” their operations (adding frozen food, quality and name brand items for more than $1, and stocking trip-initiators), consumers are capitalizing on their quality and convenience. Larger retailers are now faced with an age-old family dynamic shift—they can either adapt to this new competition or watch little brother circle the bases.

1.       Have you analyzed the Dollar channel’s effect on your business?  Are they eating away at your customer base?

2.       Do you understand how your customers use you and dollar stores?  Is there an opportunity to keep that business (product/trip focus)?

3.       Can you identify points of your business vulnerable to the Dollar channel?  How can you shore up those gaps?

A Deeper Dive on EconoLink – Q&A with Larry Levin

Thursday, January 19th, 2012

At the end of 2011, we shared findings from our new segmentation solution for CPG and retailer marketers, EconoLink™.  EconoLink categorizes shoppers into six unique segments based on their outlook, behavior and personal financial attitudes.

In the December 2011 webinar, we presented detailed insights on how different shopper segments are thinking about and planning their purchase decisions, and how marketers, in turn, must understand which shopper segments are buying their products, and how their core segments behave during challenging economic times.

There was a lot of interest in this topic, and we want to address some of these questions.  The video above features Larry Levin, executive vice president and general manager of Consumer Insights, who addresses the following topics, related to EconoLink:

  • The dynamic that seems to exist where “Savvy Shoppers” make the most money, but also buy most on deal
  • Why the “Downtrodden” and “Cautious and Worried” segments are spending more on deal
  • Aisles the “Downtrodden” are avoiding
  • Recommendations for retailers and manufacturers
  • 2012 trends

Shoppers Gain Confidence in Economy, but still Shop Conservatively

Tuesday, January 17th, 2012

After two gloomy quarters, shopper outlook finally looks a little brighter. According to our MarketPulseTM survey results from Q4 2011, consumers have higher confidence in the economy’s upturn in the next six months. However, the conservative shopping strategies adopted to weather an economic downturn may have become habit.

After analyzing a full year of MarketPulse data, we found consumers were more optimistic in Q4 over Q3, but in many ways were less optimistic than they were in Q1. We also found that financial optimism was rebounding in Q4, with 27 percent of consumers believing their personal financial conditions will be “a lot better” or “a little better” in the new year. The MarketPulse survey also found the following positive Q4 swings in consumer attitudes regarding the economy:

  • Ability to increase amount of personal savings (21%), versus Q3 (18%)
  • Rise in investment value (21%), versus Q3 (18%)
  • Earning credit to become easier (16%), versus Q3 (13%)
SymphonyIRI 2011 Q4 MarketPulse

SymphonyIRI 2011 Q4 MarketPulse

Shoppers still love buying on deal, and this trend is expected to continue in 2012 even though 20 percent of surveyed shoppers expect improvements in the economy within the next six months. Compared to the beginning of 2011, shoppers of all income levels are relying more heavily on in-store circulars, coupons, newspaper circulars, and online ads to make deal-based purchase decisions.

In addition to a press release that highlights MarketPulse survey results for Q4 2011, SymphonyIRI also just released a new Point of View, entitled “Rich with Opportunity,” which examines trends of wealthy consumers. Also available are a series of charts that highlight the top five consumer trends for 2011. All of the latest MarketPulse coverage can be found at:

http://www.symphonyiri.com/Insights/Publications/SymphonyIRIsMarketPulseSurvey/tabid/354/Default.aspx

How to Keep Kids (and Your Brand) Healthy

Tuesday, January 3rd, 2012

Pending legislation may restrict the types of food that can be marketed to children. Supporters of the proposed guidelines seek to alleviate an all-time high level of childhood obesity, but others fear the policy will eliminate too many jobs.

It may be awhile before a decision is reached due to the requirement of a cost-benefit analysis. The cause-effect relationship between advertising and childhood obesity is also being debated.

Nevertheless, children’s health is a prime concern. In the meantime, how can the CPG industry show support for minimizing the obesity crisis while upholding their brands?

Over the past few years, some manufacturers have voluntarily altered their product’s ingredient composition. For example, General Mills vowed to lower sugar levels in all cereals marketed to children, which now contain 10 grams of sugar or less per serving. The company also increased the use of whole grain in kid-friendly Big G cereals.

Other retailers and manufacturers are supporting healthier options in schools, as the nutrition of cafeteria food has long been scrutinized. Produce providers Dole, Chiquita, and Sun World have recently donated salad bars to schools to offer children fresher alternatives to standard cafeteria menus.

Whole Foods Markets (a sponsor of the Let’s Move Salad Bars 2 Schools initiative) and Publix have also made donations, in hopes that children’s act of choosing from an assortment will turn fruit and vegetable consumption into a habit.     

Dole’s Nutrition Institute even created a school curriculum, including lesson plans, music, games and activity books focused on forming healthy eating habits.

Other possible strategies manufacturers can employ to support children’s healthy eating may include:

  • Introducing healthier, kid-friendly brand extensions (Sara Lee disguised whole grains in whole wheat white bread)
  • Reducing size and calorie count of lunchbox-friendly packs (Nabisco introduced 100 calorie packs for portion control)
  • Increasing marketing efforts to promote existing healthy product lines to children (Last year, farmers borrowed the traditional junk food marketing approach to brand baby carrots as “the original orange doodle”)

What are some strategies your brand is using to combat childhood obesity?