As digital media becomes an increasingly important part of the marketing mix, management teams are demanding an increasing amount of measurement to understand ROI, just as they have done for traditional print, radio and TV ad campaigns.

There have been many articles that have appeared in the media that claim measuring digital marketing campaigns is distinctly different than for traditional media campaigns.  We believe this is fundamentally untrue.  While some of the specific metrics may be different, the process, statistics and many of the metrics are the same.  It is also important to be able to measure digital marketing with the same statistical rigor as we do with traditional media so that they can be compared.  Part of our approach is to demystify the measurement process and help marketers make more strategic decisions.

In addition to the obvious goal of determining the effectiveness of the campaign as a whole, we aim to understand the individual facets within a campaign. A detailed ROI analysis enables digital marketers to evaluate a campaign at a more granular level, which helps with planning future campaigns.

Identifying clear objectives and structuring the executional portion of the campaign with specific metrics allows for a more detailed level of statistics, which enables marketers to have a depth of understanding of the behaviors behind the return on investment.  Marketers are able to understand the specific drivers behind behaviors, and which are the most and least successful points behind the campaign.  For example, analysis might include purchased-based targeting so marketers can target households that have purchased a specific category or brand in the past; it might also include demographics-based targeting. Marketers can then compare whether purchase-based or demographics-based targeting was more effective.

A detailed analysis can also compare campaign results across different publisher sites.  Understanding each publisher’s performance at a statistically-significant level gives marketers another tool for planning.

Marketers should also look at the potential halo effect of a campaign; i.e., the effect of a campaign on related sub-brands.  If there were a campaign for Joe’s Cola, marketers will want to know the effect of the campaign on Diet-Joe’s and Cherry-Joe’s, for example, as well.

Another way to measure campaign success is by the type of buyer the initiative attracts.  Analysis can reveal the percentage of buyers that are new to the brand, those that were previously buyers and returning to the brand, or maybe a repeat buyer who has recently starting buying more.

This depth and breadth of analysis helps marketers to determine whether to repeat the campaign or not, as well as if the company made money as a result.  It also allows for maximization of ROI for future campaigns.

Publishers and ad agencies do provide similar analyses, but these metrics tend to be much more topline and do not provide the depth of data and insights as the more detailed approach outlined above.

Digital marketing has opened many new possibilities for marketers eager to reach and create dialogue with shoppers.  Equally powerful analysis tools give them the ability to evaluate their success.

Today’s consumers are a force to be reckoned with. A variety of evolving factors, including economic volatility, new product introduction and consumer-centricity, fed by the adoption of technology (smartphones, tablet computers, etc.) have armed consumers with the wherewithal to challenge brands to meet their specific needs.

Technology has enabled shoppers to be more educated about products with foresight into details, including price, attributes, performance and availability. The Internet has become an integral part of the shopping experience as consumers remain connected to it while on the go on their mobile devices; many use these devices as a shopping assistant as they browse their retailer’s aisles. Easy access to this information has transformed consumers into brand advocates or defectors, allowing them to hold more power than before and change their approach to shopping.

Given today’s empowered and enlightened shoppers, in order to drive effective campaigns and see a return on marketing investments, brands must understand how different digital consumer segments perceive products and behave. The more brands learn about new economic and digital segmentations, the more they will uncover opportunities for growth and improve retail engagement in a competitive market. By leveraging segmentations, brands can identify, locate and target ideal consumers.

We’ve previously covered how our DigitaLink and EconoLink segmentations can assist brands in understanding the characteristics of shoppers within these different segments. CPG marketers can utilize these insights to initiate a shopper marketing activation process to identify the most relevant geographies, media and messaging that appeal to a particular segment, thereby increasing ROI by creating and delivering targeted campaigns.

These new economic and digital segmentations provide a unique lens through which CPG marketers can view their business and uncover opportunities for growth.  These insights can also help significantly improve retailer engagement and drive campaign and brand ROI.

After a tumultuous 2011, consumers are starting to regain confidence in their personal finances. This week, we released the SymphonyIRI Group Q1 2012 MarketPulse™ survey and found that 19 percent of consumers feel their financial position has improved over the past year.  Forty percent feel it has remained unchanged, and 41 percent feel it has deteriorated. Though, less than inspiring, this is the most optimistic outlook since Q1 2011.

Despite the overriding doom and gloom, one group has managed to remain optimistic: the nation’s 85 million moms have a brighter outlook on the future than the general population—and trillions of dollars in spending power. The MarketPulse results offer valuable insights about this smart and influential group, including:

• 23 percent of moms feeling their financial position today is better than a year ago
• 28 percent are struggling to afford needed groceries
• More than half will shop multiple stores to find the lowest price, versus 43 percent of the general population

Delving more into this trend, we also released a Point of View on this very important consumer demographic, “Valuable Assets: Today’s Moms Represent Savvy, Smart Shoppers.” In this Point of View, we discuss how often the primary shoppers for their households, moms are tasked with saving money on groceries and household needs. They adopted new shopping behaviors after the downturn and will likely continue those saving strategies even as the economy improves. Among their penny-pinching measures, moms have embraced new media as they are 2.5 times more likely than the general population to take recommendations from social networking sites or blogs.

Social media is integral for CPG marketers and retailers looking to target tech-savvy moms, but traditional marketing still goes a long way. Given their hectic schedules and mile-long, to-do lists, moms are very strategic shoppers. Nearly three-quarters make shopping lists, and moms are 24 percent more likely to use coupons to help make their lists than the general population. Once at the store, moms’ brand decisions are influenced by in-store circulars, advertisements and promotions. But, bottom line, price remains the primary deciding factor: 61 percent of moms say the price of an item heavily sways their brand decisions, versus 49 percent of the total population.

More than 1,500 new CPG products entered the market in 2011, but only 291 achieved SymphonyIRI New Product Pacesetter (NPP) status. We’re celebrating these successful product launches in SymphonyIRI’s 2011 New Product Pacesetters report, a benchmark analysis of the best-performing new CPG brands in the food and beverage and non-food categories.

Launching new products is extremely difficult, particularly in this unstable economy. Of the 15,000 CPG products introduced from 2002-2011, less than 2 percent made more than $50 million in their first year. In 2011, 81 percent of new CPG launches failed to earn $7.5 million in first-year sales. Yet, 2011 also welcomed some GREAT newcomers; an impressive 21 percent of Pacesetter products passed $50 million in their first year.

Despite ongoing economic challenges and a complex retail environment, 2011’s Pacesetters beat the new product odds, and they did so by delivering what consumers wanted: luxury and indulgence that didn’t break the bank.  Some trends and success secrets from our report:

• Twelve percent of 2011’s successful food and beverage launches were restaurant inspired— double that of 10 years ago.
• Consumers sought unexpected textures and flavor combinations, and smart manufacturers met these demands with new technologies and bold ingredients. More than half of 2011’s successful food and beverage launches touted a new or unique recipe.
• Coffee and candy were big sellers. Candy and gum launches made up 19 percent of 2011 food Pacesetter dollars, nearly triple the average for the past decade, while nine coffee and tea innovations achieved New Product Pacesetter status, accounting for about half of all 2011 beverage Pacesetter dollars.
• In non-foods, consumers are skipping the salon and handling more of their beauty and personal care needs at home. Professional-quality beauty and personal care products that offer affordable, at-home luxury and indulgence really resonated with consumers.
• The most successful new household products made housekeeping easier, but also provided extras like fresh fragrances, sustainability reassurances and extended product life.

For more analysis of 2011’s New Product Pacesetters and to find 2011’s  most successful brand launches, please visit our New Product Pacesetters page, where you can watch the NPP video, read the press release, replay the webinar and podcast, and download a detailed Times & Trends Report on New Product Pacesetters.

It’s time to revamp our approach to CPG and retail analytics as we face the perfect storm of technology, a radical shift in shopper behavior and advanced, predictive analytical models.

Predictive analytical models can enable industry leaders to understand nearly infinite details about consumers, reshaping the complete range of product development, pricing, promotion, assortments and store layout strategies. With constant access to online information, social media and mobile technology available today, retailers can create a more relevant dialogue with their shoppers.

Building on this, we recently launched “Analytics2020,” an initiative that will define the next decade of consumer and retail analytics. Analytics2020 is comprised of a global industry survey to study in detail the requirements for success in the evolving retail landscape and how to leverage analytics to create competitive advantage, and a Consortium of leading CPG manufacturers, retailers, academics and media agencies.  Our partner, the Grocery Manufacturer’s Association (GMA), will release initial Analytics2020 industry survey findings in August 2012 at the GMA Executive Conference.

The initiative will help CPG and retail decision makers focus on maximizing the impact of integrating traditional, social and mobile technologies to achieve consumer mindshare and loyalty.  Together, we will identify and define a roadmap for companies that will help tailor products and services to be individually relevant to consumers.

Don’t want to wait until August to learn more about Analytics2020? You can find additional information here and on Twitter: @Analytics2020.

Traditional segmentation serves as an excellent initial effort to tailor marketing messages to key groups. But, simple cluster analysis lacks the actual behavioral information contained in advanced segmentation solutions which may be a more effective use of meager marketing budgets.

In “Trying to Bring the Numbers Alive,” a recent article in Quirks’s Marketing Research Review, my colleagues, Jyanping Rung and Benjamin Woll, and I explore limitations of cluster analysis and how to overcome them using the National Consumer Panel (NCP) as a sample source along with a latent class methodological analysis approach. In our article, we explain:

• How NCP data allows for a combined information base to create more effective and reliable segment profiles by integrating actual consumer purchase data
• The descriptive and predictive nature of latent class analysis, which fits consumers into segments based upon membership probabilities
• Within a test case, the significance of discrepancies between sets of segments identified using two different segmentation methods (with and without actual purchase behavior from the NCP)

Without purchase data, segments may fail to recognize the actual heaviest users and why they buy. Consumers buy products for different reasons, so integrating purchase data with attitudinal information can separate segments by their usage explanations. Latent class methodology makes segments more meaningful, as information can show segment tendencies to buy different brands and product categories.

Behavioral information is vital to segment development, as it greatly increases accuracy and creates actionable segments for effective targeting. For more examples of how to use latent class analysis and a deeper discussion of its benefits, I encourage you to read the full article, found here.

Be careful—the following might blow your mind:

1. Consumer confidence is down; spending is flat
2. We are coming out of a recession and commodity/food prices will continue to rise

Shocking, I know…and yes, it is hard to type with my tongue so far in my cheek.

Obviously, it isn’t breaking news that for most consumers, the past several years haven’t been easy.  The simple truth is people need certain items to survive, and they have become harder to afford.  Coupons, an industry mechanism to incentivize purchases, have become consumers’ life-rafts.  Bundling products, buying in bulk, and doing it with a coupon has given rise to a shopping sub-culture of coupon-focused fanatics, buying 100 cases of Raman Noodles for $15.

While coupons do pass savings down to consumers, they do very little for retailer loyalty—instead driving allegiance to the best deals and largest savings.  Even more, couponing takes time.  How will a single mother working 2 jobs find the time to comb thousands of printed deals and make trips to 7 different stores?  Where is she going to put 100 cases of Raman in her 800 square-foot apartment?

Weis Markets and Wegman’s have looked at this situation and taken a similar action—freeze the prices of key items for a set period of time.  Weis Markets lowered and froze prices on thousands of items in their stores for 90 days—including both National and Store Brands—the 8^th freeze since 2009.  Wegman’s took a slightly different approach, targeting 50 Store Brand products (250 SKUs) and freezing the price on them for 90 days—an extension of a program they ran last year for 40 products, accounting for seasonality and operational changes.

While not alone, these retailers have created a program that allows their customers to more easily afford the items needed to survive.  By allowing consumers to easily and effectively budget when shopping their stores, Wegman’s and Weis are driving return trips and increasing loyalty in an uncertain time—something all retailers need to survive.

1. Besides coupons, how are you helping consumers to buy in your stores?
2. Are the measures that you have in place driving consumer loyalty, or encouraging cherry-picking?
3. How can you collaborate with manufacturers to create a program that helps your shoppers afford their staple goods AND drives their loyalty?

At the end of January, we announced DigitaLink, a new digital segmentation solution that leverages SymphonyIRI’s Consumer Network Panel, MarketPulse research and analytic capabilities to provide new insights into how quickly consumers are embracing digital media and what digital devices and platforms they are using. We identified which demographic groups are most interested in near-term engagement, and what strategies to utilize to best engage these audiences.

We then hosted a webinar in February to introduce the five unique segments of the market that exhibit different attitudes about usage of digital devices and media: Show Me the Money, Digitize Me!, Technophobes, Socializers, and Wired for Work. During the webinar, Carl and Paul explained how CPG and retail marketers can assess the purchase patterns for each of these segments to effectively ramp-up their sales and marketing efforts with passionate online consumers.

As a result of this webinar, we received questions about digital segmentation and activation.  We’ve captured answers to these questions in the below videos featuring Carl Edstrom, principal, Survey Solutions at SymphonyIRI; and Paul Lainis, executive, Consumer and Shopper Marketing at SymphonyIRI.

Carl addresses the following questions:

• Which segments do you see growing and declining in the future?
• How long do we think this segmentation will be viable?  When do you plan to repeat it?
• Do smaller niche brands have enough panel transactions to accurately project the digital shopper breakouts?
• Can the DigitaLink segmentation be combined with our proprietary segmentation?

Paul provides insights for the following questions:

• The need to align shopper marketing and sales seems clear.  What is the connection between shopper marketing and media?
• We have a proprietary segmentation.  Does this shopper marketing platform only accept your segmentations?
• How does a manufacturer use this with a retailer? You cannot have a plan-o-gram for every store.
• Wouldn’t a company spend more on advertising if they tried to speak separately to all of these segments?  Isn’t that the point of mass advertising?

A replay of the webinar can be accessed at: http://www.symphonyiri.com/Insights/ArticleDetails/tabid/146/ItemID/1426/View/Details/Default.aspx

With minimal economic improvement, rising commodity prices and continued consumer frugality, 2011 was another challenging year for the CPG industry. During our recent webinar, “Times & Trends: CPG 2011 Year in Review,” I discussed the key economic and consumer trends that impacted CPG performance across various channels, departments and categories in 2011. These include:

• Ongoing conservatism shifted shopper behavior: As illustrated in our December report, “The CPG Basket: Fostering Growth in a Time of Conservation,” pantry stocking missions are a way of the past. Consumers are now making smaller, more strategic shopping trips. Rather than blindly stocking up on anything and everything, consumers are carefully researching where and when they can obtain items at the best possible price.

• Shopping locally: As gas prices continue to climb, many consumers are looking to shop closer to home, contributing to a decline in supercenter traffic. In 2011, consumers made an average of only two supercenter trips each month, compared with an average 4.7 grocery store trips.

• In-home indulgences: Now that consumers across income levels are saving money by enjoying more meals at home, sales of various food and beverage categories have increased, including wine, chocolate, natural cheese and salty snacks.

• Some consumers are starting to open their wallets—cautiously: Wealthier consumers are buying higher-end CPG products, such as gourmet foods and salon-quality hair products, but they’re doing so with an eye towards value. High-end CPG products allow consumers to reintroduce some of the luxuries they previously enjoyed, while still spending less than they would at restaurants, bars or salons.

• Strong drug channel and private label performance: The drug channel remains strong, with dollar sales climbing more than 4 percent in 2011. Private label performance also remained positive, accounting for 22.9 percent of unit sales and 18.7 percent of dollar sales.

So what can CPG manufacturers and retailers learn from these findings?

Price remains the primary consideration for consumers, so CPG manufacturers should look for opportunities to lower costs through innovative sourcing, packaging, and product sizing strategies. This is also an ideal time to explore product development based upon existing and emerging consumer trends. Gourmet and other high-end products, in particular, present a strong growth opportunity.

Retailers should be cognizant of the growing private label popularity, and look to extend private label share, particularly across low-differentiation categories and those with significant price increases. It’s also important to constantly re-assess and adjust pricing to maintain an optimal price gap between private label and name brand offerings.

CPG retailers should also seek to enhance product assortment, especially in high-growth categories, and look for cross-promotional opportunities with high-growth categories and brands, as well as staple products. Both manufacturers and retailers should keep an eye out for technological advances and should seek out new and innovative means of informing and engaging consumers.

If you missed the webinar, you can view it here, or download the full “CPG 2011 Year in Review” report.

When most people think of online shopping, CPG items aren’t the first to come to mind, but that may not be true for long. CPG manufacturers are capitalizing on the growing online shopping market utilizing various business models. They range anywhere from presence within e-tailers like Amazon, online stores for brick and mortar retailers like Target.com, direct to consumer selling like P&G and, lastly, social commerce through Facebook. The industry is experimenting with these various techniques as new business models emerge. Though there are a variety of products being bought online, beauty products are amongst the most commonly purchased CPG categories. The SymphonyIRI April/May ‘11 Omnibus Survey found 20 percent of respondents reported to have purchased beauty products online within the last year.

With beauty products available at drug stores, grocery stores, health stores, department stores and specialty stores, why are so many shoppers choosing to buy them online? The same study found 89 percent of consumers shop online for convenience, while 82 percent do so to save money. Many consumers turn to online shopping to purchase niche products that are hard to find in stores, but in addition, a large percentage of purchases are substitutions: consumers buy what they know, expect and are comfortable with—the same products they would select in-store.

Though consumers applaud the convenience of online shopping, they are not willing to pay more just to avoid a trip to the store. Discounts and perks like free shipping are almost expected; few would shop online if it meant a heftier price tag. But with gas prices threatening to reach $5 per gallon by summer, will that attitude change?

Just how much Americans are willing to pay for gas remains to be seen, but as prices continue to climb, we can expect to see an increased inclination towards e-commerce. Many consumers, especially those in rural areas, would prefer to shop online in order to eliminate a costly drive to the store. Soaring gas prices are especially likely to spur beauty product e-commerce, as most beauty items are small and light, bearing minimal shipping costs. So, when a consumer runs out of her favorite moisturizer, she’ll have a simple decision: do I spend 45 minutes in the car each way to get to the closest Macy’s, or do I spend 5 minutes and $5 more on Amazon?