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Posts Tagged ‘Marketing’

How to Excite High-Value Health and Beauty Shoppers

Monday, February 2nd, 2015

The vast majority of shoppers make lists before they go shopping to maximize their time and make sure they get what they truly need. Even more compelling is that a quarter of shoppers actually make the extra effort to include specific brands on their lists. Improving shopper targeting is critical for health and beauty manufacturers hoping to make it onto these lists and maximize their marketing spend. But with shoppers already inundated with marketing stimuli, from traditional advertising to mobile and in-store, how can retailers and manufacturers best reach their desired consumers?

  1. Shopper Targeting – Understanding and anticipating shoppers’ habits – whether planned or spontaneous – is vital. Without this, manufacturers and retailers can miss key facts, such as Millennial spending being on par with the U.S. population but purchasing 20% more products than the general market. While deal-focused, Millennials also enjoy the experience of shopping at retailers that use experiential marketing tactics, such as ULTA, Lush and Sephora. Affluent shoppers have similar behavior, and a few key aging Boomer groups are spending disproportionately to maintain a youthful look and image. Knowing which consumers are buying which types of products gives both manufacturers and retailers the insights they need for successful decision-making.
  2. Digital Tools – More than one in three people now use digital tools to learn about health and beauty products (the highest of any online product category). Experiential marketing, demonstrations and bloggers like Miss Maven, Maskcara and Cult of Pretty have created a large following of consumers eager to hear about the latest beauty trends. Before making any digital decisions, companies should know and understand their target demographic so that they can choose the specific mediums that will be most effective.
  3. Thoughtful Promotions – Manufacturers must “right time” their promotions but avoid being seen as an always on sale product. It can weaken a brand’s image and encourage consumers to wait to buy because they know the product will be cheaper during another shopping trip. With brick and mortar, in-store promotions provide huge opportunities. More than a third of consumers change their first choice when another equally valued brand is on sale, and many shoppers can even be swayed during the final moments of their shopping trip.

The market position of every health and beauty manufacturer and retailer is different, so their shopper targeting strategies should be as well. Developing these strategies begins with a detailed, comprehensive and nuanced understanding of high-value shoppers, including their preferences, their definition of “value,” and how they make decisions at home, online, on the go and in the store. Marketers that understand and excite their shoppers will win in today’s hypercompetitive market; those that don’t will end up like last year’s lipstick.

Pricing Strategy Moves Front and Center to Drive Sustainable Growth

Tuesday, December 9th, 2014

Harnessing the potential of big data in every aspect of a company’s operations is a highly attractive goal, but it’s one that can be difficult to achieve. IRI and Columbia Business School’s Center for Pricing and Revenue Management recently held their second annual education program on “Pricing Analytics” to discuss how leveraging big data to develop improved pricing strategies can create huge opportunities for organizations in any industry.

Those in attendance represented a diverse group of industries – CPG, financial services, ecommerce, healthcare, insurance, transportation.  They also included representatives from many disciplines within these companies. Day one included a pricing simulation that looked at factors such as shoppers’ willingness to pay, quantifying demand and price elasticity, pricing in a world of active competition, and more importantly, strategies for applying this information with attendees’ companies.

Day two focused on the techniques and technologies of pricing. The CPG industry is blessed with better information about demand elasticity than many, but struggles with how to apply this information to drive ongoing pricing strategies. The session dove into how to get decision makers from across a CPG company to align on pricing since, within many companies, this does not occur in a systematic way today.

IRI and Columbia faculty discussed several critical pricing-related issues and involved attendees in hands-on discussions about applying solutions within their organizations.   These included discussions about supporting better pricing and promotion decision with analytics, gaining buy-in for pricing analytics within an organization, translating pricing analytics insights into action and measurement, and the benefits improved pricing analytics provides to the CPG organization.

Attendees brought up issues such as a lack of alignment within their organizations about pricing strategy, concerns about communicating pricing strategy effectively with customers, how best to measure the impact of pricing strategies and the role of pricing in communicating the brand proposition.

An especially interesting session was the keynote presentation by Jeff Ansell, chairman, president and CEO of Sun Products Corporation. Jeff illustrated the critical role an effective pricing strategy can play for the success of a company.

He illustrated the perils of failing to address these points by using examples such as JC Penney and Netflix, where dramatic changes in pricing strategies not aligned with shoppers’ preferences led to unfortunate results.

Applying advanced analytics to big data can uncover new, important growth opportunities. Our program with Columbia is helping innovative industry leaders realize that effective pricing is an important cornerstone of long-term, sustainable growth.

We look forward to collaborating with Columbia again next year and hope more CPG leaders will attend!

Understand Different Hispanic Shopper Groups with Insights from HispanicLink 2014

Thursday, December 4th, 2014

Hispanics are now one sixth of the U.S. population and represent $1.3 trillion in purchasing power. That purchasing power is projected to surpass $1.7 trillion by 2017, presenting a tremendous opportunity for CPG growth. For example, a CPG manufacturer with $1 billion in sales can earn an additional $71 million in incremental revenue by effectively marketing to Hispanic consumers.

To help CPG marketers and retailers grow their Hispanic portfolios, IRI has just released HispanicLink 2014, a new report that offers critical insights on how to best target, engage and activate the nation’s largest multicultural group. HispanicLink breaks down the complex and diverse Hispanic population, comparing the purchasing and shopping habits of three distinct consumer segments: “Acculturated Hispanics,” “Bicultural Hispanics” and “Unacculturated Hispanics.”

With HispanicLink, marketers and retailers can compare the purchasing, shopping habits, and attitudes of unacculturated Hispanics to those of more acculturated Hispanic households, as well as to the non-Hispanic population.

For example, while some Hispanics speak mostly Spanish and prefer Spanish-language media, others have completely integrated into American culture. Given the diversity of attitudes within the U.S. Hispanic population, CPG companies must better align their marketing and product offerings with the wants and needs of specific Hispanic shopper groups.

Recent IRI research shows that improving Hispanic targeting can generate significant sales and increased market share. Here’s more info on the three groups:

  • Acculturated Hispanics – With a median income of $62,000, this group’s members are assimilated to American culture and tend to be digitally savvy. These shoppers generally want the best price, and are willing to compromise on product quality to some extent in order to get a deal.
  • Bicultural Hispanics – This segment is bilingual, and is more likely to follow Hispanic traditions and purchase products that are directly marketed to Hispanics. These shoppers are more digitally savvy than the other Hispanic groups, and are heavy consumers of both English and Spanish media.
  • Unacculturated Hispanics – Given this group’s more limited knowledge of English, products specifically marketed to Hispanics are most attractive to them. These shoppers often rely on Spanish translations on packaging, and are most likely to be influenced by advertising before buying a product. While money is often tight for unacculturated Hispanics, they enjoy cooking traditional meals and value healthy eating.

With the U.S. population becoming increasingly more multicultural, IRI HispanicLink offers a deep look at Hispanic consumers’ attitudes and behaviors, from path to purchase to health and nutrition. Armed with these shopper insights, CPG retailers and marketers can better understand and engage with Hispanic consumers.

For more insights on creating a cultural connection with Hispanic shoppers, refer to IRI’s “Winning with the Hispanic Consumer Today” Point of View, published in September 2014 and/or contact me at Staci.Covkin@iriworldwide.com.

Winning With The Hispanic Consumer Today

Thursday, August 14th, 2014

Spending by Hispanic shoppers has increased 207 percent since 2000, and by 2015, the U.S. Hispanic market will be worth $1.5 trillion. During our recent #IRIWebinar, “Winning with the Hispanic Consumer Today,” Latinum Network Vice President Andy Hasselwander and I discussed on what it takes to engage, measure and market to the 53 million Hispanic consumers in the United States.

By taking a closer look into Hispanic consumers’ path to purchase, marketing and media channels, population growth, purchasing power, category trends, geographic penetration, acculturation and shifts, webinar viewers left with the knowledge to grow their Hispanic portfolio.

Differences between the Hispanic consumer mindset and the mainstream American consumer mindset

More than half of Hispanics prefer a brick-and-mortar experience. These shoppers predominantly choose venue locations with the best values (dollar store, Walmart, Target, neighborhood Hispanic store) and products to accommodate larger family sizes while still connecting to their cultural needs.  And advertisements, family and friends heavily influence their purchasing decisions.

Hispanics are also willing to shop online, with online price comparisons higher in 2014 than a year earlier. However, Hispanics under-index for online shopping relative to non-Hispanics (35 percent vs. 49 percent).

While it is important to recognize and understand these cultural differences, IRI and Latinum Network advocate for a Total Market Strategy (TMS), in which Hispanics and other multicultural shopper groups are seen as part of the total market pie. A TMS methodology enables a more holistic market focus by facilitating integration of planning and agency activities. It also ensures that brand values are represented consistently across segments, regardless of the messaging mode, language and platform.

How to align brands and messaging to better suit the needs and motivations of the Hispanic consumer

Nearly half of Hispanics believe advertising today depicts an inaccurate portrayal of the Hispanic community.  Although ads that are in Spanish language are important to Hispanics, they would like to see ads that dig deeper and truly connect with them on a cultural level, as well as reflect their identity and heritage accurately.
Whether the advertisements are in English or Spanish, Hispanics expect advertisements to be entertaining, and are more likely to pay attention to outdoor advertising and in-program product placement than the general market.

Best practices in metrics and measurement to track performance of Hispanic marketing efforts

Lack of appropriate decision support systems has created a vicious cycle of under-investment, resulting in the fate of Hispanic strategy resting with the “gut feeling” of a few stakeholders. Breaking out of this vicious cycle requires a comprehensive insights regiment founded on robust data and rigorous analytics.

  • Insights allow you to create, target, and track Hispanic consumers in order to learn the best ways to reach Hispanic consumers at the household and store levels.
  • Activate consumers by optimizing marketing execution offline, online, and in store
  • Measure marketing impact on sales and brand perception
  • Innovate through specialized product improvements and launches

Making changes to reach a more diverse consumer is not something that happens overnight. It takes recognizing cultural influence, researching target demographics, customization, and shifting internal company mentalities from the C-suite down to focus on multicultural opportunities as a business imperative – and not as a cultural or political agenda item to check off a list.

If you missed the webinar, you can watch a free replay here

Are you marketing your market research?

Wednesday, June 4th, 2014

Your market research is not reaching its full organizational and business potential.

Consumer packaged goods (CPG) manufacturers and retailers spend billions of dollars annually to access, mine, consume, and produce information that is intended to provide a competitive advantage to the execution of their business.  The recent emergence of big data and new technologies has dramatically expanded our pools of available data points and insight potential faster than many organizations are able to react.

Due to the explosion of available data pools, insights are becoming the new value currency of market researchers, and all too often many of our peers view the insight itself as the end goal.  As a result, market researchers are often viewing volume and speed of insights as the key metric to organizational value.

The savvy market researcher knows that the true reflection of value for any insight or bit of information provided to a business is in its ability to illicit an effective change in execution and, ultimately, material financial impact.

To illicit effective change in execution, your insights need to be present at the moment of choice and decision.

In many cases, we as market researchers launch a project to answer a business question.  We hypothesize and dig through mountains of data to ultimately prepare a larger research piece that is shared through presentation to a finite group of individuals that had the initial question.

We check the box.  Initial curiosity has been satisfied, but have we created the environment where this information is available at scale and mindfully present for the individuals making the day-to-day decisions?

If the answer is no, then the full value potential of your insights are sitting in the back room collecting dust.

The value is not solely about the insight; it is in your ability to effectively distribute and deliver that insight.

Where do I start and how do I get there?

One well-traveled path that market researchers can lean on to raise the value of an insight is to study marketing methods in use today.  Content marketing and its more established parent, direct sales marketing, can provide an effective set of tools that market researchers can leverage within their organization.  With the right mix of vision, planning, and execution, your insights can dramatically increase their reach and impact.

Step 1 – Define who would most benefit from the insight and why

The executive team is the usual suspect when compiling your list of "who needs to know," but if you want to scale your impact, you need to dig deeper into your organization to find out who makes the day-to-day execution decisions.  Consider how the information you have can be of use for those decision makers.

I recommend to my clients and peers to compile a list that describes such elements as: function, name, how they might use the information, what calls to action you might recommend, and where and when they might need the information in their decision processes.

What you should find in your list is that very few individuals will benefit from a simple push of the full presentation, but rather, specific pieces will tie into differentiated and specific needs.  This becomes your road map for how you will shape and deliver digestible and actionable insight content to each of those players.

Step 2 – Link the insight to your singular purpose

Jeremiah Owyang is an industry analyst and founding partner of the Altimeter Group.  His motto is ABR (Always Be Researching), which fits very well to our industry, but what Jeremiah does better than anyone is communicate his multiple research findings through a singular purpose.  In 2013, his focus was on the impact of social media on business, and he has turned his focus on the collaborative economy in 2014.  He is so dialed into that singular purpose that if you Google search "collaborative economy," it is his name that comes up at the top of the search listings.

So, where do you find a singular purpose within your organization?  You find the clear linkage between your insights and the strategic goals of the company or business unit.

If your company’s strategic objective is to increase the number of consumers of your product, and you have an insights project on price elasticity, you need to find and articulate the linkage between the two.  Possibly the price elasticity is more pronounced in a key opportunity demographic, such as low income shoppers. This linkage becomes your magnetic headline and hook to deliver your insight.  

Here is the framework to consider:  Insight Finding + Strategic Objective + Call to Action = Result

For example:  Find out how price influences purchase decisions for low income pickle shoppers, and what you need to do about it.

Step 3 – Determine your delivery method

A mixed media approach is the most complete approach, but from a pound-for-pound perspective, e-mail still reigns supreme as the method of choice in providing a cost effective scale to information distribution, and here is why.

Even though we can all agree to having an e-mail inbox that would reach around the world twice, it continues to be one of the most effective forms of social communication and method for driving action.  According to a study published by McKinsey & Co. in January of 2014, e-mail is 40 times more effective than Facebook and Twitter combined in customer acquisition.  

Even though attention spans are on the decline, according to a study published by the National Center for Biotechnology Information in January of 2014, an office worker checks their e-mail inbox an astonishing 30 times per hour on average.  This will at least ensure that the subject line of your insights will be, at a minimum, seen. 

If e-mail is your game, then you might find your caddy and clubs over at mailchimp.  Beyond the fact that they offer one of the most popular e-mail marketing tools (complete with cross platform testing and campaign effectiveness analytics), they also provide a series of free e-books to educate you on campaign strategy.

Step 3 – Refine your packaging

Packaging, context, and presentation determine 95% of a message’s ability to reach home.  The same attention span study that brought us the e-mail checking neurosis also reveals that the percent of words read on a web page of 111 words or less is around 50%.

To raise your consumption rate, your packaging should scream these 5 traits:  personalized, compelling, action-oriented, short, and visual.

To achieve personalization, we return to the data we collected in step one to find the specific impact hook for your target segments.  As you consider your audience segmentation, consider personalizing the headline, content, and call to action to be specific to what matters for that particular group.  Sales and category management functions tend to have different needs and day-to-day decision parameters than brand management or marketing.

Being compelling and action-oriented requires us to sharpen our copywriting skills.  We touched briefly on the magnetic headline and the call to action, which are the bookends of your compelling copy.  The journey between those two points is just as important, as every word (and unnecessary word) counts in the stickiness of your message.  One incredible and free resource to begin sharpening your copy writing skills is at Copyblogger.  Beyond their regular post and podcast content, if you sign up with Copyblogger you gain access to a series of free e-books that nicely wraps up years of their best thinking.  

To raise your impact, be as short as possible…15 seconds short, to be exact.  If you are still with me here, you are part of the 38% that view an e-mail for more than 15 seconds and quite possibly part of the 65% that is reading this on a mobile device, according to research recently published by Movable Ink.  E-mail consumption is clearly moving to mobile platforms where your message is being viewed in line at the super market or between meetings.  You have to be mobile friendly, and it needs to get to the point faster than you naturally think.

Spending some effort working towards being visual will translate to information that is consumable and shareable.  Nancy Duarte founded and leads an agency that helps some of the biggest brands in the world create better presentations and copy materials.  She is also a multiple bestselling author on communication and presentation methods, such as the HBR Guide to Persuasive Presentations.  Nancy just released a new e-book called Slidedocs (which is also free) that provides an interesting and highly actionable point of view on how to structure your presentation and shareable copy content for broader consumption and impact.  The book provides a number of very easy to implement design and copy tactics to increase the readability of your content.

Step 4 – Create your schedule

Putting information into the right hands at the right time is an important aspect of reaching your objectives.  A responsible level of planning here can raise your effectiveness.  Place the information too far in advance of the decision event, and it may be forgotten.  Place the information too close, and it might not be fully consumed before the decision.  Based on your understanding of each of the groups you identified in step one, look for various opportunity points to anchor your launch dates.  Some of the typical events to consider are regular planning meetings, sales calls, conferences, etc.

Once you collect this information, generate an actual calendar schedule.  The schedule should include the date, time, target distribution groups, and content packages that will be delivered for each mailing.  Having the schedule written out also creates a very easy document to share with your team members in the event they will be assisting you OR have a campaign of their own in the works.

Step 5 – Flip the power switch on and adjust

At this point, you should have a reasonably robust and actionable campaign plan.  Yes, you have built a campaign, and now it is time to execute it.  Follow your schedule, release your copy and insights into the world, and follow up with your recipients to find out how it influenced their effectiveness in producing tangible business results.  Use this information to tweak your existing plan or use it in your next.

Are you ready to make a difference?  In the end, to make an insight matter, it must influence a decision.

Enhanced Testing III: In-store and Advertising and Marketing

Friday, May 16th, 2014

The volatile economy has left many consumers in a lurch, and as such, the CPG landscape remains mired in uncertainty. To navigate these murky waters, CPG retailers and manufacturers need sound product testing methods to assess opportunities, determine appropriate expenditures, gauge shoppers’ behaviors and attitudes  and mitigate risks.

In our last post, we discussed the importance of innovation testing, such as evaluating innovative new packaging and ingredients, and this installment will focus on in-store testing, which measures shoppers’ actions and responses to specific store layouts, planograms and other in-store activities, and advertising/marketing testing, which evaluates traditional, online and integrated campaigns. By effectively analyzing consumers’ responses to these factors, CPG retailers and manufacturers can isolate the elements that affect shoppers’ behaviors and attitudes positively, and use these elements to create an enhanced product/retail experience.

To evaluate the overall success of store layouts, planograms and in-store activities such as visual merchandising, IRI recommends a test market approach. Stores that match predetermined criteria are divided into either the test category or the control group. Campaign-specific variables are then introduced, and product performance data is collected and analyzed within a given time period.

One test market approach is to create a forecast that analyzes 12 weeks of in-market data, thereby allowing clients to quickly identify missed opportunities and remedy the situation. Recently, an IRI client’s major new product introduction was slipping below goals. To quickly determine the impact of the shortfall on total year one sales, IRI conducted this forecast and was able to pinpoint opportunities within distribution and promotion that had been overlooked. As a result of this in-store testing method, the client was able to correct its course. By changing sales force incentives and allocating additional funds for in-store merchandising, the company was able to recuperate lost sales and achieved its year one goal.

Alongside in-store testing, advertising/marketing testing is another valuable approach to achieving sales goals. To assess the ROI on advertising, a leading manufacturer of baby products looked to IRI to measure the impact of Spanish language advertising – a venture not previously explored. The goal was to quantify the sales impact and corresponding ROI to determine the right expenditure to validate this course of action.

IRI conducted a within market matched store test in which stores frequented primarily by Hispanics were exposed to the test treatment and stores whose clientele did not include a large Hispanic population were not. IRI helped the client recognize that although the test results showed Spanish Language advertising increased sales by three percent, ROI remained low. The client was thrilled to have foregone an expensive endeavor that almost certainly would have failed, and is now focused on exploring other avenues to bolster their advertising plan.

These case studies demonstrate the strategic advantages of in-store and advertising/marketing testing methods that have saved clients millions of dollars. Not only do these types of testing help CPG retailers and manufacturers mitigate risk, they also provide deeper insight into untapped market opportunities and help determine the labor and capital investment required to create successful innovations.

Q2 MarketPulse™ Survey Results: Consumers Settling into “New Normal”

Tuesday, September 3rd, 2013

The “Great Recession” may have ended in 2009, but budgeting has become a way of life for many consumers. While promotional activities kept many CPG marketers afloat at the beginning of the recession, these programs have been less successful during the last 12-18 months.

Results from IRI’s Q2 2013 MarketPulse™ show consumers settling into a “new normal” defined by conservative purchase behaviors and attitudes. Despite economic improvement, there has been virtually no loosening of purse strings during the past two years.

As consumers continue to focus on value and savings, CPG marketers must re-examine their tactics and apply new, innovative strategies to attract customers. To capitalize despite the “new normal,” CPG marketers need to align their products and pricing to address consumers’ most pressing needs. Everyday pricing should provide strong value while still supporting the bottom line, while promotions should be used to address short-term, tactical opportunities.

Among the key MarketPulse findings:

  • 56 percent of consumers select most of the products they will purchase before leaving their homes.
  • To find the lowest prices, 65 percent of consumers use prices advertised in retailers’ weekly circulars; 56 percent compare prices across area retailers; and 26 percent use retailer websites.
  • Store-based marketing tactics are still influential. When selecting a brand, 48 percent of consumers consider shopper loyalty card discounts; 44 percent use in-store circulars; and 28 percent use in-store signs and displays.

To win over consumers, the key is to begin the conversation before they reach the store (through advertising and social media), but to also continue a dialog up to—and even after—the purchase. Traditional tools like circulars and in-store signage are essential, but marketers should also supplement these with advanced approaches, such as sampling kiosks and highly targeted loyalty programs, to really grab shoppers’ attention and drive purchase behavior.

Have you managed to entice consumers into loosening their purse strings? Which advertising and marketing tactics have you found most effective? We’d love to hear your strategies and successes, so leave a comment below!

For more details on targeting and attracting shoppers in light of the “new normal,” please read the MarketPulse press release.

Q3 MarketPulse™ Survey Results: Don’t Ignore the “Ignored Generation”

Thursday, October 25th, 2012

Often referred to as the “ignored generation,” Generation X is far from forgettable. Sandwiched between two larger generations, the post World War II baby boomers and their millennial children, Generation X borrows traits from both groups but more closely mirrors the millennials.

This quarter’s MarketPulse™ survey narrows in on Gen-Xers (aged 35 to 44) to reveal frugality despite a sunnier economic outlook. Twenty-four percent of the group believes their financial situation has improved during the past 12 months. Because of this positive view, it may seem that Generation X has much in common with the baby boomers. In fact, though, they actually share traits around price sensitivity and tech savviness with millennial shoppers.

Just as millennials are entering adulthood amidst a weak economic environment, Gen-Xers began their adult lives, job-searching and starting a household, during the recession following the 1987 stock market crash. They’ve adopted more frugal purchase habits compared to older generations and use technology to plan shopping trips ahead of time. The Q3 MarketPulse report demonstrates these Gen-Xer traits, such as:

  • Similar to millennial shoppers, 72 percent of Gen-Xers state price is more important than convenience in brand decisions
  • 37 percent buy brands that are on sale rather than their preferred brands versus 45 percent of millennials, 27 percent of boomers and 22 percent of seniors
  • 33 percent choose products based on loyalty card discounts versus 35 percent of millennials, 25 percent of boomers and 16 percent of seniors
  • 20 percent steer clear of certain aisles to avoid unplanned purchases versus 22 percent of millennials, 15 percent of boomers and 11 percent of seniors
  • On par with other generations, 69 percent pre-plan by making shopping lists, with Internet and retailer website usage comparable to millennials and higher than older generations

With established families and more advanced careers, Generation X is an influential group. Retailers and manufacturers should not overlook their spending power. Marketers wishing to reach Generation X should approach the group with a comprehensive arsenal of tactics, showing appreciation for their tech savvy ways, and the important role that new media are playing in helping them to get off to a solid start in their adult world.

For more details about Generation X’s shopping behaviors and this quarter’s Shopper Sentiment Index™, please read the press release:  http://www.symphonyiri.com/NewsEvents/PressReleases/tabid/97/ItemID/1605/View/Details/Default.aspx.

Capitalizing on Shoppers’ Cautious Optimism

Tuesday, October 23rd, 2012

Recent unemployment numbers brought the jobless rate to its lowest point since January 2009 and consumer confidence is on the rise, but what do these economic improvements mean for the CPG industry? Will they be enough to buoy shopper enthusiasm?

Last week, we released the second-annual SymphonyIRI EconoLink™ report, revealing cautious optimism among shoppers: 27 percent of shoppers anticipate they will be financially better off a year from now (up from 22 percent with this view last year), while 21 percent believe their financial positions will be worse a year from now (down from the alarming 30 percent with that opinion last year).

SymphonyIRI’s EconoLink report, “Economic Shopper Segmentation: A Look into How Shoppers Are Changing Their Behaviors in Today’s Economic Environment,” examines the attitudes and shopping patterns of six consumer segments, grouped according to financial outlook and behaviors. The new data provides CPG marketers clear insight into how categories, brands and stores are performing with specific shopper groups—information they can use to better address consumer wants and needs. The EconoLink segments are:

  • Downtrodden: Median annual income of $41,000; very pessimistic about their financial situations; tend to shop at mass merchandisers, dollar and convenience stores
  • Cautious and Worried: Median income of $42,000; bleak financial outlook; often shop at mass merchandisers
  • Start-Ups: Median income of $44,000; impacted by the recession but maintain positive outlook; shop at grocery, drug and convenience stores
  • Optimistics: Median income of $48,000; positive outlook; favor supercenters, drug and convenience stores
  • Carefree: Median income of $59,000 and financially stable; skew toward shopping at club stores and tend to be brand loyal
  • Savvy Shoppers: Median income of $81,000 and financially stable; enjoy shopping and the quest for value; favor grocery, drug and mass merchandisers

All six EconoLink segments demonstrated a generally positive outlook for the future, but optimism is highest among Start-ups and Carefrees. Start-Ups are twice as positive as last year; 18 percent believe their financial situation will be better next year, versus the mere 9 percent who felt that way last year. Optimism also climbed for the Carefree group (18 percent this year versus 11 percent last year). However, not all segments are improving: only 17 percent of Savvy Shoppers feel their financial situations are stronger now than a year ago, versus 23 percent last year.

In another demonstration of increased optimism, 64 percent of Downtroddens believe their financial situations will be worse a year from now than today, down from an astounding 79 percent in the 2011 report. Cautious and Worried shoppers are moving in the same direction; 38 percent today believe their financial situations will be worse in a year than today, while 46 percent held this belief last year.

Financial attitudes have seen modest improvement over the past year, but shoppers remain extremely cautious. Now more than ever, manufacturers and retailers must appeal to shoppers’ beliefs, behaviors and values. With EconoLink data, marketers can target specific segments and devise new products, promotions, merchandising, pricing and store layouts to improve each segment’s shopping experience

To learn more, read the press release, or register here for our free webinar, “It’s Still the Economy: How People’s Shopping Decisions are Driven By Their Economic Outlook,” which I will host Thursday, October 25 at 11 a.m. CT.

Localization Maximizes Social Media Results

Tuesday, August 7th, 2012

Social media has become a mainstay in the marketing world. In fact, SymphonyIRI research shows that it’s also a very significant purchase influencer, with 78 percent of consumers turning to online research before purchasing. With this in mind, numerous CPG retailers are using social media, but their campaigns─and results─have largely been underwhelming. Where are CPG marketers going wrong?

Unique Visitors to Social Networking Sites

Source: comScore: State of the Internet, 1st Quarter 2012

Today’s consumers are constantly bombarded with information they don’t want, don’t need and are not interested in. The key to effective social media is to form meaningful connections, and this can only be done by generating content that is directly applicable and useful to consumers.  Social media campaigns should make consumers feel as if they are at the center of the conversation, and should encourage engagement and brand loyalty.

For CPG retailers considering social media, or seeking to increase ROI from existing social media efforts, it is crucial that campaigns be localized and customized. CPG retailers need to research their social media audiences and provide content accordingly, taking into account factors like age, gender and income level. Targeting consumers based on location is also key. Whole Foods addressed the localization issue perfectly: in addition to its primary, company-wide Facebook page, the specialty retailer also has pages for its individual stores. That way, consumers only hear about sales and events in their own neighborhoods.

Another retailer that’s getting social media right is Target, which has had particular success driving loyalty through its Facebook page by encouraging consumer involvement and providing a deep level of customization in terms of offers and couponing. Target gives consumers content that is specifically targeted to them, making them feel as if the retailer is saving them time, rather than wasting their time.

However, there is a balance to knowing too much about customers.  While it’s important for consumers to feel like the social media messaging they’re receiving is meant for them specifically, CPG retailers should never invade customers’ privacy. Consumers do not want to feel like they are being stalked or taken advantage of, and overstepping privacy boundaries is an easy way to alienate consumers. Tactics like purchase-based targeting can be a great way to present consumers with products and information they will truly be interested in, but there’s a fine line as to how these technologies should be used. Retailers should err on the side of caution to make sure they are not getting too personal or targeting consumers in a way that could make them uncomfortable.

Most CPG retailers are still learning and experimenting with strategies for promoting their brands or products through social media, but there are countless additional applications, including product development and promoting brand events. Have a new product? Use social media to hold a naming contest. Only one person will win, but every person who enters, or even just reads about the contest, will feel an immediate connection to the product before it’s even launched.