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What is Shopper Marketing?

Updated: Mar 1

Although many organizations have made significant progress in terms of Shopper Marketing, there is still a lot of ignorance about what it is and what needs to be done to properly implement it in the organization.

Why is Shopper Marketing so important?

The intensity of the struggle at the point of sale is getting stronger and selling our brands is becoming more difficult and costly every step of the way. According to the latest study by the Point of Purchase Advertising Institute - POPAI (Consumer Buying Habits Study), the all-time record is broken; 82% of purchasing decisions are made at the point of sale.

Now more than ever Buyers, whom we will call Shoppers, are choosing their brands -and sometimes even categories- in store, after exploring and/or evaluating a set of variables that guide them to their final selection.

Although this is not new -already in the 80s it was said that two thirds of purchase decisions were made in the store-, it is not until recently that both Retailers and Manufacturers understand that a deep knowledge of the needs , habits and behaviors of consumption (this already existed) and purchase (this is the new) and the relationship between these behaviors can be decisive for the subsistence of both.

The other determining factor is the growing importance of Retailers. Given the concentration levels of sales volumes in a few accounts, the consolidation of private labels (also known as own or distributor brands) and the limitations of space at the point of sale, the cost of competing in stores has been increasing. steadily increasing. The big chains demand more of everything (money, merchandising, tailor-made business plans and activities, exclusive references, etc.) and they are getting what they want.

Brands have to be much smarter to compete in this environment. Therefore, the importance of better understanding the Shopper and the Retailer's environment becomes evident again.

So, what is Shopper Marketing?

Let's start by saying that it's not what Wikipedia says (especially because of how poorly written it is): Shopper marketing takes place in the store and its goal is to convert the consumers who visit the store into buyers… Oh my God! -I say this-.

The first problem with this definition is that the Shopper may not be the Consumer (for example, a woman who buys: diapers, men's deodorant or dog food), or that the buyer is one of the consumers of the category, but not necessarily the most relevant of the family group (the case of a male buyer when he buys cookies, ice cream or soft drinks). The other problem with this definition is that perhaps the buyer is already a "consumer" of my brand and what I want is to maintain it and prevent my competition from converting it to theirs.

Shopper Marketing is the series of actions that seek to influence the customer's purchase decision in the different purchase channels.

The influence process begins in many cases before the visit to the point of sale, and its purpose is to increase sales, the strength of the brand (Brand Equity) and the category.

What do we have to know about the Shopper?

Despite the fact that more than half - in some of my clients it exceeds 80% in some categories - of the global Marketing investment is going through the Sales Channels, companies continue to invest much more in market research related to with Consumption and the Image and Communication of the Brand and very little in relation to how people make purchasing decisions.

In other words, companies know a LOT about their Consumers and very little about their Shoppers.

They may be the same person but they must be considered from different perspectives, because while the Consumer shows consumption habits, the buyer shows purchasing habits and when crossing both information we can have surprising findings.

The understanding of the Shopper ranges from the most general related to the category to the most particular. We must know not only how and when you buy the brands in a category, but also what other categories you buy, -complementary categories- (rum and cola is one of my favorites) or on the contrary, are there substitute categories? In a recent study we determined that in a market of one of our clients, rice and pasta were substitutes for a certain profile of Shoppers, especially when given the opportunity to compare prices. Both our client and the Retailers were very happy with this finding! Our obvious recommendation, and one that had a positive impact on sales, was to put the two categories in different aisles.

We must have many answers to design a successful strategy:

  • How does the Shopper feel towards our category?

  • What are the emotions generated by our category and brands?

  • Is it easy to understand and locate your SKUs, such as refrigerated soft drinks and juices, or complicated to understand, such as cookies or personal care?

  • Does it inspire exploration and evaluation time like ice creams, juices and salty snacks or is it a destination category and something boring like detergents and milk?

  • How does the Shopper decide on the brand and its different presentations?

  • Is the brand or the price more important?

  • If it is price, how do you compare prices? By weight, size or consumption?

  • Do you buy one or more brands or references from the same category to satisfy your needs?

Additionally, we have to understand how the Shopper behaves in relation to the different Sales Channels. For example how he buys beers, yogurt or toothpaste when he shops at a supermarket and how he buys it at a convenience store. Also how are their habits and expectations in relation to the different Purchase Missions (regular purchase, replacement, top up, etc.), Consumption Occasions (tonight's dinner with the in-laws or the soccer game with friends) and Also Consumption Habits.

I know a Shopper who always complains that her Retailer hasn't figured out that curry and other Indian cuisine should be displayed in the English category, and not next to Japanese cuisine, where it's always displayed.

All this also allows us to design and implement more advanced Segmentation Models focused on the different behaviors, habits and purchase missions. Fundamental to any effective Shopper Marketing strategy.

So… How do we define Shopper Marketing?

Definitely I would dare to define it as the process that allows us to deeply understand the needs, behaviors and purchasing habits of the Shopper, and reveals information that, when crossed with consumption habits and occasions, allows us to generate findings, detect opportunities (Insights) and design successful initiatives to influence the desired purchasing behavior at the point of sale (physical and digital).

To conclude, we have to understand that Shopper Marketing is a complex process that will require organizations to address this issue in a comprehensive manner, both from a structural point of view (functions, processes, training, etc.) and from an organizational point of view. adequate budget allocation.

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