Dorothy Allan, svp-retail strategy for TracyLocke has worked on direct, online and retail marketing and is now focusing on helping packaged goods companies get the most ROI for their shopper marketing efforts. So, she’s seen the rise of shopper marketing first-hand, but has also witnessed a big change in the market over the last year or so because of the economy. As she notes, CPGs have to communicate value quickly in-store or they lose out. And that’s too bad, because consumers aren’t only motivated by price. Allan corresponded via e-mail with Brandweek editor Todd Wasserman about the current state of shopper marketing. Here is their conversation:
Brandweek: What does it cost to do a shopper marketing campaign these days? Has it gone up recently because of all the attention focused upon it?
Dorothy Allen: Cost or fees tend to go up or down based on the number of programs in a retainer versus supply and demand like other industries. That said, there has been an emphasis on shopper marketing this year with more importance placed on strategic hours. Overall, I think the investment that brands are making in strategy has reduced their production costs, particularly if the objectives are clear enough to decrease the number of iterations in production. You can do more with your hours in that scenario. I think brands that really understand shopper insights and their importance can see a return on their investment in the range of 5-25 percent. This discipline is like any other: You get what you pay for. You can’t cut corners and expect to achieve best-in-class results.
BW: What are some lessons you’ve learned in shopper marketing? (Granular stuff, like “red doesn’t work”)?
DA: I’ve learned a lot about the human mind in this role. We all make decisions in basically the same way. We classify and sort information based on pattern recognition over the course of our lives. We deselect before we select. Our minds are designed to remove extraneous pieces of information to get to a decision, which is why shopper insights are so important. It gets to the very heart of what’s getting in the way of making a choice. On the granular side, there are principles of how human beings process information that need to be followed to achieve success. For example, if you want to be able to read anything from 10 feet away, you need to use a font that is at least three inches. If the store is dark, you need to use light colors for contrast. Color has meaning: Red is an action color; pink used to mean “girl” and now it stands for breast cancer; green equals the environment, etc. The first thing and last thing you read, you will remember twice as long as the lines in between, and the last line you will remember two times longer than the first. What’s the last piece of information on almost every Walmart point-of-sale unit? – “Save money. Live better.” I don’t think that’s a coincidence.
BW: How has shopper marketing reacted to the economy?
DA: This year, there has been a lot of information that really makes a case for the entire path to purchase and a cohesive approach. The In-Store Marketing Institute conference, as well as IRI and A.C. Nielsen, have begun to illustrate that the point of decision has crept out of the store. Clean store policies are forcing brands to use their leverage outside the store, and thankfully for the first time in 10 years, consumers and shoppers are reading. That is a good thing for brands. If you group shoppers into segments, you’ll find that the shopaholic is “out” and the mission-minded, pragmatic shopper is “in.” Value is the new darling, and brands have to find ways to quickly communicate their benefits to differentiate – or shoppers will default to comparing prices. Shoppers are looking to brands to help them make better value decisions. It’s not always about price, but price does have influence.
BW: Have you had any success with grouping products in store that hadn’t
previously been put together?
DA: Actually, I did. It was around reinventing and optimizing an entire C-Store (all categories) and redesigning the space based on category adjacencies. It was a two-stage process that answered the question: What categories win for the retailer and shopper, and how much and where should they be in store? So, in effect we redesigned the space based on how the shopper wanted to move through the store, not how the operator wanted to run his store. Results were a 25 percent lift in margin and 29 percent lift in sales, not to mention the savings he gained on a 20 percent SKU reduction.
BW: Have you had any success with mobile?
DA: Yes we have, and I think more broadly we (TracyLocke) understand that good digital is the result of thorough comprehensive contact strategy. This is no different than the principles of direct marketing. There are a number of good digital shops in the market, but digital that has high performance and contribution is aligned to what digital levers that consumers and shoppers want to pull – they’re in control, so we shouldn’t forget it.
BW: What are some recent campaigns that you’re particularly proud of?
DA: I think the 7-Eleven Simpsons Kwik-E-Mart campaign was the most interesting. Imagine taking 10 stores, removing the 7-Eleven brand, re-badging the inside and outside of the store to Kwik-E-Mart, and opening for business the next day, all coinciding with The Simpsons Movie. That is experiential retail at its finest. The operators that opted in for the program had a lot of courage, and thus they had tremendous success. Internally, I think our “Moods of Mom” study for Frito-Lay was a great piece of work that helped us understand her emotional calendar throughout the year. The insights from the initial phase guide our thinking to this day.