“How fast is e-commerce growing for consumer packaged goods? Fast enough that a new shopper-marketing agency has launched to focus solely on the channel. Packaged goods is now a $12 billion business across a host of pure-play e-commerce players,” reports AdAge.
“Some 10% of consumers bought consumer packaged goods via e-commerce last year, double the amount from 2009. Nielsen Co. projects e-commerce will rise from around 6% of total packaged-goods sales in 2009 to 10% by 2015 in the U.S., surpassing club stores and matching drug-stores’ share.”
So how can shopper marketing help you take advantage of e-commerce market?
E-commerce presents a far different landscape for shopper marketing than offline retail. For one thing, growth in e-commerce is coming largely from stockup “trips,” with the average online cart about three times the value of an offline cart, largely because of free or reduced shipping incentives for bigger purchases, Mr. Katz said.
Store navigation is another key factor. About 30% of online packaged-goods shoppers go through online “aisles” in a fashion similar to offline shoppers — 40% primarily use the online search box to look up categories or brands and another 30% work off auto-replenishment lists or saved shopping lists, Mr. Katz said.
Search and auto-replenishment offer the biggest opportunities — and challenges — for brands. Etailing Solutions research finds that among those 40% of shoppers using the search box, 95% of sales go to products that come up on the first page of search results. And it’s not always the market leader that comes out on top, particularly with “virtual shelves” often being much more crowded with also-rans.
Among those 30% of shoppers using auto-replenishment or saved lists, Mr. Katz said, winning offers huge and potentially long-lasting rewards.
“There’s a sense of urgency when you think of auto-replenishment,” he said. “If you’re Colgate, and Crest gets on the auto-replenishment list, that’s instant loyalty. It’s very hard to get a product off an auto-replenishment list and a new product on. It’s kind of a race to get on the auto-replenishment list right now.”