Death of Enticing the Impulse Shopper?

Thursday, December 15th, 2011

The Internets… they keep changing things. Like making shoppers more prepared when they reach the store, and less apt to be enticed to products they didn’t come in for:

It’s no secret that technology has changed in-store shopping behavior. Whether it be through mobile phones, barcode scanning, or price comparison shopping sites; consumers are more prepared than ever in the store aisle. According to a new study released from Deloitte, nine in 10 shoppers know what they’re buying before they arrive at a store, and more than eight in 10 (83 percent) have a set of brands in mind that they will consider.

Of course, when considering the holiday shopping season ahead of us, we know in-store shoppers are more mindful of finding online deals or coupons. According to the study, 80 percent of surveyed shoppers say they do their own research online and have a pre-determined price point and a potential savings amount in mind before they step into a store. Furthermore, two-thirds of consumers shop when they know products will be on sale.

Three-quarters (75 percent) of survey respondents assert that they are smarter shoppers than they were a year ago, and nearly nine in 10 (86 percent) believe they are getting more precise in what they buy.

Why are lines blurring between manu and retailer?

Wednesday, October 12th, 2011

CPG Manus are being a lot more direct lately… want to know why? Read on -

Brands have jumped on the e-commerce bandwagon, establishing their own direct-to-consumer domains, not just for the opportunity to sell directly to consumers, but also to engage and understand their shopping behaviours.

As you can see, the lines are quickly blurring between manufacturer and retailer. And there’s no doubt that this will foster accelerated innovation and cooperation.

What’s driving this market shift? I can think of a few initial reasons:

The economic crisis

Simply put, the rise in commodity prices and recent recession have forced us to innovate. The ability to combine advertising budgets to reach the right consumers preserves margins for both manufacturer and retailer.

Access to the consumer

For brands that don’t have their own retail website, this represents an opportunity to get closer to the consumer.

Proximity to the consumer allows a brand to capture more meaningful insights that can then be used for spotting market trends, or uncovering ways to accelerate a brand’s product development.

Lack of effective means to gather customer feedback

Brands that lack the capability to capture these insights may end up using blunt-force consumer surveys, which creates misinformation that results in products like the ‘Homer-Mobile‘.

The convergence of retailers and manufacturers foreshadows a flattening of the marketplace and increased challenges in differentiation.

Where did the Walmart shopper go?

Wednesday, September 28th, 2011

A recent report found that Walmart shoppers aren’t always so loyal:

  • The price king has been toppled. 86 percent of Walmart shoppers no longer believe that Walmart has the lowest prices. Every brick and mortar retailer lowered prices and shouted sales throughout the recession, while the Internet became the go-to place for shoppers in search of the lowest price. If Walmart no longer stands for everyday low price (EDLP), what does it stand for?
  • Where did the Walmart shopper go? The Walmart Shopper is finding better shopping elsewhere, including dollar stores, supermarkets and other mass merchants. “The most frequent core shoppers are still in the [Walmart] store, but they have less money to spend and so are always looking for a better deal,” says Liebmann. “If Walmart can convince them that it has the best deal every day, they will hopefully not be so tempted to go elsewhere.”
  • The recession is not over for Walmart shoppers. 82 percent of the retailer’s shoppers say they haven’t seen any improvement in their financial situation in the past year, and 70 percent don’t expect their finances to get better next year. The economic downturn, credit crunch and higher gas prices, among other factors, squeezed the discretionary spending out of the wallets of Walmart shoppers.

Has the recession caused a permanent shift in how consumers shop for deals? Are shoppers finally going online and staying there?

Top 5 Retail Trends Unique to 2011

Wednesday, September 14th, 2011

What are some of the retail trends unique to 2011?

Opening Keynote speaker Keith Anderson, Senior Analyst at the RetailNet Group predicts:

There’s a lot of 2011 left, but here’s a “pre- post-mortem” based on what I’ve seen so far and what I expect to see before year-end:

  • Smartphones went mainstream (> 50% adoption by year-end), and tablets proved optimal for e-commerce
  • Amazon was prioritized as a customer by suppliers, a competitor by retailers, and a target by regulators
  • Multichannel retailers embraced online-offline integration and invested to make sites and stores support each other
  • CPG retailers and brands realized that digital influence (marketing) is as important as e-commerce (retailing)
  • Everyone realized that business model viability depends on context, and that the world looks very different for Peapod, Amazon Fresh, FreshDirect, Wag.com, and Petflow today than it did for Webvan, Pets.com and Kozmo a decade ago

There will be much more to talk about at the conference, but that’s a pretty good start.

Learn more from Anderson at the conference:

The Smarter Shopper: Marketing to the Digital Consumer
Tue – Wed, September 20-21, 2011
Stamford, CT
Register now >
Don’t forget – Use the code “digitalcpg” at registration for a 10% discount just for DigitalCPG.com readers!


Rise of Social Commerce & Future of Retail

Tuesday, August 30th, 2011

Dive into these two great presentations on your lunch hour or your mid-afternoon slump:

PSFK's Future of Retail Report 2010
View more presentations from PSFK

How Retailers Are Getting Digital

Thursday, June 23rd, 2011

The State Of Retailing Online 2011: Marketing, Social, and Mobile report conducted by Forrester Research Inc. is out and here are the key takeaways:

- 91 percent of retailers currently have a mobile strategy in place or in development (up from 74 percent a year ago).

- 72 percent of retailers say they will increase their spending on social networks this year over last year.

- Retailers report that 21 percent of all mobile traffic is coming from tablets.

- 48 percent of retailers report having a mobile-optimized Web site; 35 percent have deployed an iPhone app; and 15 percent offer an Android app and an iPad app.

- 62 percent of retailers said the returns on social marketing strategies are unclear, and nearly the same percentage said the primary ROI from social marketing is listening to and gaining a better understanding of customers.

This research begs the question: is your iPad app ready yet?

Testing How to Drive Loyalty from Online to Offline

Tuesday, June 21st, 2011

Groupon is entering the grocery market. But probably not how you think.

Groupon is partnering with a New England supermarket chain to offer deals on groceries. Here’s what will happen – Groupon subscribers will be notified of the deal at Big Y Foods stores — a $39.99 “Shellfish Grill Pack” for $24. But unlike most Groupons that rely on a printed coupon or mobile phone for redemption, those who purchase the deal will have it credited to their Big Y Foods loyalty cards.

“It’s seen as test of whether Chicago-based Groupon can adapt its daily deals to retailers beyond the small merchants that have been its core business,” reports Chicago Business. “One major challenge has been redeeming the Groupon offers. The traditional daily deals require Groupon users to print out paper coupons or use an electronic version on their mobile phones.”

Of course,  if it’s successful, other grocers are lined up to participate. Would your brand want in on such a deal?

Parents Less Likely to Move to Baby Private Label

Monday, May 16th, 2011

“Betting that parents are less stingy when it comes to junior’s needs, two of the country’s biggest makers of diapers and wipes are pushing through price increases. Kimberly-Clark Corp. plans to raise prices on its Huggies diapers and wipes by 3% to 7% while Procter & Gamble Co. announced a 7% rise in prices for its Pampers diapers and 3% increase on wipes,” reports the Wall Street Journal.

Why such confidence? That’s because:

“Shoppers are less likely to switch to a cheaper brand on a baby product than many other items on the shopping list,” according to a recent survey by Sanford Bernstein analyst Ali Dibadj.

“Just 10% of consumers said they switched to a cheaper diaper brand because “it’s not worth paying more in this category,” and no consumers reported switching baby food. By comparison, nearly a third of consumers said they switched brands of bleach, bottled water and liquid soap.”

Who else can raise their prices?

“Brands that have the highest market share, are purchased infrequently (like sunscreen or lightbulbs), are necessities, have few competitors, or where it would be hard to reduce consumption (like toilet paper) have the most power to enforce price increases.”

“Mr. Dibadj ranks Kimberly-Clark and Clorox among the least able to raise prices, given that they operate in highly competitive categories with high commodity cost pressures. P&G and Colgate, with their exposure to distinctive items like beauty products, pet food and toothpaste, fare better, Mr. Dibadj said.”

Wal-Mart tests online grocery delivery in California

Wednesday, May 11th, 2011

Walmart is taking it’s shot at Peapod and FreshDirect.

The “Walmart To Go” test allows customers to visit Walmart.com to order groceries and consumables found in a Walmart store and have them delivered to their homes.

Products include fresh produce, meat and seafood, frozen, bakery, baby, over-the-counter pharmacy, household supplies and health and beauty items.

The online grocery business has proven difficult to succeed in given the perishability of fresh food and the industry’s small profit margins, analysts have said. But this model probably makes more sense with its stores and distribution centers across the country already. They have the infrastructure.

Should be interesting to see how it plays out.

Go Green Goes CPG Sour in Recession

Monday, May 9th, 2011

Green may only be the new black when times are good.

“As recession gripped the country,” reports the New York Times, “the consumer’s love affair with green products, from recycled toilet paper to organic foods to hybrid cars, faded like a bad infatuation. While farmers’ markets and Prius sales are humming along now, household product makers like Clorox just can’t seem to persuade mainstream customers to buy green again.”

Sales of Clorox’s Green Works have fallen to about $60 million a year in comparison to its year of launch when sales topped $100 million.

“Every consumer says, ‘I want to help the environment, I’m looking for eco-friendly products,’ ” said David Donnan, a partner in the consumer products practice at the consulting firm A. T. Kearney. “But if it’s one or two pennies higher in price, they’re not going to buy it. There is a discrepancy between what people say and what they do.”

Does this surprise you?