Yanking shopper’s levers

 

Groceries, shopping, trolleyA shopper marketing FMCG professional recently asked me the very good question: “how do I know who are my most valuable shoppers?”

Following on from my last column on retail objectives, the answer comes back to what your retail objectives are and for whom

As with anything, there’s no single correct answer on finding out who your most valuable shoppers might be.

Some questions to ask yourself may be:

– Who spends the most? This may also be those that buy from you the most often.

– Who advocates your category and/or your brand to others?

– Do you have a pool of great unwashed? This would be shoppers who don’t buy the category very often or aren’t even aware of it or your brand

– Do you have repeat or loyal buyers?

– Do you care about those you already have or those who you want?

Deciding which questions to ask comes down to the lens you want to look through, for instance, if you’re using a commercially based or shopper marketing lens, and over what period of time you’re interested in.

This could mean:

– A monetarily short term objective targeting the frequency of shop versus spend

– A monetarily long term strategy that’s about the value of the shopper

– An advocacy lens aiming to target brand loyalty and advocacy of your product

– Another lens could look at the consumer’s level of category involvement

The retail objective and therefore value of a type of shopper depends on their role and level on the category or brand commitment scale.

For example, with low frequency shoppers, you would try to increase their tendency to shop and penetration, but this is likely to come at a price, such as a lower overall spend.

With brand acceptors and adopters, you would look to increase frequency and probably spend.

You may want to turn adopters into adorers, by targeting their overall spend.

One size doesn’t fit all

Ultimately, you need to segment your shopper base both attitudinally, psychographically, and behaviourally, and map or compare the retail metrics and commitments.

This will help understand who is worth what and how much, and what levers you need to pull to yank the chains of each segment, as they will each be different.

Asking who your highest value shoppers are may be different to where the category growth will come from.

Growth may be in finding out who your shoppers aren’t, rather than who they already are.

For example, if you are a category or brand with a low number of shoppers worth a high percentage of volume, then growth will come from both extending your base and frequency.

This may have more benefits than simply rewarding the behaviour of existing shoppers, such as by promoting instore discount offers.

If you are a category with high household or basket penetration, such as breakfast cereal, the growth will come from increasing the individual item price and possibly frequency.

This is bearing in mind that breakfast is largely a non-expandable category in terms of consumption: just because shoppers buy more, doesn’t mean a household will pour more per serve.

This is opposed to an impulse category like salty snacks, where the game is about penetration and frequency.

Overall, it’s important to be aware that you need different campaigns for different shopper types, each with different objectives aligned to who you’re going after.

Doing that will give you a year’s worth of strategically thought out activity without resorting to promotional calendar slot filling.

Norrell Goldring is head of shopper insight and retail strategy at GfK. She has 12 years experience in shopper research and has worked in category and channel planning for Coca-Cola, Goodman Fielder, and Vodafone. Contact her on 0437 335 686 or norrelle.goldring@gfk.com.

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