Has the internet changed the nature of the way shopping occurs in stores these days? more
Facebook Places, Foursquare and just about every Social Networking seems to be focusing on location these days. But the problem is they all rely on some sort of check-in, whether it be manual check-in by the user or using the latest GPS/Geo-fencing based check-in.
According to the GMA (Grocery Manufacturers Association), grocer’s budgets for shopper marketing in 2007 grew at 21% per year, compared to just 2% in overall marketing budgets.
Although there is significant debate surrounding the exact definition of the term "shopper marketing", GMA identifies six main definitions, and combines them into its own broader definition. This type of marketing, it says, includes all varieties of marketing stimuli that build brand equity and have the potential to influence a shopper to make a purchase. These are developed based on a "deep understanding" of shopper - or consumer-in-shopping-mode - behavior.
There's a key distinction between "customers" and "shoppers". And this is key to the entire idea of shopper marketing: a customer is someone who has purchased something from you before (and who may or may not do so again in the future). A shopper, on the other hand, is someone who is actually engaged in the action of shopping, whether by looking through your catalog, browsing your website, or roaming the aisles of your brick-and-mortar store. Ideally, the right messaging helps convert shoppers into (repeat) customers.
Now in order for "Shopper Marketing" to start delivering a quantum leap in ROI you need to know who the shopper is. What customer segment does she belong, what is her transaction history, what is her browsing pattern in the store -- which sections of the store does she visit and where does she spend the most time. This is currently done online in ecommerce sites like Amazon.com. But given that more than $4 trillion dollars is transacted offline, wouldn't it be great to have all this information about the in-store shopper?
Enter Presence Marketing
Presence Marketing hinges on two fundamental in-store concepts: Presence Identification and Session Metrics. Presence Identification identifies a customer upon entry to retail establishment and Session Metrics captures the duration of a customer’s shopping visit, departments visited, time spent in the various departments. It provides key insights such as lost sales -- when a shopper spends time in a department/store and does not purchase
Consider the following example to illustrate the difference between Shopper Marketing and Presence Marketing. If P&G wants to provide a discount on Tide detergent it could use shelf talkers mounted near the shelves which carry the Tide product. The shelf-talker would present a coupon to every shopper who walks past the aisle. It has been reported that 60% of these types of promos actually cannibalize a brands own sales! So someone who was going to buy Tide and was willing to pay full price now gets it at a discount. In contrast “Presence Marketing” would take into consideration the shopper’s transaction history. So if the customer was buying a different brand’s detergent then a coupon could be sent to the customer’s mobile phone based on Presence Identification.
The store is a compelling and ideal marketing canvas. Over 70 percent of purchasing decisions are made in-store, and 68 percent of in-store purchases are impulse. This, it has been said, leaves marketers with a "tremendous opportunity to reach consumers.” I believe, especially in this economy, Presence Marketing will allow the promise of in-store shopper marketing to be realized and will deliver a quantum increase in marketing ROI!
