Are you re-inventing your retail?
I was recently reading an article by DR. ALAN TREADGOLD on the Hub Magazine (here) and he 
made some interesting points which I would like to address.
That shoppers no longer need to go into physical retail stores is incontestable.
True — even groceries can be ordered online….
What should traditional B&M stores do to compete with their online counter parts?
While the rise of internet retailing tells a lot about how shoppers value the 24/7 and never-leave-home convenience of the web, it also says something about the relative lack of appeal that traditional stores have for a lot of shoppers in a lot of product categories a lot of the time.
Maybe we are evolving into smarter (or lazier) shoppers. Where unless it’s convenient; I’m not going to buy it. To be honest; in some cases I’d rather shop online then drag 2 kids to a local B&M store. Why not sit on the couch and order a my groceries online and even pay a little more for the convenience of doing so.
The good news is that, to paraphrase Mark Twain (13,252 results on Amazon.com, incidentally), reports of the death of the retail store have been greatly exaggerated. In a recent survey of 2,200 American shoppers, fully 50 percent agreed that there is still no substitute for going into the store and seeing the product in real life. In high-touch categories, 43 percent still like to touch and feel a product before they feel sufficiently confident to make a purchase.
Ahhh so true, but I would say it really depends on the item. Example: I might check out a iphone 4 from a friend. I am familiar with the phone already since i own a iphone 3, and I know the quality of the iphone by apple. I know the brand and what to expect. So i would “NOT” want to go to my local apple store and wait 1 hour or more just to purchase a phone (I did that once before). I’d rather order it online and get it delivered to my door.
This might not hold true for a pair of shoes. But electronics, certain clothing and I’m sure a handful of other items fit into this category. What about you? What items do you have to absolutely TOUCH & FEEL before buying?
The first is that a substantial minority of American shoppers —around 20 percent in this survey — regard the internet as a good substitute for going into a store. In fact, they would prefer not to go into a store at all.
I guess I fall into that category. I’ll be the 1st to admit it.
This raises the important consideration of relative advantage. Physical stores are better placed than the online space to deliver some attributes of the shopping experience. Surely, stores should be capable of being more experiential, more engaging, more stimulating, and more theatrical even than their online counterparts. If they are not able to deliver beyond the web on these experiential elements of retailing, then it is very valid to question just what the relevance of the retail store becomes.
So retailers – you need to engage on a much greater level and ensure the experience is fun and exciting. What is a high priority on your holiday shopping experience? Good Outstanding customer service? A unique product? Or the experience? How will you standout?
Retailers should have no doubt that, for many shoppers, the experience of visiting their stores is indeed a distinctly sub-optimal, unsatisfactory and underwhelming one. Retail businesses are essentially all about momentum — if they’re not cycling forward then they are almost certainly spiraling backwards, but very rarely are they ever standing still.
OUCH! So the current experience is “sub-optimal, unsatisfactory and underwhelming one” sounds like fun! Retailers are you taking note? You should be surveying and setting up focus groups to determine how to make a shift in the current feelings & experiences.
The multi-channel and recession-defined landscape that is the US retail marketplace is certainly no Field of Dreams: If you build it they won’t necessarily come. But they will if you understand how physical stores can win over the web, deliver at least to the expectations of shoppers on the “basics,” and create truly imaginative and inspiring experiences.
Bravo Alan, you hit the nail on the head – create truly imaginative and inspiring experiences!
Thanks for the great article.
Kroger Simplifies Digital Couponing
Brandweek.com reports that Kroger grocery shoppers can load coupons to their loyalty cards prior to their store visits. Kroger, which has been offering some digital coupons for about three years, has rolled out a new service for consumers that puts more than 100 coupons on its Web site for private label and name-brand items. Dubbed the Digital Coupon Center, it’s shepherded by San Francisco-based YOU Technology, which has worked with the chain and various packaged goods marketers on previous Kroger digital efforts, and the current “Summer of savings” sweepstakes and promotion.
If this initiative proves to be a success for Kroger, will other grocery stores follow?
Learn more: Kroger Simplifies Digital Couponing
Fancy a Snack? Try Some Ice Cream!
As I said in my previous post, just because it’s the last day of the conference doesn’t mean the content and questions aren’t thought provoking! And maybe hunger provoking too!
I had the chance to sit in on the Nestle’s New Merchandising Location Strategy preso specifically covering ice cream cups presented by Russ Onish and Alex Sodek. The added bonus for sitting in? A chance to sample some of the great ice cream. Talk about a delicious multi sensory experience!
Nestle’s ice cream brands include Haagen Dazs, Dreyer’s, Edy’s as well as Skinny Cow. All of these brands have cup options for a total of 30. Cups are an interesting concept because ice cream can be an intensely personal experience. Everyone has their own favorite brand or likes to eat ice cream in a certain way. Cups also let you be a little more adventurous. You can try a new flavor without committing to a whole tub. And, for us permanent dieters, cups are great for portion control.
For the retailer and manufacturer, cups are a huge revenue opportunity to expand ice cream to be more than ice cream, like desserts or snacks. Here’s an interesting ratio to give a sense of scale $10 Ice Cream : $40 Dessert :$100 Snack. So, if these cups are crucial to expand into “snack” then the question becomes how to merchandise these cups properly: either with the parent brand or within a separate case? And how do you learn the answer quickly and reliably?
The answer lies in virtual shopping research! There were two questions:
- Should the cups be in a dedicated case or with the brand family?
- How should promotional pricing be communicated: 99 cents or 10 for $10?
I wish I could show you the virtual shopper research demo! We saw a video of how the shopper traversed the virtual grocery store and arrived at the ice cream aisle. The shopper could stop at any case and make any amount of purchase they desired. Here’s a little of what they learned:
- The Skinny Cow branded cups performed better when placed with their parent brand and the 10 for $10 offer resonated more than the 99 cent each offer.
- The other branded cups performed better in a dedicated case. When placed in the dedicated area, people bought more within the category, they bought in multiple, they bought in variety yielding more dollar sales. People also traded up to more cups versus tubs ($1/serving versus $.31/serving).
- In terms of pricing the 10 for $10 offer yielded 21% sales penetration versus 18% for the 99 cent each offer. Also, people bought more cups when offered at 10 for $10.
Nestle made recommendations for retail implementation. Here are some of the results:
- 90% of stores now stock the cups together. These stores have sales 53% higher than the 10% that did not stock the cups together.
- 85% of the stores keep the Skinny Cow cups with the parent brand. These stores have sales 136% higher than the 15% that did not stock the cups with the parent brand.
- Sales are currently at $50MM which is up 45% over one year ago. 2011 Forecast shows $300MM in sales.
All in all, these are delicious results for Nestle. I really enjoyed this preso – what about you?
Parissa Behnia
Idea Chef
678 Partners
Listen to the changing shopper
Just heard a great presentation from Lois Seidl, Meyers Research Center where she discussed the myriad of options available for retailers and marketers to fully connect with their shoppers and understand purchase behavior. Seidl discussed that by doing research in-store, both retailers and marketers can understand exactly why customers choose one product over another. Sometimes there is absolutely nothing wrong with the product, the customer simply has a coupon for another product or they are tight on money during this shopping trip. Of course, having a nice presentation of a brand and a great store experience does help, Seidl says that so much more of the purchase behavior is within the shopper. So what can retailers and marketers do? Listen and research.
Meyers Research has found that shoppers increasingly want a small, artisanal market experience when shopping. By listening to the shoppers needs, stores have undergone changes to suit the customer’s desires. Even large retailers like Walmart and Target have followed suit, creating a more intimate shopping experience.
Seidl also showcased many of the in store marketing signage that’s available for stores and manufacturers, highlighting digital signage.
Highlighting the store experience and the items available are important, but the overall theme of Seidl’s speech was to listen and to research your shoppers. Our thanks to Meyers Research Group for their presentation.
Welcome to Day 4 of Shopper Insights in Action 2010!
Welcome to our fourth and final day of coverage at Shopper Insights in Action 2010. This week we’ve heard from amazing speakers who challenged us with the next best practices and fueled us to create what’s next for retail innovation. But there’s so much more to come!
Our team’s coverage continues today as we share in the twitter discussion at #Shopper360. We encourage you to take a look at our coverage from the conference.
Have a great time today!
Cheers,
The Shopper Insights in Action Event Team
Where Do Your Eyes Go?
Are you enjoying these sessions as much as I am? I’ve learned quite a bit so again, a big thanks to IIR and Shopper Insights in Action!
After lunch, I listened to Herb Sorenson and Jacob Suher present The Path of the Eye in Shopping and Purchasing. It was a fascinating discussion of how our biological framework can be a help and a hindrance to our shopping. As I was listening to their comments, I remembered yesterday’s keynote by Mark Changizi so I will try to bring in some of his comments here as well.
This presentation showed us through a practical video example that the current aisle setup and merchandising creates clutter which forces the shopper to filter through the choices to eliminate what they don’t want in order to focus on and select what they do want. The video showed us that while our torso and our feet move, our point of focus does not move. This rather reminded me of the hand exercise in yesterday’s keynote. If you recall, when we blocked one open eye with a hand, that hand became semi transparent.
Sorenson and Suher’s research showed that if the shopping times were quicker, then the basket sizes grow larger. A few approaches to minimizing shopping time include reducing the number of SKUs and also laying out products horizonally instead of vertically. In other words, if you maximize shopper efficiency, the time you give back to the shopper will be rewarded with larger baskets and increased loyalty.
What’s interesting here (and what I couldn’t ask because Q&A time was over) was that WalMart lost sales and customers because they minimized SKUs. I wish I could understand how and why WalMart’s practical example differs from the research findings. Furthermore, Changizi’s comments yesterday suggested more depth than breadth when it comes to displays/merchandising which is also different from the recommendation here. It would be good to know where and how these findings fit in with one another.
Another question I had was typical big box/warehouse stores typically are longer shopper times (not shorter) with inefficient layouts. Why and how is it that it’s impossible to walk out of Costco, Target or WalMart having spent more than you intended if the trip is long (especially taking checkout into consideration)?
I know there are good answers to these basic question? Were you in the session with me? What would you add?
Parissa Behnia
Idea Chef
678 Partners
Coca-Cola’s Cappy Juice Success
What an amazing presentation today by The Coca-Cola Company! Jessica Ellickson took us through the journey through Coca-Cola’s juice brand, Cappy Juice. Popular in Turkey, Coca-Cola wanted to revamp the image of Cappy Juice and to make it the #1 choice for Mom’s and kids in the country. Coca-Cola partnered with popular grocery retailer Migros, who was thrilled to partner with the company. Coca-Cola and Migros started an intensive shopper research study that looked at who, why and when shoppers reach for juice and how Coca-Cola and Migros could get those shoppers to purchase Cappy Juice first.
The roadmap that they followed went as follows: 1. Identify opportunity 2. Gather insights 3. Generate ideas 4. Action in market
1. Identify opportunity:
Coca-Cola saw that the opportunity existed to increase sales and recognition with the Cappy Juice brand. The company made an executive decision to focus on one channel to grow the brand, grocery stores.
2. Gather insights:
Ellickson said that Coca-Cola almost has too much data to worth with – so how do they decide which data to use? They decided to focus on who is the shopper of this brand and how do they use the brand. At this point in the roadmap, Coca-Cola decided to focus on Eye Tracking, Shop-Alongs, Shopper Intercepts, In-store observation, shopper segmentation – all to discover how to make the package more shopable.
Here is a brief overview of what they discovered:
Who’s the shopper?
Female, shopping for juice for self/children
Fill-in mission: 55% of supermarket trips, 60% of value
Females spent 16 min in the store vs. 13 min of store time for Men
40% juice purchase in store
70% bakery items
What do they like?
90% want variety
85% like to browse
60% like product tasting
Coca-Cola discovered that 100% naturalness is most important purchase criteria for juice
3. Generate Ideas
Migros & Coke work to prioritze and create actionable solutions together. They implemented breakouts in teams of four to understand and generate ideas. After brainstorming and working together they came up with the winning idea: “Welcome to Cappy Orchard”- A return to nature so you can pick the best Cappy “from a tree.” Juice fountains provided free samples to customers.
4. Action in market
Coca-Cola and Migros created an in-store landscape that allowed the customers to try the product and experience juice in a completely new way. Taking the brand outside the juice aisle and near to the baked goods, they were able to increase sales and boast brand health scores at the highest level that they’d been for the Cappy Juice brand.
We’d love to hear your thoughts on the presentation. This was such a popular presentation that we ran it twice for attendees!
Duane Reade’s Transformation
Of course I saw the transformation of Duane Reade, who could miss it? The store went from being a discombobulated array of items (not unlike most NY apartments), to a clean, well organized space. Filled with light and wide aisles, the new store is a welcome change from whatever it was that Duane Reade used to be. So what happened? How did “the DR” go from ugly duckling to swan? I and other New Yorkers can thank Joe Jackman and his team for that.
Today Jackman showed is the transformation, from a whisper to a big voice. We learned that the retailer wanted to become a brand, to connect with New Yorkers and to be THE corner store for the five Burroughs. Jackman discussed the original backlash from New Yorkers when they found out that Walgreens had purchased the retailer; but that that attitude has shifted, thanks to good publicity by The New York Times and New York Magazine.
Something that I had not considered was that Duane Reade’s new branding is black and white; not red, white and blue like other pharmacies and corner retailers. Thinking about this color scheme (or hue scheme, really), we see that its visually clear, it’s black and white, that this is the brand this is the New York brand. The in-store experience was paramount to the transformation by Duane Reade. The implementation of clean, white space, wide aisles and cheeky signage helped the brand to further connect with their audience. Duane Reade has also implemented fresh convenience food, to serve a hungry New Yorker, faster than their ubiquitous minute.
So what’s next for Duane Reade? They will continue to roll out fresh, clean spaces for New Yorkers and give them the option to simply shop – and maybe have a little fun.
Welcome to Day 3 of Shopper Insights in Action 2010!
Welcome to our third day of coverage at Shopper Insights in Action 2010. Our first main day of the conference included several great speakers and industry leaders and there is so much more to come. We have several great guest bloggers joining us in our coverage, there’s a great deal for you to review and share with your colleagues through this event blog. The coverage continues today as we continue to share in the discussion at #Shopper360 or follow us at own Twitter feed, @Shopper360.
Take a look at our coverage from Day 2 of the conference.
See you at morning coffee –
Cheers,
The Shopper Insights in Action Event Team
Mark Changizi’s Alien Vision Revolution
Hello!
This is my first post for Shopper Insights in Action! It’s a pleasure to share my takeaways with you!
This morning, Mark Changizi’s keynote blew me away and I’m sure those in the audience would agree with me! He told us at the outset that once we understand what our perceptions are about, it can change applications of how we package and present product to the consumer. In effect, we can better steer the consumer once we understand how they “see” items in a retail environment.
Changizi’s comments covered three things: color, forward facing eyes and illusion and gave us implications for packaging and display based on what he’s discovered in his research as a cognitive neuroscientist.
Color: Interestingly, we learned today that as our sense of smell diminished during evolution, our sense of discerning color has improved. Color affects our emotions, our moods and our health. Consequently, color has significant impact on how we perceive packaging, displays, marketing — basically anything with color that touches a product will impact our perceptions of it. So, it’s not something that we can take lightly.
Forward Facing Eyes. Humans have forward facing eyes whereas many other mammals don’t. The audience went through an interesting exercise of covering one eye (while still open) with one hand. What happened wasn’t half sight. Rather, it was the “perception” that the hand covering our eye was semi transparent so that we could still “see” with both eyes. Hard to believe at first but wildly interesting concept. What this means is that we can handle depth of what Changizi calls “clutter” versus breadth of clutter. If we consider how our grocery aisles are set up today, they are not set up for forward facing eyes… Maybe this calls for a shift for how aisles and shelves are build and products are displayed?
Illusion. We learned today that our vision isn’t bad so much as our brains are slow in processing certain types of graphics. We saw a number of different graphic designs that “appeared’ curved or even bulging but actually weren’t. These type of graphical stimuli are ideal objects to put on our packaging and our displays. Though they are static images, they will be dynamically perceived. Our eyes will be attracted to it and because our brains are slow in processing what we see, we’ll become even more attracted — almost like a loop of sorts.
All in all – very positive, thought provoking approach to how we can use our unique qualities and apply them to packaging and display. I’d like to hear your thoughts? Please send me an email at
678Partners@gmail.com or let’s tweet chat. I’m @parissab! I’ll be writing more posts about the other sessions I attended today. Stay tuned!
Best,
Parissa Behnia
Idea Chef
678 Partners
