The Third Place: Trends in shopper marketing
by Louise Marsland (@trendlives), publishing editor, TREND. Shopper marketing is the fastest growing advertising category globally and is set to become one of the biggest growth areas in South Africa too. Yellowwood strategic marketing consultancy reports that in the past year, shopper marketing has taken an ever greater share of marketing budget, showing 21% year-on-year growth in budget allocation in 2012, globally.
The retail trading environment is tough and it is only getting tougher as recession-hit consumers shop for value and for the best deals they can get.
Retailers and brands are scrambling to keep up and the increasingly competitive trading environment in store has spawned a myriad of new media options in the last few years, aided by digital innovation and with the aim of targeting a consumer that is ever harder to please.
We spend so much time in malls that they are referred to as our ‘Third Place’ – after home and the office.
Malls have become the leading entertainment and leisure destinations in this 21st Century world. And a captive consumer enjoying themselves is a consumer ripe for the picking, as retailers and marketers have discovered, hence the boom of mall and in store media in the last decade.
Shopper marketing has become a retail science all of its own and a mass medium that is taking an ever greater slice of the marketing pie. Depending on who you talk to, the fact is that between 68% and 72% of purchasing decisions are made in store – in the aisle, at the shelf. Research has shown that shoppers organise their shopping trips around the type of experiences that they want to have, not only around what they need to do.
However, as we go into year five or six (depending on which region of the world you live in) of the world’s worst recorded global depression, the consumer is a different animal these days: in the main price conscious, cash-strapped, stressed and with a powerful voice, handed to them by technological and digital evolution in the last few years.
The key word is VALUE. Retailers and brands have discovered that you need to enrich the lives of your customer-base. And to be able to do so, you need to get to know them very well. The era of marketing to the individual is upon us.
These are some of the key trends identified in the latest TREND. Dissect report: The Third Place.
- Shopper Marketing Channel: Shopper marketing is the fastest growing advertising category globally.
- Value Mart: Price matters, but so does value. You need to enrich the lives of your consumers, either through a superior product experience, information, or a pleasant shopping environment.
- I ‘Heart’ You: You need to care and the consumer needs to believe that you do. Not just about them and their needs and the needs of their family, but about the environment they live in, that their children will grow up in, what they consume and where products are sourced and how they are made/grown/harvested.
- Price Point: The majority of grocery shoppers in South Africa display strong store and brand loyalty, but rising food prices and economic uncertainty is driving store brand popularity and a decline in non-essential purchases. South Africans have become cautious, price sensitive grocery shoppers.
- Loyalty Legion: South African shoppers demonstrate high levels of store loyalty and brand loyalty and don’t switch shops or brands necessarily for price only.
- Shopper Tribes: There are new “tribes” of shoppers following on the recession, as identified by trend forecaster Dion Chang: notably the ‘Forever-frugal Shopper’.
- What’s in it for me? If you want brand fans for your social media channel, you have to give them something in exchange, consumers want something back for supporting their retailers and brands and they are quite mercenary about it.
- Experiential: Offering shoppers instant rewards in store or on loyalty cards or via mobile couponing; or providing ‘solutions’, like meal combinations for dinner.
TREND., the South African trendwatching portal and MarkLives’ sister site, takes an in depth look at Shopper Marketing in the latest TREND. Dissect report, ‘The Third Place’. The full Shopper Marketing ‘The Third Place’ report is available at TREND. on www.trendlives.info, for free.