Shopper marketing is evolving into a strategic priority of consumer product goods manufacturers and is expected to increase 5.8 % to $18.6 billion over the next four years, outperforming the growth of total brand-focused spending, according to a report by the Association of National Advertisers (ANA).
The ANA report, conducted in April 2016 with market researcher GfK, represents responses from 185 marketers with an average of 12 years working in marketing/advertising and approximately 40 percent at director-level or above. The report found that shopper marketing is now being leveraged as a means of reaching consumers at a wider variety of touchpoints and influencing long-term behavior.
In addition, it was found that shopper marketing’s importance has increased as companies leverage shopper marketing insights and shift from indirectly targeting consumers through retailers, to directly targeting consumers through digital. 82% percent of the marketers polled said digital and mobile technologies are shifting the balance of power away from retailers and manufacturers and toward consumers. In response to consumerism, 35% of respondents cited motivating shopper marketing behavior beyond price as a top shopper marketing goal.
Additional key findings of the report include:
1. Leveraging Insights
Over half of the marketers surveyed said shopper marketing will become more driven by insights based on actual behavior rather than reported activity. Despite this desire to invest more in behavioral insights collection, only 40% of respondents think their organizations are adequately funding shopper insights. The reason? The insights focus is relatively new, and often must complete with other marketing budgets, thus spending must come at the expense of other activities. The solution? Rather than marketing operating in isolation from shopper marketing, the two departments should unite, giving marketers the opportunity to leverage shopper insights to fuel their omnichannel focus and better understand what motivates consumers in order to create a more holistic and connected view of the consumer.
2. Focusing on Customer Experience
43% of those surveyed believe that shopper marketing will better reflect the shopping experience as part of the overall consumer journey. In conjunction with this finding, the report emphasized that shopper marketing will need to evolve further, becoming more aligned with the total customer experience. Shopper marketers will become more experience-focused by developing advanced, personalized pre- and post-purchase brand communications, in addition to increasing the joint-planning of shopper marketing programs with partners to better drive loyalty.
3. Valuing Dedicated Shopper Marketing Teams
A dedicated shopper marketing team is more likely to be viewed as a competitive advantage today than it was in the past. Among respondents who are members of organizations with a dedicated shopper marketing team, 51% indicated that shopper marketing was a competitive advantage, and 55% said shopper marketing reflected the convergence of brands, shoppers and retailers.
4. Merging with Marketing
According to the study, the strategic value of shopper marketing is more completely realized when it reports in to marketing as opposed to sales.
“The sales process has typically been a more tactical, nuts-and-bolts kind of function and marketing has traditionally been more about using insights to drive programming. When shopper marketing reports into the Marketing Department and is able to be more insights-driven, it, too, can have more impact from a strategic standpoint. And that goes for the brand, the category, and the retailer as well, with the shopper at the center,” said Sarah Gleason, senior VP in the shopper and retail strategies group at GfK.
Shopper marketing is evolving into a critical component of the total marketing package as it becomes more strategic, more insights-driven and more focused on driving shopper behavior beyond the levers of price. The CPGs that will succeed in the shopper marketing space will recognize that the function is no longer about purely driving in-store sales—it is about reaching shoppers at all touchpoints, delivering shopper solutions that overcome purchase challenges and creating deeper and more personalized brand experiences across media.