“Begin with the end in mind” is one of Stephen Covey’s seven habits of highly effective people. The same applies to successful shopper marketing programs, which should not be run just to fill a calendar slot or follow last year’s program. Last week, while I was judging POPAI’s Marketing at Retail awards, I came across more than a few entrants with fuzzy or confused objectives. It’s timely to outline the different types of objectives for shopper marketing programs, and some of
the mechanics that can be used to achieve these.
Commercial objectives
Commercial objectives means sales outcomes, typically expressed as volume uplifts, value uplifts, and return on investment (ROI).
This may also include incremental sales, baseline versus promotional sales, and source of volume/cannibalisation rates (where the shopper switches brand or product, but the category doesn’t grow).
It’s not enough just to have commercial objectives. You also need to determine which shopper behaviour types will drive the result.
Behavioural objectives
There are really only three ways to grow in retail: more shoppers, spending more, more often. In marketing terms, this can be summarised as follows:
Traffic: Getting more shoppers to the store, aisle, and category.
AWOP (average weight of purchase): Increasing the number or size of items bought at the checkout.
Penetration/incidence: Getting the item into the basket (increasing conversion). This is important for categories with low household penetration and for new product introductions.
Spend: Increasing the dollars handed over. May or may not be linked to AWOP. For instance, a buy one get one free offer may increase AWOP, but does not increase spend, whereas offering two for $5 versus one for $3 increases both.
Frequency: Getting the category, department, or store shopped more often.
Swap and mix objectives
You can’t achieve all objectives at once, because some of them may conflict depending on the nature of the category.
For instance, if you run an AWOP activity in a category that isn’t expandable (just because you buy more doesn’t mean you will use more) this will push out your frequency, rather than increase it.
This means you need to decide what objectives you’re going after, which should depend on the shoppers you’re chasing.
If you’re going after low involvement or low frequency shoppers then your goal may be traffic, penetration, or frequency.
If you’re going after shoppers who buy your category or brand reasonably often, then your objective is more likely AWOP (buy more) or spend.
Objectives dictate mechanics
Price or win in store promotions aren’t the answer to everything.
Discounting may or may not achieve traffic and penetration, and often just cycles shoppers between brands in a category they’d already planned to buy, rather than adding incremental sales or growing the category.
Win instore promotions may simply reward frequent loyal shoppers and cost you money, rather than increasing the penetration of lower frequency or involvement shoppers.
It’s not enough to have a shopper marketing brief with objectives like ‘we want to increase awareness, drive trial, and improve category sales’.
By determining what shopper behaviour change you want to see, the mechanics you need to use to achieve it become clear and measuring it easier.
Different objectives require different mechanics.
Below is a short summary of the retail objectives with some of the common mechanics required to achieve them.
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.