Shopper MarketingWhat’s Working & the Road Ahead

Summer 2012 Mediative.com

PART I

Shopper Marketing It’s Official

Impact on Media Strategy Top 10 Countdown: What is Working

PART II

Where are we Headed? Consumers are smarter and always on

The purchase pathway has changedImpact on media strategy

Five Years AgoNo retail media opportunities

No common name - POP advertising, at-retail advertising, etc.

Trade marketing lacked control over strategy, creative, timing and tracking

No dedicated expertise at agency

Digital Marketers could not directly impact the purchase pathway

TodayEstablished media programs on NA’s leading retail sites

Shopper Marketing Industry

Established brand-building strategy

Media agencies restructuring internally to influence buying decisions

Fastest growing sector of ad spending (200% since 2008 and increasing 15% per year) *

* Source: Ad Age Insights Jan 2011, In-Store Marketing Institute

Quick stat: 83% of CPG companies surveyed expect to increase their shopper marketing

Impact on Media StrategyClient education needed for mandate

Manage differentiation with trade marketing

Strategy shift from indirect contextual relevance to influence buying decisions

Move from awareness to impacting conversions

Created new objectives and more meaningful ROI vs. non-retail media

TOP 10 COUNTDOWN

WHAT IS WORKING?

10• E-Commerce sales will be doubling in 2010-2015

• 82% of internet users are online shoppers (18 million Canadians)

• 57% of internet users have made at least one purchase in the last year

Retail Audiences are Growing in Canada

eMarketer, February 2011

9 Reach Audiences in Buying and Research Mode

9

Offline Buyers • Brick &

mortar buyer only

• Almost no online research for in store purchases

• 15% of internet users

Online Shoppers• Conducts

online research prior purchase

• Mostly buys offline, in-store.

• 33% of internet users

Online Buyers• Extensive

Research online

• Buys select categories frequently in half the categories they research

• 31% of internet users

Online SUPER Buyers• Most frequent

online buyer• Researches

and buys across many different categories

• 21% of internet users

NPD Canadian E-commerce Report, July 2010.

9 Reach Audiences in Buying and Research Mode

8 Impact Sales & Branding

8 Measuring the direct sales impact online & in-store

(1) Retail Advertising Whitepaper, Mediative 2012

(Amazon, 2012)

1

1

1

(Smart Shopper Survey, 2011)

8 Shopper Marketing is Good for Branding

2012 retail email volume is forecasted to grow by almost 50% compared to 2010

More people with access to email anywhere (i.e. in-line at nearby grocery store or in mall)

Retailers are increasingly focusing on optimizing CRM with mobile marketing

7 The Almighty Inbox is Back

6 Shopping tools guide consumers and positions brands as recommended products

6 Recent shopping tools

5 Increasing use of video to shop

Retail is transforming from text and reading to viewing and experiencing

• 2 out of 3 of consumers agree; video is superior in building confidence towards purchase

• 2 out of 3 of consumers watch videos multiple times during their purchase consideration cycle

• Top video content wanted by consumers are short product demonstrations and quick objective reviews

Source: Invodo Whitepaper March 2012

5 Increasing use of Video to Shop

4 Reach even larger audiences with In-Store Digital Signage

>> Digital in-store displays expected to triple by 2013

Source: iSuppli Corp. market research

3 Mobile is Growing

In Canada, 53%of smartphone owners used their phone for retail-related activities in a store

3 Reach Shoppers Anywhere, Anytime

(2012 Mobile Future in Focus, comScore)

2 Rich, Creative Content Engages & Converts Shoppers

2 Retail Splash Pages

2 Retail Brand Stores

2 Editorial Centre & Custom Content

2 Inspire the Shopper & Watch them Convert

Consumers who visited retail shopping content pages were 73% more likely to complete a purchase compared to shoppers who visited product pages through traditional retail navigation

73%

More likely to complete a purchase

Walmart Canada, 6-week trailing average, multiple content projects (2012)

1 Reaching Audiences who have clearly demonstrated their Intent to Buy

1 Reach Shopper Audiences with Intent to Buy

Digital Moms

Connected Dudes

Toys, Kids & Baby

Health, Wellness & Grocery

Gadget Geeks

Gamers

Beauty

Household Packaged Goods

They make more than 80% of household buying decisions

Reach 3.7 million women shoppers / mth

More than 2x AOL Lifestyle, Sympatico Lifestyle and Chateline combined

2.6x time spent vs iVillage Womens Network

1 Audience Reach at a Glance: How to Reach Digital Moms in Canada?

comScore December 2011

“2012 will be an inflection point in retail, shopping, and paying.

You’re going to see more change in how consumers shop and pay in the next three years, than we’ve seen in the last 20 years.”

John Donahoe President and CEO, eBay (January 24, 2012)

3 Key Forces of Change

1- Consumers are smarter and always on

2- Technology has disrupted the way we shop

3- Purchase pathway has changed

1. Consumers are Smarter and Always On

• Half of Canada owns smartphones

• Consumers have specific expectations at each step of the purchase pathway

• Nearly half of shoppers are willing to use two or more technologies to shop (IBM Institute Oct 2011)

• Consumers are smarter and expect more

• They are empowered and demand more

• They want to be served (not sold to)

• They want personalization

2. Technology has Disrupted the Way We Shop

– Location; ability to deliver offers based on purchase location proximity

– Information; on-demand and self-serve tools, learning, reviews and convenient information

– Personalization; data helps that customizes offers to individual consumer behaviours

– Social; consumers have access to trusted recommendations

– Mobile & tablet; instant access to rich information and apps anywhere on smartphones and tablets

2- Technology has Disrupted the Way We Shop

2011• 20%-30% retail

visits from mobile devices

2014• More people

est. to access web on mobile than desktop

2016• Est. 1 billion

smartphone sales per year

Mobile: Game Changer

Mobile Usage Insights

• The “Showroom Effect”: Consumers are increasingly using smartphones at POP to learn about products, compare products / pricing and reading reviews

2- Technology has Disrupted the Way We Shop

3. The New Purchase Pathway

Seamless approach to purchase pathway simultaneously through all available shopping channels

Many customers, shopping across many channels – one channel per purchase

“We need to sell online”

“Customers will come to us”

Retail Outlook 2012, Deloitte Canada

OmniChannel Shopper at a GlanceShopper IDs a

need

Research

Transaction

Post-

transaction

Digital Mom is on iPad; wants to buy her son

a PS3

Researches in-store and on mobile

She buys online

Home delivery

3. The New Purchase Pathway

Impact on Media Strategy

1- Deliver relevant messagingA) Location, location, location

83% of mobile users are looking for deals at nearby stores when shopping (comScore)

83%looking for deals when shopping

79% of consumers find location based alerts from retailers appealing (comScore)

79%Find location based alerts appealing

B) Information

Retail sites are evolving to “kingdom of content”

Products will not sell themselves; Marketers need to provide info for immediate purchase decisions

Benefits

Lifestyle and context

Shopping tools

Comparison

Reviews

Video, and more…

1- Deliver relevant messaging

C) Personalization

One message is not for all

Data gives marketers better signals as to when to communicate, what produce and which message

1- Deliver relevant messaging

D) Social

Help consumers access social communities and uncover recommendations they trust

“1 out of 3 of people are more likely to buy a product if it is has a high number of likes”

8th Bridge Consulting, 2012

1- Deliver relevant messaging

2- Understand the shopper buying cycle & channelsIn an OmniChannel world, each step of the purchase pathway is an opportunity to give the shopper what they need to make a buying decision

Shopper IDs Need

•Display advertising•Email promotion•Editorial feature•Social media post •Special offer in proximity to store•Lifestyle video

Research

•Product features and benefits•Video reviews, product comparisons•Personalized message based on historical data •Platform targeted msg (phone vs tablet)•Digital couponing•In-store digital networks•Social recommendations•In-store marketing event

Purchase Transaction

•Recommend related products or offers•Action oriented messaging “Buy now”, pre-order, 2 day delivery

Post-transaction

•Re-target for related products or offers

QUESTIONS?