the rise of social shopper marketing

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T h e R i s e

o f S o c i a

l S h o p p e r M a

r k e t i n g

T h o u g h

t S t a r t e r s o n C o

n n e c t i n

g S o c i a l

M e d i a a n

d S h o p

p e r M a r

k e t i n g

JANUARY

2011



THE RISE OF SOCIAL SHOPPER MARKETING | Thought Starters on Connecting Social Media and Shopper Marketing

Social media is powered by people, many of whom belong to

one or more shopper loyalty programs. But most marketers

haven’t made the connection. Even though brand marketers

will increase their spending in social media and shopper

marketing more than almost any other format in coming years1,

these budgets are typically managed by different groups that

rarely speak to each other. We expect this to change

dramatically in the very near future.

Why? Because shopper marketing – with its focus on crafting

offers based on intimate knowledge of consumers – worksbetter when accelerated through the peer recommendations

that thrive in social media. And because the ROI o f social

media can be demonstrated more powerfully through loyalty

program data than any other method. This dynamic will lead

marketers to increasingly plan their social media programs

with an eye on tracking shopper data, with an expectation

that their efforts will tie directly to ROI.

This becomes even clearer when you look at the changes in

how media inuences purchase behavior (see image below).

Increasingly consumers are rst hearing about products

through social settings rather than traditional media. While tra-

ditional media still plays an important role in shaping purchase

decisions, marketers need to add proactive social marketing

programs to their promotional strategies.

1 GMA/Booz & Co. Survey of CPG Manufacturers and Retailers, Summer 2010

I N S T O R E

L O Y A L T Y

C A R D

D A T A

R A D I O

M A G A Z I N E

S O C I A L M E D I A & P E E R I N F L U E N C E P R I N T

D I G I T A L

M A R K E T I N G P R O G R A M S

S ho p pe r ma r ke t i ng da ta ca n be fed i n to t he de ve lo p me n t a nd o p t i m i za t io n o f soc ia l med ia p rog ra m s.

T V

O U T D O O R

Social media the new “starting point”

for consumer engagement

Traditional media informs and

reminds post social dialogue

Measure social media spend against

loyalty card behaviors I N

S T O R E

L O YA L T Y

CA R D

DA TA

Use to develop effective

shopper marketing programs

What Does Shopper Marketing Have to Do With Social Media?

Shopper Card Data Highlights Social ROI




Can Shopper Marketing and Social Marketing Work Together?One of the earliest studies of social media’s impact on

loyalty and shopper marketing occurred in 2003. Harvard

Business School’s Dave Godes and Yale University’s Dina

Mayzlin partnered to study how accelerating consumer

dialogue would impact loyalty behavior and sales.

They studied a social marketing program developed by

BzzAgent for Rock Bottom Brewery, where 1,000 Rock Bottom

Loyalty Cardholders - and non-cardholders – were provided

deep experiences with the brand and encouraged to share

their opinions with others. Authentic dialogue was created

in-store, offsite and online.

The Proof is in Loyalty Card Data

Growth in dollarsspent per cardholder

75%

Increase in loyaltytransactions

55%

Increase in programmembership

37%

Learning

Social Marketing was proven to impact loyalty behavior

and restaurant sales. This was measured through loyalty

program acquisition and transaction data provided byRock Bottom Brewery.

A

B C

D

E F

Peer recommendations are most powerful when it occurs

between acquaintances, not friends. Information between

A and D is “new”, leading to stronger results.

New Information Between Acquaintances

Creates Stronger ROI

New Loyal Customers Are More Likely

to Create Signicant ROI

The most powerful incremental WOM may come from

those less-loyal. Those most loyal have probably

already told everybody – both strong and weak ties – in

their social networks about a product or service.

Firm-Created Word-of-Mouth Communication: A Field-Based Quasi-Experiment, David Godes and Dina Mayzlin, 2004.

Opinion Leaders Matter

Only If they Show Loyal Behavior

Opinion Leaders” create the most word of mouth if, and

only if, they are loyal.

H E A V Y L O Y A L T Y

L I G H T

L O Y A L T Y

E XP ER T N ON -E XP ER T

L O W

W O M

V E R Y H I G H

W O M

H I G H W O M

New Loyal>




Is there a Social Media Consumer and Loyalty Cardholder Overlap?

For Starters, Yes in the UK

Majority of Vocal Consumers are

Supermarket Card Holders

Question: Are consumers who are engaged in social media,

and talking about brands, also engaged in loyalty programs?

Grocery brands are surprisingly talkable. According to Keller

Fay (a word-of-mouth research rm), Tesco and Sainsbury’s

are among the 10 most talked about brands in the UK.

Vocal consumers are more likely than the general population

to carry loyalty cards. The number of UK BzzAgents1 who carry

loyalty cards is eye popping.

The United Kingdom is a perfect market to consider; a number

of supermarket chains cover the entire region (not the case in

the U.S.) which makes them nationwide brands. More than

half of their 25 million households carry a loyalty card for at

least one supermarket chain.

Of BzzAgents are

TESCO card holders

Of BzzAgents are

Sainsbury card holders

68%

70%

Product Categories British Consumers Discuss 1+ Time Per Day

FOOD & DINING

BEVERAGES

THE HOME

HOUSEHOLD PRODUCTS

PERSONAL CARE & BEAUTY

CHILDREN’S PRODUCTS

SIXTY FOUR %

FIFTY SEVEN %

THIRTY THREE %

THIRTY %

TWENTY NINE %

EIGHTEEN %

1 BzzAgents are volunteer brand advocates who have self-identied as liking to share their opinions

about brands across social mediums.

Source: Keller Fay, TalkTrack UK, May 2010




4 Steps to Tracking Social ROI Through Shopper Marketing.

COUPONSIN-HOME SERVICES

SHOPPER REWARDS EVENTS

SHOPPER DATA ADVOCACY

RESEARCH

ONLINE REACH

OFFLINE REACH

COUPON REDEMPTION

SURVEYS

MATCHED MARKET TEST

MARKET MIX MODELING

ANALYSIS

IDENTIFY1 ENGAGE2 ACTIVATE3 MEASURE4

Select loyalty program members to

participate in structured advocacy

activities. Targeting should be based

on demographics, psychographics,

shopping behavior and measured

social inuence.

Use loyalty program touch points to

deliver brand experiences that

motivate, educate, and drive activity.

Participants encouraged to share brand

experiences with peers via digital tools

and in-person conversations.

Program impact measured via loyalty

program data, coupon redemptions,

media attribution models.

SAMPLING

We expect a simple formula to emerge among teams

managing social media and shopper marketing. Teams thatuse it successfully will increase the earned reach and overall

impact of shopper marketing programs while increasing the

measured ROI of social channels.

To learn more, go to about.bzzagent.com or call us at 877• BZZAGENT

the rise of social shopper marketing

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