Best Buy was dead. It really wasn’t a question of “if”; it was more a matter of “when”.
Best Buy was dead. And then, it wasn’t.
In fact, since its deathwatch started in 2012 (when similar stores, like Circuit City, CompUSA, Tweeter, and Radio Shack were dropping like flies), Best Buy has enjoyed a consistent uptick in sales leading to Q2 of 2017, which was its best quarter in seven years.
The turnaround wasn’t easy. There were many elements to the retailer’s successful (and ongoing) strategy, but two of the main ones were:
- Blending its in-store and digital experiences.
- Improving the shopping experience.
Those components are part of an initiative employed by many retailers these days, known as “shopper marketing”. While the concept is still evolving, basically shopper marketing is the culmination of all the activities that a store uses to convert a shopper into a buyer. It is a holistic overview of every persuasive effort that occurs during the shopping process.
A recent report by Deloitte Consulting, in conjunction with the Grocery Manufacturers Association, estimated that Best Buy is seeing sales gains of 8.4 percent by implementing effective shopper marketing strategies. Kroger has also benefitted from shifting to this approach, seeing an improvement of 6.8 percent.
Despite the fact that online retailers are negatively impacting brick-and-mortar outlets, 71 percent of U.S. consumers say they still prefer to buy from physical stores – even if the same product is available online. That’s according to a recent TimeTrade survey. This same report found that 85 percent of consumers like to shop in stores because they want to “touch and feel” items before buying them.
This means retail outlets have an advantage over online; however, it’s largely psychological. Whereas online retail appeals to rational needs, offline retail appeals to emotional needs. By and large, people like the act of shopping, browsing, and discovering an unexpected item. This is where implementing shopper marketing strategies can help retail win the day.
Let’s take a look at a few shopper marketing strategies and some of the successful, real-life ways they have been implemented.
Good store design is all about storytelling…taking the customer on a journey through your store. It’s all about the ability to immerse the consumer in your brand and guiding that person towards the register. But how can you immerse today’s demanding consumer when they can break from your trance simply by glancing at their screen?
Today’s store design needs to appeal to the consumers’ everyday experiences, show that your brand understands their pain points and has the solutions – solutions they may not even be aware they need yet.
Smart use of technology and the insights it gives you about your shoppers can help create a strategy that appeals to today’s mobile-empowered, distracted consumer.
For example, Target (working with Kimberly-Clark) identified that when a child moves from diapers to training pants, it’s a big deal – for the child and the parent. So, the retailer relocated the training pants away from the diapers and baby products into a new aisle with products that were directly relevant to both the toddler and the parent. It was a physical, in-store recognition that both have moved into a new phase of their lives.
This may seem like a small change, but the psychology of the act is very impactful. And it worked. Sales improved for the products featured in the new aisle.
Another example is Target competitor Wal-Mart. Wal-Mart had no problem selling cough and cold products – in fact it was the leader in that category, except during the winter months when most people would get a cough or cold. What the retailer discovered was that, when sick, most folks would rather run out to the nearest pharmacy or convenience store rather than deal with parking and the checkout lines at a larger retailer.
So Wal-Mart (working with P&G) created an in-store campaign around the theme of “preparedness” that encouraged shoppers to stock up on tissue and other supplies since they were already at the store. The resulting campaign was very successful, and it ran for several years, increasing sales on these products by 30 percent.
Marketing and Merchandising
Your marketing sets the expectations for your brand – it’s the initial message that should carry through all other “conversations” with your customer. If marketing is what drives someone to your store, it is the duty of the outlet to pick up the dialogue and continue the story through the color, texture, and lighting of your merchandising.
It’s here that the store has the advantage. Once a consumer has made the trip to your shop, he or she has already made a commitment to spend some time with your brand. Typically, marketing does not have this benefit – although creative use of digital channels will give you more opportunities than in the past.
Utilizing in-store technology, such as video walls and digital displays, will help continue the marketing into your merchandising. But the key is to ensure it is embedded in the conversation, not something that stands apart and is disconnected.
A fun example that is being implemented in retailers across the world is experiential rooms. Experiential rooms are interactive areas that are designed to get people talking about a product – and then share those experiences on social media. The European sporting equipment company Globetrotter has many stores where people can put on heavy-duty Globetrotter clothing and enter a chamber that pelts them with water and storm-grade winds or subjects them to freezing temperatures (-22°F) and wind.
This may seem like an outlandish (maybe slightly dangerous) stunt – until you realize it’s actually the retailer showing off the quality of its clothing. Someone who is going to spend any amount of time at -22°F will want to know the clothes being purchased will actually do their job.
Good content can be the essential element that moves a consumer from interest to purchase. Content can create excitement, show how a product satisfies a need, and generate a personal connection between the merchandise and the customer.
Whether customers first see this content online or in-store, it should set them along a path to purchase. With everyone walking around with a small screen in his and her pocket, utilizing digital to enhance that content is essential. Then expanding that digital message to the store through video walls (to display massive messages) and smaller, shelf-level screens (which pass along more intimate content). It’s all about delivering the product-specific benefits and features in a manner that fits the merchandise and consumer.
UK milk brand, Cravendale, developed a marketing campaign that centered around the playful theme, “Tastes so good, the cows want it back”. In TV commercials, cows would follow people from the store hoping to retrieve the milk. Coupons were home delivered like a ransom note designed with cutout letters and signed with a hoof print. In store, displays would shout at passing customers, “We want it back!” Finally, the packaging was redesigned to fit with the campaign and stand out from the other brands. Sales of Cravendale increased, and a study found that it was entirely due to the combined effect of these efforts.
A more technological example is Macy’s use of iBeacons (iBeacon is an Apple service, other companies provide similar Bluetooth-enabled trackers). As they browse the store, Macy’s customers with the Shopkick app installed on their iPhones are sent deals and information on items tailored to their interest – and location.
There is a risk that this type of precision marketing can be seen as invasive, but a recent study by Horizon Media found that 61 percent of consumers were “more than willing” to share their real-time locale in exchange for personalized rewards. Retailers have reported an appreciably higher redemption rate with beacons as opposed to coupons delivered by other means.
Photo Credit: WeLoveAd
In this age when consumers are always on, it is increasingly difficult for brands to control their own message. How a brand is perceived has as much to do with the responses on social media as the original, intended message.
Brands can help consumers “stay on message” by providing a benefit, such as loyalty points, frequent-user exclusives, and tailored coupons. This type of personalization reinforces a connection with consumers that has the ability to drive them to the store
Once there, consumers should see the retail outlet as the personified extension of the brand. The signage, technology, and in-store experience should help shoppers find the promised value, convenience, and personalized experience. Establishing and delivering a consistent user experience will reinforce brand equity and encourage return visits.
Amazon has recently done a lot to change the once prevalent perception of Whole Foods as “Whole Paycheck”. The retailer also set out to combat this image, which definitely did not appeal to Millennials, with the lower-priced outlet 365.
365 stores feature a dog-hitching station out front, iPads located throughout the store for ordering to-go, a coffee shop with beer and wine, a self-serve “teaBOT” that brews a customized cup in 30 seconds – as well as the expected organic fruit, responsibly harvested seafood, and antibiotic-free meat. This brand, specifically targeted toward Millennials, is presented in a streamlined, warehouse-like atmosphere and is all about delivering perks and quality at lower prices.
Photo Credit: Seattletimes.com
Shopper marketing strategies provide a comprehensive experience for the consumer. In part, this involves incorporating technology into the everyday shopper experience, something that retailers are just beginning to tap into. If you are interested in blending some shopper marketing strategies in your mix, give The Trade Group a call at 800-343-2005. We will help you connect with your shoppers to ensure they return for more.