Shopper Marketing: An Emerging Discipline

Rakhi Thakur

Author: Rakhi Thakur

Date: Sun, 2016-09-04 17:06

Shopper marketing is an exciting new discipline within the marketing and retailing domain. While many definitions exist, a simplistic one which captures the essence of the domain is “all marketing stimuli, developed based on a deep understanding of shopper behavior, designed to build brand equity, engage the shopper (i.e., a customer in ‘shopping mode’), and lead him/her to make a purchase.” While Shopper Marketing has been around in global markets for a while, it’s still in a nascent stage in India. The emergence of shopper marketing is an outcome of the shift in power from brands to retailers to shoppers. As shoppers are becoming more and more savvy with purchase decisions shifting close to the point of purchase, shopper marketing is going to take centre-stage in times to come.

From the perspective of the industry landscape, there are four group of entities that may be of interest for us as practitioners and students of shopping to understand.

The shopper is the decision maker at the point of purchase. In the world of omnichannel retail, a shopper's path to purchase may cover multiple touch points. She may notice a brand in a magazine, research on the internet or a mobile app, and decide to visit a brick and mortar store to get a feel before buying it. The dynamics could change once she lands in a store and she may completely change her decision on the brand or even the product. Research has shown that depending on the product category, 25-70% of the purchase decisions are actually made in the store. Shoppers are influenced by in-store placements, promotions, demonstrations, trial samples/ testers to name a few.

The retailer is the face of the brand/ product for the shopper. Depending upon the shopping mission, shoppers may choose different types of retailers. But retail in itself is a multi-sided market. While retail is a wafer thin margin business, retailers make money not only by selling the merchandise to shoppers but also by selling space to brand manufacturers. Prominent display areas like end-caps, floor fixtures come for a premium for brand manufacturers. Advertorial space on walls, windows, pillars etc. too earn substantial revenue for the retailers. All the streams of revenue, however, are connected and retailers aim for getting more and more footfalls. Once the shoppers are in the store, in-store activations are targetted to convert shoppers into buyers and increasing the ticket size by influencing them to buy more.

Brand manufacturers are looking at attracting shoppers all the time through a mix of ATL and BTL tools. However, for brand manufacturers, the retailer is the customer. Through the retailer, they reach out to the shoppers in the last stage of the shopper journey. Unlike many developed markets, the Indian retail segment is still very fragmented with the  unorganised sector still contributing to 80-90% depending upon the category. We must also take cognizance of the fast growing online retail sector. In the era of omnichannel retail, there may be different segments of shoppers visiting different formats or there may be the same segment of shoppers visiting different formats based on their shopping missions. Many brand manufacturers conduct shopper research and share their findings/ recommendations with retailers. Brand manufacturers customise their marketing mix based on the retail formats.

Independent agencies have always played a critical role in the area of marketing. These may vary from consumer research agencies working on getting insights to advertising and media agencies involved in creating and distributing marketing messages to influence shopper behaviour and drive shopping. Further, there are agencies which analyse  market movements and spot upcoming trends. The science of shopping is nascent but evolving, and hence there are specialists to understand  complex shopper behaviour. India, as a market has its own nuances and global models cannot be directly applied. Both global and home-grown brand manufacturers, as well as retailers, are looking at specialist agencies to help them get shopper insights and develop favourable shopper experiences.  Some of the global agencies like TracyLocke, Integer, SaatchiX, Ogilvy Action etc. are already present in India. With the increasing focus on shopper marketing by brands and retailers, more specialist agencies are likely to enter this segment.

In articles to come, I will explore more aspects of shopper marketing in the future: ranging from shopping missions, shopper journeys, retail environments, brand migration, in-store shopping influencers, changing power dynamics and more.

 

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Comments

Submitted by Sudhanshu Gupta on Thu, 2017-02-09 23:37
In India, recently shopper marketing has emerged as a new domain of marketing. The direct communication is provided by manufacturers or suppliers to the end customer. This way of marketing provides new ways to fulfill the individual needs and choices the consumers. With the help of emerging technology / media, the marketing campaign of shopper marketing is spreading at a very rapid speed. As per Association of National Advertisers report, spending in shopper marketing is expected to increase by approx. 6 percent by 2021 and the volume of shopper marketing may become approx. $ 20 Billion. The companies who have developed shopper marketing plans for their organization are growing faster than their peers who are not participating in this marketing field.

Submitted by Sudhanshu Gupta on Thu, 2017-02-09 23:37
In India, recently shopper marketing has emerged as a new domain of marketing. The direct communication is provided by manufacturers or suppliers to the end customer. This way of marketing provides new ways to fulfill the individual needs and choices the consumers. With the help of emerging technology / media, the marketing campaign of shopper marketing is spreading at a very rapid speed. As per Association of National Advertisers report, spending in shopper marketing is expected to increase by approx. 6 percent by 2021 and the volume of shopper marketing may become approx. $ 20 Billion. The companies who have developed shopper marketing plans for their organization are growing faster than their peers who are not participating in this marketing field.

Submitted by Satyanarayan Bishoyi on Mon, 2017-05-08 22:22
The article talks about an interesting marketing topic – “Shopper Marketing”. Prof Rakhi has very lucidly explained about this upcoming trend in India, which has been now used globally to gauge the mood of the shoppers. As the consumers become shoppers when they enter into a retail store, it has become important to understand the behavior of shopper. With the increase in retail stores where customers chose their products by roaming inside the store, it has gradually become the trend that the shoppers tend to buy many things instantly finding a lucrative offer. With the boom of e-commerce, the shopper’s behaviour towards instant purchasing decision has become more frequent. Hence the market study on the purchasing style of the shoppers inside a retails store or on online market place has become important for companies to increase their sells. Independent study will help the companies and retailers to provide the best valuable products to a shopper as on when he/she visits the store. Shopper Marketing is definitely going to play an important factor for companies and retailers to boost their sale.

Submitted by Vinoth kannan P on Mon, 2017-05-08 23:12
Hello ma'am, this is one of the interesting articles I have read about marketing. As stated by you the key for marketing lies in the deep understanding of the shopper's behaviour. The buyers have more power and they dictate the prices in the highly competitive markets. Most of the shoppers nowadays make on the spot decision to buy a product or not. Stores are able to give much better choices to shoppers in terms of brands and variants/SKUs as appropriate to their catchment area and target customers and hence hoppers marketing are integral to influencing customer decision making in such a scenario. There are umpteen instances across the world where brands have been built and their competition destroyed using shopper marketing. The trend is absolutely clear. The power of customer choice will force companies to bring Shopper Marketing to the core. Brands would need to spend time and resources in understanding the Shopper as different from the customer. In the coming years, Shopper Marketing would become an integral part of brand building efforts of companies and retailers. Thanks

Submitted by plash chopra on Fri, 2017-09-01 09:39
This article very nicely explains the importance of shoppers marketing as it is not only about marketing the product in market it is more about marketing the product according to the consumer of the product because understanding the behavior of consumer is far more complex than simply marketing product. The marketing that is done at whole is more likely to just attract customer footfall or increase his/her curiosity in buying the product whether online or offline. As the trends are changing but more likely the customer that is buying the product first time would like to try and feel the product first then buy it. So here comes the relevance of retailers as they are the last line of sale and which finally convert the footfall to product sale. The consumer decision mostly changes according to the type of store, facilities provided and quality of customer care so it’s very important to organize the in-store facilities and services to convert more footfall into sales. Prominent displays in stores also provide an edge to the brand as they give more customer interest than other displays in the store which is another way of marketing and attracting customers attention. The trend of shoppers marketing is on a rise in India because it is one of the best emerging markets in the world currently so the number of research agencies which help in these kinds of activities. As this sector in India is very unorganized so in order to increase the sales tools like ATL and BTL are used and based on data provided by these agencies, brand strategies are made. These all strategies and decisions are taken because of converting more number of customers which are being found more effective as more researches are been done and their results are showing the positive effects of these techniques.

Submitted by Shraddha Chatterjee on Sat, 2017-09-02 12:11
Dr, Rakhi , Thank you for bringing in this topic , I was deeply touched, as Shopping for me is not just an activity , its my worship .As a hard core shopaholic , whenever I go to a store , I am mesmerised by the way in which the brands of the retailer shop manoeuvre my shopping .Taking a decision between Brand( price) & Beauty ( look ) of the dress felt ,as if it was the most toughest decision to take . Little did I know that for me to think about the brands in a retailer shop & to make my choices , there is an entire science towards it .Right from the moment I enter in the shop ,there is a motive of every brand is to make me buy their product in the best possible way that they can , with the right kind of branding at the right places that catch my attention and compel me to rethink every step I move towards a new brand . Of course the Indian Shoppers market is at a very nascent stage but as the brands have made every possible way to study the shoppers (the brand manufacturers in India have agencies like Tracy Loche , SaatchiX to name a few which give them the analysis) , the shoppers also , have become more aware about brands with abundance availability of technology . The retailers bridge a gap between the two know which shoppers would convert into buyers & which brand would rule the roost among them

Submitted by Rhiddhijit Ghosh on Sat, 2017-09-02 18:50
A wonderful read, Thank you Dr. Rakhi Thakur. This gives us an opportunity to participate in discussion that is engrossing the current brands. Technology has evolved the shoppers so has it equipped the brands and retailers with powerful tools to understand their shoppers. Taking feedback from customers probably forms the most essential part of the process. Artificial Intelligence(AI) has enbaled brands to interact with their customers and then decide on their strategy. Augmented Reality(AR) has enabled brands to elevate their customers to the next level of feeling the product and create a differentiation. Cashless payment methods are also gaining attention to undestand payment behaviour of customers and come up with more flexible easy product delivery strategies to make customers feel more comfortable in shopping.

Submitted by Shiva Prasad Yalala on Sat, 2017-09-02 21:59
The article has opened doors to the whole new perspective of retail marketing. In today’s scenario of growing consumerism, consumer awareness and increasing competition, there exist opportunities for both brick and mortar retail stores and ecommerce retailers. At the same time, there exist risk of losing market, if the firms do not innovate the marketing strategy. Therefore, the shopper marketing opens up new ways to increase the market share. The article explains how growth in organised retail sector in India has created a need for shopper marketing. The Shopper Marketing has been explained with four entities i.e. shoppers, retailers, brand manufacturers and independent agencies, that are involved in the process of shopper marketing. It is interesting to know how shoppers marketing can change purchase decision of buyers at the store. Further, the 25% to 70% of change in purchase decision due to shopper marketing mentioned in the article shows the impact of shopper marketing on the purchasers. The article brings out how the retailers have benefited with emergence of the shopper marketing. The shopper marketing itself has generated revenues apart from the revenue from increased sale. The shelf space in prominent corner, display of advertisements, allowing brands to engage salesmen at the store has brought in new opportunities to increase the revenues. The article has explained how shopper marketing is helping organised retail stores to increase their bottom line in the thin margin retail business. Third benefited entity as mentioned in the article is the brand manufacturer. The brand manufacturers have increased their market share in organised retail store with low cost advertisement such as shopper marketing. It is also evident in the article about the fact that 80% to 90% of the retail is still conducted in the unorganised sector. Therefore, there is long way to go for the brand manufacturers to tap the benefits of the shopper marketing in full scale. However, article also mentions the fact that the shoppers marketing provides the pulse of the customer to the brand manufacturers and this enables them to reengineer products as per customer needs. The Independent agencies are the fourth entity in the article influencing the shopper marketing scenario in India. However, the specialist in this area are still in nascent stage and yet to evolve. The growth in the organised retail would boost the emergence of the specialist shopper marketing independent agencies which would further fuel growth in the sector. The takeaways from the article are very useful for all involved in study of evolving retail sector in India giving out analytical view of the emerging shopper market.

Submitted by Francis Anto on Sat, 2017-09-02 22:45
This article introduced me to this new concept in marketing and led me to read further on the subject. I gleaned the following insights from my further readings. Shopper Marketing signifies a paradigm shift in the way marketers approach the question of how to sell more. It departs from the traditional approach of appealing and satisfying the consumer to targeting the shopper directly in a real-world retail setting. To put it simply, it understands that consumer use while shopper buy. The main factor contributing to its development is the emergence of open format stores where shoppers take their own decisions without the direct influence of the retailer/salesperson. In such formats, the shoppers interact with the product and shopping decisions are take on the retail floor. Shopper Marketing places emphasis on creating “Shopper Intimacy”, which involves going beyond having just a connection with the shopper and actually having a relationship with the shopper.

Submitted by Dhwani Rathod on Sun, 2017-09-10 12:49
As effectively pointed out by you mam, shopper marketing focusses on the customers at the point of purchase. It is majorly about the last minute purchase decision which an individual takes when to buy a product. TV ads, print or radio does influence a customer but may fade by the demonstrations and subtle marketing gimmicks at the store. In order to create an overall impact on the customer, product, price, place and promotions should be carefully looked into when going for shopper marketing technique. In terms of product, size is an essential attribute; family packs or SKUs or the overall colour or packaging of the product that helps draw customer attention due to its innovativeness or usefulness. In terms of price, providing checkout coupons can help enhance the shopping experience. In terms of place, the display of the product near the billing counters or enhancing brand visibility through eye level shelf positioning or presenting the product in small kiosks or booths with effective music and lighting can help capture the customer’s emotion and thus attention towards the product. In terms of promotions, offering sampling demo help the customers try the product before purchasing thus establishing credibility of the brand. Also, in store TV or shelf signs can help promote the product to a wider customer base. Also a greater importance is given to the product that is placed beside the intended product on the shelf when discussing shopper marketing. A customer can be lured to move from one product to another or repel from the adjacent placed product as per the company’s needs. An example of the same can be attributed to the strategy followed by the company Target when it was willing to promote its sales of baby clothes. Traditionally when pants were placed adjacent to diapers the emphasis was reduced and thus the company decided to dedicate a separate aisle to the pants which placed a greater emphasis on the transition mothers felt. The major goal behind these strategies is to convert majority of footfalls into potential customers and thus ensure brand loyalty in the future. Looking at the current scenario wherein it is expected that the number of online shoppers in India will cross 100 million by the end of 2017 the emphasis on shopper marketing seems to be slightly unjustified. The Indian e-retail market is likely to jump 65% on year in 2018 to $17.52 billion as indicated by a recent study conducted. The growing working class and the hours spent on delivering output has tremendously increased the work load. People have no time left to carry out a shopping trip. Today’s generation has constantly shifted the amount of time spent on shopping to that on leisure and entertainment activities. What was once considered a major reason to get out of the house is now a 15mins chore where one surfs through the online shopping sites and gets the product delivered at the doorstep. The rising customer sentiments towards online shopping is unstoppable. In such an era of digital techies, investment in shopper marketing can be a waste of money and time. A higher emphasis on search engine optimisation and pay-per-click advertisements can be beneficial to retain a larger customer base. Still there is a large chunk of population which includes myself who are still reluctant to buy products online due to the absence of physical touch and thus a lack of trust factor which can be captured and retained through the shopper marketing techniques.

Submitted by SHASHANK MISHRA on Sun, 2017-09-10 23:24
Dear Ma'am, This was a very enriching piece of write up. It seems to not only broaden my horizon but has also added so much value to my outlook towards marketing as a craft. This article efficiently explains shoppers marketing and its importance in today’s light. According to Wikipedia to further broaden my horizons I read Shopper Marketing to be "understanding how one's target consumers behave as shoppers, in different channels and formats, and leveraging this intelligence to the benefit of all stakeholders, defined as brands, consumers, retailers, and shoppers." It focusses on the purchasers at the point of purchase. It is about influencing that one decision which sometimes looks as trivial as a Boolean decision of Yes or No. And it is majorly influencing these last minute purchase decision which an individual takes before buying a product. Though shopper marketing is not limited to in-store marketing activities yet there is a trivial assumption that shopper marketing cannot be influenced under certain cases. Consumer marketing, therefore, should be included as a major if not subsidiary approach towards linking the direct consumers to the ones who are generating the demand thus generating an insight on how the products can not only be positioned but also fancied so that the sales increase. Considering the four Ps of marketing, seeing the product end, the most important criteria is indeed size and shelf life; family packs or fancy packaging of the product generally helps attract a larger customer base due to its freshness, ability to be differentiated among a market full of similar products and also the shelf life would add to the sale cycle. Checking the price end, what might help are the discounts and cash-backs. Considering the place factor, proper segregation of market place in order to gain maximum visibility will help further to increase the customer base. Also capturing customer attention through placing products in retails and the entrance of most malls through making small promotional kiosks is helpful In terms of promotions, providing small free samples to the target audience and boost social media marketing can be hugely helpful towards attaining a huge customer base. This entire process of shopper centric marketing targets to increase customer visibility or intrigues one in buying the product. With changing trends any customer would like the flexibility to check before purchasing. There are brands working towards this, where Lenskart has introduced the policy of selecting 5 frames and trying at home. There is a paradigm shift towards consumer monopoly. The customer has always been the boss. And yet again consumer stands on a pedestal to be pleased. So there are more factors than the four Ps. A consumer can be influenced also by goodwill. Often prominent positioning to enable easy access and save time is one of the major factors towards larger customer base. Prominent displays in stores also provide an edge to the brand as they give more customer interest than other displays in the store which is another way of marketing and attracting customer’s attention. The trend of shoppers marketing is on a rise in India because India is one of the emerging markets in the world currently catering to a vast population.

Submitted by lokesh kumar on Sun, 2017-11-26 15:25
Dear Madam, Thanks for giving us valuable information on Shoppers Marketing. I fully agree with you that availability of information at figure tips has shifted the power from brands to shoppers. Indian consumers are spoilt for choices, which have prompted them to be choosy. These choices have also reduced Brand Loyalty among consumers (especially for FMCG goods). Bains along with IMRB Kantar Worldpanel recently studied shopping habits of approx. 80,000 Indian households (mix of urban & rural) and found out that Shoppers are not loyal to specific brands. They buy multiple brands in each category (Repertoire behaviour). Thus, it is imperative for the brands to offer something special with their products in order to retain customers and also add new customers. Print, Video & Digital marketing create awareness about the brand and influence the buying decision of the consumer. But in most of the cases the consumer visits nearby brick & mortar shop to get the feel of the product before deciding to buy it. But if the brand’s competitor outsmarts him and does a better shopper marketing through the retail outlets, there is a chance of the shopper shifting to the competitor’s product. This highlights the importance of shopper marketing and the need to invest in it for the brands. Shopper marketing must be part of an overall integrated marketing approach that considers the opportunities to drive consumption and identifies the shopper that would need to purchase a brand to enable that consumption. As mentioned in the article, Indian retail segment is still very fragmented with the unorganized sector still contributing to 80-90% depending upon the category. The unorganized sector is predominantly price sensitive and in many categories, the unorganized sector is captured by local manufacturers whose USP is low cost manufacturing. So, for brand manufacturers to capture these sectors, they need to increase visibility of their products and think of new marketing strategies to shift focus from pricing. Shopper marketing (providing samples, advertising in retail outlets etc.) can be a useful marketing strategy in increasing product visibility. Also, a satisfied shopper provides free word of mouth publicity (A powerful marketing aid even today especially in rural areas), which will improve product’s market penetration.

Submitted by Vijai Prakash Maurya on Mon, 2017-11-27 18:46
Thank you Dr. Rakhi Mam to providing such an interesting topic and valuable information on a public forum. I am in agreement with this article key point of shopper’s marketing instead of brand marketing. Now these days if consumer choose to purchase any thing he have too many options at their fingertips with condition how much resources he has available. Now in rural area as well people ordering thing online and getting it delivered as per their choice. There is no limitation of limited brand from where they can only choose while there is multiple similar option available from where customer can choose and buy. Emerging technology has played a very key role here which provide very robust platform in Video, Mobile, website from where consumer can make their choice. Like Many programs running on television for shopping only for various brand which is a call away to get their desired product, or many mobile applications available like, Flipkart, Amazon and many more which deal in almost all the consumer needs and for vegetables and other items Big basket app and similar other app available from where consumer can purchase with very competitive price without visiting physical store. Shopper’s Marketing concept totally change the behaviour of modern customers. Customer get the choice to choose the brand and product instead brand influence customer to purchase specific brand. Earlier brand was playing key role in almost all FMCG products but because of consumer marketing concepts now its Shopper’s choice what to buy and what not to buy. The power of making choice comes from the many options available at one place where consumer can compare the various products and make decision. As mentioned in the article, Indian retail segment is still very fragmented with the unorganized sectors which still paying retailers to 80-90% depending upon the category. The unorganized sector is primarily price sensitive which spread in many categories, the unorganized sector is captured by local manufacturers whose USP is low cost manufacturing. So, for brand manufacturers to capture these sectors, they need to increase visibility of their products and think of new marketing strategies to shift focus from pricing.

Submitted by Aayesh Malhotra on Tue, 2018-07-24 23:50
The future of marketing in India. Dr. Rakhi has explained the concept of shopper marketing in very comprehensive and coherent manner. This is a very important aspect of marketing and she has very appropriately incorporated the concept of Omni channel retail in the blog. Shopper marketing is basically understanding the shopper and not necessarily the consumer (because the two might now be same always) and then prepare a marketing mix accordingly in order to positively impact the consumption of the brand or the product. Nowadays even in India, this concept has come into action lately. The shopper might see an ad on his Facebook feed, then he might be reading an article on some random website and again the product ad pops up with the words discount. This entire process entices the shopper and he is convinced to either buy the product then and there or visit a brick and mortar store and try it there because for a person like me I really need to visit a store first, try and have a feel of the product and then either buy it from there or online whichever is cheaper. The perfect mix of technology and marketing and tools like ATL and BTL is actually helping companies lure more customers and earn more revenue. With the introduction of cashless payment methods (apple pay, Samsung pay, paytm etc.) has made it even easier for shoppers and is very convenient. Overall it is a very well put up article and covers a very essential topic of marketing which can actually take companies and retailers to greater heights. Let’s wait and watch what future holds for us.

Submitted by SHUBHASHISH GARG on Wed, 2018-07-25 21:12
Thank you Dr. Rakhi for writing on this topic. The topic “Shopper Marketing” is quite new especially for an emerging market like India. However, it has been growing rapidly and we can see how it is gradually shaping up the customer shopping behavior. The article has opened doors to the whole new perspective of retail marketing. Marketing strategy such as “Shopper Marketing” in the retail market has now become one of the important strategies whenever a company decides to launch a new product in the market. This can majorly be attributed because with customers moving towards digitalization and moving away from local vendors to one shop store such as Big Bazaar, Spencers, Reliance Fresh, 24x7 etc. It is majorly about the last minute purchase decision which an individual takes when to buy a product. TV ads, print or radio does influence a customer but may fade by the demonstrations and subtle marketing gimmicks at the store. Common instances which I guess everyone can relate to are the presence of chocolates, quick edibles such as chewing-gum, mouth fresheners, toffees and end moment purchase like nail-cutter, condoms, odonils etc are kept near the billing counter to attract the customer buy the product. This way of marketing provides new ways to fulfill the individual needs and choices the consumers. As the consumers become shoppers when they enter a retail store, it has become important to understand the behavior of the shopper It is interesting to know how shoppers marketing can change the purchase decision of buyers at the store. The article brings out how the retailers have benefited with the emergence of the shopper marketing. Other than just the placement of different items in the stores, the consumers are also influenced by the various advertisements via brochures and posters in these stores. This has also helped the retail owners to benefit from it by earning additional earnings from the advertisements at their stores

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