Retail/CPG Brands Market Beyond Store Walls

Posted on by Patty Odell

At one time, the terms most frequently heard when instore marketers convened were most likely “shelf talkers” and “signage.” But two October conferences in Chicago on marketing to shoppers — Shopper Expo and the Forrester Consumer Forum — showed that the retail and CPG brands that make up their audiences want to look beyond those limited tactics and start messaging customers in new ways with new value propositions and more effective loyalty tactics. And they want to take advantage of the rise of earned media in the social channel.

In fact, the sponsoring organization that went into Shopper Expo 2011 as the Instore Marketing Institute announced its own reorientation: It's now the Path to Purchase Institute, emphasizing the marketing effort that goes on both before and after the actual purchase is made.

Subway shoppers

Many of the discussions and presentations at both meetings centered on ways to get shoppers more engaged before and after they walk through the store doors. But in at least one case cited frequently at both gatherings, those doors don't exist. Home Plus, a grocery chain in South Korea, wanted to dominate the market without building new stores to match the category leader. Instead, in 2010 it went out to public spaces like subway stops with high-quality, backlit photo displays of grocery shelves. Each item carried a QR code.

Users waiting for trains who had registered at the Home Plus website could build a shopping list of products by scanning the codes, then purchase the items via the app and set delivery for whenever they'd be home from work that day.

Results were strong: Registered members at the Home Plus site increased 76% year over year by April 2010, and online sales grew 130% in the same period. Home Plus is currently the online grocery leader in its target markets and a very close Number 2 in offline sales.

Loyalty in a flat world

Other presenters at both conferences talked about dealing with the downside of mobile ubiquity: shoppers' ability to check the competition for deals and rebates while right in the aisle. Asked by WSL Strategic Retail about the impact of the recession on their household finances, 54% of shoppers said their personal worth will take one to three years to recover, noted WSL CEO Wendy Liebmann, and 31% said they have no idea when their finances will bounce back.

The result: 72% said they pay more attention to prices, 54% said they make lists before shopping, and 37% said they don't even allow themselves to browse, Liebmann said. Instead of the top-down marketing dynamic, brands and retailers “now live in a flat, horizontal world where shoppers can see everything, informed by a technology cloud that allows them to be smart about their decisions,” she said.

For the most part, retailers fight this price-consciousness by strengthening the bonds of loyalty with their customers. Helena Foulkes, EVP and chief healthcare strategy and marketing officer for CVS Pharmacy, talked about building the chain's ExtraCare rewards program over the last 12 years into a platform that drives loyalty among high-value shoppers, albeit with discounts for members.

ExtraCare's 68 million active members get 2% back for purchases at checkout, access to special offers, and $1 in Extra rewards for every two prescriptions filled. Conveying those rewards moved from direct mail to register tapes in 2003, and then to price-checker scans in 2007, letting customers know what they'd already earned before they started shopping.

This year CVS has added enhancements such as the Green Bag Tag. Customers who buy a recycled shopping bag can scan its tag and their ExtraCare cards on the store price checker and get $1 in rewards for every four scans. Heightened shopper rewards for diabetes medications were married to extra content about symptom care and avoidance. “We wanted to start to engage that consumer in learning more through his or her experience with CVS,” Foulkes said. “We didn't just want a discount program.”

And in May the chain launched the ExtraCare Beauty Club, in which members can earn $5 in rewards for every $10 they spend on beauty products at CVS.

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