Marketing 340 Final Exam

Chapter: Shopper Marketing

The Scenario: 1. Supermarket Retailers- are losing market shares to mass merchandisers, drug stores, convenience stores and restaurants. CPG Manufacturers- are faced with market fragmentation and media fragmentation, and therefore can no longer efficiently and effectively communicate to a large segment of the population. (no longer groups, no longer single way to communicate) a. Supermarket Retailers and CPG Manufacturers make up the shopper market b. Blending Example- Walmart has groceries. Splintering Population Among Ethnic Lines: Projected Population Growth 2000-2050 1. White- (70.5% vs. 50.7%) 2. Hispanics- (11.6% vs. 23.3%)- growing the fastest in terms of percentages. 3. Asian- (4% vs. 9%)- fastest growing segment 4. Total Population- (257 vs. 420) increased by about 50% Facts: Americans watch the evening newscasts, which still attract the biggest audience of any news shows. Couric, Williams, and Gibson total 68 million viewers per week (ABC, NBC, CBS combined). This is the best time to advertise a. 68 million viewers per week vs. 127 million Americans visiting Walmart every week, which suggests mass media marketing might be less effective than ads at a Walmart. 2. 70% of all purchase decisions are arrived upon at retail, right there in the store; only 30% of people are effected by TV/other ads. a. 68% of purchases are impulse purchases 3. Shoppers decision time: a. 42% 5 seconds or less b. 33% 6-15 seconds c. 25% more than 15 seconds

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Shopper Marketing Definitions: 1. Shopper marketing should consistently be defined from the shoppers point of view and should include: all marketing stimuli, developed based on a deep understanding of shopper behavior, designed to build brand equity, engage the shopper (a consumer in

shopping mode) and lead him/her to make a purchase. *Video*- the shopper market is disruptive. Traditional vs. Shopper Marketing 1. Traditional Marketing- focus on consumers, that is, the consumption of goods and services. Shopper Marketing- understanding shoppers, that is, consumers when they are in shopping mode. a. Ex- Smart Carts with GPS for store. Coupons/ promo on handle depending where you are in the store. (Kids food section and an add for a disney movie coupon appears on the handle of the shopping cart) b. Leaders in usage of shopper marketing- Kraft Foods, P&G, Pepsico. c. Always follow the money- in terms of ROI for marketing mix elements, instore activities have the highest ROI for both manufacturers and retailers. Shopper Marketing cont. 1. The Marketing Budget devoted to shopper marketing will grow by 21% for manufacturers and 26% for retailers (on a comparative adj. growth rate) It means signage, coupons, circulars, music, lighting, sampling, video, intelligent carts... it means everything.Pull it all together with an aligned message and a clear strategy and it adds up to a brand battleground nonpareil across the modern trade channel around the world. The elements of shopper marketing are geared toward speaking a language that creates an undeniable presence that begins when the consumer walks in the door and isn't over until he or she is banded a receipt.- Michael C. Bellas is chairman/CEO of Beverage Marketing Corporation (New York, N.Y., USA)

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4. Theres a distinction between the manufacturers who get it and those who do not. Working with the ones who do not is like squeezing water from a rock. Every meeting is like the movie Groundhog Day its the same thing over and over again. Retailer