With changing lifestyles of people, rules of marketing are fast changing. Customers are no more passive receivers of brand communication and purchase decisions made at the beginning of shopping journey are often changed at the point of sale. Some of the latest research has shown that as much as 70% of the purchase decisions are made in the store. That's the place where shoppers switch the brands, make impulse purchases and sometimes make big unplanned purchase decisions. Marketing focus is fast shifting from consumers to shoppers who make purchase decisions at the point of purchase - may it be in a physical store or a virtual shopping environment. With such insights, large manufacturers and retailers are focusing on shopper marketing.
Brand manufacturers are making substantial investments in shopper marketing space to understand the factors affecting point of purchase decision and use these insights to develop product packaging, pricing, and promotions. They also work with the retailers on brand promotion and visual merchandising at store level to influence shopper purchase decisions. Leading FMCG player Hindustan Unilever Limited has set-up a shopper-marketing lab in Mumbai to understand the shopping patterns and influencing aids in the store. The company tests product concepts in both physical and virtual environments in the lab during product development cycle. Leading home decor company Asian Paints has set up its 'Colors' experiential stores to help shoppers visualize different products in varied settings. The company also offers customized visual-aided advisory from such stores for individual houses. Being a high-investment category, such visualization helps shoppers make appropriate choices based on their tastes instead of depending on the catalogs and home-contractors. Wipro Consumer Care, another FMCG company with leading brands like Santoor and Babysoft has a dedicated shopper marketing team. The team creates point-of-purchase merchandising aids to influence shopper decisions and works with retailers for in-store activations.
Our research has shown that in-store placements and activations have a huge influence on shopper decision making. We have observed that a large number of impulse purchases are induced by in-store activations like product launches, live demonstrations, in-store advertisements, standees etc., product applications in case of cosmetics, led to higher purchases. Smaller packs with lower risk perception across different categories led to trial purchases with potential brand switching in future. We have also found interesting changes in planned purchase decisions including brand switching, purchase of alternative SKUs etc. based on promotions and positioning in alternate display areas. We observed that promoting un-related categories like chocolates close to cosmetics induced purchases among health-conscious women. Keeping kitchen cleaning products like Scotch-Brite with cooking oil attracted favorable decisions among home-makers.
While there is a lot of traction among brands and retailers to understand and influence shoppers, not all the shoppers are born equals. Research agencies in this space are working on understanding different shopper types. In 2016, leading research agency Euromonitor released its study on shopper trends and identified five different segments of shoppers based on their shopping patterns - Conspicuous Consumer, Savvy Socialiser, Balanced Bargain-hunter, Productive Planner, and No-frills Saver. The agency, in their report, presented characteristics of different segments and recommendations for marketers to tailor their shopper marketing strategies based on the target shopper segment. Another prominent consumer research agency Nielsen's research on 'the path to purchase' looked at the Shopper Journey and decisions on different occasion based on their shopping missions. Neilson's research explores the motives behind shopping that leads the shopper decisions on stores and products. Overall, retail shopper marketing is fast becoming a science being explored by researchers and marketers to come up with an effective strategy to influence shoppers in the store - the place where money, shoppers, and brands meet.
(Author is Assistant Professor, Marketing, S.P. Jain Institute of Management and Research)