Shopper marketers must consider business needs as well as shopper needs. To that end, some marketers focus mostly on short-term ROI while others focus on executing strategies. Unfortunately, campaigns tend to fail or fall short when there’s too much focus on one or the other. Many smart strategies executed with heavy spending result in poor sales lift and returns. On the other hand, investing only in the highest return tactics for short-term financial gain may ultimately erode brand equity, among other unintended results. Savvy marketers do both — ground each marketing campaign in a smart strategy with clear objectives and use tactics that support those goals and have proved to be effective. Staying true to a brand’s strategy while creating efficient marketing programs sounds simple enough, but it’s challenging to pull off.
Here are best practices that can help shopper marketers successfully achieve this balance:
- Choose tactics that best meet stated marketing objectives
- Use tactics that work for your brands at each retailer
- Leverage digital (specifically mobile) to reach shoppers where they are
- Use tactic cost benchmarks to evaluate marketing buying decisions.
Our best practices were uncovered from a meta-analysis of 30,000 shopper marketing events measured using analytic methods specifically designed for shopper marketing. These events included products from every department of grocery, supercenters, club, drug, convenience, dollar and commissary outlets. The sales lift, return on investment and diagnostics were measured for every tactic in each of these events using analytic methods specifically designed for shopper marketing. These results have accumulated in the Foresight ROI Shopper Marketing Industry Benchmarks database.
1. Choose tactics that best meet stated marketing objectives
Marketing is not just a numbers game, and while this analysis lays out tactical best practices supported by data analysis, programs must be strategic to maximize returns and other performance measures. Let’s say a major objective is changing shopper behavior by increasing trial, purchase size, or occasions. Certain tactics work best to meet those objectives. For example, tactics that increase trial include in-store demos, sampling, blogger outreach, social media, and digital coupons.
2. Use tactics that work for your brand at each retailer
When marketing objectives are clear and strategies are set, shopper marketers can then use historical performance to guide tactical decisions within those guardrails. Tactic don’t get the same returns across the board — what succeeds at Safeway may sink at Kroger and yield so-so returns at Target. But don’t blindly choose the top tactics for each retail customer. Historical results set a baseline, but judgment also comes into play. For example, at-shelf messaging is only an average performer at Target, but a shopper marketer might assess the message, signage, and expected execution for a particular program and deem it likely to perform better than average. It’s not enough knowing what works at each retailer but also grasping what works specifically for each retailer, as they are keener to collaborate for a win-win when programs from CPG partners align with their strategies.
3. Leverage digital (specifically mobile) to reach shoppers where they are
Digital tactics generally outperform traditional means of reaching shoppers, who are always tied to their devices. Digital offers lower distribution costs and have better targeting abilities. Events with a digital component bring 40% greater returns on average, which is why there’s been a rapid increase in the amount of spend CPGs are allotting for digital tactics. Unfortunately, as digital spend goes up, in-store marketing spend tends to go down, which can erode a brand’s overall strategy. Foresight ROI has found that shopper marketing returns decline when spend on in-store tactics dips below 40%. So, while digital is shaping up to be a must-have tool, it’s just one of many that CPGs need in their shopper marketing toolkit to succeed.
4. Use tactic cost benchmarks to evaluate marketing buying decisions
The cost of marketing reach varies greatly even for tactics with comparable targets and engagement, so shopper marketers should compare the cost rates and use industry benchmarks to get the most bang for their buck. Ultimately, the differences in marketing costs have a greater impact on ROI than differences in sales lift. This isn’t to say that shopper marketers should always try to get lower-cost marketing because achieving objectives — for example, reaching targeted shoppers — is worth some extra spend. Buy higher-priced marketing, when you think that you will get higher conversion and sales lift.
Here is a case study of a marketer that learned what tactics work better, changed their mix of tactics and increased their average ROI by 14%.
To get the most from your shopper marketing investments, develop effective strategies and activate with best practice program designs. Designing programs to meet marketing objectives is just one of the four strategies that are proven to work.
Be sure to visit Foresight ROI Blogs next Wednesday, August 19th, to catch the final blog of our special five part series of Shopper Marketing Best Practices where we will feature: Implement Processes to Optimize Marketing Effectiveness.
Foresight ROI, the leading provider of shopper marketing ROI measurement, decision support, and software solutions, helps CPG companies and retailers increase their shopper marketing effectiveness. To learn more about our measurement, software, or industry ROI benchmarks, please contact us at Contact@ForesightROI.com