The Path to Peak Shopper Marketing Performance

Shopper marketing managers are in a tough spot. Even when a program is, by all appearances, a big win, they cannot quantify their success or trace the results to specific actions on their part. That’s because marketing mix models can’t tease out shopper marketing from trade promotion effects, let alone isolate the effects of each shopper marketing tactic. As a result, shopper marketers are always defending their spending while making decisions in the dark. That’s where data-based decision guidance comes in, helping CPG companies avoid missteps by lighting the way to quantifiable and repeatable shopper marketing successes.

Becoming a top-tier shopper marketing organization is a five-part journey that starts with having the right tools including the next best thing to a crystal ball.

1. Decision Support Capabilities

If achieving top-tier status alongside such CGP heavyweights as Tyson Foods is a journey, then predictive analytics is both a compass and a map. Specifically designed to measure shopper marketing, Foresight ROI’s analytics make it possible to confidently forecast outcomes and build on successes by honing best-practice knowledge.

Predictive analytics answers some million-dollar (and then some) questions for marketers:

  • How much should I spend on shopper marketing?
  • Where and when do I spend for budget optimization?
  • How do I spend effectively to maximize returns?

For any given program, forecasting shows marketers whether it would pay to put more money toward, say, Walmart versus Target based on past performance and data-based projections. Providing decision support in every aspect of shopper marketing, predictive analytics also measures probable outcomes of various tactics and strategic platforms, making clear, for example, that an outdoor grilling theme with cross-merchandising will sell more hot dogs than a Super Bowl theme with a sweepstakes.

2. Optimize the Budget

Predictive analytics captures and measures granular data down to the tactical level; forecasts shopper marketing ROI by brand, retailer, strategy, and tactic; and yields accurate sales lift and topline growth data traceable to shopper marketing.

Once the results start rolling in, the second leg of the journey is budget optimization, or reallocating dollars to get the best bang for the buck. Aside from spending more on a summer grilling program, our hypothetical hot dog brand may, for example, earmark more money for the retailer that moves the most franks and the tactics that have proved to be most effective.

It’s important for shopper marketers to identify their best customers because they typically generate returns four times greater than the lowest-ranking customers. Marketers who fund their best customers through small reallocations increase their total returns upwards of 5 percent on average, just by reallocating 10 percent of the budget, and double-digit increases aren’t uncommon.    

3. Best-Practice Event Designs

By this stage, shopper marketers using predictive analytics have the information they need to design events that are objectively, measurably, and repeatably successful. They know to plug in variables based on past performance to forecast their sales lift and other key performance indicators.

Marketers typically find that a full path-to-purchase approach, though costly and complex, yields a much higher ROI—21 percent on average. Shopper marketing programs with multiple touchpoints tend to benefit retailers, too, which brings us to the penultimate leg of our journey.

4. Collaborate for Win-Win Results

CPG brands compete for prominence on key dates. Hot dog brands all clamor for the Fourth of July, for example, and the brand that presents the retailer with an event and forecast showing a win-win will nab the victory. To be mutually beneficial, an event must grow the category, not just the brand. Pre-store activities have been shown to increase category sales while expanding program reach and brand penetration.

In addition to winning retailer support, predictive analytics gets the shopper marketing team, the brand marketing team, and marketing agency on the same page about how to go to market. When these key stakeholders along with customers and shoppers all come out as winners, the shopper marketing team has earned the right to a victory dance—and a bigger slice of the marketing budget.

5. Manage for Continuous Improvement

The fifth and final leg of the journey is actually a loop spiraling higher and higher, to top-tier shopper marketing performance. This is where shopper marketers compare actual results to the expected results as part of a learn-change-grow process of continuous improvement.

If a program does better or worse than the forecast, granular data reveals why. With these insights, marketers know what to beef up or do differently to perform even better next time, and the next, and the next after that. Continuous use of Foresight ROI’s predictive analytics tool typically results in a 10 percent or more increase in marketing ROI each year.

Once shopper marketers are engaged in continuous improvement, they realize it’s a journey that never ends but just keeps on going onward and upward.

This is the first of a three-part blog series on the journey to becoming a top-tier shopper marketing organization. Part 2 discusses the continuous improvement process in more detail. Part 3 rounds up Foresight ROI CEO Rick Abens’ impressions of the 2018 P2P Summit, March 12-14. Abens co-presents with Tyson Foods VP Christopher Witte “Journey to Top-Tier Shopper Marketing Organization: A Case Study” at the Summit on March 14, 10:15-11 a.m.  

Foresight ROI is the leader in shopper marketing measurement, decision support, and software solutions for CPG companies and retailers. To learn more about our measurement, software or industry ROI benchmark solutions, contact us at:

Rick Abens
Founder & CEO