Retailers comprised 15 per cent of the respondents in the Popai/GfK Shopper Marketing Industry Benchmark survey.
Similarly to last week’s article on brand manufacturers, here we’re going to review what’s happening with retailers organisationally in the shopper marketing space.
Probably the first thing to note is terminology. Retailers tend to refer to shopper marketing as customer marketing or simply marketing.
Half of the retailer survey respondents in retailing were in middle management (58 per cent), with a further 28 per cent reporting to the MD and 13 per cent being business owners (ie store owners or smaller retail chain owners).
The level of active support by the senior executive in retailers was slightly higher than for brand manufacturers (71 per cent compared to 69 per cent), but there were fewer retailers for whom there was active executive promotion of the function (33 per cent) and therefore more for whom the function has been identified as a priority (38 per cent).
For nearly seven in 10 retailers, shopper marketing is either perceived to be core to what they do and a key growth driver (38 per cent) or likely to become integrated into a broader version of what category, customer, and consumer marketing already do (31 per cent).
These numbers are lower than for brand manufacturers, demonstrating a certain level of scepticism by some, with 15 per cent of retailers said that shopper marketing was likely to remain tactical (compared to seven per cent of brands) and a further eight per cent viewing it as a fad (compared to three per cent of brands).
Regardless, there is a reasonable amount of alignment between brand manufacturer and retailer shopper and category functions as Figure 1 below demonstrates, with the major difference being that retailers are half as likely as brands to have customer/trade marketing departments.
Again this is likely terminology – in retail the trade and store marketing activations departments exist but may be called something like ‘Marketing Ops’ instead.
More than half (55 per cent) of retailers said their companies had been involved in shopper marketing activities for six years+, and similar to manufacturers this was higher for the individuals themselves (67 per cent). At the other end of the spectrum 24 per cent of retailers said they had been involved in shopper marketing for less than two years.
The number of people in each function is reflective of both the terminology and its existence in the various retailers.
For instance, 50 per cent of retailers only have one person in shopper marketing and channel planning respectively, but nearly two thirds have four or more people in category management.
The number of retailers expecting to increase their shopper marketing team resources (18 per cent) is broadly similar to manufacturers. But nearly 50 per cent plan to increase category resources and a further planned resource additions in shopper insights and channel planning (24 per cent each). These areas have higher planned increases for retailers than for manufacturers.
In line with the people resource focus on category management, one third of retailers plan to increase their budgets in this area, however, retailers planned fewer budget increases in shopper marketing, shopper insights and customer marketing than did brand manufacturers. See Figure 2 below.
If more resources were available, retailers are most likely to deploy them under upfront shopper strategy and planning (43%) and shopper marketing programs instore or prestore/digital (36 per cent each).
While two thirds of retailers believe that shopper marketing is gaining in momentum and focus, only a third believe it is assisting with manufacturer/retailer collaboration.
Retailers see shopper marketing as likely to result in more innovative programs (57 per cent). Currently the largest areas of dissatisfaction around shopper marketing for retailers are a lack of proven ROI, a concomitant lack of measurement, and the fact that it is new and more strategic thinking they need to bend their heads around.
Following this overview, we’ll discuss where agencies are at next week, and then what’s getting activated in further articles.
Norrelle Goldring is head of shopper experience and retail performance at global retail research house GfK. Norrelle can be contacted on 0437 335 686 or email norrelle.goldring@gfk.com
Lee McClymont is GM of Popai Australia and New Zealand and has 15+ years’ industry experience in specialty retail, agency, and brand. Lee can be contacted on 0414 941 585 or email leem@popai.com.au.
