Perfect Store: how to attract shoppers to our products
Over the past few years, the consumer decision process has become a multichannel journey. Thanks to new technologies, now retailers & manufacturers in the consumer products industry have to deal with a more specialized & informed consumer, who knows best and has many ways of finding out all the details of a product and comparing it against competitors.
Yet, there are things which do not change. According to surveys, half shoppers make the final decision while in-store. Even when shoppers have decided which categories they need to purchase, almost a 30% of them don't really know which brand they will buy until they are in front of the shelf. And almost 20% of consumers end up buying in categories they were not even considering before entering the store.
Knowing all this, building a brand image outside the store is necessary, but brands need to work in in-store brand building and activations, to attract new shoppers and defend themselves against competitors.
There are different techniques to increase visibility inside the store, the most important thing is "always been there". Manufacturers & retailers should agree in the assortment that will be available in-store and make sure it will be carried out properly.
To design this assortment, it is very important to use all the data within our reach, and the most valuable one is the Sell Out. Manufacturers & retailers can find inside their sales how the presence & the location of a reference affect sales to the consumer.
As mentioned before, consumer trends are not the same between retail channels (hypermarket, supermarkets, etc.), so the assortment should be designed accordingly and they need to be sure it is being carried out appropriately.
OSA, On Shelf Availability
One of the first issues to battle in terms of assortment is the Out of Stock, as it affects both manufacturers & retailers. According to studies when shoppers do not find the product they were willing to buy, 40% of them decide not to buy or buy elsewhere, affecting the retailer sales; and 35% buys another brand, affecting the manufacturer sales.
Most times, OOS is caused by a lack of demand planning based on consumer behavior. Thanks to the Sell Out & Consumers behavior data algorithms, this problem can be highly reduced by a closed collaboration between Retailer & Manufacturer.
SOVI, Share of Visual Impact
So sometimes it is important to guarantee just being there, but also the location is key. As we deal with a very "visual" shopper, the most important shelf is the one on eye level.
It is said that "eye level is buy level" and its effects in sales is almost immediate For example if very typical to find products meant for kids in the "touch level" (lower than the "eye level") so kids will see them and have them within their reach.
So height is important and so it is the number of facings available in comparison with the overall category and the main competitors (% On Shelf Share), but both height & facings come with a price.
Of course, another important factor is the price. Most shoppers will compare prices before deciding what to buy. Sometimes manufacturers use strategies like using specific measures instead of round ones (packagings of 225 instead of 250) to make comparing prices a more difficult task.
In this aspect, competence is fierce, and some manufacturers keep their products in promotion almost all year long. That does not always mean that "less is better". Sometimes consumers associate higher price with quality, and a lower price will scare them away.
But most times a reduction in price results in an increase in sales. It is crucial to be able to measure your promotional efficiency in order to detect which promotions work better and which end up with a negative ROI.
Other than price reductions, there are many types of promotions that might prove effective on achieving sales: On Packs, Gifts, "buy more, save more" promotions, coupons, loyalty points, etc.
SDG Business Insights
In the end, shopper behavior in-store can be measured, and the solution for most in-store problems relies on our data. The challenge is to transform information into knowledge and use it as an advantage against competitors. SDG Business Insights service helps Consumer Products companies to face this challenge within:
- Predicting Sales to optimize customer service and product availability;
- Creating the best assortment for each store automatically, helping the retailer and the manufacturer to increase their sells;
- Increasing the promotional ROI with the recommendation of the best promotion for each customer and moment;
- Optimizing the sales force execution ranking the potential of each point of sales of the market and defining the Perfect Store Scoring.
These are only a few examples where analyzing data with SDG, companies can increase sales through better decision making.
This article has been written by Maribel Delgado, Consumer & Retail Manager at SDG Group, and Enric Escalé, Consumer & Retail Manager at SDG Group.