BrainTrust Query: Is Your Digital Strategy Active or Passive?

Through a special arrangement, presented here for discussion is a summary of a current article from the Mark Heckman Consulting blog.

While I understand grocers need to hitch their wagons to those media and programs that represent critical mass, digital content and offers in the grocery channel aren’t close to grabbing the headlines away from traditional venues and promotions

My assessment as to why digital programs still live in the periphery of grocer marketing options centers around whether they are passively or actively promoted.

Passive digital programs are those that are launched relatively quietly, typically exclusively on digital touch points. Often in the case of a grocer offering load-to-card or load-to-account digital coupons, little or no mention of these programs is made in mass media (weekly circular, TV, etc.) or at the store level.

Another issue is the content. Retailers who expect hundreds of meaningful, widely purchased brands to drive the content bank of these digital programs often find that, unless the shopper is in the market for an obscure meat seasoning or a new herbal toothpaste, the digital offers available have little relevance to their shopper’s needs. Yet they wonder why engagement is so disappointing.

The first take-away for retailers: Digital is not going away. Other channels of trade and online retailers are setting the early shopper expectations in both content and technology. As Winn-Dixie aptly "tags" its new digital program, "The Future of Savings is Here."

The second is that waiting for the content to arrive is depriving retailers of a golden opportunity to become a committed leader and thus gain share of wallet from their current shoppers.

Here, a few recommendations for how to become an active retail digital marketer:

  1. Shout about the program in-store. Point of sale signage and bag stuffers should tell the story. Associates should be aware of the program and endorse it at every opportunity.
  2. Drive the digital content with retailer-sourced offers. Make the commitment to have some of your "skin in the game." Measure results and then invite your brand partners to contribute based upon your early positive results.
  3. Tie digital into the mainstream of your marketing program. If you offer paper coupons in your circular or paper direct mail, convert them to load-to-card or -account. Also, think about layering digital bonus savings on front page items and end cap features; perhaps have a "Store Manager’s Digital Offer of the Week." Get inventive.
  4. Measure the results. Use the resulting customer data to become iteratively smarter about which offers and content drive the best results among your shoppers.
  5. Don’t forget to include store brand offers. Nothing will get your brand partners interested in participating faster than if they see their share of category sales diminishing due to the impact of your store brand digital offers and campaigns.

BrainTrust

Discussion Questions

Why are grocers generally taking a passive approach to digital engagement? What unique hurdles does grocery face around digital versus other retail channels? What suggestions would you have to shifting to a more active approach?

Poll

10 Comments
Oldest
Newest Most Voted
Inline Feedbacks
View all comments
Ralph Jacobson
Ralph Jacobson
11 years ago

The disconnect is not just true loyalty, but passion with grocery shopping. Grocery shoppers still redeem FSIs far more than digital promotions from most grocers. While other formats of retail (e.g. specialty apparel) drive more passion with their marketplace for their brand, grocers seem to struggle with getting any level of energy from their shoppers to do much more than clip paper coupons. Other retailers drive real passion around the shopping experience. Grocers first need to promote their overall brand much better than they currently do, on the average.

Once there becomes a following of the brand (where shoppers would [almost] want to wear shirts with their logo), then more interest in digital promotions will follow. Speaking of “following,” the most digitally-savvy grocers are the ones that have the largest social channel presences.

Tony Orlando
Tony Orlando
11 years ago

The digital engagement is happening in all the stores today. The scope of it is different for every store, so some will do it very well, and others will just stick their toes in the water. It is going to keep changing how all of us advertise, and grocery stores are coming around to getting more involved. At the recent NGA Convention in Vegas just last week, I attended some outstanding social media workshops.

It takes commitment, time and money to do it properly, so by next year you will see a much better grocery store effort into this digital media.

Ben Ball
Ben Ball
11 years ago

Perhaps it is because grocery retailers understand that—by and large and with few exceptions—grocery shopping is not a high engagement experience. It it a chore. When digital technology makes completing this chore easier then shoppers will adopt it.

For now, digital marketing is essentially online promotion offer delivery. It may be the “manager’s special” or “get double rewards points” or simply a discount or coupon, but it is still the same basic set of incentives just offered digitally.

Real engagement, digital or otherwise, goes up as the shopper’s involvement with the experience goes up. We are very engaged in a new car purchase, searching Consumer Reports and the Kelley Blue Book pricing diligently before buying. But the average shopper is unlikely to spend much time in the grocery store Googling Campbell’s Tomato Soup.

Max Goldberg
Max Goldberg
11 years ago

Retail seems unwilling to commit the funds necessary to fully embrace digital: mining data and delivering personal value. With over 50% of consumers using smart phones, it’s more important than ever for retailers to embrace digital and use it to dialogue with consumers. Yet doing this costs money, and this gives them pause.

Digital should be much more than simply linking coupons to loyalty cards. There’s nothing special about that and it does not necessarily save time for harried consumers. Digital needs to create a dialogue with consumers, taking data about past purchases and suggesting new items. It needs to understand what is important to individual consumers and then deliver value against those priorities.

Retailers have this information, and the technology to engage in the conversation is readily available. They need the resources and the will to dive in.

Tom Redd
Tom Redd
11 years ago

Habits are hard to break. Circulars have been a way of life for the both shopper and the grocer. Traditional Media Remains Key Source for U.S. Shoppers and Leading the pack: 67% of shoppers turn to circulars to get ideas on what to purchase on their shopping trips. Meanwhile, almost 3 in 10 get ideas from newspaper articles.

From the family science approach, some of this addiction may be due to the fact that shoppers were “trained” early—from childhood days—that the circular and newspaper coupons are the way you shop a grocery. Shopping for other items—like apparel and electronics—becomes a method and a way of each new generation. Especially with the very new areas, like mobile technology. Any “memories” from childhood on mobile phone shopping with mom or dad?

The “deeper” the habit, the tougher it is to change.

So to wrap, grocers may want to also target the KIDS and supply coupons to the things that they want via mobile. In the food space, the child can control the direction of the shopping cart…I know I did as a kid and always had Twinkies, AlphaBits, and Frosted Flakes. My brother ate that Life cereal stuff….

Tom

Lee Kent
Lee Kent
11 years ago

Digital is not all about coupons! To me, that is using new technology to do the same old things. Just sayin’.

Digital is a wonderful way to create great customer experiences. Think about who your customer is and deliver to each persona. My husband, the grocery shopper and cook in the family, goes to the store knowing those things we are out of and generally knows where to find them in the store. That part is easy. The next part isn’t. He does not plan ahead about what he is going to cook. He looks at the manager’s specials for ‘ideas’ then moves on to his favorite haunts for more ‘ideas’. Great places to use digital to help him move from idea to visual using what’s on the managers specials table or at the fish counter. Now do this for several persons who enter your store and voila! Customer experience!

Shilpa Rao
Shilpa Rao
11 years ago

While everyone is sold on the thought that digital is the way to go, grocery has its own set of challenges to overcome.They have to fix their fulfillment first to become truly digital retailer.

Since most retailers are grappling with this problem of remaining profitable and at the same time promise fulfillment, the majority of grocery customers are still in the store. That explains the passive approach, since most retailers are not able to quantify the impact of digital engagement.

Kai Clarke
Kai Clarke
11 years ago

This is very clear. Digital is still not a mature marketing medium. The majority of consumers in the grocery channel are still shopping at their local grocery store, and localized mail advertising or newspaper inserts are still the most effective medium for these grocery retailers to use.

Digital has yet to come of age, and until it can reliably offer actual numbers of positive marketing growth for the grocer’s marketing spend (with verifiable, repeatable, success) it is doubtful that digital will overcome these more traditional channels any time soon. Grocers should and probably will continue to focus on proven marketing spends that work. These are non-digital….

Dan Frechtling
Dan Frechtling
11 years ago

Mark’s recommendations 1-5 have merit.

Here’s a potential #6: Make digital more savings-rich and more convenient than paper.

Shoppers want savings, relevance, and convenience. Any digital program that’s going to win them over has to win on two or more of these dimensions.

Contrary to convention, relevance actually isn’t the natural advantage for digital. Until offer inventory increases dramatically, relevance is going to be the hard to engineer beyond broad appeal products like soda and cereal.

It should be easier and more convenient for shoppers to participate in digital savings. Rather than prompting them to visit a website to log-in to see offers, simply present them via email. Instead of expecting an app to engage shoppers, use an easy mobile SMS program.

Discounts should be deeper in digital media than paper. Costs of printing and redemption are lower, and the value of a shopper opting in to digital communications is worth the cost of saving them more money. Save particularly strong deals for digital-only access to build a bigger following.

Alexander Rink
Alexander Rink
11 years ago

I would have to agree that grocery generally suffers from a lack of engagement not only digitally, but across all channels. As Ben Ball so aptly put it, for most people, it is a chore—a mundane activity that most people strive to complete as quickly as possible. However, I don’t think it has to be that way. Just as lettuce sales took off when a smart marketer thought to sell it prepared in a bag rather than just as individual heads, grocery seems ripe for reinvention, and digital is a great way to raise user engagement.

Judging from the number of television channels and shows that showcase cooking, and the significant increase in healthy eating, it would seem that grocery would be a natural category for experience marketing, both in the store and digitally. For example, I would think that an omnichannel campaign to promote a famous chef preparing meals in a store, simulcast on YouTube and promoted through social media, would be an attractive draw both in-store and online.

In addition to promoting the actual campaign, the store could sell bundles of ingredients and cooking instructions that went into the making of the meal, making it easy for consumers to purchase and prepare the meal on their own.