Retail TouchPoints: Redefining Reach – A New Lens for an Old Media Metric

Discussion
Mar 23, 2010

By Laura Davis-Taylor, VP of Global Retail
Strategy, Creative Realities, LLC

Through a special arrangement, presented
here for discussion is a summary of a current article from the Retail
TouchPoints
website.

As more retailers embrace
the concept of marketing at retail, an interesting recent phenomenon is
that of old school media planners struggling to include the store as
media. Where they get hung up is defining "reach" within the store.

Wikipedia defines advertising
reach as "a measure of the size of an audience." GRP (Gross Rating Point)
is how the industry measures reach by a specific media vehicle or schedule.
The CPM represents the cost to reach 1,000 people within that vehicle.

Almost all traditional
media is defined and measured this way, so it’s no surprise that people
new to playing within stores inquire about a retailer’s in-store GRP and
CPM. However, this approach has some big issues.

Recent factors are causing
brands to look at new outlets, new vehicles and new methods for connecting
with busy, distracted people on the go. Lucky for us, the store was reevaluated
as a consumer connection point and folks like P&G helped the industry
see that it’s actually the richest place to create a relevant dialogue
with consumers. Given that a message received in-store is an active one
(shoppers respond with an immediate buy), it’s shocking that this was big
news. Regardless, it has legitimized the store as a healthy piece of the
yearly marketing plan.

The issue is that reach,
as defined today, is becoming irrelevant. CPG brands I’ve spoken with don’t
hesitate to share that they’ll pay top dollar for one qualified viewer
over 500 unqualified ones. And, when it comes to the store, they care about
brand awareness when it supports an ultimate sale.

Shelly Palmer, media guru
and host of Digital Life, recently shared that five years ago there
were approximately 25,000 broadcasters in the U.S., consisting of about
18,000 radio stations, a couple thousand television stations, and a few
thousand multi-systems operators (MSOs). Today, there are more than 150
million broadcasters. His point? Attention is what everyone in the advertising
industry packages and sells, yet reach has no direct correlation
to attention. Reach is just the potential — attention is the hopeful outcome.

We need to think about
this. I’ve often asked CPM-insistent media buyers how they will be transacting
TV media buys once we start reporting exact commercial viewership at the
household level. Then, I ask their clients how they prefer to buy in-store
media. In most cases, it’s somewhere in between flat sponsor rates, cost
per qualified engagement and a revenue share. They’re always clear that
they are willing to pay premiums based on the level of measurement the
retailer is willing to share.

As an ad vet myself, I
learned a very valuable lesson years ago: a message that has no relevance
to someone is an advertisement; a message of personal relevance is communication.
Therefore, reach is not a measurement of potential bodies exposed to an
advertisement, but of people who become engaged and absorb a message.

Discussion Questions:
Should retailers accept old school "reach" as the metric of value for
in-store marketing? Or, should the industry strive for a valuation
approach tied to results?

[Author’s commentary] The
"store as media" is a new concept being overlaid on a very established
consumer channel. It indeed opens up a lucrative new revenue stream for
retail brands. I simply ask that as we become savvier in the art of "relevant
reach," let’s try to keep our stores measured by this new school thinking
rather than by dying media dogma. Value and measure by message impact
— it’s a much better path to happy shoppers, inspired vendor partners
and thriving stores.

Join the Discussion!

15 Comments on "Retail TouchPoints: Redefining Reach – A New Lens for an Old Media Metric"

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Nikki Baird
BrainTrust

Ah, Laura, here we are, back to the future. I totally agree. It’s ironic that in-store is being held to a standard that the industry increasingly understands is dying and irrelevant. It should become a qualification question for your agencies these days: what’s the best way to measure (and pay) for in-store marketing (of any kind, not just the digital)? If they stare at you as if to say, “The store? Who cares about the store?” then run away. If they say, “Well, Walmart gets 380 million eyeballs EVERY MONTH” then I would also say run away. If they speak about in-store as an important piece of an overall communications strategy, then you’ve got a keeper.

Don’t think of it as “out of home.” That is an important media element in the world today, but the store is not simply out of home, it’s “at the shelf.” What do people do there? They buy things. Any measurement methodology that does not take that into account–I’m not saying it has to be the be-all/end-all–but if it is not some component, then you are completely missing the point.

Gene Detroyer
BrainTrust

This argument has been going on for 25 years. For some reason there is a desire by the advertising community to stick to reach and frequency as the measurement gold standard. They totally ignore the value of actually seeing how an in-store ad moves product.

Laura is absolutely correct. If there is a Coca-Cola ad in a store and the shopper has no use for that ad, the ad has no value. But, if we leave that decision up to old school media maven, it is part of the delivery.

The problem is that the advertising community does not want to be measured by performance. It is much more preferable to be judged on reach and frequency delivery than to an actual uplift in volume. Further, there is great fear that if advertisers find that in-store is measurably very effective, that more monies will move away from traditional media to in-store.

Despite what advertising agency boast, they do not want to be judged on hard performance. There is too much of a risk of indefensible failure.

Ralph Jacobson
BrainTrust

Although the questions posed for this discussion may be a bit leading in nature, I’ll take the bait and say, yes, the industry needs to strive to “reach” their targeted audience, not just a shotgun approach. Wait a minute, that IS old-school thinking. Their target audience is the one who will accept a message as a communication, rather than a simple advertisement.

However, the methods to best reach those desired people (yes they ARE people) are evolving as we speak. yes, social media is the latest craze. And I look with suspicion at anyone who claims to be an expert at it. No one knew what twitter would be in 2010. And no one has any idea what will drive the successful vehicle next year. Bottom line, retailers and CPGers need to utilize consumer analytics tools available in the marketplace, and take a little more of the old-school “gut feel” out of their marketing programs.

Ryan Mathews
BrainTrust

First of all, there isn’t anything new about the notion of the store as media, making it even more amazing that we are still having these kinds of discussions.

Clearly, we live in a new day and one of the realities of that new day is that we desperately need new measures and metrics. The author is right. “Reach” talks about potential and you can’t take potential to the bank.

I’ve said it before and I’ll no doubt say it again–All customers are not created equal and retailers who think they are will end up shuttering their doors.

The ability to engage one key customer is indeed worth more than “reaching” 500 cherry pickers or non-buyers. We need retail metrics that get us closer to understanding who those key customers are.

Sandy Miller
Guest
Sandy Miller
7 years 6 months ago

The store is not a media, it is a media platform until interesting, informative Reasons to Buy selling messages are added. The key point is the in-store Direct Selling Media (DSM) which reaches shoppers in stores with intent to buy things; it’s the only media with this measurable power. As we activate this media and guarantee 95% to 100% installation, the retailers see 20% to over 100% sales lift.

Marge Laney
BrainTrust
7 years 6 months ago

In-store is where the rubber meets the road, and as the author points out it is incredible that this is news. Nudging the customer while they are face to face with the product is a no-brainer that should reinforce the messages that got the customer into the store to begin with.

Retailers these days are all about caring and trust in their mass media campaigns to get you in their stores with testimonials from real customers and associates alike. Once you get them in the store, make it worth their while and yours by informing them about what’s in the store and any deals you have to offer. It should be easy to figure out what’s working and what’s not by looking at your overall traffic and conversion of the promoted items, or am I missing something?

Liz Crawford
BrainTrust

A number of good points are made here already. But the metrics can’t be old school advertising metrics.

We need to look at eyeballs (yes, at Walmart every month), but also dwell time, conversion at shelf, program participation if applicable and basket impact (including category adjacency purchases).

These are the direct returns that GRPs will miss…and yikes, that’s a big miss!

Anne Bieler
Guest
Anne Bieler
7 years 6 months ago

Thank you for bringing this forward. We will not get to better answers until we ask the right questions! It will require new kinds of thinking, processes and collaboration to determine effectiveness with the engaged shopper. But measuring reach just tells us exposure–which doesn’t tell us much about who is purchasing.

Mike Spindler
Guest
Mike Spindler
7 years 6 months ago

Not only do we need a method of measuring relevant reach (some of the methods on which P.R.I.S.M. was working held promise), we also need to measure what the consumer is “reaching for”! This was an important component that media alternatives do not need to worry about. Are the signs and the products actually available in-store? Big question and the answer is all too often “no.”

ShelfSnap is working on a study covering Shopper Marketing efforts in-store and compliance with plan from a product and program standpoint.

Derek Patterson
Guest
Derek Patterson
7 years 6 months ago

Hmmm, interesting. I sell radio advertising; old school as you say. And I don’t want to be held totally accountable for the action in the store. I want to be held accountable for delivering qualified buyers and properly communicating with them.

But to be held accountable for what is going on in the store? No way. There are too many variables, namely, the ability of their people to close the sale. It’s not as simple as having something appealing in the store that may lead to a purchase. There’s often a human element to it that I cannot control.

Will their sales people properly sell and service the prospect? I’ve been in enough stores and seen enough promotions where salespeople just sit there. Or the store has their promo material buried behind a counter.

So no, I cannot be responsible for what goes on in the store. I will be responsible for delivering buyers. And if I don’t do that, then fire me.

Camille P. Schuster, PhD.
BrainTrust

“Reaching consumers” is critical for success. However, using traditional methods of measuring reach is not a strategy for success. While some message may be in front of a consumer, the only effective messages are those to which the consumers give their attention and have a positive response. That does not mean “seeing” the message in passing. A new definition of reach is necessary and new methods of measuring reach are necessary.

Nathaniel Fry
Guest
Nathaniel Fry
7 years 6 months ago

Retail marketing innovation is being led by the eCommerce and Mobile Commerce channels. These channels have/are quickly morphing from dollars spent for “eyeballs” (browsing) to dollars spent for “click throughs” (purchasing). This moves marketing expenditures down the conversion funnel, closer to where the consumer spends money in an actual transaction.

How long will it be before a retailer teams with Google in developing a store-based “search/advertising” model, including enabling suppliers to “bid” for specific store locations, and times of day?

The current OOH digital media marketing/advertising model will be transformed by the models/algorithms being used so successfully in eCommerce and Mobile Commerce.

The Store channel has to quickly innovate to be more like the eCommerce and Mobile channels, otherwise it will continue to lose market share and relevancy to consumers (and manufacturers).

John Williams
Guest
John Williams
7 years 6 months ago

I find myself in total agreement with Derek Patterson above.

Media is a piece of the sales process, but it isn’t the complete sales process. Media delivers a message, but it can’t stock the shelves, keep the lines moving, or even monitor what the competition might be doing–sometimes in the same locations where your brand’s media is running.

To be really “old school,” when we get back to the old saw about the four Ps of marketing (place, product, promotion, price) in-store media can really only improve the efficiency of “place.”

Doug Stephens
Guest
Doug Stephens
7 years 6 months ago

I think the debate here goes beyond marketing metrics. What we really should be talking about is the fundamental shift from “interruptive” (a.k.a. reach and attention) marketing to “permission-based” marketing.

We need to stop filling retail environments with marketing clutter that battles for attention and instead do a better job of giving consumers the information they really need, when and where they need it, in order to make more intelligent buying decisions.

Herb Sorensen
BrainTrust
Reach and frequency is highly relevant in the retail space. The problem is that it is not being truly measured. People making up the measurement regimes have very poor understanding of the relation between media in the store and shoppers. Without going into a lot of detail, media is ubiquitous in the store. Just because a bunch of newbies arrive in the store with newfangled communication devices, THAT does not vitiate all the media (mostly packages) already there. And considering shoppers an “audience” by simply counting them is totally inadequate. At a minimum, an “audience” MUST be exposed to the visual field of the audience, which means that measuring simple presence in an aisle wildly exaggerates exposures. Amongst other things, the shopper turns, but not like a top, so they probably only see well less than half of the environment they actually visit. You know, the store is not like a television that people sit and stare at (at least intermittently) for extended periods. There is really nothing wrong with the metrics of reach and frequency, just a failure to take into account what these standard metrics really mean in stores. Instead, there has been a steady interest in creating… Read more »
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