A 360-Degree View of the Shopper: Part 2 – In-Store Marketing

In-store merchandising has assumed even greater importance over the past year and a half, and for a good reason: During the economic downturn, consumers wanted to be guided to values.

SymphonyIRI Group's Economic Update Survey notes that over a quarter of America's shoppers (28 percent) are experiencing difficulty in purchasing necessary groceries. And, to make matters even more stressful, 80 percent of consumers expect prices will rise in 2010. At the same time, economic conditions have pushed consumers to return significantly toward at-home and from-home meals -- perhaps to the detriment of foodservice but much to the benefit of food retailers.

These developments have prompted considerable in-store merchandising activity in the fresh/perishable, frozen and center store departments with the aim of projecting a demonstrable value message as well as making shopping for value easy and efficient. Not surprisingly, price-only actions are being leveraged extensively. For example, 70 percent of frozen categories are using this merchandising tactic to a greater degree, versus a year ago.

In 2010, value tactics such as these have been bringing results. For center store, 75.7 percent of categories experienced a volume increase due to price-only activity during 2010. Over 80 percent of frozen categories showed volume increases due to any merchandising. Nearly 60 percent of the fresh/perishable department's categories increased in volume this year, resulting from price-only actions.

The rise in in-store marketing activity is a direct response to stated shopper needs. According to the FMI Brand and Retailing Loyalty Survey, the top two consumer needs for making shopping easier relate to deals and specials: 71 percent of consumer respondents wanted easier ways to find in-store sales and specials and 39 percent wanted more signs on the shelves.

Responding to this complex set of challenges requires 360 shopper-centric analysis, according to SymphonyIRI's report. Full understanding of shopper missions and behavior is critical because of the potential impact on margins and profit.

However, to emphasize the overriding importance of taking a 360-degree approach to managing shoppers' in-store experience, there's also a long-term trend at play in addition to economics: Americans' growing interest in health & wellness and self-care. This trend has been accelerated by financial pressures, since self-treatment is a money-saving strategy, as well as providing more control over one's life, and it applies to both health and personal care. According to SymphonyIRI, a third of consumers are using home-based beauty care products more frequently, while a third are going to a physician less often, preferring to self-treat.

These developments, too, are causing a more extensive deployment of in-store tactics, and merchandising activity is on the rise in many HBC categories. Take skin care, as one example. In the year long-period ending April, 2010, 30 percent of this category's volume was due to any merchandising and it resulted in a +1.5 point change from a year ago.

LEARN MUCH MORE about gaining a 360-degree view of the shopper in the latest SymphonyIRI Times & Trends report...

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