Need-State Marketing May Enter the World of Ethnic Marketing

Aug 04, 2004

By Bill Bishop

Interest in need-state-oriented marketing has increased in the grocery business, as more specialized retailers like dollar stores, limited-assortment stores, and natural/organic supermarkets have picked off certain types of shopping trips that otherwise would have gone to the supermarket.

Need-state marketing varies from more traditional marketing in that it focuses on the way a situation/occasion influences the shopping decision. This means that marketers cannot rely as heavily on traditional demographics, since individual shoppers operate in different need states, depending on the situation in which they find themselves.

The World According to Shoppers study released a couple of months ago by the Coca-Cola Retailing Research Council of North America documents the high quality of shopping experience that these retail specialists provide for different need states, and sharply defines the challenge for supermarkets.

It turns out that in some of the unpublished findings of the study are clues as to how need-state shopping behavior plays out with two different ethnic groups, i.e., African American and Hispanic shoppers.

While the sample is too small to project to a national level, it suggests that Hispanic shopping patterns tend to parallel those of the general population, i.e., operating in the same need states. Care for Family, for example, and Smart Budget-Shopping are the need states in which these shoppers are most likely to operate. This segment uses the supermarket most often but is a little more likely to use the convenience store as a place to buy groceries.

African American shoppers, however, vary from these general patterns in that they’re less likely to operate in the Reluctance need state, i.e., occasions when they just want to get done with grocery shopping and are more likely to operate as Bargain-Hunters. These shoppers use the supermarket as the most common place to buy groceries, but are also more likely than the average shopper to visit drugstores for groceries.

The study provides retailers with another set of lenses through which to look at the market, i.e., a need state versus a customer-specific perspective. It also offers an online
tool for retailers to begin to apply the study learnings to their own stores.

Moderator’s Comment: Are the differences observed in this small-scale analysis of Hispanic and African American shopping patterns consistent with your
experience? What are the pluses and minuses of using a need-state-driven marketing approach in marketing and merchandising to ethnic shoppers?

Bill Bishop – Moderator

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