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PL Buyer's eReport May 20, 2008

May 21, 2008
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Break Through the Clutter
A new study examines how to reach the right audience -- at the right time -- with the right message.
 
Retailers and marketers spend billions of dollars a year on in-store advertising to connect to consumers and "turn mind share into market share," says New York-based TNS Brand & Communications. But are they reaching the right audience at the right time with the right message?
 
According to "Reaching the Shopper at Retail," a new TNS study, the three most effective ways to reach shoppers are through in-store sampling, package ads and coupon dispensers -- with the most suitable advertising format determined by the category, products/brands and type of shopper. Meanwhile, "interactive touch points" remain the most underused form of in-store marketing, TNS said.
 
For its study, TNS focused on the cereal category, said Jeni Chapman, executive vice president of the company’s Brand and Communication Division. But the findings apply broadly to other product categories, including private label offerings.
 
"The way we’re looking at this is ‘How do you break through the clutter?’" she said. "Shoppers are coming in; they’re experiencing; they’re spending an hour there; and retailers are realizing this is a way to continue to build brand experience with that audience when they’re in there."
 
Consumers approach the shopping experience with a certain mindset, Chapman said, which varies from shopper to shopper.
 
"What we’re hoping with this research is to help retailers and brands understand how to connect with consumers in-store, so they turn that mindset that they have -- or that equity of that mindshare -- into market share in the store experience," she said.

As for the underused interactive touch points, Chapman said they work best when connected to the type of shopper a retailer or marketer is targeting.
 
"If it’s the quick shopper, interactive is going to work in a different way, and what you’re trying to get out of that touch point is different," she stressed. "You’re probably looking to facilitate that so when they go into the store, they come out with exactly what they want, versus the stocker-upper shopper or the person who just really enjoys the experience of retail. [They require] a different touch point."
 
Interactive touch points also appeal to the growing population of online shoppers, Chapman added.
"We’re seeing more and more people who are shopping and looking for that kind of an experience -- that is, the convenience and functionality can actually transfer the other way for when they do have a brick and mortar experience," she said. "It allows offline retailers to benefit from that whole experience of convenience and functionality -- kind of taking that equity transfer in the other direction."
 
Chapman points to Procter & Gamble’s "Olay for You" kiosks as an example of an interactive touch point that appeals to a certain type of shopper in the health and beauty category. But determining the most effective in-store advertising vehicle ultimately requires the retailer or marketer to consider a number of factors simultaneously.
 
"Combining the understanding of how to break through the clutter with how people shop is very powerful," Chapman added. "[Consumers] are going to get more value when [retailers] combine this with an understanding of the category."
 
For more information about the study or to purchase the report, e-mail TNS at tnsbcdinfo@tns-global.com
 
Our Take: We all know it’s not a one-size-fits-all world. What works for a subset of shoppers in one category might not fly with another group or another category. A bit of targeted research can help retailers develop in-store marketing tools that can jumpstart private label sales within a lagging category.


Industry Insider

Shoppers Share Pet Peeves
Frustrated shoppers want retailers to open more checkout lanes, ensure advertised items are in stock, and more, says a new study.
 
In its latest "Ouch Point" study, Opinion Research Corp., Princeton, Ind., asked shoppers nationwide about their shopping-related pet peeves. The "winning" annoyance? Stores that have too few checkout lanes open -- 37 percent of shopper-respondents admitted to having a beef here.
 
Rounding out the top 8 in the frustrations list were: 
  • Advertised items out of stock (15 percent)
  • Prices not clearly marked (12 percent)
  • Price at checkout doesn’t match advertised or listed price (11 percent)
  • Use of self-checkout is unclear (5 percent)
  • Product displays are placed in narrow aisles (4 percent)
  • Commonly used items are located at the back of the store (3 percent)
  • Signs do not accurately reflect where items are located (3 percent)
"As such a wide margin of respondents cited insufficient checkouts as their chief shopping frustration, there is clearly a significant customer service issue which stores must address if they want to keep their customers happy and ensure they will come back," said Linda Shea, Opinion Research’s senior vice president and global managing director of customer strategies. "When the last moment of the shopper’s experience is an unpleasant one, the result is likely to be a lingering negative perception of the store."

 
Our Take: Although most of these pet peeves might seem far removed from your actual job, the whole retail package must work together to ensure shopper satisfaction. Your private label frozen egg rolls might be the best thing since sliced bread, but that message probably won’t reach the customer who’s watching the appetizer thaw during her long wait to check out.

 


Economy Watch

Restaurant Downturn Good for Retail?
More consumers are dining at home to offset higher fuel costs and other economic pressures, said FMI.
 
Economic concerns are compelling Americans to cook at home more and eat less often at restaurants, according to "U.S. Grocery Shopper Trends 2008," a new report from the Food Marketing Institute, Arlington, Va. In fact, FMI said families now eat their main meal at restaurants only 1.2 times per week, down from 1.3 in 2007 and 1.5 in 2006.
 
Moreover, FMI said consumers are buying fewer luxury goods (67 percent) and more store brand items (60 percent). The high cost of fuel also is contributing to a decline in the number of weekly shopping trips -- which now stands at 1.9.
 
"Food retailers can turn these economic challenges into benefits for consumers and the industry," said Tim Hammonds, FMI president and CEO. "As people eat out less often, we can help revive the great American home family meal tradition. This presents an opportunity to win back a share of the meal-time market long owned by restaurants, and it provides American families [with] important health, economic and social benefits."
 
Our Take: We’ve said it before, but it warrants repeating: The economic downturn provides a huge opportunity for retailers to showcase and grow private label brands. Those retailers that present their store brands as part of a well-thought-out solution to easing their shoppers’ current economic stresses will reap the most rewards.


Bits and Pieces

What’s News in Private Label

Among the most notable retail and private label news:  
  • The Better Living Brands Alliance, Los Angeles, announced the key licensees that will expand the U.S. retail presence of Safeway Inc.’s O Organics and Eating Right organic and health and wellness brands. Member food companies include Safeway subsidiary Lucerne Foods Inc.; Vernon, Calif.-based Overhill Farms Inc.; Irwindale, Calif.-based Ready Pac Produce Inc.; and Schreiber Foods Inc., Green Bay, Wis.
  • Rochester, N.Y.-based Wegmans Food Markets launched an interactive online "experience" (www.wegmans.com/newstores) that allows future customers of its new Woodbridge, Va., store to take a virtual tour of the store and its offerings -- and "meet" key employees. The store is scheduled to open in June, Wegmans said.
  • Wal-Mart Canada is embarking on a major expansion of its Supercenter stores in Canada, according to a May 8 article posted on Canada.com. The article said the Mississauga, Ontario-based retailer would open or expand 25 to 27 stores in Canada by 2009 and create 6,000 new jobs.

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