28 Creating Value

8/6/2019 28 Creating Value

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Cover headinggoes hereCover sub-heading goes here

Creating valuein-storeUnderstanding and proting

rom the dierences between

shoppers and consumers



Interbrand | Pg. 2

The retail shel: the orward position in

the battle or consumer spending

The battle is on. The current environment has

not only changed the economic realities or

consumers around the world, it has radicallyshited the mind-set o shoppers in-store. In

normal times, companies spend a tremendous

amount o time and resources in the

development and management o their brands

by developing identities, measurement tools,

and communication, including signicant

media spending budgets. Yet, these are

anything but normal times.

When consumers eel pain in the pocketbook,

they react dierently inside the store.

Unortunately, it is this in-store decision

moment that is chronically misunderstoodand under-resourced. Many brand owners

have mistakenly treated the in-store

experience as yet another operational

unction. Major decisions are made with

little connection to brand and marketing

management, with conversations rarely

moving beyond the undamentals o in-stock

position and promotions. Even i they wanted

to extract more value rom the shel, many

brand owners lack the insights and tools to

do anything about it.

Yet, the store plays a major role in the

success or ailure o brands. In many

categories, 70 percent or more o purchase

decisions are made in-store. Recessionary

belt tightening only increases the number o decisions that are made in-store as shoppers

scrutinize every line on their list, double-

checking that they’re spending wisely. With

this in mind, it is crucial that the in-store

experience, and how brands are presented

in the environment, should be managed

with at least as much rigor as the other

components o a branding program.

Shoppers versus consumers

What is the dierence between consumers

and shoppers? Essentially, they are the

same people, but they operate in twodierent environments, subject to dierent

environmental infuences, and possessing

dierent needs.

Consumers are the overall targets or

brands. Aspects like location, demographics,

and the habits and practices o their lie

oten segment them. The goal o brands

is to orm bonds with target segments o

consumers—to touch them where they live,

work, and play.

Shoppers are what consumers become

when they enter the store environment.

Shoppers segment dierently–chiefy

by their shopping behavior, habits, and

practices. They are also more dynamic;willing to change in-store behavior based

on local events (e.g. a great seasonal displa

could turn a programmatic shopper into

an impulse shopper), caprice (e.g. “I’ve

had a rough day—I’m going treat mysel

to something rom the skin care aisle”) or

macro trends (e.g. penny pinching). Outsid

the store, when the same segments are

consumers, nothing may have changed in

how they see brands. However, inside the

store, as shoppers, their behavior is anythin

but static. The goal then, or brands, is

shopper connection. And to achieve this,they need to leverage shopper insights

and use creativity to orchestrate in-store

behavior and drive choice toward the brand

Shopper insights, or an understanding o

how shoppers behave in-store, is a key rst

step to optimizing the value o brands in th

retail environment. But in order to leverage

shopper insights, one must rst understan

the dierences between consumers

and shoppers.

Creating value in-store:understanding and protingrom the diferences between

shoppers and consumers

by Kelly Crouch and Emily Grant



Why should we make understanding the

shopper a priority?

In-store, shoppers have unique

communication and inormation needs. They

have unique habits and practices that occur

when they are shopping. Cues that attract

a consumer to a brand may not be the same

cues that cause a shopper to choose a brand in

the moment o purchase.

With this in mind, brands must help to deliver

a seamless shopping experience that meets

shopper needs while delivering benets

to the brand and retailer. To do this, brand

manuacturers must understand the dynamics

o the shopping environment—how options

are considered and choices are made. Even i

a brand has successully caught the interest

o a consumer, the shopper’s needs must

still be met in order to convert attachment

into purchase. Imagine a consumer who hasdecided they want to purchase a product,

Brand X. They have seen an ad and decided this

is something they want to buy. This consumer

travels to their avorite store, goes inside, and

becomes a shopper.

This consumer/shopper wants Brand X, but is

not sure where to nd it in the store. This alone

may turn them away. I they do locate the

section, they are presented with more options

than they’d imagined. They can choose Brand

X, or Brand Y, or Brand Z, or even Product Q,

which is a little bit dierent but appears to doalmost the same thing.

What do they do? Remember the statistic

about 70 percent o purchase decisions being

made in the store? I the brand does not cut

through the clutter, communicate why it is

dierent, or otherwise make this situation

simpler or the shopper, the shopper may well

go with another option or even abandon the

purchase entirely.

Creating value in-store: Understanding and proting rom the dierences between shoppers and consumers Interbrand | Pg. 3

How can a brand eectively address the

needs o the shopper?

There are a number o ways to better meet

shopper needs—key operational actors, like

in-stock position, must be solved, but on top

o the basics, other levers can be activated to

better meet shopper needs. These tools are

things like:

•Merchandisinglogicintheformofcategory

principles (e.g. vertical versus horizontal

shel arrangements by brand, scent,

size, etc)

•Plannedadjacenciesandstorelayoutboth

within and across the categories

•Categoryandbrandsign-posting

and waynding

•Totalstoreplanningandow

•Packaging

•Multi-levelcommunication

•Emotiveandinteractivecommunication,

such as imagery, technology, or out-o-

box displays

But rst, to make the right decisions with

tools like these, marketers must also

understand shoppers. Good branding

proessionals know how to get people into

stores. However, in order to get a consume

to make a purchase, marketers must also

understand what happens in-store, and

structure the brand oering in a way that

connects to shoppers in the environment.

How can brands understand whatshoppers really need?

To understand the best use o the tools

mentioned above, the rst objective must

be to understand the shopper. We must

investigate consumers in the role as

shoppers in order or brands to unlock the

mystery o the store and orchestrate valuab

shopping behavior.

Shoppers and shopper behavior must be

studied. Marketers must ollow them,

observe them, and ask questions. This

investigation can’t just happen in the homeor workplace, and cannot be gathered by

looking at market research studies that

outline what people buy. Those insights

are meaningul, but leave out specic

environmental dynamics and are oten

backward looking. Understanding and

observing how people behave and what

infuences them in the store provides an

opportunity to aect change, plan or the

To understand what motivateand infuences the shoppers,brand must understand thebasics o the shopper.

Brand manuacturers must understand thedynamics o the shopping environment.



uture, and deliver meaningul innovation

or the shopper.

To understand what motivates and

infuences the shopper, brands must

understand the basics o the shopper:

•Whatdrivestheshoppertogotoastore,

and on what kinds o trips to the store is the

brand likely to be purchased?

• Isthecategoryusuallyadestination,

planned, unplanned, or impulse purchase

and what drives that role?

•Whatarethecurrentpurchasedriversand

barriers in-store?

•Whataretheunderlyingassociations

with the category?

•Whatinformationdoshoppersseekinthe

store, specically?

•Howdoshoppersselectandde-select

options and what are the decision

hierarchies?

•Howdoshopperswanttointeractwith

products? What interaction do they need?

•Howdoshoppersorientthemselvesinthe

category? In the store?

Note that these things should be considered

at both a category and brand level. Brands

must careully balance their own interests

with those o the retailers that sell their

products. Understanding the total category,

and how the brand can best perorm within

it, will ensure that brand marketers can

orward their own objectives while retaining

perspective on the needs o the retailers. I

brands can deliver perormance in-store or

both their brand and the retailer’s category,

partnerships with retailers and the ability orbrands to infuence the store environment

will become stronger.

Incorporating strategic objectives o

the brand

In addition to understanding shoppers,

brands must also be clear about what they

want to achieve with shoppers. Knowing the

priority strategy or the brand and category is

the second leg to unlocking value in the store

environment. Strategies or the brand might

be things like:

•Promotingtrial

•Facilitatinggreaterpurchasefrequency

•Encouragingtradeup

•Addingorincreasingmarginvariants

•Motivatingmulti-productroutines

Putting it all together

The marriage o shopper insights with in-

store strategy can lead to the construction

o in-store solutions that increase shopper

satisaction while orchestrating protable

purchase behaviors. In our experience at

Interbrand, brands that have done this in

retail have seen signicant gains.

One o our clients, Procter and Gamble,

consistently utilizes shopper insights to

create store solutions that successully grow

the objectives o their brands. Its eorts have

paid o in a number o categories, in terms

o increased share and volume, and have also

helped to establish P&G as a thought leader

and a key partner to retailers.

In another example, a big-box, North

American retailer instantly saw category

increases in the range o ve percent in

revenue, as well as units within a commonhousehold product category in test markets,

ater a relatively simple shel and category

reorganization built on shopper insights.

In act, because the in-store environment

is so requently overlooked or under-

examined, the opportunity or gains, even

based on relatively simple solutions, can

be signicant. Extracting more value with

little to no incremental investment is always

a good idea. And considering the current

environment,forsomeFMCGplayersand

retailers, it might mean survival.

So, brands must get to know shoppers,

not just consumers. In-store should be

treated as an input to brand strategy. The

store environment is a brand opportunity,

not just a point o tactical operations.

As the competition or share and loyalty

continues to get more intense, brands that

manage the shopper aspect o their brand

put themselves in a position to dierentiate

and create meaningul value as a brand and

retailer partner. ■

Creating value in-store: Understanding and proting rom the dierences between shoppers and consumers Interbrand | Pg. 4



Creating and managingbrand valueTMinterbrand.com

Kelly Crouch

As Brand Analytics Director, Kelly guides

the integration o analytics programs and

ensures insights are represented within

strategic and creative outputs. Kelly’s

analytics expertise includes the design and

interpretation o research or brandingpurposes, delivery o retail insights,

creation o business cases and decision

rameworks, and ensuring clear links

between brand and business strategy. The

American-born Kelly now lives and works in

Amsterdam.

Emily Grant

As Senior Consultant in the Analytics

group at Interbrand, Emily Grant conducts

research and provides strategic guidance on

projects across a variety o sectors. She has

worked on engagements or a number o

high prole clients.

28 Creating Value

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