Beyond Redemption: Digital Shopper Marketing 2.0 April 13, 2011 - PowerPoint PPT Presentation

Beyond Redemption: Digital Shopper Marketing 2.0 April 13, 2011 Blog: smartretailmedia.com Twitter : ShopperMedia 1

Intro to Speakers • Dan Frechtling VP Client Solutions • Joe Battoe VP Shopper Marketing Blog: smartretailmedia.com Twitter : ShopperMedia More : www.smartretailmedia.com DRAFT 2 2 2 1/26/10

What do these 4 images have in common? Blog: smartretailmedia.com Twitter : ShopperMedia 3

Digital + Gaming? First Digital Video Game 1952 Blog: smartretailmedia.com Twitter : ShopperMedia 4

Digital + Gaming! Blog: smartretailmedia.com Twitter : ShopperMedia 5

Digital + Film? First CGI Animal 1986 Blog: smartretailmedia.com Twitter : ShopperMedia 6

Digital + Film! Blog: smartretailmedia.com Twitter : ShopperMedia 7

Digital + Publishing? First New York Times homepage 1996 Blog: smartretailmedia.com Twitter : ShopperMedia 8

Digital + Publishing! Blog: smartretailmedia.com Twitter : ShopperMedia 9

Digital + Mobile? First mobile phone 1983 Blog: smartretailmedia.com Twitter : ShopperMedia 10

Digital + Mobile! Blog: smartretailmedia.com Twitter : ShopperMedia 11

First Generation (1G) Make animals look Simulate a paper photo-real game with pixels Re-creates Provide desktop Enable a phone to news content travel Blog: smartretailmedia.com Twitter : ShopperMedia More : www.smartretailmedia.com DRAFT 12 12 12 1/26/10

Second Generation (2G) Merge fantasy Let players become and reality the controllers Creates Complete any e-task Add new with one handheld experiences to news Blog: smartretailmedia.com Twitter : ShopperMedia More : www.smartretailmedia.com DRAFT 13 13 13 1/26/10

What does this have to do with digital shopper marketing? Blog: smartretailmedia.com Twitter : ShopperMedia More : www.smartretailmedia.com DRAFT 14 14 14 1/26/10

Digital Shopper Marketing is Starting a 2G Transition On this trajectory: 2G E-Circulars • Digital Coupons • Social media • Adoption In-store media • Targeted display • 1G Mobile vehicles • … • Time Blog: smartretailmedia.com Twitter : ShopperMedia 15

Examples today Today (approx) On this trajectory: 2G E-Circulars • Digital Coupons • Social media • Adoption In-store media • Targeted display • 1G Mobile vehicles • … • Time Blog: smartretailmedia.com Twitter : ShopperMedia 16

Objectives 1. Understand 2G digital shopper marketing 2. Know how to use it more effectively Media reviewed • E-Circulars • Digital Coupons • Social media Blog: smartretailmedia.com Twitter : ShopperMedia More : www.smartretailmedia.com DRAFT 1/26/10 17 17 DRAFT 17 17 1/26/10

2G Principles Blog: smartretailmedia.com Twitter : ShopperMedia 18

2G Principles right offers to the right behaviors Blog: smartretailmedia.com Twitter : ShopperMedia 19

2G Principles auto-adjusting campaigns Blog: smartretailmedia.com Twitter : ShopperMedia 20

2G Principles helpful product/ service suggestions Blog: smartretailmedia.com Twitter : ShopperMedia 21

2G Principles value realized in fewer steps Blog: smartretailmedia.com Twitter : ShopperMedia 22

2G Principles right offers to the right behaviors Blog: smartretailmedia.com Twitter : ShopperMedia 23

Different Interpretations (Anagram Example) DIRTY ROOM DORMITORY College student Parent THE MORSE CODE HERE COME DOTS Naval communicator Layman ELECTION RESULTS LIES – LET’S RECOUNT Winning candidate Losing candidate Blog: smartretailmedia.com Twitter : ShopperMedia 24

1G E-circulars Prompt people into the store to buy more. • Feature weekly or seasonally promoted products • Promote launched or re-launched items • Localize product presentations based on store traits • Accentuate underperforming departments • Organize content for pre-trip searching and list making Blog: smartretailmedia.com Twitter : ShopperMedia 25

2G E-circulars Use targeting to more naturally stimulate purchases • Expand purchases of popular products • Cross -sell complementary products • Re -activate lapsed product buyers • Align with individuals’ purchase cycles Blog: smartretailmedia.com Twitter : ShopperMedia 26

2G E-circular Case Example Post Email vs. Pre Email Sales Impact Example: 10 recent categories 6.0 Self Care 5.0 Average lift from personalization: 4.0 Pet Food 2.4X Cereal Bars Sales lift 3.0 Chicken Eggs 2.0 Cheese Soda Ice Cream 1.0 Canned Soup 0.0 0% 20% 40% 60% 80% Offers Penetration (%) Blog: smartretailmedia.com Twitter : ShopperMedia Source: DS-IQ 27

1G Digital Coupons Turn around the mass-coupon paradigm Pros: Flip the model from push to pull, as shoppers log in or opt in to offers • Provide basic targeting e.g., past activations, clickstream, and banner/geo • Cons: D on’t distinguish individual buyers • Don’t personalize by product or increment • Blog: smartretailmedia.com Twitter : ShopperMedia 28

2G Digital Coupons Occasionally Stopped Buys novelties buys buying (but not pints) Serve the right offers to the right shopper behaviors. Examples: • Attract new buyers by selecting and targeting those most likely to try • Expand current buyer consumption by increasing frequency and units • Re -activate lapsed buyers such as brand switchers or category defectors Blog: smartretailmedia.com Twitter : ShopperMedia Source: DS-IQ 29

2G Digital Coupon Case Example 1 Identifying shoppers most likely to try 47% Frozen dinner 17% 9% Campaign redemption rate Frozen entrée Brand buyers category buyer from other categories Source: DS-IQ More : www.smartretailmedia.com DRAFT 1/26/10 30 30 DRAFT 30 30 1/26/10

2G Digital Coupon Case Example 2 Increasing loyal shoppers’ buying rate Purchase frequency (mos) Every 2 Single serving meal Every 6 Before During >1 units per purchase 100% 36% Before During (avg 1.8) (avg 4.1) Blog: smartretailmedia.com Twitter : ShopperMedia Source: DS-IQ 31

2G Digital Coupon Case Example 3 An email and mobile coupon program for a major grocer increased trips per week 12% Test 1.59 During campaign Pre-campaign 1.47 Control Pre-campaign Pre-campaign 1.42 During campaign Pre-campaign Blog: smartretailmedia.com Twitter : ShopperMedia Source: Catalina Marketing DRAFT 32 32 32 1/26/10

1G Social Media Self-expression, instantly broadcast • Express affiliation with brands more broadly • Automate word of mouth immediately • Opt-in to news from preferred brands • Join groups with shared affinity Blog: smartretailmedia.com Twitter : ShopperMedia 33

2G Social Media Use targeting to engage passions • Reach emotional loyalists • Engage them in an event they care about • Enable them to share and self-express • Add special insiders-only perks Blog: smartretailmedia.com Twitter : ShopperMedia Source: YOU Technology 34

2G Principles auto-adjusting campaigns 1.Optimizing segments 2.Optimizing offers Blog: smartretailmedia.com Twitter : ShopperMedia 35

Differing Outcomes (Optical Illusion Example) Blog: smartretailmedia.com Twitter : ShopperMedia 36

2G Optimizing Segments 27.3% 18.1% 14.3% 13.5% 13.4% 9.5% 8.7% avg $1 off 2 $.50 $.60 $.60 $.75 $.75 Heavy buyers Light buyers Lapsed brand Brand adj Category Affinity (2 units) category category buyers category Segments buyers buyers buyers Expand brand Convert Generate buyer category non-category consumption buyers buyer trial Blog: smartretailmedia.com Twitter : ShopperMedia Source: DS-IQ 37

2G Optimizing Offer Values Web coupon program for ConAgra and national retailer Test Values Result Save $2.00 Loser New Buyers 12% cost/unit Save $1.75 Winner improvement Blog: smartretailmedia.com Twitter : ShopperMedia Source: DS-IQ 38

What Kind of Personalization? 3 approaches 1. Let shoppers select the kinds of offers they wish to receive 2. Apply collaborative filtering or similar techniques to suggest what similar shoppers have chosen 3. Use individual purchase history to recommend the most relevant offers Blog: smartretailmedia.com Twitter : ShopperMedia 39

Enough Talking About Marketers Blog: smartretailmedia.com Twitter : ShopperMedia 40

2G Principles helpful product/ service suggestions value realized in fewer steps 1. E-circulars 2. Digital coupons Blog: smartretailmedia.com Twitter : ShopperMedia 41

Offer Relevance Loyal Mach 3 user Timing and brand elements enable relevance Right time Wrong brand Schick Hydro Current brand Right time Right brand (upsell) Gillette Fusion Blog: smartretailmedia.com Twitter : ShopperMedia 42

Relevance Surveyed % of shoppers participating in a 2G program who said the offers made them: 42% 36% 30% 10% Switch Try Purchase Stock Up Brands Something More of on Offers New Specific Received Product “ It made me buy the product about a week sooner than I would have…and I’m not sure I would have otherwise bought the two, but I did, because it was relevant to my life.” Blog: smartretailmedia.com Twitter : ShopperMedia Blog: smartretailmedia.com Twitter : ShopperMedia Source: Catalina Marketing DRAFT 43 43 43 1/26/10