By Larry Levin
During the past few years, the grocery store perimeter has been evolving to accommodate the changing food needs and preferences of today’s consumers. Closely connected to their devices, people no longer shop or even plan to shop the way they did just a few short years ago. CPG retailers and manufacturers that incorporate shoppers’ preferences into their marketing and advertising strategies can ensure more successful campaigns that contribute to top-line growth.
The Power of Digital Communication
Some staggering facts:
- Consumers now spend an average of six hours per day online
- 48 percent say they are “unable to function” without their smartphone
- 45 percent say they are early adopters of technology
When it comes to shopping, consumers often jump online first – whether for reviews, inspiration, or merely to browse deals. In fact, according to recent IRI data, almost 50 percent of all consumers search for coupons and promotions from a coupon, retailer or manufacturer website, demonstrating not only their quest for value, but their desire to access it digitally.
For these reasons, having a strong and integrated online presence is no longer an option, but, rather, it is vital – especially for retailers, who serve as the jumping-off point of communication as consumers begin their shopping planning.
Social Media and Millennials
It’s impossible to talk about digital and not include social media. It plays a big role in “setting the table,” though its influence is stronger in certain areas than others. While social media is a less influential factor in shopping planning, it is a critical partner in education and meal planning; the information consumers collect on social platforms help them make purchasing decisions when they’re in the store.
When it comes to shopping planning, millennials are clear digital trailblazers, with more than 25 percent looking up recipes online prior to making a purchase. Millennials are also very value conscious, with more than one-third comparing prices – either at home or in- store – before making a purchase.
Linking Digital and Traditional Media
While digital connectivity is critical for sharing content, tried and true techniques should not be forgotten. In general, 75 percent of shoppers claim to use online resources at least as frequently as they have in the past. But, about 50 percent of all shoppers still use newspapers, store circulars and magazines to plan their shopping. Traditional methods remain relevant and companies should not forego them altogether. The goal is, of course, getting traditional and digital to work together seamlessly. It is our opinion that “paper planning” will not “go the way of the dinosaur” until Gen Z is fully engulfed in the shopping process. This generation will be the first to be completely “clicked” and it seems that only then will traditional methods will be striving for relevancy.
Impact of Pre-Shopping
Everyone’s time is limited. Overall, more than 60 percent of consumers say they do less than 30 minutes of prep or planning before shopping – and 11 percent do no planning at all! This indicates a very narrow window of time for brand messages to reach consumers and make an impact before shopping begins.
Some perimeter categories, including meat and poultry, have similar levels of “pre-tail” activity as do the center aisles of the store. Demographically, more millennials use digital pre-tail than shoppers ages 35 or older. Although 81 percent of meat and poultry buyers report making a list before a shopping trip, 90 percent do not include a specific brand. This represents a clear opportunity to create a distinction between brands.
To better understand consumers and their shopping and digital preferences, IRI has segmented them based on how they engage online via our DigitaLink segmentation. The “Digitize Me” group is the most digitally savvy segment and makes up 25 percent of U.S. consumers. They are much more heavily involved in leveraging devices for their entire shopping activity. However, they don’t only care about digital – many of them still prefer some form of traditional communication, making it important for manufacturers and retailers to find the right balance between digital and traditional media to communicate wisely and effectively.
The Winning Recipe
Given consumers’ limited time, the opportunity to connect with and engage shoppers is limited as well. To win with connected consumers, retailers and manufacturers should:
- Create compelling digital content that will make consumers’ lives easier. This can include helping guide them to the right aisles in the store quickly to ensuring that they get offers for categories they regularly buy.
- Work together. When manufacturers and retailers create effective partnerships, both parties win.
- Invest in social media marketing and capabilities, as this is a powerful way of influencing millennials’ purchase behavior.
- Understand how to leverage the influence of the Digitize Me segment for sustainable growth. This segment wants and expects digital content, and they want it to be fun and engaging but not intrusive.
Want to learn more about IRI’s shopper segmentations and/or how consumers are shopping the perimeter? Check out our webinars on this topic and/or email me at Larry.Levin@IRIworldwide.com.