By David Page, Media Center of Excellence, IRI
During my life so far, I’ve used or observed a variety of tools to measure. The ruler, which is a classic. The yardstick or, as I like to call it, a ruler on steroids. The measuring tape – just be careful when it rolls back up, ouch! The laser (for the serious or professional measurer). And my latest personal favorite: my wife using her outstretched arms to determine whether a table will fit in a room. (It’s now a proven method of measurement in our home.)
What about your shopper marketing programs? Are you measuring them and using the right tool? The role of shopper marketing has evolved, and I think most of us will agree that doing it right it is vital to brand growth. The significant amount spent on shopper marketing each year, currently around 13% of CPG marketers’ budgets according to Cadent, demands a clear understanding of its performance. If you can’t reach the right set of consumers, drive them to the shelf to make a purchase, your brand will be at risk. You may lose shelf space or even be delisted.
What is shopper marketing? It’s those marketing initiatives focused on the shopper right at that crucial moment of truth – the point of purchase. When programs are working the way they should, the buyer is being driven to a specific retailer. Shopper campaigns are typically those shorter activations often centered around key buying times such as back-to-school, holidays, spring cleaning, or other events that may be relevant to certain buyers at a given time. In digital, these will often be co-branded activations with a specific retailer or set of retailers highlighting retailer-specific deals or product availability.
Matched market (or matched store) testing, fueled by an ANCOVA-based methodology, is a proven sales lift measurement tool to help quantify campaign effectiveness, particularly for shopper marketing campaigns. A test-and-control approach measures sales lift between exposed versus non-exposed markets at the store level. By leveraging point-of-sale data, the ANCOVA model analyzes causal data such as pricing, distribution, merchandising, brand advertising and competitive effects, then works to isolate the media treatment. When successful, meaning when statistical significance is reached, a positive sales lift can be detected and quantified.
Here are four elements you need to consider when planning your shopper marketing programs to help drive a positive sales lift:
- Targeting – Are you exposing the media to the right audience? If you’re promoting diapers to DINKS (double-income-no-kids) or empty nesters, the results will be underwhelming.
- Creative/messaging – Is it compelling? Does the creative capture the eye? Is there an incentive to buy? If so, will it not only drive the consumer to the aisle but also influence them enough to buy the featured brand over a competitor’s?
- Feasibility – Is the campaign a good candidate for measurement? Product sales and distribution at the retailer of interest, along with the length of the campaign and impression levels, are considered when determining candidacy.
- Brand Presence and Health – The size of the brand, its presence in the marketplace and current health (both for the brand and the category) can all play a role in measuring sales lift.
It’s important to realize that, while matched market/matched store testing is an effective tool for measurement, there are some granularity limitations. The results will include high-level sales uplift, incremental sales and, when spend is provided, a short-term calculated return on ad spend (ROAS). Consumer or specific marketing insights are generally not available with this type of measurement.
Understanding the various factors that result in shopper marketing program success (or not) can help marketers form a more effective strategy and properly set expectations for post-campaign sales lift measurement.
Want to learn more about best practices for matched market/matched store testing? Contact your IRI representative or reach out to us at IRIMedia@IRIworldwide.com. We’d be happy to give you additional tips to get the most out of your shopper marketing programs.