By Mike Boland, Consumer Shopper Analytics Director
Like most teams in any business, my team started the year with an annual planning session to align on and build a plan for our 2020 initiatives. Being the dawn of a new decade, we kicked off this year’s session discussing how to be more agile in our Volatile, Uncertain, Complex, Ambiguous (VUCA) world, and the colour Pantone 19-4052 Classic Blue.
Colour, of course, is a far less important attribute in most FMCG categories than in say the automotive, fashion or white goods sectors, but I thought it made sense for our team to spend a few minutes talking about this particular colour as we envisaged the year ahead. Each year, the American company Pantone selects a colour that is somehow meant to be a statement of cultural zeitgeist. According to the Pantone website, Pantone 19-4052 Classic Blue is meant to “instil calm, confidence, and connection” and “highlight[s] our desire for a dependable and stable foundation on which to build as we cross the threshold into a new era.” I mean, how good would it be if we could rely on the cultural insight of a single colour attribute to better understand key FMCG shopper groups?
This conversation at our team planning session, of course, happened before the COVID-19 pandemic and the profound impacts it’s had on lives and economies around the world. Even as we discussed the VUCA world, we never imagined the year 2020 playing out as it has thus far, and that we’d actually find ourselves looking for connection and going back to basics in so many different ways.
As the pandemic began to take hold in one country after another, we saw fear and anxiety set in. Shoppers started making fewer, larger grocery trips and stockpiling the “basics” – pantry staples/essentials and cleaning/sanitising products. With this came disruptions to on-shelf availability, disruptions to business and many of our long-built autopilot shopping behaviours. In some instances, these disruptions resulted in a new openness to brand and product alternatives.
Technology as an enabler
One of many fascinating things about this pandemic has been how an accelerated adoption of technologies helped enable multiple facets of our work and personal lives as large sectors of the economy shifted into “hibernation”. Never before in history would it have been possible for our homes to so effectively become the centre of almost every aspect of our lives. New technologies changed the way we consume media, enabling many of us to binge watch Tiger King
while in lockdown.
Technology also enabled us to school children from home and to communicate and collaborate with friends, family and colleagues. At the start of the year, I never would have imagined regular Zoom meetings with my 75-year-old mother back in Detroit.
Yet what we all soon learned was that whilst technology was a great enabler, it wasn’t a replacement for so many of the things we traditionally enjoyed. Catching up with friends, sharing a meal or watching our favourite performers just wasn’t the same in the virtual environment. Most of us, however, have come to adopt and accept new technologies and social distancing as parts of our “new normal”.
Australians going back to basics in lockdown
Humans are indeed creatures of habit, but we are also incredible in our ability to adapt and innovate. As we were adjusting to lockdown, Australians leveraged technology to connect and communicate. In April, we surveyed the 13,000 member IRI Shopper Panel, which is representative of Australian households. Of those that responded, 46% were spending more time on social media, and 47% were having more phone/video calls with friends & family. By May, these percentages had dropped to 33% and 31%, respectively. Over that same period, many Australian households went back to basics, spending their time enjoying more of the simple pleasures in life with 29% reading more often, 31% doing more craft & DIY projects and 34% getting outside more often for hikes and walks. Even with access to endless streaming digital content, nearly 1 in 5 Australian households have been spending more time on fun family activities together, such as game nights. With limited out of home eating occasions, it’s also no surprise that 34% of households are now spending time baking and 26% of households creating meals from scratch more often than before.
The question, of course, is whether these “back to basics” behaviours will continue (or for how much longer) as we move into the next phase of the pandemic. Amongst those households that started creating more meals from scratch, 2 in 3 said they would continue to do so more often than they did before Coronavirus. When asked about returning to restaurants, movie theatres/entertainment venues or attending social gatherings -- at least half said they would wait a few weeks or longer beyond when restrictions eased.
Going back to basics to understand Australian shoppers
As a relatively new Australian citizen, I have never felt so lucky to be living in this country. We have effectively smashed the curve and 82% of us believe that the Australian government’s response to the pandemic was “about right”, up from 64% in April. Australians also understand that this is a marathon and not a sprint. The threat of a second wave is still a very real possibility as we move into winter -- 76% of us believe that the economic impact of COVID-19 is likely to last more than 12 months.
With Australia now facing its first recession in 29 years, it has never been more important to understand shoppers in order to provide the right value proposition and deliver on their needs. Unfortunately, understanding shopper wants and needs cannot be achieved through uncovering a shopper zeitgeist via a single product attribute like the colour Pantone Classic Blue. The reality is no category, brand or retailer has a single shopper type. Winning shoppers and growing your brands during the best of times -- and even more so in challenging times -- requires going back to the basics of shopper research.
IRI leverages multiple datasets and analytic approaches to understand shoppers to better inform strategies for growth across price and promotion, range and above the line marketing investments. Successful brands and retailers need to be able to differentiate their different shopper types, understand their needs and quantify their sales contribution in order to prioritise initiatives.
Longitudinal purchasing information from Australia’s largest shopper panel provides one of the most powerful resources for developing a deeper understanding of who your shoppers are, how they shop, and what’s important to them. IRI technologies enable us to efficiently mine the on-going purchases of 13,000 households and classify shoppers based on specific purchasing behaviours.
Going back to basics with long standing analytic approaches such as using household purchase information to create Heavy/Medium/Light or New/Lapsed/Retained segmentations can provide foundational shopper understanding to guide, size and prioritise category and brand initiatives in the wake of COVID-19.
Analysis of purchasing behaviours can be further enriched by integrating the values, opinions, and attitudes of these key shopper groups to overcome the universal challenge of shopper research – that what shoppers say they do is not always what they actually do. The ability to interact with actual brand and category buyers via the IRI Shopper Panel provides clear visibility of a brand’s competitive advantages and key vulnerabilities through uncovering the product attributes that are most important to shoppers – be it packaging, ingredients/formulation, flavour, provenance, etc. – and how your brand performs against these multiple attributes.
This vital understanding of attribute importance and performance across those shopper groups -- you must retain or need to win -- provides the ability to confidently improve product propositions, inform packaging and new product development and to ultimately communicate authentically with shoppers to grow mental availability.
For information on how IRI can leverage product attributes to decode conscious and unconscious shopper decisions or inform your assortment and retail planogram decisions, visit iriworldwide.com.au or contact us at +61 2 8789 4000.
|Mike is the Consumer Shopper Analytics Director for IRI Asia-Pacific. Over the last 20 years, Mike has leveraged his strategic consumer, shopper and market research experience to support global, local and multi-national clients across the FMCG, Retail and Automotive sectors.