Shopper Research

Understanding shoppers behavior

Page 1

AGENDA
WHAT IS SHOPPER RESEARCH? WHY DO WE NEED TO STUDY SHOPPERs ? DECOMPOSING SHOPPERS DECISION MAKING CASE OF HAND AND BODY LOTION HOW WE CONDUCT SHOPPER STUDY?

Page 2

What prompts my desire or need to shop?

Dont buy the one we got last time...i want a healthier one.

Honey, were out of cereal...

Where do I choose to shop?

Each decision is framed in its own way.

They sell natural and organic foods there and the check out lines arent long

But which store?

And now Ive chosen which store.....

How do I react to the environment within?

The aisles are well marked. At least I can find the cereal aisle easily and be in and out!

Finally.... Im in the aisle. How do I make my choices?

Whole grain? Organic? We havent tried this before...its good they have a small pack, let me get it
Buy me! Buy Buy me! me! Buy me! Buy me! Buy me!

Ive got 5 minutes before Im due to pick up the kids...

The shopping process takes the consumer through several decision stages.
If I buy the cereal, I get Rs. 12 off on the Biscuits. Ill get those as well.

Do these work in synergy for your category and brand?

Despite doing Pre-launch research, spending so much in Advertising, Channel commission Why my Brand is NOT taking off ???

Biscuits purchased on impulse planned cereal purchase : brand leaped off the shelves and induced switching

What is Shopper Research?

Understanding how ones target consumers behave as shoppers in different channels and formats, and leveraging this intelligence to the benefit of all stakeholders, defined as brands, consumers, retailers and shoppers

WHY TO STUDY SHOPPER ?

More than 70% of purchasing decisions are made in-store Different modes of shopping and each has a subtly different set of requirements in-store Most shopping is significantly influenced by habits, conditioning and culture Without any emotional influence, the working memory discards and forgets information in less than 18 seconds Shoppers use multi-sensory cues with which to evaluate and select or reject products Shopper are increasingly in auto-pilot /grab n go mode
8

HOW DO SHOPPERS BEHAVE?

Shoppers dont waste huge amounts of energy on everyday shopping decisions They use Heuristics to make quick decisions As people spend more time in the store, they become more purposeful, less likely to explore, and more likely to grab their familiar products. After getting "virtue" categories (essentials), shoppers are more likely to head over to locations that carry "vice" categories (indulgences) Difference in Behavior when shopping alone than when shopping in groups. They Bundle Products[ BEER & DIAPER ]

Page 9

key to reaching shoppers lies in understanding that the auto-pilot mode does get disrupted
by external stimuli Shoppers move into the experimental mode your window of opportunity

Page 10

Lets Start DIAGNOSIS

Page 11

DECOMPOSING SHOPPERS DECISION MAKING

Source : Nielsen

Page 12

A CASE OF
HAND & BODY LOTION CATEGORY

HOW DOES IT HELP A MANAGER ?

Page 13

decode

shopping modality

discover
specific category dynamics
(compared to cross category norms)

unique shopper mode segments whats hot and whats not?

uncover

channel
synergy

leverage
unseen channel potential

uncover

brand
synergy

unlock
unrealized brand opportunities
Page 14

decode

category shopping modality

Page 15

Where does your category map on the Involvement-Experimentation grid?

high traction super slippery

INVOLVEMENT

Involvement : How involved are the consumers in brand choice evaluation?

super traction

slippery

Experimentalism : Do they shop on grab & go auto-pilot mode or do they experiment with different brands and engage in scrutiny shopping?

EXPERIMENTATION

Source : Nielsen
Page 16

Category Typology : Involvement vs. Experimentation

high traction super slippery

INVOLVEMENT

Toothbrush

32.0

Shampoos and Conditioners

Deodorant Toothpaste Hand and Body Lotion

Hand & Body Lotion is a super slippery category must keep shoppers engaged or they can defect to other brands or stores

27.0

Razors and Blades for Men Bar Soap

Body Wash

22.0

Razors and Blades for Women

17.0

Liquid Hand Soap

12.0 10

super traction
15 20 25 30 35

slippery

EXPERIMENTATION

40

Source : Nielsen
Page 17

What are the strategic implications?

INVOLVEMENT
high traction super slippery Constantly keep consumers engaged to ward off threat with advertising, buzz, new introductions, packaging and exciting promos

Dont cut back on ad spend even if share trends are stable. If your consumers defect, it is an uphill battle to win them back.

Challenging to displace brand leaders. If you are the leader, avoid radical brand repositioning which may disrupt auto-pilot mode. Weaker competitors can make lots of noise but it will fall on deaf ears. super traction

While they dont care much about the category, they experiment. Price and promos can easily tip them over.

slippery

EXPERIMENTATION
Source : Nielsen
Page 18

Hand & Body Lotion

impulse

purchase triggers
Hand & Vs In-store Body norm Lotion Diagnosis Checked prices 27 Shoppers of hand & body lotion Promotion 14 arespecial promotion On more impulsive, leaving 13 manufacturers and retailers 3 with Special display a chance to increase sales. 22 Pack-induced browsing Browsed through several 19 Read opportunity Thispack/ingredients is dependent 18 Attractive pack upon the level of shopper 5 Pack stood out 4 engagement with the product and New brand/variant 10 purchase activation Signage/poster 2 Out of stock 1 Pre-store Habitual same as usual 37 Recently advertised 6 Used coupon 13 Spouses preference 6 Kids preference 2 Friend/rel recommendation 3

Impulse purchase (decision to buy category taken in the store) : 27% If shoppers are engaged, opportunity for incremental sales

activation
New Product Activation : High Impact Promotion Activation : High Impact

Buzz Index

204

(indexed to personal care categories)

Source : Nielsen

Page 19

Hand & Body Lotion

impulse

purchase triggers
Hand & In-store Body Lotion Diagnosis Checked prices 27 Due to Promotion consumers high 14 On special promotion involvement with the category, 13 Special display 3 they are highly tuned-into the Pack-induced browsing very much 22 category and are Browsed through several 19 aware of new products/ variants Read pack/ingredients and promotions that are 18 Attractive pack 5 introduced. Pack stood out 4 By manipulating these factorsNew brand/variant 10 with new, innovative Signage/poster 2 introductions and/ or attractive Out of stock promotions- manufacturers 1 and Pre-store retailers can achieve increased Habitual same as usual 37 sales as shoppers will continue Recently advertised 6 to coupon be engaged with the category. Used 13 Spouses preference 6 Kids preference 2 Friend/rel recommendation 3 Vs norm

Impulse purchase (decision to buy category taken in the store) : 27% If shoppers are engaged, opportunity for incremental sales

activation
New Product Activation : High Impact Promotion Activation : High Impact

Source : Nielsen

Page 20

Hand & Body Lotion

impulse

purchase triggers
In-store Checked prices Promotion
On special promotion Special display

Diagnosis Impulse purchase (decision to buy category The key to taken in the store) : triggering 27%
If shoppers are engaged, opportunity lotion lies in grabbing for incremental sales

purchases of hand & body consumers attention.

Pack-induced browsing
Browsed through several Read pack/ingredients Attractive pack Pack stood out

Attention is focused most ctivation heavily on reading packs and Newconsidering ingredients, so Product Activation : Highwe must clearly associate the Impact brand with consumers desired product Promotion Activation : attributes.
High Impact

The regular introduction of new brands/ variants, will generate Buzz Index buzz and interest 204 (indexed to personal care categories) thus among consumers, and fuel increased purchases.
Source : Nielsen

New brand/variant Signage/poster Out of stock Pre-store Habitual same as usual Recently advertised Used coupon Spouses preference Kids preference Friend/rel recommendation

Hand & Body Lotion 27 14 13 3 22 19 18 5 4 10 2 1 37 6 13 6 2 3

Page 21

Promotional Activation
25

high impact

Promos do engage shoppers and activate purchase

PROMOTIONAL ACTIVATED CHOICE

Liquid Hand Soap Toothpaste Body Wash Hand and Body Lotion

Toothbrush Deodorant Razors and Blades (NET) Shampoos and Conditioners

20

Bar Soap

15

low impact
6

PROMOTIONAL ACTIVITY (% sales on promotion)

11

16

Source : Nielsen
Page 22

New Introduction Activation

55

CONSUMER PERCEPTION OF CATEGORY INNOVATION / CHANGE

50

high impact Razors and Blades (NET)

Shampoos and Conditioners Body Wash

45

Hand and Body Lotion

40

Toothbrush Toothpaste New introductions catch attention in the category

35

30

Deodorant

25

Note: Outlier
20

Bar Soap
15

Liquid Hand Soap

low impact
25 30

15

20

Source : Nielsen

CATEGORY CARDIO (% new skus introduced in past 2 years

Page 23

Hand & Body Lotion

INSIGHTS

The highly involved and experimental nature of shoppers makes it a precarious category that requires much attention on the part of manufacturers to keep consumers engaged. Shopper interest and purchase is peaked by new introductions, promotions, outside recommendations (buzz) and strong pack designs. Each of these marketing activities should support a strong product positioning that clearly identifies key, desirable product attributes, which, in turn, will encourage shopper engagement with the category and lead to incremental sales opportunities.

Page 24

decode

shopping mode segments

Page 25

Shopping mode segments

Trendsetters

11%

Uninvolved Auto-pilots

23%
Deal Seekers

17%

22%
Engaged Browsers
Source : Nielsen

27%
Discerning Auto-pilots

Page 26

Shopper engagement
uninvolved autopilots (23%) discerning autopilots (27%) engaged browsers (22%) deal seekers (17%) trendsetters (11%)

auto-pilot

experimental

enjoy shopping for Hand & Body involvement Lotions?

Low involvement

High involvement

Med-High involvement

Med involvement

High involvement

No

Somewhat A lot

Somewhat

A whole lot

impulse purchase incidence

Low impulse

Low impulse High Impulse

Med Impulse

High Impulse

Source : Nielsen

Page 27

Shopping modes & Triggers

uninvolved autopilots (23%) discerning autopilots (27%) engaged browsers (22%) deal seekers (17%)

Least Challenging & Most diff. to retain trendsetters (11%)

auto-pilot

experimental

Kids preference Buy the same one

Buy the same one

Spouse preference

Coupon

Coupon Advertising Friends recommendation Spouse preference Kids preference In-store promotion Visual pack appeal Read description New brand / variant Tested lotion on skin Smelled lotion Special display Merchandizing

pre-store

Checked prices in-store

Read pack label Browsed several Smelled lotion New brand / variant

In-store promotion Checked prices

Source : Nielsen

Page 28

Channel & Mission

uninvolved autopilots (23%) discerning autopilots (27%) engaged browsers (22%) deal seekers (17%) trendsetters (11%)

auto-pilot
channel $store Club Mass $store Entertainment Non-food Season change winter Needed a smaller bottle for travel / carrying in bag Had an urgent need for lotion at that moment and didnt have it Felt dissatisfied with the current lotion Grocery Pharmacy Special Offer Restock Season change winter

experimental
Pharmacy $ store Entertainment

shopper mission

Restock

Restock

Source : Nielsen

why lotion purchased?

Replenish lotion stock at home Replenish lotion stock at office

Replenish lotion stock at home Replenish lotion stock at office Someone at home requested it

Season change winter Pampering self Felt dissatisfied with the current lotion Saw a new lotion type

Page 29

How do shopping modes and decision rules intersect?

uninvolved autopilots (23%) discerning autopilots (27%) engaged browsers (22%) deal seekers (17%) trendsetters (11%)

decision rule segments

auto-pilot Everyday non greasy Special Needs Special Needs Indulgent Therapeutic

experimental Indulgent Naturals Therapeutic

therapeutic
decision rule segments
driven Therapeutic by rules focused on restorative and replenishment benefits

non-greasy
looking for an everyday lotion, vetoing on greasiness, consistency

naturals
driven by Special Needs rules focused on natural, gentle, nonartificial products

indulgent
decision rules focused on pampering and scent, other indulgences

special needs
more restrictive rules based on a special skin condition or need, reducing consideration set

Source : Nielsen
Page 30

Rules & Moments of Change

uninvolved autopilots (23%) decision rule segments discerning autopilots (27%) engaged browsers (22%) deal seekers (17%) trendsetters (11%)

auto-pilot
Non-greasy Special Needs Too expensive Special Needs Therapeutic Dont want one with fragrance Consistency is too thin / watery Not suitable for sensitive skin Previous bad experience Out of stock Someone in family liked it Indulgent Therapeutic

experimental
Indulgent Naturals Does not look like a premium product Looks like a prescription product Dont like the way it feels on the skin Dont like fragrance Previous bad experience Came up in conversation Recommendation Advertising Someone in family liked it Merchandizing Tried it at someones home / office Internet blog

veto rules

Looks like a prescription product

Too expensive

Out of stock Need moments

Out of stock Pack caught attention

Coupon In-store promotion

Source : Nielsen

Page 31

Assortment
uninvolved autopilots (23%) discerning autopilots (27%) engaged browsers (22%) deal seekers (17%) trendsetters (11%)

auto-pilot
brand Suave Private label Vaseline Lubriderm Gold Bond Cetaphil Suave Aveeno Olay Neutrogena Private label Dove

experimental
Dove Curel

fragrance

Fragrance Free

Fragrance Free Aloe

Fresh / clean Nuts & Spice Cocoa Butter Ultra healing Tanning Replenishing / nourishing Aroma therapy Travel Small Medium size Tube

Cocoa Butter Citrus

Fruit Nuts& spice Herbal Fresh / clean Firming Skin smoothing Age defying Aroma therapy

Everyday moisturizing Extra moisturizing UV protection Large

Medicated / sensitive skin Extra moisturizing Replenishing / nourishing skin X- Large

size

variety

Ultra healing Tanning

Large

pack

Bottle with pump

Tube

Source : Nielsen
Page 32

Opportunity : Incremental sales and profitability

Weak price veto rules profitability opportunity

discerning auto-pilots
Steady revenue stream for more premium offerings. Not easily swayed by cheaper prices or promos in other stores

Incremental sales opportunity

trendsetters

engaged browsers

deal seekers uninvolved auto-pilots

Low category impulse High category impulse
Page 33

Strong price veto rules

incremental sales opportunity

Source : Nielsen

uncover

channel

Page 34

Shopper Missions Defined

Re-stock Immediate Intermediate Special Offer Entertainment

To re-stock my home

A routine shopping trip to buy items for TODAY To get an urgently needed item or two quickly To get readyto-eat items to eat/ drink right away or before I return home

A routine shopping trip to buy items for the NEXT DAY or TWO To get items needed for a MEAL that will be eaten today or tomorrow

To take advantage of a special offer

To purchase a non- food item

Page 35

Pharmacy

Page 36

Pharmacy | Shopping mode segments

High category impulse Incremental sales opportunity

engaged browsers

trendsetters

uninvolved auto-pilots

deal seekers
Pharmacy Leverage trendsetters & deal seekers

Low category impulse

Source : Nielsen

discerning auto-pilots

Opportunity : Could attract engaged browsers by making the shopping experience more engaging

Pharmacy

Page 37

Grocery

Page 38

Grocery | Shopping mode segments

High category impulse Incremental sales opportunity

engaged browsers

Threat : deal seekers make channel profile vulnerable. They can switch channels if they find better deals elsewhere. Opportunity : Attract discerning auto-pilots on restocking mission to drive steady stream of profitable revenue. Attract engaged browsers / trendsetters by offering trendy products and making the shopping experience more engaging.

trendsetters

deal seekers uninvolved auto-pilots discerning auto-pilots Grocery

Low category impulse

Source : Nielsen

Page 39

uncover

brand

Page 40

Promotion activation
In-store Promotion activated choice
high impact

Curel Lubriderm Olay

Dove

Jergens

Private label Suave Neutrogena

Vaseline Aveeno Gold Bond

Nivea

Eucerin
low impact

Promotional activity (% sales on in-store promos)

Page 41

HOW To DO IT ?

Page 42

Common Methods Used

Accompanied shopping Unaccompanied shop In-store interviews Post purchase analysis Eye Tracking

Page 43

TO SUM UP

A deep understanding of key shopper insights help managers to make brilliant use of all assets which shoppers see our brands, packages, equipment, merchandising, pricing and messaging which convert a shopper into a buyer

Page 44