Wall Street Journal
By Ellen Byron
Determined to find the best deals, more shoppers are researching their grocery lists online before going to the store. For marketers, that means big changes in how and when they tempt consumers to buy.
In-store marketing—the practice of trying to influence consumers' buying decisions as they shop—traditionally consisted of flashy product displays, special promotions at the end of the aisle and attention-grabbing packaging on the shelf.
It's well known that consumers research expensive products like electronics online, but coming out of the recession, consumers are more scrupulous about researching their everyday products such as diapers and detergent, too. More than a fifth of them also research food and beverages, nearly a third research pet products and 39% research baby products, even though they ultimately tend to buy those products in stores, according to WSL Strategic Retail, a consulting firm.
That has led retailers and brands to target customers via blogs, social-media sites such as Facebook and Twitter and campaigns on retail sites, in addition to in-store campaigns.
Ms. Howell argues that consumers' careful research means the shopping trip now begins long before the shopper enters the store, so store-focused marketers have to move their efforts forward.
Three years ago, just 10% of Saatchi X's in-store marketing projects included an online component, but now "almost 100% do," she says. Likewise, nearly 20% of the firm's revenue comes from digital work, up from less than 5% three years ago.
A 2010 campaign for Procter & Gamble Co.'s new CoverGirl "Smoky Eye Look" makeup kit illustrates the more complex route marketers are taking.
To drum up hype for the product launch online, P&G, with Saatchi X, shipped the packs of mascara, eyeliner and eye shadow to makeup bloggers before they were available in stores. The "Makeup Master" kit also included application instructions, blogging tips, product photographs and a CoverGirl-emblazoned director's chair.
Inside stores, CoverGirl drew attention to its kits with live product demonstrations, its co-branded print ads with Wal-Mart Stores Inc. and cardboard trays that carried the kits on the shelf while highlighting the product's features.
After a purchase, shoppers were encouraged via Facebook and other online campaigns to write a review of the product, thus spreading the word to more customers researching makeup online.
The digital shift is a particular challenge for food and household-product companies, which typically aren't as advanced online as their electronics and apparel counterparts. They have been deterred by the cost of shipping bulky but low-value items like paper towels, detergent and canned soup, especially given the ubiquity of brick-and-mortar stores selling the products for about the same price.
In the weeks leading up to this year's Super Bowl, Saatchi X created a campaign to promote PepsiCo Inc.'s Pepsi beverages and Frito-Lay foods at Walgreen Co. stores. Customers received weekly co-branded emails containing Pepsi and Frito-Lay promotions and Walgreens' coupons. Facebook promotions, online ads and text messages also directed shoppers to the deals, while inside Walgreens stores Pepsi and Frito-Lay products used displays, fliers and in-store radio to tout the specials, too.
"It was a successful campaign both in our stores and online," a Walgreen spokesman said.
Some 62% of shoppers say they search for deals online for at least half of their shopping trips, according to a survey by consulting firm Booz & Co. and trade group Grocery Manufacturers Association.
"It's become a matter of, 'I need six things, who has the best price on them?' " says Candace Corlett, president of WSL Strategic Retail. "It takes 90 seconds to research that online, and that's how shoppers choose the store where they shop." Ms. Corlett says consumers' increased shopping research is driven by improving technology and a more scrupulous shopper. About 80% of women say they pay more attention to price on "just about everything," says Ms. Corlett, citing a WSL shopper survey from last year. That's up from 64% in 2008, she says.
Google Inc.'s user queries for local searches (like store locations), coupons, recipes and product reviews have doubled or tripled year on year, says Kevin Kells, Google's national industry director for consumer-product companies. "Those are just proxies for this more informed, more sophisticated shopper," he says. "The shopper is saying 'I can't really afford to be wrong.' "
Wal-Mart is banking on the trend to accelerate. Lately, it has made its online circulars more user-friendly. It is also developing ways to offer more customizable circulars online, based on a shopper's interests or needs. "If you don't have a pet, your circular won't need to include pet stuff," says Stephen Quinn, chief marketing officer of Wal-Mart.
The retailer has also broadened its use of Facebook and other social media sites. "Over time people will use these [online] tools much in the way they've used media or word of mouth," says Mr. Quinn.
Brands including household goods are reacting by trying to be visible online where deal hunters research. "Buy now" buttons on social media sites like Facebook, product reviews on retailer and manufacturer websites, online circulars, digital coupons, and blogger buzz are now crucial for products to make it on to the shopping list and ultimately into the cart, marketers say.
To be sure, the shift hasn't eliminated the need for effective campaigns inside stores. In-store marketing gained appeal and sophistication amid the fragmentation of television and print audiences, and accelerated during the recession, when marketers believed cash-strapped shoppers made even more purchasing decisions when looking at the store shelf.
But as consumers are starting to open their wallets, companies are more focused than ever on attracting them during their shopping trips: Post-recession, 83% of consumer-product companies say they plan to increase their investments in shopper marketing over the next three years, while 55% say shopper marketing is their top investment, with spending increases topping 5% annually, according to the Booz & Co. survey.
"The reality is marketers have to pull more levers today than they ever had to before. All of us are consuming media in so many different ways—some people are only online, some only watch TV," says Ms. Howell. "The bulk [are] somewhere in the middle, and that's what's making it harder to determine what is the correct formula."
