OUTLOOK
ROAR IN THE TWENTIES WITH YOUR CUSTOMER
Data is a powerful tool in getting to know your customer better .
Being customer-centric should be entrenched in your strategy . It ’ s not a choice . You need to know what your shopper is going to do before they do . This intimate understanding and activation at speed – in-store and online – is critical to successfully connecting with Australians in 2022 . And there are five key insights to get customer-centricity right and roar in the new post-pandemic world .
1 . KNOW YOUR SHOPPER Pandemic or otherwise , shopper behaviours continue to evolve and be disrupted . Fast-changing digital innovations like social e-commerce are colliding with who we are and influencing shopper decisions in the moment . Australians can access an increasing number of product and retail options accelerated by pandemic innovations . In this cluttered landscape , the most effective retail and marketing initiatives are those informed by shopper needs and motivations .
To ascertain shopper decisions , identify why they are leaving a category or brand and / or purchasing less so you can adapt marketing strategies . Equally , ascertaining why shoppers choose one brand or retailer over another will allow you to better curate meaningful messaging and communications . By linking what shoppers say they do to their actual purchase behaviour , you can better measure marketing impact . But don ’ t forget the shopper journey starts with “ when do I need it ?” and , for many , is driven by instant gratification . Availability and shipping information will drive success .
Data delivers more targeted ranges and retail activations Shopper data delivers a broad overview of your customer while retailer data reveals how to nail planning , ranging decisions , instore activations and cross promotions . Accessing longitudinal purchasing information will help you develop a deeper understanding of who your shoppers are , how they shop , and what ’ s important to them . Using IRI technologies will help you more efficiently mine household purchases and classify shoppers based on purchasing behaviours . And given a large proportion of shopping is subconscious , IRI ’ s Shopper Panel can enrich your understanding of what is driving verified purchase behaviours , new product trial and rejection .
Interacting with brand and category buyers clearly highlights competitive advantages and key vulnerabilities . You can uncover the product attributes most important to shoppers , such as packaging , ingredients , formulation , flavour and provenance , and accordingly ascertain how your brand performs . The result is the holy grail of knowing what shoppers will actually do , given it ’ s not always what they say they ’ ll do .
Being customer-centric should be entrenched in your strategy . It ’ s not a choice . You need to know what your shopper is going to do before they do . This intimate understanding and activation at speed – in-store and online – is critical to successfully connecting with
Reimagining retail for the roaring twenties
Australians in 2022 . And there are five key insights to get customercentricity right and roar in the new post-pandemic world .
Data delivers more targeted ranges and retail activations Shopper data delivers a broad overview of your customer while retailer data reveals how to nail planning , ranging decisions , instore activations and cross promotions . Accessing longitudinal purchasing information will help you develop a deeper understanding of who your shoppers are , how they shop , and what ’ s important to them . Using IRI technologies will help you more efficiently mine household purchases and classify shoppers based on purchasing behaviours . And given a large proportion of shopping is subconscious , IRI ’ s Shopper Panel can enrich your understanding of what is driving verified purchase behaviours , new product trial and rejection .
Interacting with brand and category buyers clearly highlights competitive advantages and key vulnerabilities . You can uncover the product attributes most important to shoppers , such as packaging , ingredients , formulation , flavour and provenance , and accordingly ascertain how your brand performs . The result is the holy grail of knowing what shoppers will actually do , given it ’ s not always what they say they ’ ll do .
2 . KNOW YOUR MIX Product mix is a universal challenge . Manufacturers know product availability is key to product selection while retailers hone offerings to maximise baskets and sales . Both groups must understand shopper wants in the right locations and make strategic decisions about category range and shelf layouts . Understanding of product substitutability and loyalty to different products from shopper panel information can provide that blueprint .
Sorting the assortment Assortment optimisation uses store-level sales data to inform SKUlevel decisions – but there is a significant shift in how companies view product assortment . The push strategy that moved a set of products into all stores is no longer viable . Effective assortment optimisation is now driven by a pull strategy , which identifies the product attributes shoppers value , so that assortment can be designed to drive category sales .
While it ’ s not easy to get product assortment right , it is vital . Assortment optimisation analysis takes the guesswork out of what to put on the shelf , with data evaluating how people purchase instore for specific retailers . Location shares some idea of shopper demographics but fails to reveal who ’ s in the store and what they ’ re buying . Each category has numerous products offering a multitude of product features . Some products offer similar features in shopper eyes and are more “ substitutable ” while others offering a point of differentiation are essential to keep . Understanding this enables you to quantify how much volume will stay within your portfolio compared with competitor flow .
The fallout of range changes When items are deleted , not all volume flows to other products in the category . There may be a proportion of volume that leaves the retailer completely ( non-transferable volume ) – and the ability to measure it enables manufacturers to build plans that drive share growth and demonstrate how assortment changes deliver growth . Traditional range-tail analyses have been the primary tool for guiding ranging decisions ; however , optimising on sales rates alone may forgo 2.5 per cent in annual category growth . 61 There is untapped value in rethinking how you look at assortment .
3 . KNOW YOUR PRICE When it comes to being a pricing leader , McKinsey experts reveal “… the three most important areas to focus on are being creative in meeting customer needs while preserving value , driving strong pricing discipline , and investing boldly in capabilities for the future ”. 62 ‣