Retail Trends - Personalization & Emotional Connectivity
Today, consumers aren't necessarily visiting brick and mortar stores for the best price or selection -- they can usually find better alternatives online. Instead they are coming in search of an experience. Personalization as a retail trend refers to the promotion of an in-store experience that is tailored to each guest. Personalizing the shopping experience can strengthen customer loyalty and level the playing field with mobile and e-commerce.
A recent survey reported that 78% of consumers are more likely to be repeat customers if a retailer or brand provides targeted, personalized offers. Targeted offers save consumers time. They do not need to browse through products they are not interested in so they can spend more time focused on new things they actually care about. Retailers and brands -- especially those with Millennial and Gen Z as a target market -- will quickly win over their customer base.
Interactive tactics within the retail experience can . . .
Engage shoppers more quickly
Encourage more purchasing
Help with product and service feedback
Allow the customer to become a key stakeholders in creating new products and merchandising opportunities for CPG's and suppliers.
BRAND LOYAL EMOTIONAL CONNECTIONS
Building brand loyalty through emotional connections will continue to be a focal point in 2016 and beyond. It would be logical to think that people make all of their buying decisions based on considerations like price, quality or convenience. Yet time and again, studies have shown that these qualities only moderately factor into consumer buying decisions. The truth, more often than not, is that people make these choices based primarily on their emotional connection to a business, product, display or service.
Whether brands are interacting with a potential customer for the first time or catering to a longtime buyer, it's critical to foster positive emotional connections. Always. This isn't to say that quality, convenience and value aren't important but in order to cement a loyal relationship over time, it is important for companies to focus on building strong emotional bonds with customers. How CPGs and suppliers collaborate to use the available research will decide how successful they are at forging strong relationships with consumers.
Which of these 4 Trends to Watch will emerge as THE trend of 2016 is still difficult to predict but you're safe knowing a mix of each of these trends will provide the best chance for success in today's retail environment. Next year, the trends may change but the goal will remain the same -- bring maximum attention to your products to drive that sale.
4 Retail Trends to Watch For
Based on the work TimBar has been engaged in with its clients and what industry-leading experts and our own partners are reporting, it seems clear that four important trends will continue to gain ground through the remainder of this year:
THE AWAKENING OF LICENSEE USAGE
Star Wars! Need I say more? 2015 was probably the biggest year of licensing in the history of the universe, thanks to this one sci-fi franchise that now spans across three generations. The power of licensing will continue to grow in 2016 and beyond. Check out what brands can learn from the Star Wars Licensing Blueprint published by Forbes CMO Network .
The most obvious benefit to a CPG or service provider that licenses a brand, character, design or piece of intellectual property is the instant marketing power it brings to the product. When done right, a strong licensing agreement can be lucrative for both players and mitigate the hundreds of thousands or even millions of dollars it takes to build a brand from scratch. Licensing represents a way for a manufacturer to take advantage of all the brand and image building that has gone on before.
The impact of licensing on packaging and displays has generated greater shopper attraction and sales results at retail. In addition, as retail shelf space shrinks and e-commerce continues to grow, brand licensors are getting more aggressive with their own retail initiatives.
TECHNOLOGY: THE NEW PATH TO PURCHASE
Retail space is not going away for the foreseeable future and neither are mobile devices. We've seen many CPG's and retailers use specific technologies in and out of store to guide shoppers to the point of sale. Social media, mobile applications and in-store digital media offer more opportunities to advertise, educate and promote new products and to encourage the most important engagement -- the sale! Today, consumers access multiple channels to executive a purchase; leading to the requirement that all channels work collaboratively to support the brand and the experience. Giving shoppers options on how they can shop and purchase creates more positive experiences and offers CPG's and retailers more merchandising opportunities.
Consumers no longer follow a singular straight path to purchase but wind their way along many different paths. They will often research products on line and may even make final purchase on line but many still want to see, feel, try-on the merchandise before closing the sale. CPG's, retailers and suppliers with an Omni-Channel Marketing strategy that is consistent and customer centric win! Therefore, we are continuing to see more connection between in-store merchandising tactics and other, outside of store, marketing communications.
Please return next month when our post will discuss the last 2 trends -- Personalilzation and Emotional Connectivity.
Successful Retail Displays Start with Consumers First
Let's kick this off with a one-question quiz.
Q. What is the first step in creating a successful retail display?
a) Design b) Manufacturing c) Fulfillment d) All of these
If you said D, you fell for our trick question. While each of these are vitally important in developing a successful, award-winning display, we call them the triumvirate of packaging and display -- the answer is C. Fulfillment. The first step in a winning retail program.
What do we mean by fulfillment? We're not talking about moving product from manufacturing to retail in the shipping case. We're talking packing or bundling product for display and sale at retail. Engaging the customer at the point where they encounter your product and make that all important decision: Buy or don't buy. Which will it be?
Ultimately, for a point of purchase display to be a raging success, we don't have a choice but to begin with the end. Often, our clients want to go straight to design or find out what hot, new gimmick will give their product the distinctive edge at retail. We work with our customers to help them understand that the consumer-first approach is the way to begin any retail display project. P & G rightly called the end (fulfillment at retail) the "first moment of truth". And Google raised the stakes with the "zero moment of truth," but that's a whole other blog. The ultimate moment of truth for a point of purchase display is when a consumer picks up your product and places it in a basket or cart for purchase: Buy it!
That's why we start with fulfillment first. Every time. Focusing on that moment with critical attention on:
Who is the customer?
What is the purpose of his/her shopping experience?
Why does she/he need this product?
How do we get attention among all the surrounding retail noise?
What's driving this purchase? Impulse? Need? Something else?
If we begin with the purpose, goal and target consumer, everything else gets easier and falls into place.
Design efforts don't focus on the cool factor as much as clearly focusing on the final goal at retail
Manufacturing processes can be easily identified, customized and optimized
Proven methodologies and programs, while customized, can be applied for maximum success
THE SMARTER MARKETPLACE
This approach works extremely well in today's smarter marketplace. Our customers (marketers) are highly effective in planning, targeting and product distribution.
There was a time when every store was treated the same. If one received a product display, they all did. That rarely happens today because big data, customer segmenting and stores customized to location have eliminated the mass display distribution approach. Segmenting retail display programs very specifically -- choosing only the ones that are the best fit -- helps to maximize marketing spend and return.
Now, each final display whether pallet-pack, aisle or a high-tech digital presentation, is custom built. It's what we do. We make it easy for our customers to execute the retail experience that meets their customers' goals. By understanding the desired audience and why they want the product, we take the first step in fulfilling successful results at retail.
Three Key Merchandising Elements
Kristen pushes her cart through the store with list in hand and a lot on her mind. Her eye is on the time and her focus is on the mission at hand. She needs granola bars, sports drinks, bananas, paper towels and deodorant. She does not need art supplies. But on her way to grab a birthday card (needed, but not on the list), she notices a brightly colored display on the end of the next aisle over. It features a life-sized image of a paint-splattered little boy with a big grin who looks a lot like her son. He’s holding up a picture he’s made, beaming with pride. The picture actually juts out from the display, as if he’s handing it to someone...to her. The decision is quick, the action definitive. In less than 60 seconds, she grabs paints, crayons, markers and paper. A quick series of rationalizations float through her mind...I think we’re low on supplies, Jackson is so creative, he need more to do this summer, this would be a great family activity...and she’s back on track to quickly pick out a card before steering back onto her list-determined course.
She impulsively bought the art supplies, but there were plenty of items she didn’t buy because she didn’t need or notice them. Today, everything competes for attention, and effective marketing and merchandising requires more work, more creativity, more insight.
For many years, shoppers used to push their carts down each long aisle in a store. Over the past two decades, however, behavior has changed. Quick-hit trips are common and multi-tasking has become an epidemic. In addition, we’ve learned that although most people have a tangible list, whether paper or digital, they also have a mental list. This one is flexible, and morphs constantly throughout their shopping trip. With so much going on in the peripheral, we need to be able to add to this mental list quickly and decisively. When it comes to breaking through the physical—or mental—clutter in order to gain that competitive advantage, you’ll want to:
1- DIRECT THEIR FOCUS.
Press pause on the “After I [__________], then I have to [__________] ...” cycle. Uni-tasking is almost unheard of when it comes to daily chores and errands. Shoppers are always thinking ahead to the next item on the list, the next destination of the day. Successful merchandising has to break through into their “zone.”
“In order to activate additional purchases, you need a ‘lure’ that pulls shoppers out of habitual or list-driven behavior and triggers a conscience response,” says Michelle Adams, PhD, founder of Marketing Brainology. “One way to do this is to create shoppable sections. TimBar has been very effective in this strategy, and a pioneer in creating vertical displays to frame these sections, grabbing a shopper’s eye and their attention.”
At TImBar, we rely on thought leadership by experts like Michelle, and follow the market research on shopper behavior in order to have a deeper understanding of how people make purchasing decisions at the retail level. We want to “get it,” to dig in and understand the what and the why. Challenging the status quo helps us discover the impact different tactics have on influencing shopper behavior, and that helps us to be smarter as we help drive results for our customers. New approaches can make all the difference when it comes to getting (or staying) ahead of the curve.
2- PLAN TO SURPRISE.
Be novel. Our eyes and brains are always searching for something new, whether we’re engaged or not. Color, contrast, eye-level action, forward motion, even glossy finishes—these all impact where we look and how long we spend looking. And often a little extra time is all that’s needed to propel the purchase decision.
When creating a display, TimBar considers the way an eye tracks an image, with left-side dominance and clockwise motion. Research shows that each element serves a purpose, and we take the time to learn and then strategically apply that knowledge to each project.
Although the landscape is always changing, much about human behavior stays the same. We need to apply what we do as marketers and merchandisers in a way that responds to a dynamic environment and still creates a direct and actionable message. Using insight effectively means keeping things as simple as possible in translating research-driven ideas to and for our clients. It also means giving shoppers what they want: inspiration.
3- MAKE A CONNECTION.
Get personal. Insert the product into their life. An imagined experience is emotional engagement, so visually develop that for them. Don’t just show them holding the glass, show them drinking from it, enjoying the beverage with family or friends around them in a special place on a beautiful day.
As human beings, we’re busier than ever and more easily distracted as well. Thanks to the explosive speed of technological advances, we’re used to experiencing an ultra-quick result. We expect things to happen now, and if not, we’re on the move. But we still want to be inspired, entertained, engaged. And we want it to feel authentic.
So a shelf or display has to do more than hold product and it has to be more than a communication device. It must break through the noise and create a relationship with shoppers by telling a personal story that fits many. Bring them to your product, then bring the product into their lives.
Learn more about how we use our innovative Activ8 program to create strategic and effective Merchandising Solutions that drive results.