Beyond Redemption: Digital Shopper Marketing 2.0 April 13, 2011 - - PowerPoint PPT Presentation

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Beyond Redemption: Digital Shopper Marketing 2.0 April 13, 2011 - - PowerPoint PPT Presentation

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Beyond Redemption: Digital Shopper Marketing 2.0 April 13, 2011 Blog: smartretailmedia.com Twitter : ShopperMedia 1 Intro to Speakers Dan Frechtling VP Client Solutions Joe Battoe VP Shopper Marketing Blog: smartretailmedia.com Twitter :

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Blog: smartretailmedia.com Twitter: ShopperMedia

April 13, 2011

Beyond Redemption: Digital Shopper Marketing 2.0

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Intro to Speakers

  • Dan Frechtling

VP Client Solutions

  • Joe Battoe

VP Shopper Marketing

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What do these 4 images have in common?

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First Digital Video Game 1952 Digital + Gaming?

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Digital + Gaming!

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Digital + Film? First CGI Animal 1986

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Digital + Film!

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Digital + Publishing? First New York Times homepage 1996

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Digital + Publishing!

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Digital + Mobile? First mobile phone 1983

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Digital + Mobile!

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First Generation (1G) Re-creates

Simulate a paper game with pixels Provide desktop news content Enable a phone to travel Make animals look photo-real

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Second Generation (2G) Creates

Let players become the controllers Merge fantasy and reality Add new experiences to news Complete any e-task with one handheld

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What does this have to do with digital shopper marketing?

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Digital Shopper Marketing is Starting a 2G Transition

2G 1G

Time Adoption On this trajectory:

  • E-Circulars
  • Digital Coupons
  • Social media
  • In-store media
  • Targeted display
  • Mobile vehicles
  • …
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Examples today

2G 1G

Time Adoption

Today (approx)

On this trajectory:

  • E-Circulars
  • Digital Coupons
  • Social media
  • In-store media
  • Targeted display
  • Mobile vehicles
  • …
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  • 1. Understand 2G digital shopper marketing
  • 2. Know how to use it more effectively

Objectives Media reviewed

  • E-Circulars
  • Digital Coupons
  • Social media

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2G Principles

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2G Principles right offers to the right behaviors

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2G Principles auto-adjusting campaigns

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2G Principles helpful product/ service suggestions

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2G Principles value realized in fewer steps

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2G Principles right offers to the right behaviors

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Different Interpretations (Anagram Example)

HERE COME DOTS THE MORSE CODE Naval communicator Layman DIRTY ROOM DORMITORY College student Parent LIES – LET’S RECOUNT ELECTION RESULTS Winning candidate Losing candidate

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1G E-circulars

Prompt people into the store to buy more.

  • Feature weekly or seasonally promoted products
  • Promote launched or re-launched items
  • Localize product presentations based on store traits
  • Accentuate underperforming departments
  • Organize content for pre-trip searching and list making
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2G E-circulars

Use targeting to more naturally stimulate purchases

  • Expand purchases of popular products
  • Cross-sell complementary products
  • Re-activate lapsed product buyers
  • Align with individuals’ purchase cycles
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2G E-circular Case Example

Sales lift Offers Penetration (%) Post Email vs. Pre Email Sales Impact Example: 10 recent categories

Source: DS-IQ

Cheese Self Care Canned Soup Ice Cream Cereal Bars Soda Eggs Chicken Pet Food 0.0 1.0 2.0 3.0 4.0 5.0 6.0 0% 20% 40% 60% 80%

Average lift from personalization:

2.4X

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1G Digital Coupons

Turn around the mass-coupon paradigm Pros:

  • Flip the model from push to pull, as shoppers log in or opt in to offers
  • Provide basic targeting e.g., past activations, clickstream, and banner/geo

Cons:

  • Don’t distinguish individual buyers
  • Don’t personalize by product or increment
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2G Digital Coupons

Serve the right offers to the right shopper behaviors. Examples:

  • Attract new buyers by selecting and targeting those most likely to try
  • Expand current buyer consumption by increasing frequency and units
  • Re-activate lapsed buyers such as brand switchers or category defectors

Stopped buying Occasionally buys Buys novelties (but not pints)

Source: DS-IQ

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9%

Campaign redemption rate

2G Digital Coupon Case Example 1

17% 47%

Frozen entrée category buyer Brand buyers from other categories

Identifying shoppers most likely to try Frozen dinner

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Source: DS-IQ

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2G Digital Coupon Case Example 2

36% 100% Before During

>1 units per purchase

(avg 4.1) Before During Every 6 Every 2

Increasing loyal shoppers’ buying rate

Purchase frequency (mos)

Single serving meal

Source: DS-IQ (avg 1.8)

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2G Digital Coupon Case Example 3

An email and mobile coupon program for a major grocer increased trips per week 12%

Pre-campaign

1.47

Pre-campaign Pre-campaign During campaign

Test

Pre-campaign During campaign

Control

1.59 1.42

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Source: Catalina Marketing

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1G Social Media Self-expression, instantly broadcast

  • Express affiliation with brands more broadly
  • Automate word of mouth immediately
  • Opt-in to news from preferred brands
  • Join groups with shared affinity
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2G Social Media Use targeting to engage passions

  • Reach emotional loyalists
  • Engage them in an event they care about
  • Enable them to share and self-express
  • Add special insiders-only perks

Source: YOU Technology

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2G Principles auto-adjusting campaigns 1.Optimizing segments 2.Optimizing offers

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Differing Outcomes (Optical Illusion Example)

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18.1% 27.3% 8.7% 9.5%

Heavy buyers (2 units) Light buyers Lapsed brand category buyers Brand adj category buyers Category buyers Affinity category buyers

13.4% avg

Expand brand buyer consumption Convert category buyers Generate non-category buyer trial

14.3% 13.5%

$.75 $.75 $.60 $1

  • ff 2

$.50 $.60

Segments

2G Optimizing Segments

Source: DS-IQ

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2G Optimizing Offer Values

Web coupon program for ConAgra and national retailer 12% cost/unit improvement New Buyers Save $2.00 Save $1.75 Loser Winner Result Test Values

Source: DS-IQ

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What Kind of Personalization?

3 approaches 1. Let shoppers select the kinds of

  • ffers they wish to receive

2. Apply collaborative filtering or similar techniques to suggest what similar shoppers have chosen 3. Use individual purchase history to recommend the most relevant offers

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Enough Talking About Marketers

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2G Principles value realized in fewer steps

  • 1. E-circulars
  • 2. Digital coupons

helpful product/ service suggestions

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Offer Relevance

Loyal Mach 3 user

Timing and brand elements enable relevance Right time Wrong brand Schick Hydro Current brand Gillette Fusion Right time Right brand (upsell)

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Relevance Surveyed

“It made me buy the product about a week sooner than I would have…and I’m not sure I would have otherwise bought the two, but I did, because it was relevant to my life.” 10% 30% 36% 42% Switch Brands Try Something New Purchase More of Specific Product Stock Up

  • n Offers

Received

Source: Catalina Marketing

% of shoppers participating in a 2G program who said the offers made them:

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Simplicity of E-circulars

Principle Availability Pre-selection Delivery Browse hundreds of images

  • r search by category

View relevant offers pre- selected and ranked

1G 2G

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Simplicity of Digital Coupons

Principle Pull, not push Saving steps Delivery Find offers, print out, and bring to store Load-to-card and set up mobile reminders

1G 2G

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Targeted right offers to right behaviors Dynamic auto-adjusting of campaigns Relevant helpful product suggestions Simple realizing value in fewer steps

Examples today

Time Adoption

2G 1G

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Further Guidelines

Principle 1: Go beyond redemption. Principle 2: Don’t jail shoppers in static segments or zones. Principle 3: Look for ways to bet after the race has started.

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More about digital shopper media:

Blog: smartretailmedia.com Twitter: ShopperMedia Corporate: ds-iq.com

Dan Frechtling dan.frechtling@ds-iq.com Joe Battoe joe.battoe@ds-iq.com