With growth in the FMCG sector hard to come by, IRI strategic consultant Rod Street argues more companies must spend more time trying to improve a consumer’s shopping experience.
Despite almost one hundred years of self-service grocery, creating the perfect in-store shopping experience still remains an industry-wide challenge. According to Procter & Gamble, shoppers make up their mind about purchasing a product in three to seven seconds – the amount of time it takes to notice a product on the shelf.
Go deeper with GlobalData
They call it “the first moment of truth”. It’s considered the most important marketing opportunity for any brand. Going back further in time, Paco Underhill’s book Why we buy: The Science of Shopping provided an early insight into shopper behaviour in-store and the importance of in-store product placement.
Yet still, it is estimated as few as 1 in 25 of grocery shopping trips end in complete success, as shops still fail to stock the products desired, merchandise products in the right place making them hard to find, maintain stock-levels for all product pack sizes and ensure promotional offers are clear.
Think about your own experience and consider how frustrating it is when you have to either traipse around several shops to get a key item or settle for a less than desired brand or an odd pack size. It is extremely irritating, as I experienced last week when I struggled to find and buy edamame beans in my local superstore, but even looking at common shopping trips over the last two to three weeks, I think that 4% success rate is a fair estimate, given the number of times my own shopping routine had to change in order for me to buy all of the items on my list – let alone buy them at the right price.
See Also:
The experience leads to a very dissatisfied shopper, I can assure you! Ironically, the same factors also raise costs, such as inventory holdings or the time spent by store staff to guide customers around. My only compensation was a long conversation with a really helpful Polish guy in Tesco about beans.
How well do you really know your competitors?
Access the most comprehensive Company Profiles on the market, powered by GlobalData. Save hours of research. Gain competitive edge.
Thank you!
Your download email will arrive shortly
Not ready to buy yet? Download a free sample
We are confident about the unique quality of our Company Profiles. However, we want you to make the most beneficial decision for your business, so we offer a free sample that you can download by submitting the below form
By GlobalDataWhy is it that manufacturers and retailers seem unable to take advantage of the long-standing opportunity to create value that is, so clearly, available to them by perfecting the in-store shopper experience? This 96% opportunity seems even more relevant as we suffer a grocery market that is stagnant and where value is being driven by price increases alone.
There are many elements to address to create the perfect in-store shopper experience but the foundational ones centre on the four Marketing Ps – the right product on offer in the right place, at the right price and in the right pack size and format. For most companies evidence shows there is still a long way to go. Whether its product positioning, availability of new products, clear promotional offers, a variety of product sizes on offer, it is important to deliver a good experience in order to stay ahead of the game, grow sales and retain customer loyalty.
Do recent innovations help or hinder? The picture is mixed. Click-and-collect or online shopping should make things easier because of the potential for consolidated stock points. But they still leave equally demanding inventory management. Mobile applications can certainly prove to be a valuable contribution towards a positive shopping experience offering reassurance on pricing, advising on the best in-store route for purchases based on the shopping list; more accurate live inventory records in that store, easier offer discounts and vouchers, all help to provide a less disappointing shopping experience.
Developments also mean manufacturers can offer shoppers very targeted virtual promotions in time and with surety about the visibility of the offer. It also enables them to connect the supply and demand areas of the business and ensure availability. The shoppers’ expectation is to be able to purchase their average basket of items day-in, day-out, and that is the basic standard the industry should be working towards. If innovations work alongside and in tune with the industry, the opportunity to harness excellence in-store is more likely.
Despite the confusing stretch this makes to the “first moment of truth” it can only lead to greater success if used well and directed to reducing that shopper disappointment.
However, I suspect many have viewed the moment-of-truth lens from the wrong end – that of the supplier and the brand. Yes it is the moment of truth but the whole point of it is that it is the truth the shopper experiences and not the company. It is the shoppers’ perception of the brand and of the store, of the success or failure of the shopping trip, of the choices available to them and of the ease of getting what they want.
Many companies seem to have interpreted this useful way of looking at things as a form of trade marketing on steroids and have looked at it in terms of brand impact and presence. This is not wrong but it is too limited for the shopper for whom a good experience includes also many basic things – such as having the product on the shelf when they want it, seeing the offer that should be on it easily, finding it within the category without having to walk back and forth, navigating between poorly placed categories. This will chip away at that dissatisfaction.
In practice leading players have been working at this for several years but is it now time for the industry as a whole to really target it and embed excellence across the entire business and supply chain. They need to address the real challenge to make it work across sales, retail management, supply chain functions and business partners, making better choices around day to day metrics, using near real time information on point of purchase, providing a broader definition of roles that captures success end-to-end and designing smart reports that highlight the exceptional issues and hide the successfully delivered but massive detail.
All in all, this issue of providing the perfect in-store shopper experience should be much higher up on the agenda and on everyon’s agenda – not just some of the leading players. Every food manufacturer and retailer should be asking themselves: “Are we even focusing on this?” If they are not, they really do not have their eyes on one of the bigger prizes in the industry.
