Editor’s note: In May, we published an article on the in-store consumer experience, explaining the myriad of factors that come into play when a consumer enters a store and the effect those factors have on purchase decisions. Reader response to the piece prompted a lot of interesting discussion with a few of our clients and at the ArchPoint offices, so we thought a follow-up piece was warranted to take the concept a few steps further.
In this piece developed in a round-table discussion with ArchPoint leadership, we offer perspective on how the retail landscape has changed, with brands having fewer and fewer meaningful (and affordable) ways to engage with consumers in-store. We also offer guidance on how brands can drive a greater level of influence outside the store and positively impact the consumer path to purchase.
Between the early 2000s to now, retailers have experienced a massive shift in consumer behavior. Consumers are making fewer trips to grocery stores and shopping malls and increasingly using technology to impact their shopping experiences. The consumer of 2017 is the savviest, most demanding shopper in history and retailers are constantly finding themselves squeezed by the complexity this consumer adds to their marketing strategy.
Marketers can no longer rely on largely homogenous shopping patterns of their customer base and must focus more than ever on what their brand means to each customer.
Get laser focused on your target customer
To ensure you are getting the most out of your marketing efforts in today’s retail climate, you must begin with getting insanely focused on your core customers. It’s impossible to design experiences that appeal to everyone so you must understand each of your target customers, the challenges they face, what they desire and how your product interacts with their life. You should know more about your customer than anyone else in the space – and use that information to plan all activities from the point they recognize a need for your product to the point of purchase.
New Balance is a great example of this. In the 1990s, their laser focus on their target market – Baby Boomers and Gen X-ers seeking function over form – made them the fasting growing shoe company in the United States. “When I go to a New Balance store, I’m buying a shoe from someone in my generation, not a 20-year old so I’m not shamed because I’m not as athletic as that person,” Jesse Edelman, ArchPoint CEO, says. “It’s impractical to think you can be everything to everyone like Nike. When a client tells me their target customer is ‘everybody’, I say ‘well we’re done here’.”
If you haven’t completed a customer segmentation exercise, now is the time. It’s important to get customer segmentation right before spending any resources to communicate with your targets. Consumer journey mapping is another exercise that can be extremely helpful at this stage – really understanding the consumer’s buying process to make brand positioning decisions on what consumers are actually doing versus what we think they’re doing.
Use your brand truth to drive positioning
At the core of brand positioning should be your brand truth, which communicates what your brand stands for, the promise you make to consumers and why that promise is different and unique. A company’s brand truth seeks to communicate an emotional connection with its consumers, moving beyond product attributes and benefits. Burt’s Bees has very successfully communicated their brand truth to consumers for decades. When a consumer purchases Burt’s Bees Beeswax Lip Balm, they aren’t just buying a product to soothe chapped lips, they are supporting the movement for quality, natural ingredients and sustainable products. Consumers choose Burt’s Bees to do their part for the planet.
It’s especially important for challenger brands without huge national advertising budgets to be unique and different from what’s already in the category.
Be truly innovative – or be the best
Once you establish loyalty by identifying and creating meaningful experiences with your target customer, you need to continue to own their attention and engagement. They will continue to look to you for truly new ideas and incremental innovation won’t cut it (i.e. adding one more blade to a five-bladed shaving razor). Too much capability exists in most industries to reverse engineer products the minute incremental innovation shows up in the market.
If innovation is not what drives your organization the goal is to persuade your target customer that your product does something that others do not. It’s not enough to convince consumers that your brand of dog food is better than other brands for their pet; it’s convincing them that it’s the best brand for their pet. Your target customer should think your brand is so good that they walk into a store with blinders on.
Do more with digital
Imagine the scenario: you’re at Costco, standing in front of a television that seems like a good deal and you’ve been in the market for one for a while. What is the first thing you do? Take out your phone, search for the exact make and model, read consumer reviews of the product and compare pricing. For most product categories today, having anything less than a pretty-darn-good digital strategy is like signing a death warrant for your brand. Brands tend to lose their grip on how people are looking for product information and spend time and energy on assets that aren’t valuable because they don’t consider how consumers shop today.
Every organization – and we mean every – has some level of presence digitally. Your brand must exist in the space where 80% of shoppers seek product information before visiting a store, according to FierceRetail.
If traditional strategy development can seem overwhelming, digital strategy development can seem downright paralyzing to marketers and companies unfamiliar with the space. (If you need guidance on digital marketing, read our article on the topic.)
There is no formula for planning activities that will support a strong sense of customer and brand, so companies should be willing to experiment. “Think about bringing infomercials to life,” Edelman suggests. “Product demonstrations and opportunities for hands-on interactions are great tactics for creating meaningful interaction with customers.” These interactions can happen in-store or near-store – a concept based on providing meaningful experience before a customer reaches the store, so they walk in with influence biased towards your brand and with resilience against in-store distractions.
Knowing your target customer is critical to making an experience a genuine one in the eyes of your customer and not one that seems gratuitous. Interactions must be relevant, wanted and make sense to them – and for this to be accomplished, you must know who they are.
Another opportunity is to leverage complimentary products to drive more experiential interactions with consumers. Edelman offers the idea of building a program for distributors or brokers to implement. “Give them a plan to drive offers and incentives for consumers. You build the framework and they fill in the complementary brands.”
A trend in retail that began over a decade ago is the single-brand, brick-and-mortar store. Rick Wood, ArchPoint Executive Director Canada, says “Fifteen years ago, barely any brands had their own retail stores. Now, if you don’t have one and only exist in multi-brand outlets, you’re lost in a sea of hundreds of other brands.”
Even though 80% of consumers seek product information online, the overwhelming majority – 85% – still prefer to make a purchase in a physical store, according to the TimeTrade State of Retail Report. By owning the physical space, you can completely own your own brand experience.
The level of feasibility for each of these will vary by channel. Remember, as you strategize on optimizing your market efforts to know your customer, know your brand and be bold.