At CES 2020, H.S. Kim, President and CEO of the Consumer Electronics Division at Samsung Electronics, announced the “Age of Experience” during his opening keynote:
“The Age of Experience will be defined by personalized technology that meets your needs… [it] will help you make a tangible connection with technology in a personal way that was not possible in the past. Instead of changing your routine to incorporate more devices, your devices will work seamlessly for you.”
To put it in simply, the Age of Experience is using technology to create personalized experiences that make life more convenient, more enjoyable, and more meaningful.
The New Retail
In the world of marketing and brand building, especially in the digital space, the concept of creating a deeply integrated experience is likely familiar to you. With ever-growing competition, brands are more eager than ever to build lasting relationships with consumers. In parallel, consumers expect a more meaningful experience.
As with these growing demands, brands have felt the pressure to create a more personal and consistent shopping experience, which has been generally referred to as “omni-channel.”
What is Omni-Channel Marketing?
Omnichannel involves integrating each touchpoint to offer the customer exactly what they need, when they need it, anywhere they are and on any device. So, in theory, a customer can be shopping online from a desktop or mobile device, via phone, or in a brick-and-mortar store, and the experience of your brand will be seamless.
It’s a pretty simple concept, however, executing it is where it becomes tricky.
Take booking a trip to Disney, for example. Starting with your first experience on their website - whether you’re on a desktop or a mobile device, the experience is seamless. Once you book a trip, you can use the My Disney Experience tool to plan everything, from where you'll dine to securing your Fast Pass.
While In the park, you can use your mobile app to locate the attractions you want to see, as well as view the estimated wait time for each of them.
Furthermore, the release of its Magic Band program allows a consumer to use a wristband as an all-in-one park admission ticket, hotel room key, photo storage device, fast pass, and food ordering tool.
They are a tried and true example of how to blur the lines between online and the physical world to compete in the new Age of Experience.
CPG Brands in The New Age of Experience - The Problem
Unfortunately for many CPG brands, their ability to improve the experience of their customers is very often limited by their distribution partners.
In fact, there is a sensitive area of overlap where a retailer (e-commerce or brick-and-mortar) is more concerned about the value of their brand than the value of yours. If you don’t have a well-established brand, the retailer would have to decide whether granting you shelf space will hurt or increase their own value.
Most CPG brands often have very limited access to the consumers of their products in mass, because retailers consider the consumers of your products to be their customers. This greatly restricts the ability of a CPG brand to understand the experiences that customers have with their products, and to collect data. This can ultimately negatively impact their ability to drive a true omni-channel strategy.
To thrive in the Age of Experience, CPG brands have to find direct connection with the consumers of their products.
CPG Brands in The Age of Experience - The Solution
Similar to Disney, few understand the concept of omni-channel retail better than Jeff Besos. Amazon is still a poster child of a company designed around customer experience and that is the key to success of the Amazon brand. In fact, Amazon’s stated mission is to be “Earth’s most customer-centric company.”
While Amazon has vastly more resources than most brands today do, there are still lessons to be learned from their success - and it focuses on leveraging consumer data to improve experience.
So how do CPG brands accomplish this when retailers impede on your ability to connect with your consumers and gather important data?
The answer: tactile experience.
There is an old saying: “one picture is worth a thousand of words.” One of our customers, an experiential marketing firm called Flavor Fanatics, modified the saying to “one taste is worth a thousand pictures” (i.e. advertising images). This is a great testament to a power of tactile experience.
Take Le Tote, for example. They are an online fashion rental store who, in November of 2019 purchased the 194-year-old department store chain Lord & Taylor for $100 million. While it raised a lot of questions, founders Rakesh Tondon and Brett Northart defended their decision, stating:
“A lot of these digitally native brands are realizing there is a ceiling to how much you can scale, and how much you can really connect with a consumer online… There are real limitations, there is no tactile experience, there is a lot of lag and latency in the shipping experience.”
How CPG Brands Can Create Tactile Experience
I get it, not every business is capable of making a $100 million dollar investment to expand their offline footprint, nor do I think it’s advisable in many cases.
The point is that you must meet consumers where they are in order to build relationships and create a deeply integrated experience. An extremely effective way for CPG brands to do this, is through in-store product demonstrations.
You can spend millions of dollars using beautiful copywriting and top-notch design to tell of the greatness of your product, without showing a cent of change in perception of your brand by actual customers.
Alternatively, you can invest $2-$4 per customer, allow them to touch, smell, and/or taste your product, and get direct on-the-spot feedback. This strategy not only benefits your brand’s ability to innovate, but also it benefits your relationship with your consumers. They feel like they’re being heard - not by a robo-chat, or a generic email survey, but by a real person, in real time. And not a "survey", but actual conversation.
Now, isn’t that the better customer experience?
Field Marketing is More Effective
Field Marketing is more effective than any other form of advertising because it can measurably impact sales in a very direct and accountable way.
“Half of my advertising budget is wasted away. Unfortunately I don’t know which half” is the quote attributed to John Wanamaker, Philadelphia retailer and marketing pioneer. Even with the advent of digital advertising it is difficult to account how ads exposure and clicks translate into actual unit sales.
Difference Between Solid ROI and Lost Sales
“Per our study (Adweek), in the U.S. 39 percent decide brand choice inside the store and that decision is most frequently triggered by a product demo versus other activities. Twenty-nine percent of shoppers buy products impulsively in-store. How would you rework your marketing if you had this information about your brands?
Activating brands in-store is the single biggest investment most manufacturers should make today, and using a shopper insight-based approach will be the difference between solid ROI and lost sales.”
In Store Demo Campaign
Any field marketing manager can easily figure out the complete cost of in store demo campaign. Understanding factors that contribute to return on this investment is a little more challenging. Most brand builders realize that the product sales during in store demo are only one piece of this puzzle. While it is easy to measure it is only the tip of the proverbial value iceberg.
Another contributor to in store demo profitability is the product residual sales uplift that often lasts weeks after initial event. You need help from the grocer’s POS data or your distributor”s sales reporting to detect and measure it. Keep in mind that grocers benefit greatly from your in store demo investment, as these events lift sales of an entire product category and promote more traffic in their stores. Your demo reports data also has value to both grocers and distributors, and can be used to incentivise them to pool your information resources together as it enhance the value of this information for all.
Brand Awareness contribution of In Store Demo
Lastly, the brand awareness contribution to profitability of in store demo is often targeted, but rarely measured. We have borrowed a methodology from CAC (Customer Acquisition Cost) calculations as it is commonly used in digital marketing to simplify brand awareness contribution estimates and incorporated it into the Demo ROI Calculator available free of charge.
To build this Calculator, we analyzed data collected during thousands of in store demos, including sales numbers for demonstrated products, day of the week variations of foot traffic during the events, and number of shoppers who tasted a product without purchasing it. We also looked at follow-on sales of these items for four-five weeks after the events. This data is a critical asset in your drive to secure more and better shelf space in the stores.
Retail transactions done online afford customers, wholesalers, retailers and even the manufacturers, the luxury of conducting business anywhere at their own convenience. With speed and accuracy, operations can be carried out smoothly - one can therefore see the dilemma traditional independent grocers face. The concerns about falling traffic in your stores are very real as over 71% of consumers trust that they can find better prices online.
So how do you as a traditional retailer survive and most importantly thrive amidst the disruption and turbulence caused by ecommerce? Below are some ideas to increase sale in retail stores.
The first key to survival is to retain and increase foot traffic in your store - this is one of most important grocery store marketing strategies. The good news is that 94% of retail sales are still conducted in brick and mortar stores. Even with the ease of ecommerce, people still prefer a physical experience, a relationship, an interaction with the product or the retailer. This is what defines us as humans - our desire to interact.
The Major Keys to Survival in this Volatile Retail Environment
One of the best strategies to boost number of customer visits in your stores is to leverage this human desire to interact and to discover new experiences. Try to re-imagine your store as an event space which your customers see as being a fun place to visit - not just the place they need to go for weekly provisioning. Promoting limited time price discounts (TPR) on popular and well known products only leads to erosion of margin.
“If consumers come to expect price cuts as the rule rather than the exception, then price promotions lose their ability to boost sales and become unprofitable. “
Consequently, one of the major keys to survival in this volatile retail environment is the creation of exceptional customer experience in your stores. Retail leaders realize that customers now have a plethora of choices available to them. Surely, the store that provides the best experience is certainly where the customers will throng to. In essence, the traditional grocers have the advantage over ecommerce giants in providing quality customer experience through in store demo and other event based marketing strategies.
According to a survey of 1,786 US grocery shoppers conducted by Food Marketing Institute.
“Among all regular food shoppers, brick-and-mortar supermarkets continue to enjoy a clear edge over online grocery retail in perceived performance on key evaluation criteria, especially in providing fresher produce (a top store-selection driver) and better customer service,”
According To a Survey
With the ever dynamic nature of retail today, there is no way you can talk about improving customer experience without including in store demos. This refined tactic helps to draw customers, boost sales of demonstrated products and also improve the sales of other products in that category. To withstand the barrage of online competitors, you have to think of an in-store demo as a network of events rather than one elaborate show. Knowing the right product to demo, duration of each demo and location for the demo are very crucial to your stores survival. In order to measure the impact of in store demos on your stores’ Sales Per Customer Transaction, you have to consider
Understanding return on investment for these promotional strategies can go a long way in attracting the sponsors for them. Analysis of data, collected effortlessly by your POS, holds the key to leveraging vendor’s promotional budgets for increasing foot traffic in your stores. Any quality in store demo agency or vendor’s field marketing organization collects valuable data specific to the demo events they conduct. Cross referencing POS with demo data can produce empirical evidence, that would entice vendors to demos in your stores all day long, and that will lift:
In retrospect, arming yourself with the right information and tactics will give you sufficient leverage in the unstable 'waters' of retail. Reaching out to your customers, giving them the very best and improving on your operations are essential tips for relieving the pressure of online competitors.
There are several write ups about Amazon acquisition of Whole Food Markets with everyone attempting to clearly state their own opinion. This is seen from different sectors including pundit specification from industries which is channeled towards an unavoidable disruption of the grocery industry. This is with the primary aim of having an analysis of the Whole Foods price reductions. Joining the choir was my own way of offering my opinion and observation from an industry ecosystem participant perspective.
Whole Foods Stores
Over the years, there have been a scale up in the traffic seen with Whole Foods stores. This was noticed only after the acquisition as well as lower pricing of some selected items. However, vendors, distributors and brokers have sent no reports showing that they are dissatisfied with the internal operational changes. Complaints about the availability and quality of organic produce on the store shelves are becoming quite disturbing and these complaints are received mainly from the Whole Foods shoppers.
Whole Foods Management
There is currently no evidence to indicate a positive change from the perspectives of shoppers or the grocery ecosystem. There are only indications to show that a hands off approach to Whole Foods management was adopted by Amazon as they continue with the implementation of operational initiatives even before acquisition takes place.
Major grocery retailers are already announcing their significant investments into technology. This is with the aim of combating Amazon’s scour for food to their territory. The likes of Kroger have already started to court smaller, regional product brands threatened by Whole Foods abandonment. This may be a good development for nonindustrial food manufacturers, when and if it materializes.
Analysis you would find are only focused on the impact of the Whole Foods changes on publicly traded companies. There are only few write ups about how the food brokers, independent groceries, demo agencies, small batch product manufacturers and merchandisers are affected by the changes. In fact, there are only evidence to show that there is lower foot traffic as well brand promotional activities on the store floors of the aforementioned. However, many grocers we spoke to are in denial that a small grocery eco-system will be materially affected. And that is a mistake.
Thanks to Jeff Bezos's relentless focus on the quality of customer experience, i.e. long term sustainability of Amazon business, everyone assumes that the acquisition will produce some magical result and force a major change in how we buy our food. So far this "earthquake" is yet to produce a tsunami of change. Amazon does not always succeed, but it succeeds most of the time. Change now. Before you have to.
The small and independent grocers can obviously not compete with bigger technological investments, rather they can mobilize partners within their ecosystem to provide a better and more personal experience to their shoppers. This should be their prime focus because Whole Foods sidelines their trade partners who helped them to become successful, independent grocers could use this opportunity to forge closer alliances to provide more engaging shopping experience in their stores.
In recent years, retail has evolved into a business where proficiency, versatility and creativity are all needed to become very successful. Brands no longer market products just to make profit alone. You might be wondering where I am going with this, but humor me a bit. Brands now strive to appeal to the customers emotions. They want them to feel attached to the brand or product or even the store. This spurs the people to get the product at any cost. There are various techniques through which brands make this happen and one of those strategies is a successful in store demo. The best way to get to your audience is by capturing their attention and what better way to go about that than giving the people a feel of your amazing product.
In store demos are ways brands and retailers engage with the shoppers directly, fostering human connection that will help them in experiencing the product. You may wonder whether in store sampling are necessary for all stores - well, they are, especially if the area of specialization is very competitive like food products in grocery stores and supermarkets. These demonstrations are cheap investments in making sure you stand out among the rest.
We can say to an extent that your performance as a grocery store lies in the success or failure of your marketing strategy. Thankfully, positivity is one of the tenets of retail and that's why we'll look at the essentials of having a memorable in store demo.
PROMOTE PRODUCTS ON THE STORE FLOOR
This is an essential tip for you to have a successful marketing strategy. However, this depends on the effectiveness of such promotion techniques - Let me explain. You are not just going to attack the customer or force him or her to try the product. NO! People like it when you approach them calmly and speak confidently about the product. Most likely, they might have heard of similar products but your job is to give them a feel of that they have never heard before. This will give them the impetus to want to try the product. Furthermore, successful in store demo programs are done with care and precision. They are well planned and coordinated because in the end it is your reputation and revenue that is at stake. You would not want to see one of your customers going to another store to get the product elsewhere. Brands promote products on the store floor because of the lower customer acquisition costs which is preferable to the conventional or digital advertising.
THE BEST BRAND AMBASSADOR
It is important to have an experienced brand ambassador in your corner as he or she is a major stakeholder when it comes to in store sampling. In addition to recruiting a certified influencer, you will need to find a profitable location where you know your products are going to thrive; a place where traffic is just right for you and your store. Let's look at these two extremes to get a clearer picture of why location is important to you and the brand ambassador. If your store is situated in a place with low traffic not even the best and most creative packaging will save the product demonstration there. On the other hand, if there is too much traffic, your brand ambassador might be swamped and end up giving out too many samples that do not turn into sales. Double bummer if you ask me. In essence, find your product niche and settle there.
SUCCESSFUL IN STORE DEMO
There are a lot of intricacies when planning for a successful in store demo. You have to be able to combine these steps to get positive results. First of all, you need to consider the shoppers demographics of the store. Make adequate research on the type of people that come into the store on a regular basis, know the age range, sex, religion, background of some of these people. In store sampling will be easier this way. You then have an idea of how to plan for subsequent demos with the information you already have. Plan a frequency with which you can schedule a series of demos in that store. You already have an edge with the information gathered from the research. What some smart brands do is to invest in a small number of stores instead of wasting money on many stores in a bid to cover the whole market.
LATEST RESEARCH TO MEASURE DEMO PROGRAM EFFECTIVENESS
All that has been said are all key elements in achieving a successful in store marketing strategy. However, without understanding how to measure the effectiveness of the program, you might get stuck. Let's look at some metrics that are apt in measuring in store demo effectiveness.
Traffic management: This explains the percentage of shoppers who stop to taste the product in the store.
Product engagement: It represents the amount of time the shopper spends at the demo table, which may include interacting during the product demonstration
Conversion rate: This is more like a combination of the previous metrics. It is the percentage of shoppers who tasted the product and went on to make a purchase.
NPS ( Net Promoter Score): It is a management tool used to gauge the loyalty of shoppers or customers relationships.
Conclusively, There are a few other tips that were not examined but are also essential for a successful in store demo. You need to come early for the setup preferably at least 30 minutes to meet with the demo coordinator . Also, have every employee or majority of the employees in the store try your product. This will help in promoting the product even more. Another tip is to bring flavors the store doesn't have.
It is very important to note that an in store demo program cannot happen without a quality product. Hence, before you think about all the elaborate marketing strategies to captivate the people, you need to make sure that you have the right product. Bearing that in mind, you need to understand that times have changed, customers have evolved and you need to join the wagon in improving your product and profit making strategies.
HOW DO YOU CHOOSE A BRAND AMBASSADOR?
Some brand activation managers find it hard to get a quality brand ambassador for their product as this is a very crucial aspect of their business. Firstly, recruit a professional. Someone that is experienced and reliable; who would invest time in learning about your product. Secondly, take out some time to train the ambassador, provide him or her with the primary source of information about the product. Another point is to select an ambassador with the relevant personality, someone who can stand by his or her word. Finally, maintain strong relationships with the person, get to know each other and take it up from there.
HOW DO YOU PROMOTE A PRODUCT TO A CUSTOMER?
You can ask the employees of the store to try out the product. Surely, they will get employee discount but understand that this will work in your favor. The employees of the store will have better rapport with the customers and no matter how much research you do, the employees will know them better. Also, during product demonstration, you have to give the customers facts, especially things they haven't heard about. It is a good way of promoting a product to the customers.