A recent post about the dangers of POPAI’s infamous ‘76% of purchase decisions made at the point of purchase’ attracted a lot of comments and debate. The purpose of the post was to highlight to readers that this infamous number has hidden dangers: that the number simply wasn’t true for all shoppers in all categories, in all channels, at all times. Most comments supported this thesis, though there were many who also made the point that, while the number might be misleading, it had at least focused marketers minds on the importance of the point of purchase. This may be true. But it is also true that this number has been the excuse for one of the greatest crimes in consumer goods history. The rampant overuse of discounts.
Promotions deals and discounts – it’s getting worse
There was a time when brands weren’t on promotion all the time. I’ve spoken to a number of retailers in the last year and each of them suggest that promotional intensity has increased significantly in the last decade. In some categories, well over half of the sales are now on deal! There are many factors which have influenced this: competition has got tougher, for one thing. The expansion of private label, the economy, the rise of discounters and online shopping have all been blamed in part for the increasing use of discounts and deals in-stores.
Promotions, deals and discounts – justifying the madness
But one other factor has contributed massively to this: the belief that the vast majority of shoppers can be influenced in-stores. If it is true that 76% of shoppers can be influenced, then all of this money spent on deals and discounts isn’t a waste, it’s an investment. It’s an investment in shopper marketing!
No. It’s not.
If it’s true that 76% of shoppers can be won over in store, then marketers have to find a mechanism which will work for everyone. A mechanic that pretty much every shopper will buy into. What is that? A promotion! Who doesn’t like a deal? All shoppers like a deal, so a promotion will get all of that 76%, won’t it?
76% of purchase decisions made in-store isn’t a good thing
The fact that so many decisions are made in-store isn’t necessarily a good thing. The fact that, if anything, this number is going up, not down, is not a good thing. It is an indication that we are training shoppers to seek out deals. Training shoppers that they should select based on promotional offers, not inherent brand values. It is an indication that too much of what goes under the name of shopper marketing is damaging to brands and to categories. It is an indication that we’ve got our investment priorities wrong.
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Aim for the target shopper, not the 76%
As shopper marketers, of course we want shoppers to make decisions in-store. Of course we want to influence shoppers and change their behavior. That, at its heart, is the definition of shopper marketing. But not all shoppers! We want to change the behavior of our target shoppers in a way which will drive future consumption of our brand. Not all shoppers! Some shoppers already buy our brand, so perhaps we are happy with their current behavior. Some shoppers don’t buy our brand, but the cost of getting them to do so (a promotion which perhaps trains our loyal shoppers to buy on deal) isn’t worth the gain (a one-off purchase). Any messages which suggest that somehow targeting most of the shoppers is a good thing to do will almost certainly lead down the path to more and more promotions.
And that, almost certainly, isn’t a good thing.
Moving beyond promotions, deals and discounts
Shopper marketers – it’s time to step up to the challenge. Let’s stop ‘doing activity’ and start really marketing to shoppers. Let’s start thinking systematically about which shoppers we are trying to reach and what we want them to do. Let’s start challenging the conventions, myths and paradigm that surround our discipline, and let’s start thinking for ourselves. Thinking about our brands: our consumers, and our shoppers. We wouldn’t plan a TV campaign just because most people watch TV. We’d want to know about our target consumers. So let’s not plan our shopper marketing on the fact that apparently 76% of shoppers might make decisions in-store.
If you want to think differently about your shopper marketing, if you are up for some more challenging thinking, then please join Toby Desforges and myself for a complimentary webinar where we’ll explore this and much more. See you there!