Shopper marketing provides a means for retailers to share insight and work with suppliers to grow incremental revenues for both parties - but achieving success can be challenging and often requires a change in approach, according to customer insight consultancy Emnos.
Digital technology is now creating a much more transparent and open landscape for retailing where the ability to browse, research and price compare is intensifying competition. This transparency, together with the current harsh economic climate, has led many retailers to focus on price as the main source of competitive advantage. While price is an important element in a mix of strategies for influencing customer behaviour, it does not provide the differentiation required to build long term sustainable growth.
Moreover, the price reductions are potentially harming a vital source of support. Suppliers have a deep understanding of their categories and can provide valuable additional knowledge as well as product innovation to help drive a strategic advantage. What's more, in a more transparent environment where retailers have only a short window to correct mistakes or failures, a strong partnership with suppliers will be needed to help spot changes in consumer preference early and formulate effective responses.
Shopper marketing provides a means for retailers to share insight and work with suppliers to grow incremental revenues for both parties. However, achieving success through shopper marketing can be challenging and often requires a change in approach for both retailer and supplier. Experience gathered from around the world suggests that the five key steps for success are:
"After a few years of focusing on price, we anticipate that retailers will look for a more sustainable source of competitive advantage," concluded Maxime Brunet of Emnos. "Success will be found in differentiating their propositions and enhancing their engagement with relevant offers and communication. Shared shopper insights and collaboration with suppliers will enable the development of these propositions to drive long term competitive advantage."
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