|Half FullShopper marketing needs better tools to execute bigger ideas.|
|Shopper marketing is inherently a powerful idea. By attempting to unify the needs of retailers with the needs of the vendors whose products these retailers sell, shopper marketing works to serve two masters and drive two agendas. When well executed, shopper marketing can achieve this ambitious agenda, because it tailors its programs for specific brands, specific retailers and, sometimes, even specific stores.But because shopper marketing is always both inherently serving two masters and because it tends to be executed on a somewhat micro basis, execution is even more difficult and important to shopper marketing than it is to traditional marketing programs.
To deliver on its promise, shopper marketing needs to be executed cleanly, consistently and excellently. Without this executional quality, shopper- marketing programs are destined to, at a minimum, underperform their potential. Often, poor execution can also make shopper-marketing programs outright failures.
All of this is magnified when, as is often the case, a crucial part of the execution of specific shopper-marketing programs needs to unfold in stores — a very unforgiving and difficult environment. Flawless execution is hard enough when the creator of the program can control all of the variables. When the execution becomes reliant on execution in individual stores, the odds of success become lower and the need for focus on consistency and execution become paramount.
Let me illustrate this with a story from the days when I was getting started in the promotion business, and, yes, dinosaurs still roamed the earth. I am talking about 1989, when I had just left my comfortable job as a marketer at a packaged-goods company and had joined what was, at the time, the largest in-store demonstration company in the United States.
In my first few months at the company, I had a chance to connect with a variety of old friends and try to sell them on our services. One of these meetings took me to beautiful Battle Creek, Michigan, to meet with my old friend Jeff, the brand manager of Rice Krispies.
I started the discussion as one does, asking Jeff if he had any problem I might be able to solve. And he had a big one. Specifically, he wanted to reinvigorate the classic “free toy inside” promotion by offering a better toy with the purchase of two boxes. We suggested a simple in-store execution: We would send ladies to the stores with big boxes of toys (yo-yos, in this case) and posters offering to give the toys to anyone willing to buy two boxes of Rice Krispies.
The idea was clear and compelling, and the results were spectacular. In participating stores, the average number of boxes sold skyrocketed from 30 the week before the promotion to more than 300 the week of the promotion with no additional price reduction or advertising — just the lady, the signage, the yo-yos and the in-store presence.
Needless to say, this became a big idea very fast. We started running programs like this almost every month. We did them on all sorts of cereals with all sorts of toys. Kellogg’s quickly became one of our largest clients. Jeff was promoted to run all kids cereals and everyone was living the dream.
But about six months into this adventure, we discovered something remarkable. While we were, indeed, selling an average of 300 units per store when the promotion ran — fully ten times the sales on a typical week — per-store results were wildly uneven. In fact, we discovered that about half of the participating stores were selling only about 60 units during the promotion while the other half were selling an average of more than 500 units.
A deep dive into the store-by-store results revealed a problem. Basically, in half of the stores we really got the execution right: Twenty to thirty cases of product were being delivered and set up on the floor a day or two before the event, and the demo lady was arriving and setting up her yo-yos in front of the display. Consumers were responding in droves. These stores were moving through 500 units in about two days.
But in the other half of the stores something was going terribly wrong. Most often, the demo lady was arriving with yo-yos to discover that the store manager had no idea what was about to happen. The demo lady would then set up and, by 2 p.m. on the first day of the event, have sold every box of Rice Krispies in the store (only about 60 boxes, it turns out). Having nothing else to do, she was then going home with a big box of leftover yo-yos.
So, what did we learn? The key is that we thought that we had a good idea, one that could sell 300 units in a weekend, and executed it well. What we discovered was that we had a great idea, one that could sell 500 units in a weekend, but were executing it well only half of the time. We quickly put in a variety of controls and systems that made sure that the lady with the yo-yos was only deployed if the store had received delivery of the additional Rice Krispies.
Interestingly, we found that there were a significant number of stores where for some reason — the size, the location, the store manager — we could never seem to get the cereal delivered on time. We never did manage to execute flawlessly in all stores, but by addressing the issues and developing systems to make sure the cereal arrived in-store, (or the lady and the yo-yos didn’t) we got to the point where we were selling an average of about 450 units per store, and executing in about 80 percent of the targeted stores — a much more effective and efficient outcome.
But why do I tell this long story? Simply because we were initially so pleased with the macro results that it took us almost six months to realize that the promotion was delivering only about half of its potential — and that the reason for this significant shortfall was simple executional logistics. It happened that in this case the executional weakness was getting the product into the stores on a timely basis. But it could have been almost anything.
What is important is that one executional issue took the promotion from being a total success — increasing sales from 30 to 500 units — to a minor blip, increasing sales from 30 units to 60 units. This was not nearly enough to cost-justify the event. The point is that we need to do everything in our power to not only come up with the great ideas, but to execute them as well as we possibly can.
One interesting aspect in the story is the role of technology in execution. Back then, part of the reason we had a hard time figuring out what really happened was that data was hard to get a hold of and slow in arriving. Scanners were still in only some stores, and the data took weeks to arrive, not hours.
The good news is that technologies have since emerged that could address the issues aggressively. The bad news is that not much has been done to deploy these technologies properly in-store. Technology tends to be deployed against the whiz-bang parts of marketing, not the prosaic, executional elements which end up making a huge difference.
Twenty years ago, the demo ladies charged with executing this type of promotion would go to the store and call in a report detailing what happened. Today, most demo companies operate in exactly the same way. A few more advanced companies use internet-based reporting, but almost no one has distributed technology down to the store level. All of this is compounded by a tricky combination of store-level technology issues and lingering distrust between manufacturers and retailers which still need to be addressed.
So, what are the lessons of this story? I think there are two. First, never underestimate the importance of excellent execution in making shopper-marketing programs work, especially at the store level. And second, it is time for the industry to come together around technology that can make executional excellence more achievable. The technology is there, it just needs to be customized and deployed.
DAVID DIAMOND is chairman of StorePort Inc., a provider of management tools for third-party labor. He began his career at Procter & Gamble, later served in senior-management roles at ActMedia and Catalina, and can be reached at ddiamond-@-storeportnetwork.com.