Narrow the focus

The marketplace has been in a stagnant phase for some time, according to Susan Viamari, vice president, thought leadership for Chicago-based market research firm Information Resources Inc., but retailers that want to increase sales of private brand products could benefit by pinpointing pockets of growth in the marketplace. To pinpoint these pockets of growth, however, retailers will need to stop lumping consumers together in large all-encompassing groups. Instead, they will need to “dig deep” to understand their targeted consumers’ shopping habits.

During her Oct. 12 presentation at Store Brands’ 2015 Collaboration Summit in Miami, Viamari mentioned that differences among shoppers are becoming so nuanced that even similar shoppers will often shop differently depending on where they live in the country. For example, “Techies” — young consumers, often millennials, who are generally concentrated in college towns or in areas where innovative companies such as Microsoft, Google and Amazon have high employee concentrations — tend to shop the drugstore channel more often in Raleigh and the club store channel more often in Texas.

“Retailers need to be aware of these differences when designing their product assortment and marketing strategies,” she added. “Retailers really need to be sure their product assortment is reflective not just of their banner, but of the individual market that they’re serving at any point and time.”

One way retailers could understand and target these smaller, more nuanced consumer groups is by using the one thing they all have in common: technology. Consumers are online and looking for products, deals and information, and e-commerce is a great opportunity for retailers to enhance existing marketing programs and come through with hyper-targeted and personalized engagements, Viamari said.

Currently, only about 1 to 2 percent of consumer packaged goods  spending is online, but the Internet is having a huge impact on the shopper journey and the path to purchase, Viamari stated. For example, 8 percent of consumers are referring to a digital device while shopping, and 25 percent use a digital device prior to shopping in the planning process. The products these consumers are researching include personal care items, meat and poultry, and frozen food. And the information for which they are searching often revolves around efficacy, safety and ingredients for personal care items, as well as money-saving deals and product usage ideas for food items.

“Retailers need to be there supplementing their traditional programs with digital programs that will influence shoppers as they begin to plan and carry through the shopper journey,” she noted.