By Laura Durham
“We need to see a true collaboration between brands and competitors and retailers on and offline to deliver customer experience. Collaboration is the new customer solution.”
Craig Lodge, CEO of BrandsInTrade was addressing a group of marketers, point-of-sale (POS) agencies and retail representatives at the POPAI (Point of Purchase Advertising International) Annual Conference held in Johannesburg last week.
Marketing @ Retail is always an interesting subject, particularly in the South African context where we have such a diverse retail landscape. Whether it be to stokvels, township traders or formal retail chains, fast moving consumer goods (FMCG) suppliers are trying to get their brand across to consumers.
And not everyone is getting it right.
Success in stokvels
Mamapudi Nkadima, MD of African Response spoke to the delegates about the enormous opportunity that lies within the stokvel market segment. According to research just completed by African Response, there are over 811 830 stokvels in the country, with 11.4 million members and an estimated financial contribution of R44 billion annually. “Stokvels are the backbone of many families for financial security. They are here to stay – so you need to take this market segment very seriously,” says Nkadima.
She suggests that brand managers and retailers need to understand stokvel members as ordinary consumers “and think about how you can remain top of mind, brand of choice and the chosen channel”. Currently, Shoprite is the store of choice for 47% of respondents and 45% choose to do their bulk shopping at wholesale or independent stores.
There are various ways that marketers can reach this booming segment. “Take in-store out of store – be available and have your brand at stokvel gatherings through sampling and activations,” she suggests. There is also an opportunity for big brands to offer a whole range of products (dry goods, cooking ingredients and cleaning products) at a discounted stokvel price. But most important, says Nkadima, “stop making assumptions – talk with them and understand their needs and aspirations”.
Marketing @ townships
How to effectively market @ retail in the township environment was discussed in depth by Gill Mkhasibe, owner of Alternative Consultancy. This market contains a spectrum of store sizes, variants and customers – from the old general dealer stores, spaza shops, hawkers and more recently, major retailers in malls and stand-alone outlets. Another change has been the demographic profile of these retailers – with immigrant traders becoming more prevalent, particularly in the Western and Eastern Cape and Gauteng. Mkhasibe says from her research into the market, 75% of Soweto traders are foreign, 90% in the East Rand and 100% in Polokwane (including Chinese traders).
Why? “Because South Africans are not entrepreneur in spirit like immigrants and South African traders make much more money renting out their stores to foreign traders,” she explains.
Branding has also undergone a change. At first, there was no branding allowed (illegal), once legalised, every small retailer was grateful for signage. “And now they’re asking ‘what’s the marketing plan?’” she laughs. Mkhasibe offers marketers and POS agencies a few tips:
1. Store sizes vary so you need to offer a variety of options
2. Remember that visibility is a major issue in this trading environment – often cramped, dark stores and many have burglar bars
3. POS material needs on-going maintenance and replacement – it is a rough trading environment
4. Township traders do very little marketing for you so you have to be responsible for helping them sell your products. I.e. you need to find ways to communicate with the end-consumers through them (samples, door-to-door campaign)
5. Immigrant traders like township artists to paint brands onto walls
6. SA is the only African country where traders don’t charge manufacturers
to put up branding/wall painting – take advantage of this
7. Wash lines are a good option in this environment
8. By branding the box you are giving your brand more visibility as traders often use the box as an informal self-merchandising unit
9. If you can’t go directly to traders, POS packs at wholesalers are better than nothing
10. You need to have an integrated marketing plan – below the line, above the line, outdoor, TV – and all need to complement each other.
The new digital experience
Jason Xenopoulos, CEO of NATIVE and Craig Lodge, CEO of BrandsInTrade, spoke on this last point in their presentation on digital shopper marketing. “Shopper marketing is the understanding of why people buy and packaging activations around that through a process that will bind sales and marketing teams (as opposed to separate silos,” argues Lodge.
The social media phenomenon also needs to influence how brands market their products. “The way we encounter information has moved from ‘browse’ to ‘search’ to ‘discover’,” says Xenopoulos. It’s the difference between a brand page versus setting up a community. “Brands need to be ready to accept that the consumer is in control. You need to allow your brand to pass between them in the way they want to share,” he says.
“Social media doesn’t generate word of mouth, word of mouth generates social media,” says Xenopoulos.
In addition, consumers are looking for experience in how they interact with products. In fact, says Lodge, with the age of online shopping, bricks and mortar stores could just become experience centres. “The hybrid format is going to be a merging of digital and real stores,” he says.
Understanding your customer
Regardless of the channel, customer knowledge translates into display success. In this case, marketers need to look at retailers as their customers – and consider how best to meet their specific needs. Bill Smith, senior display manager at Procter & Gamble USA spoke about the ‘second moment of truth’ – where end-consumers use products at home and either reaffirm or reject loyalty to a given brand. But, the ‘first moment of truth’ lies in the store environment. Marketers and display agencies have an important role to play in this space.
Graham Bouwer, CEO of Primedia Instore argues that in-store POS campaigns should be a no-brainer for marketers because of the sheer volume of shoppers that pass through the retail environment. He says that instead of just concentrating on a TV advert campaigns that will reach the 3 million total TV subscribers, why not create an in-store campaign that would reach around 15 million unique shoppers in a retail chain per month. “After all, 75% of decision making happens in-store,” he says.
Smith gives a few winning strategy of effective POS material:
• Adaptable to different size stores
• Minimises floor space per display and reduces floor maintenance
• Provides customer (i.e.. Retailer) labour savings
• Reduces restocking
• Maximises sales and profit
“If your POS doesn’t address these, your displays will never be placed in-store for customers to see,” says Smith.
Award winners announced
The conference ended on a high note as the winners of the POPAI SA Awards 2011 were announced. The awards recognised, for the first time in South Africa, excellence in point-of-purchase (POP) advertising displays and in-store communication activity produced and placed in the country.
“Never before has there been a platform to recognise the guys who put together POP display. POPAI SA and its awards create an opportunity to collaborate and share best practices in the industry and create a broader marketing @ retail platform and for all of us to grow by sharing,” concludes Lodge.
For a full list of winners go to http://www.popai.co.za/awards-2011/ and for more information on POPAI SA go to http://www.popai.co.za/