Expo Preview: The Revolution Is Upon Us

While the supermarket industry has trained shoppers to rely on paper circulars, it’s now faced with creating new behavior patterns as shoppers demand to be spoken to in increasingly relevant – and digital – ways. That is part of the findings that will be shared on Oct. 15 during a keynote presentation at the Shopper Marketing Conference & Expo in Minneapolis.Oracle teamed with eight regional grocers to research exactly where the industry stands with circulars and how it needs to transform to remain pertinent. Marketers from three of the eight grocers as well as Angela Myers, Oracle Data Cloud’s head of retail strategy, will present the research and implications.Oracle has hosted strategic meetings with this group of non-competing regional food/drug chains for the past eight years, and it was last fall that they decided to conduct the research. Circulars are continually a high-priority discussion among the group members. They can consume 40% or more of the marketing budget, and for more than just a cost-cutting measure, examining the relevancy of today’s circular is a must as smartphones have changed the way shoppers engage with marketing. And the spending power of the digitally savvy Millennials continues to increase.Circulars that are readily available and highlight fewer ads are big attractions for the younger generations, says Myers. She notes that Millennials tend to be less deal-sensitive and coupon-friendly, but a digital version could introduce them to the circular in a contemporary way and encourage broader adoption among all shoppers.“We are just now starting to see the mobile revolution’s impact on circulars,” says Blaine Bringhurst, SVP, marketing and merchandising, Price Chopper Supermarkets, “which need to adjust not only to the screen size and attention span but also to the fundamental shift in shopping behavior.”“It’s about reallocating advertising dollars to a more relative and efficient channel in order to promote long-term loyalty and profitable sales,” adds Kevin Albritton, EVP, sales and marketing, Brookshire Grocery Co. “It is also time to quit talking and wondering when the time is right to make a change and do some actual testing to provide clearer insights.”For the research, each retailer was responsible for inviting a percentage of its shoppers to participate in the survey – “and we worked collaboratively to ensure we could track the responses back to the behavior for a closed-loop analysis,” Myers explains. Interviews were conducted via email and phone and were designed to gain understanding of both in-home and in-store behavior around sales and circulars. Survey questions focused on the importance of circulars and how they then shape shopping habits. Responses were tied back to in-store purchase metrics using loyalty card data – shared by the retailers – to put responses in perspective.The findings showed that deals remain important to shoppers – more than 80% surveyed said that weekly sales items are important or very important when planning their shopping trips. Shoppers also said it was important to receive a printed grocery store circular, and most said they always, or frequently, read it, compare multiple circulars and look through the entire ad. “Shoppers definitely have habits around the use of the printed circular,” says Myers. “However, what’s interesting to us is what shoppers say they would do if they stopped getting these ads delivered to them.” More than half said they would look for them on the Internet and a “sizable group” said they would go to the store and shop as usual. A small, “but not insignificant group,” said they would shop at another store if they no longer received a paper circular.Myers says it’s key that the industry needs to work with shoppers to evolve their habits. “They have been well trained to use the paper ad, but many today are ready to interact with those ads in a different way digitally,” she says.“It’s not enough for our mobile technology to just have an app and a strong social media presence,” says Albritton. “We must be solution-based – personalized offers, lifestyle content, recipe content just to name a few – and we must allow our customers to interact with us how, when and where they want to.”Longer-term implications of the changes in distributing weekly specials revolve around the planning and negotiating between stores and brands. “The weekly ad planning process is a critical component of the CPG-retailer collaboration and relationship,” Bringhurst says. “As the circular evolves in format, size and distribution it will create a fundamental shift in that relationship. We don’t know yet how exactly it will change, only that it will change significantly and quickly.”Visit the Shopper Marketing Conference & Expo website for more information.

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