SUPERMARKET INDUSTRY. Tactics to Target Audiences and Product Categories

Transcription

1 SUPERMARKET INDUSTRY Tactics to Target Audiences and Product Categories

2 Key Findings 1. The top 3 supermarkets, Tesco, Sainsbury s and ASDA, have the highest online population share in the UK, but zooming in to city-level, other supermarkets also compete. See how to target consumer segments by combining location, consumer type and competitive share 2. Online searches for gin have grown rapidly over the year, and were 93% higher at the start of November, compared to the previous year. See who is winning this product category, and how other supermarkets have benefited from a halo effect 3. Visitors to Amazon Fresh s site have grown by 16% *, since the acquisition of Whole Foods. See which supermarkets have the greatest customer overlap with Amazon Fresh, and how they can respond * Comparing the 9 weeks pre and post-acquisition. 2

3 Agenda 1. Audience Targeting: How can Iceland attract the Organic Fruit & Veg shopper? 2. Category Targeting: Who is winning the gin category and why? 3. Competitive Benchmarking: Who is Amazon Fresh competing against, and for what consumer types? 3

4 1. Audience Targeting How can Iceland attract the Organic Fruit & Veg shopper? Tactics to increase market share by location and customer segment * Source: Hitwise Intelligence. Period: 4 weeks ending

5 Share by supermarket UK online population The three largest supermarkets in the UK *, Tesco, Sainsbury s and Asda, have over double the online population share compared to other supermarkets. 7% 6% 5% Share by Supermarket UK Online Population Tesco, Sainsbury and ASDA reach over double the online population in the UK, vs other supermarkets. 4% 3% 2% 1% 0% Tesco Groceries Sainsbury Asda Groceries Morrisons Waitrose Amazon Fresh Ocado Iceland GroceriesAxis Title Groceries Source: Hitwise Intelligence. Period: 4 weeks ending The above chart shows results for only groceries, for Tesco, Asda, Morrisons and Iceland. * According to Kantar Worldpanel total sales. 5

6 Share By Supermarket selected cities But when we zoom into specific cities and locations, a different set of supermarkets arise. In Manchester, people are most likely to visit Asda, Morrisons and Iceland online. In contrast, Londoners are more likely to visit Ocado and Waitrose. Share by Supermarket Selected Cities 160 Manchester London Over-index in London Over-index in Manchester Asda Groceries Morrisons Groceries Iceland Groceries Tesco Groceries Sainsbury Amazon Fresh Ocado Waitrose Axis Title Manchester London Source: Hitwise Intelligence. Period: 4 weeks ending The above chart shows results for only groceries, for Tesco, Asda, Morrisons and Iceland. Index to standard online population in the UK. 6

7 Audience zoom In Manchester Zooming deeper into different types of consumers by location, we can see which supermarkets are attracting which segment. Audience Zoom Regularly purchases the following ranges Manchester Based In Manchester, Asda & Morrisons are comparatively more likely to attract the Premium & Budget Range shopper. Iceland largely under-indexes for the Organic Fruit & Veg shopper. Organic Fruit & Veg Range Premium Range Budget Range Asda & Morrisons attracts both the Premium and Budget Range shopper in Manchester Iceland under-indexes, particularly for the Organic Fruit & Veg shopper in Manchester. Most Over-indexed Most Under-indexed Source: Hitwise Intelligence & Kantar TGI. Period: 4 weeks ending The above chart shows results for only groceries, for Tesco, Asda, Morrisons and Iceland. Index to standard online population in the UK. What can Iceland do to win this segment? 7

8 Audience targeting What can Iceland do in Manchester? If Iceland wanted to conquest the Organic Fruit & Veg shopper and saw Manchester as a strategic location, what could they do? The supermarket could firstly understand the unique interests and needs of this target segment. One such way is through search term analysis. The Manchester, Organic Range Audience Search Term Analysis How can Iceland use this insight? Food & Drink Searches Wine & Alcohol zubrowka somersby cider grey goose Treats dark chocolate Nutella chocolate vegetarian Health Foods coconut milk gluten free bread multivitamins green tea - PPC targeting - Regional promotions (e.g. vegetarian chocolate) - Onsite or social content (e.g. gluten-free tips) Wider Groceries Searches Delivery Searches tesco same day delivery hello fresh Household Products washing up liquid stain remover nappies Seasonal Searches wine advent calendar - Inform product assortment in Manchester - Potential upsell opportunities (e.g. basket suggestions online) Source: Hitwise Intelligence. Period: 4 weeks ending Selected search terms are over-indexed, compared to the online population. 8

9 Audience targeting What can Iceland do? (cont.) Iceland may also want to develop regional promotions or ad campaigns for quick online response. Below is a list of websites that the Manchester, Organic Range audience is most likely to visit. Using this insight, Iceland could then strategically select the best affiliates to partner with. The Manchester, Organic Range Audience Online Behaviour Analysis How can Iceland use this insight? Website Visits Food Industry Online Alcohol Drinks Supermarket Master of Malt Subscription Box Gousto Hello Fresh Competitors Asda Groceries My Supermarket - Monitor audience share with direct competitors - Identify partnership opportunities with complementary brands Website Visits Other Industries News & Media Manchester Evening News Channel 4 Sky Sports Halifax Online Social Tumblr Reddit - Develop whitelists to host display ads - Identify social channels for content/blogs Source: Hitwise Intelligence. Period: 4 weeks ending Selected webites are over-indexed, compared to the online population. 9

10 How to get these insights? Audience Profiler 1. Define your target audience Combine location, consumer type and competitive share to locate your gaps & opportunities 2. Understand their unique interests Delve into the target s online behaviour, such as search terms and websites to build a wider profile 3. Reach your target audience Link insights to action feed analysis into PPC, content, display and partnership opportunities Want to combine online insights with offline purchase data? See link to Hitwise s new partnership with Kantar Media TGI. 10

11 2. Category Targeting Who is winning the Gin Category and why? Tactics to convert high-growth product categories * Source: Hitwise Intelligence. Period: 4 weeks ending

12 % Search Clicks 0.04% 0.03% 0.02% 0.01% Alcohol searches peak over the festive season Searches for Alcohol Types Trend over the Past Year Compared to other alcohols, searches for gin have rapidly increased over the year 0.00% Nov Dec Jan Feb Mar Apr May Jun Jul Aug Sep Oct The seasonality of alcohol Online searches for wine & spirits peaked over the festive season, and remained mostly flat for the rest of the year. But, compared to other alcohols, searches for gin largely differed. Gin searches and variations of the term have rapidly increased since March, and at the start of November, were 93% higher compared to the previous year. Gin Vodka Rum Whisky Mulled Wine Source: Hitwise Intelligence. 12 rolling weeks to 5-Nov-2017, over 52 weeks. The above chart includes search variations of each alcohol type. 12

13 Top Rising Keywords Around Gin 12 weeks to 4-Nov, YoY Type Keyword Search Share YoY% Why have gin searches increased? Flavours Seasonal Rhubarb Pink Ginger Calendar Baubles Advent 3.82% 2.28% 1.37% 1.95% 0.99% 2.00% 173% 175% 127% 106% 14185% 96% By comparing keywords around gin searches, we can see why gin has grown rapidly over the year. The top rising keywords showed that new products (e.g. advent calendars and baubles), flavours (e.g. pink) and supermarkets (Aldi and Lidl) were trending, in time for this year s festive season. Brands Supermarkets Whitley Manchester Gordon Aldi Lidl Tesco 0.72% 0.59% 0.83% 1.52% 0.85% 1.72% 177% 66% 25% 323% 164% 28% Gin Baubles went viral last year, with brands like Pickering s recently releasing their new batch, in time for this year s festive season. Aldi launched the first Scottish Gin Festival at the start of Nov. Lidl has also just released their award-winning pink gins in-store. Source: Hitwise Intelligence. 12 weeks ending 4-Nov-2017, YoY 13

14 The gin audience Share by region Growth in gin searches can be seen overall in the online population, but more so in some regions. The chart on the right shows the proportion of people within each region searching for gin, and how this has changed since last year. In particular, Scotland saw a 70% rise in October YoY. 0.7% 0.6% 0.5% 0.4% 0.3% 0.2% 0.1% 0.0% 70%* The Gin Audience Share Per Region 63% 62% 62% Scotland North East North West South East London 51% Oct Oct Source: Hitwise Intelligence. Audience: Top 1000 searches around Gin, over the periods: 4 weeks ending 4-Nov-2017 and 5-Nov * Relative difference between two time periods. 14

15 The halo effect of gin Lidl released their award-winning Christmas gins on 31-Oct. Aldi also launched the first Scottish Gin Festival on 2-Nov. As a result, searches for Lidl gin and Aldi gin grew by 732% and 133%, respectively, in the week of 04-Nov. These promotions were instore, but others have benefited online. Although much lower in volume, Amazon Gin saw a 32% WoW rise, the following week % % % Supermarket Gin Searches Weekly Trend Searches for Lidl gin and Aldi gin had grown 732% and 133%, respectively, WoW % 14-Oct 21-Oct 28-Oct 04-Nov 11-Nov Lidl Gin Aldi Gin Amazon Gin The following week, although lower in volume, searches for Amazon Gin grew by 32% WoW Source: Hitwise Intelligence. 12 weeks ending 4-Nov-2017, YoY 15

16 Amazon Internal Searches, Related to Gin Week ending 11-Nov gin miniature gin baubles Selected Gin Terms WoW % gin advent calendar 2017 gin glasses 111% 68% 59% 51% How can others capitalise? Only 38% of lidl gin searches went to their site directly, and 59% for aldi gin. The remaining traffic went predominantly to news and media sites. Amazon, on the other hand, had 100% of traffic from amazon gin searches go to their site. When we look at searches within Amazon s site, a number of gin-related products significantly increased. These included: gin glasses, miniatures, calendars and baubles. gin gift 35% gin 18% So what? The opportunity to benefit from a halo effect can be direct or indirect. Amazon saw significant rises in searches for gin-related products, and not necessarily for gin brands. Source: Hitwise Intelligence. Searches made within Amazon, as a proportion of all searches over the specified week. 16 * Source: Hitwise Intelligence. 12 weeks ending 4-Nov-2017, YoY

17 How to get these insights? Category & Product Tracker 1. Track fast moving search terms Monitor what is trending week-on-week by product categories 2. Monitor the impact of competitor campaigns Assess the uplift from competitor events or campaigns, such as searches or onsite conversions 3. Connect with your product and promotions Combat or benefit from a competitor s campaign - Look at the demand for direct or related products to determine your response How can we see inside Amazon s website? Contact us about Hitwise s category and product tracker solutions. 17

18 3. Competitive Benchmarking Who is Amazon Fresh competing against and for which consumer types? Assessing competitor audience overlap and product opportunities * Source: Hitwise Intelligence. Period: 4 weeks ending

19 1,200,000 1,100,000 Prime Day: +38% WoW Weekly Online Visits Discounts Passed onto Whole Foods: +26% WoW 60,000 50,000 Amazon Fresh & Whole Foods Online impact 1,000, ,000 40,000 30,000 Amazon fully acquired Whole Foods on 28- Aug, and soon after, Whole Foods announced price cuts of up to 40%. 800, ,000 Amazon Acquired Whole Foods: +11% WoW 600, Jul 22-Jul 05-Aug 19-Aug 02-Sep 16-Sep 30-Sep 14-Oct 28-Oct 20,000 10,000 0 Amazon Fresh and Whole Foods currently service only a handful of locations in the UK (mainly London), so what is their impact online? Visits to Amazon Fresh have steadily grown, with the number of visitors to their site rising by 16% since the acquisition *. Whole Foods Amazon Fresh Source: Hitwise Intelligence. * Comparing Pre-Acquisition: 9w to Aug-26, and Post-Acquisition: 9w to Oct-28 19

20 Amazon Fresh Overlap with supermarkets Amazon Fresh Audience Overlap Pre vs. Post Acquisition * Who is Amazon Fresh sharing their online audience with? Since the acquisition, Asda, Waitrose and Ocado have seen a larger proportion of their audience shared with Amazon Fresh. In particular, Ocado has seen a significant shift of 17% overlap. 10.5% % Difference: * +14% 6.5% % Difference: +11% Online grocer, Ocado, has seen a comparatively large shift of 17% in audience overlap with Amazon Fresh. 7.0% % Difference: +17% Amazon Fresh Audience Asda Audience Waitrose Audience Ocado Audience Source: Hitwise Intelligence. Pre-Acquisition: 9w to Aug-26, Post-Acquisition: 9w to Oct-28. * % Difference: Relative difference in audience overlap, over these two periods. 20

21 Amazon Fresh more likely to attract the regular chocolate shopper Audience Comparison Food Habits Ocado is more likely to attract the regular spirits and fresh coffee buyer Wine Chocolate Spirits Fresh Coffee Delivery Service Amazon Fresh vs. Ocado Audience food habits To see why there is a shift, we can compare the types of audiences that Amazon Fresh and Ocado draws. Regular buyers of wine and food delivery services are similarly-indexed for both online supermarkets. Ocado is more likely to draw the regular shopper of fresh coffee and spirits, whereas Amazon Fresh is more likely to attract the chocolate lover. Source: Hitwise Intelligence and Kantar TGI. 4 weeks ending 28-Oct The above chart only shows the most regular consumers of wine, spirits, chocolate etc. Index to standard online population in the UK. 21

22 Amazon Fresh Ocado 1 Wrapped Bumper Retro Sweets Selection 1 Fanta Zero Halloween 2 50 Original Nespresso Coffee Capsules 2 Ocado Magnetic Meal Planner 3 Green & Black's Organic Tasting Collection Amazon Fresh vs Ocado - Top Product Pages Week ending 28-Oct 4 Indo Mie Mi Goreng 4 5 TASSIMO Costa Americano 16 T DISCs 5 3 Staropramen Premium Beer 4 x 330ml Fitou Mme Claude Parmentier Cuvee 75cl Waitrose Heston Hanger Steak Pie 2 x 250g 6 Nong Shim Shin Noodle Ramyun 6 Offer - Waitrose Duck Leg Confit 500g 7 TASSIMO Kenco Colombian 16 Capsules 7 Waitrose Pumpkin, Porcetta & Sage Pizza 310g Amazon Fresh vs. Ocado Top product pages In the week ending 28-Oct, 4 out of the top 10 products viewed on Amazon Fresh were coffee-related. But, Ocado attracted a higher proportion of fresh coffee drinkers (potentially not converting as much as Amazon Fresh). To respond, Ocado could then push promotions on coffee capsules the following week, to secure and convert this audience. 8 Tassimo Kenco Decaf Coffee 8 Mr Organic Basilico Pasta Sauce 350g 9 Aberlour 12 Year Old Single Malt Scotch Whisky 10 Monin Flavoured Cocktail Gift Set 10 9 Ocado Tea Towel Waitrose 1 Two Salted Caramel Tarts 167g So what? Amazon Fresh is a growing online threat, and Ocado has seen a larger audience overlap with them. To respond, Ocado could identify product gaps by linking audience data with product insights. Source: Hitwise Intelligence. Product pages viewed on Amazon Fresh and Ocado s website. 22

23 How can I get these insights? Competitive Intelligence 1. Assess the impact of online disruptors Amazon Fresh is one online disruptor, but others like My Supermarket have grown over the year. Assess their online impact to your business 2. Compare your audience overlap Track the audiences shared with other supermarkets and understand why 3. Identify product opportunities Link audience insight to online product performance. Identify gaps in consumer segments, such as where you don t convert Want to monitor your audience overlap with competitors? Get in touch to see Hitwise s AudienceView platform. 23

24 Summary Key Takeaways & Hitwise Services * Source: Hitwise Intelligence. Period: 4 weeks ending

25 Key takeaways In this report, we covered three actionable tactics for supermarkets that combines online and offline data resources. These were: - How to grow a consumer segment The Manchester Organic Range Shopper was identified as an opportunity for Iceland. Iceland could then understand this segment s unique interests to grow engagement, online and offline. - How to convert in a product category Gin has seen enormous growth this year. Other supermarkets can hop onto the halo effect from Aldi & Lidl s instore campaigns, such as Amazon, which has seen growing demand for gin-related products. - How to monitor online threats Amazon Fresh is taking over online audiences. To differentiate, Ocado could then analyse audience breakdown and product performance, to pinpoint gaps and product opportunities. In summary, these tactics support supermarkets targeting customers and increasing value from each segment. 25

26 Want to get these insights? The following Intelligence Tools & Services were featured in this report: Audience Profiler Competitive Benchmarking Product Tracker By combining online metrics and market research variables, the Profiler report identifies the demographics, attitudes and online behaviours of a target audience. Hitwise s platform allows clients to determine what is driving competitor success, by tracking a set of websites and subdomains on a daily, weekly or monthly basis. This custom tool allows brands and retailers to keep pulse on which products are trending on specific sites. With these insights, brands and retailers can identify product demand and determine gaps in their own categories. 26

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