The Changing Landscape of Retail & Consumer Promotions. Tom Pirovano March 15, 2011

Transcription

1 The Changing Landscape of Retail & Consumer Promotions Tom Pirovano March 15,

2 Welcome! 2

3 Topics Covered What s What The State of Retail Promotions Today What s New and What s Next Game-Changing Trends & Technology Future Retailing & Promotion Opportunities 3

4 The State of Retail Promotions Today 4

5 Major Supermarkets Running More Ad Circulars in Count Retailer Circulars Circulars Change Safeway (Multiple Banners) Carr s, Dominick s, Genuardi s, Randall s, Tom Thumb, Vons, Pavilions Jewel-Osco King Soopers / City Market Publix Quality Food Centers Fresh & Easy Save-A-Lot Source: ECRM-MarketGate Ad Comparisons, Calendar

6 Other Major Retailers Running More Ad Circulars in 2010 Outside the Traditional Grocery Channel Count Retailer Circulars Circulars Change JC Penney Sears Family Dollar Home Depot Dollar General OfficeMax Walgreens Walmart-US Toys - R - Us Target Stores Source: ECRM-MarketGate Ad Comparisons, Calendar

7 Very Few CPG Retailers Are Running Fewer Ad Circulars Chg In Retailer Circulars Circulars Circulars Sentry Foods Kmart Copps Farm Fresh Big Lots Source: ECRM-MarketGate Ad Comparisons, Calendar

8 Squeezing More Ads into Fewer Circulars 2010 Chg In Chg In Retailer Circulars Circulars Ad Blocks Sentry Foods ,845 Kmart Copps ,217 Farm Fresh ,896 Big Lots Source: ECRM-MarketGate Ad Comparisons, Calendar

9 Most leading retailers ran more ad blocks in 2010 than in 2009 Increased 2010 Ad Blocks Vs Kroger Safeway Albertson s (Supervalu) Loblaw s (Canada) Publix Stop & Shop Food Lion H.E.B. Decreased 2010 Ad Blocks A&P Wegman s Meijer Kmart Sears Shopko Walgreen Company CVS Rite Aid Walmart-US Target Stores Shouldn t we expect fewer print ads as digital media grows? Source: ECRM-MarketGate Ad Comparisons, Calendar

10 Retailers with the Most Ad Blocks Per Circular Avg Ads Per Circular ShopRite Meijer Fred Meyer Acme Markets Waldbaums A & P Superfresh Pathmark Shoppers Drug Mart Weis Markets Supermarkets in Eastern U.S. states tend to have many more feature ads per circular. Source: ECRM-MarketGate Ad Comparisons, 12 Months Ending 2/19/

11 Retailers with the Fewest Ad Blocks Per Circular Aldi Kerr Drug Wegmans Fresh & Easy Big Lots Walmart-US Duane Reade Food 4 Less Bloom Price Chopper Avg Ads Per Ciruclar Ads with these retailers are less likely to be lost in the crowd Source: ECRM-MarketGate Ad Comparisons, 12 Months Ending 2/19/

12 Retailers Promoting Private Label Private Label Share of Ad Blocks Aldi Fresh & Easy Wegmans Hannaford Bros H.E.B. Giant Carlisle Hy-Vee Food Basics Loblaws (Canada) Scott's Food & Pharm 27.6% 27.3% 26.9% 26.7% 25.2% 25.1% 24.8% 49.9% 60.8% 66.4% Aldi, Fresh & Easy, and Wegman s are the clear leaders in promoting their private brands. Source: ECRM-MarketGate Ad Comparisons, 12 Months Ending 2/19/

13 Retailers Promoting Traditional Brands Private Label Share of Ad Blocks Big Lots Marc Glassman Bartell Drug Lewis Drug Price Chopper (KC) Longs Drug (Hawaii) Dierbergs Shop 'n Save (St. Louis) Walmart-US Albertsons LLC 0.0% 0.4% 4.2% 4.3% Traditional brands may find less private label competition with these retailers. 6.1% 6.2% 6.6% 7.1% 7.5% 7.8% Source: ECRM-MarketGate Ad Comparisons, 12 Months Ending 2/19/

14 Top Promoted Brands in 2010 Across All Categories Share of Retail Rank Brand Name Print Ads #1 Samsung 0.60% #2 LG 0.46% #3 Pantene 0.44% #4 Dove 0.42% #5 Coca Cola 0.42% #6 Pepsi 0.41% #7 Sony 0.34% #8 Neutrogena 0.34% #9 L'Oreal Paris 0.33% #10 Aveeno 0.30% Source: ECRM, Share of Ads (Brands Counts) for Calendar

15 Top Promoted Brands in February Brand Share February January Calendar of February Brand Name 2011 Ads Rank Rank Rank Samsung 0.726% #1 #1 #1 Dove 0.580% #2 #2 #4 Coca Cola 0.526% #3 #5 #5 LG 0.501% #4 #39 #2 Pepsi 0.449% #5 #7 #6 Herbal Essences 0.385% #6 #27 #12 L'Oreal Paris 0.361% #7 #12 #9 Axe 0.344% #8 #149 #23 Fructis 0.338% #9 #14 #17 John Frieda 0.312% #10 #60 #40 Olay 0.303% #11 #74 #43 Revlon 0.299% #12 #10 #16 7up 0.289% #13 #20 #14 Nature Made 0.288% #14 #25 #21 Maytag 0.285% #15 #65 #38 Source: ECRM's MarketGate Ad Comparisons, U.S. and Canada, All Retail Channels 15

16 Ad Pricing By Region Target Front Page Ad, Week of March 13,

17 Featured Products By Region CVS Front Page Ad, Week of March 13,

18 Ad Exclusivity Sharing Ads Space with Competitors. Ads Running Week of March 13,

19 As suppliers improve their ability to evaluate trade promotions, look for trade spending to be adjusted across retailers based on promo quality regardless of ad media. 19

20 Game-Changing Trends & Technology 20

21 Where does the name Roto Ad come from? Answer: The Rotogravure Printing Press 21

22 News: February 24 th, 2011 Shoprite is First Grocery Retailer On All Three Leading Mobile Spaces First with 1. iphone (IOS) App 2. Android App 3. Mobile Web Site 22

23 Mobile strategies appear unbalanced across the top U.S retailers Company # Who Like Facebook Page iphone App? Android App? Mobile Web Site? Walmart 3,500,000 Yes Sam's Only Yes Kroger 54,000 Yes Yes No Target 3,900,000 Yes Yes Yes Walgreens 823,000 Yes Yes Yes The Home Depot 228,000 Yes No No Costco 217,000 No No Yes CVS 263,000 Yes No Yes Lowe's 508,000 No No Yes Sears/Kmart N/A Yes Yes Yes Best Buy 2,500,000 Yes Yes Yes Safeway 145,000 No No Store Locator Only Observed as of 2/19/

24 How many shopping apps does a consumer need? 25

25 Authenticity is a new challenge in mobile marketing Each of these Android apps uses the Walmart name, and some look very authentic. But none of these is from Walmart. 26

26 Use of 2D barcodes continues to expand. Bed/Bath/Beyond 3/9/2011 Sears 3/13/2011 FSI 3/13/2011 Costco 3/9/

27 Online Customer Reviews How Are Shoppers Using This? How Are Category Managers Using This? How Are Product Managers Using This? 28

28 What You Need to Know About GROUPON Combines collective buying with social media to offer local coupons via Valued at $6 Billion in February, 2011 Launched November, million subscribers 500 markets in 35 countries Groupon s Super Bowl Commercial Just one of several new ways to promote online TV spot criticized by some, but helped to broaden awareness of this emerging marketing powerhouse 29

29 Will Shopkick be the next big thing? Shoppers are willing to let retailers track their locations in return for special offers. 30

30 Other Consumer Tools to Watch 31

31 New players are finding a role as consumer advocates February, 2011 Jill Cataldo, the Super- Coupon Queen, launched a social media campaign after finding 761 expired items at a major Chicago retailer. Coupon Tools From JillCataldo.com Coupons.com SmartSource.com RedPlum.com CouponNetwork.com Cellfire.com ShortCuts.com PGeSaver.com Hilander Softcoin Upromise.com Jewel-Osco Avenu Dominick's Just For U Meijer Mealbox Target Walgreens CVS/Pharmacy Wal-Mart All You Exclusives Current Inserts Coupon Lookup 32

32 Super Bowl TV Commercials 8 CPG Suppliers with 2010 Super Bowl Spots Anheuser-Busch PepsiCo Coca-Cola Mars Candy MillerCoors Dr. Pepper/Snapple Unilever Diamond Foods 4 CPG Suppliers with 2011 Super Bowl Spots Anheuser-Busch PepsiCo Coca Cola Mars Candy Only 4 CPG Players in 2011? Will Super Bowl TV commercials remain effective for CPG brands? 33

33 Alternative Strategy P&G s Old Spice Campaign Specifically focused on Old Spice Body Wash Launched first on Old Spice Facebook Page Loaded to YouTube on 2/4/2010 BEFORE Super Bowl Strong FSI Support Expanded Campaign in July Overshadowed Super Bowl Ad By Other Men s Body Wash 34

34 What s Next? 35

35 Evolving Revenue Streams for U.S. Food & Drug Retailers Margins on Everyday Turns Store Brands Slotting Fees Circular Ads Displays Diverters Online Sales & Shipping Leasing Kiosks Cell Phones/Electronics Gift Cards Marketing 2011 & Beyond 2-D Barcodes Location-Based Ads Download Sponsorship Guaranteed Couponing Car Charging? 36

36 Content Sponsorship Redbox is already developing CPG partnerships. 37

37 Retailers Owning Media Companies February, 2010: Walmart Buys Vudu Retailer Opportunities Ad-Subsidized Downloads Interactive Ads Reward Downloads for Frequent Shoppers Pag 38

38 Ad-Sponsored Book Downloads? Media has a long history of ad sponsorship. Will ads lower the price of e-books? Could advertising lead to an increase in literacy? Enjoy a Coke with your book. 39

39 Private Label Phone Service Walmart, Kroger, Meijer, and other retailers offer private label phone service. Retailer Opportunities Text Ads Surveys Location-Based Ads Pay By Phone Minutes/Downloads for Frequent Shoppers 40

40 The Other App Stores: Chrome Apps & Mac Desktop Apps 41

41 Retailers May Be the Key to Tomorrow s Infrastructure Charging Electric Cars at Whole Foods and McDonalds 42

42 In Summary Retailers are running more print ads. Suppliers have better tools to measure promos. CPG transition to digital promos is unbalanced. Retailers need to maintain ad revenue streams. Download sponsorship offers new advertising white space. While social media drives attitudes, mobile media can drive sales. 43

43 Thank you. Questions? 44