Digital Marketing in F&G 2012

www.evolution-insights.com

Digital Mobile Marketing in UK Food & Grocery 2012 – SAMPLE EXTRACT Essential Shopper Insight into the use of Digital Mobile Media & Mobile Commerce

Evolution Insights Ltd Prospect House

32 Sovereign Street Leeds

LS1 4BJ Tel: 0113 389 1038

http://www.evolution-insights.com

Evolution Insights: Shopper Insight Series

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Disclaimer


Please note No part of this publication may be reproduced, stored in a retrieval system or transmitted in any form by any means, electronic, mechanical, photocopying, recording or otherwise, without the prior written consent of Evolution Insights Ltd. The content of this report is based on information gathered in good faith from both primary and secondary sources and is believed to be correct at the time of publication. Evolution Insights can however provide no guarantee regarding the accuracy of this content and therefore accepts no liability whatsoever for any actions taken that subsequently prove incorrect. © Evolution Insights Ltd 2012

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• Evolution offer a range of products & services for clients in the field of shopper research:-

• Off-the-shelf research

– Evolution’s off the shelf research publications deliver affordable insight into shopper motivation and behaviours in UK food, drink and grocery

• Insight Plus

– Insight Plus offers your business the opportunity to engage in any of our regular shopper research projects in advance of publication, tailoring the scope to suit your needs

• Bespoke Consulting

– As publishers of research, we are able to draw upon a wealth of existing proprietary data for consulting projects – helping to better inform and shape any further research requirements.

Evolution is a leading research consultancy specialising in shopper motivation and behaviour. We deliver off-the-shelf, tailored and bespoke research for manufacturers, retailers and agencies.

Further information is available at our website http://www.evolution-insights.com

Visit and sign up for Reflections, our free quarterly newsletter offering analysis and commentary on topical issues

About Evolution Insights

As a leading publisher of shopper research, we are ideally placed to offer your business actionable shopper insight.

Our research and analysis helps clients develop targeted shopper marketing initiatives designed to influence shoppers at the point of purchase.

We use a range of research methodologies to discover genuine insights. Our research incorporates a broad spectrum of robust qualitative and quantitative research techniques.

www.evolution-insights.com 3

Contents


Key Findings and Summary 6 Push Vs. Pull 37 When Shoppers Prefer to Receive Marketing Messages 38

Digital Mobile Marketing: Introduction 11 Summary 39 Introduction 12 Path to Purchase 13 Price Comparison 40 Benefits 14 Introduction 41 M-Commerce 15 Technology Usage 42 Current Statistics 16 Using a Smartphone – Awareness & Usage of Initiative 43 Shopper Marketing Initiatives 17 Using a Smartphone – Appeal 44 Methods of Reach 18 Push Vs. Pull 45

When Shoppers Prefer to Receive Marketing Messages 46 Digital Technology at a Glance 19 Summary 47 Introduction 20 PC/Laptop Ownership & Usage 21 Recipe Ideas 48 Tablet Ownership & Usage 22 Introduction 49 Ownership of Smartphones – Year-on-year Change 23 Technology Usage 50 Ownership of Smartphones - Demographics 24 Using a Smartphone – Awareness & Usage of Initiative 51 Smartphone Usage 25 Push Vs. Pull 52 Marketing Relevance 26 When Shoppers Prefer to Receive Marketing Messages 53 Location-Based Marketing 27 Summary 54 SMS and Email 28 Method of Receiving Marketing Messages 29 Digital Vouchers & Coupons 55 Summary 30 Introduction 56

In Action 57 Digital Marketing Initiatives Technology Usage 59 Online Shopping 31 Using a Smartphone – Awareness & Usage of Initiative 60 Introduction 32 Using a Smartphone – Appeal 61 Technology Usage 33 Push Vs. Pull 62 Using a Smartphone – Awareness & Usage of Initiative 34 When Shoppers Prefer to Receive Marketing Messages 63 Using a Smartphone – Appeal 36 Summary 64

Contents


Product Information 65 Summary 93 Introduction 66 Technology Usage 67 In-store Experience 94 Using a Smartphone – Awareness & Usage of Initiative 68 Introduction 95 Using a Smartphone – Appeal 69 In Action 96 Push Vs. Pull 70 Using a Smartphone – Awareness & Usage of Initiative 97 When Shoppers Prefer to Receive Marketing Messages 71 Using a Smartphone – Appeal 99 Summary 72 Summary 100

Loyalty Points 73 Mobile Apps 101 Introduction 74 Introduction 102 Technology Usage 75 In Action 103 Using a Smartphone – Awareness & Usage of Initiative 76 Current Retailer Apps 104 Using a Smartphone – Appeal 78 Ownership & Usage 105 Push Vs. Pull 79 Summary 112 When Shoppers Prefer to Receive Marketing Messages 80 Summary 81 NFC 113

Introduction 114 Shopping Lists 82 The Future of Mobile Advertising 115 Introduction 83 Awareness & Usage 116 Technology Usage 84 Uses in Food & Grocery 117 Using a Smartphone – Awareness & Usage of Initiative 85 Summary 118 Using a Smartphone – Appeal 86 Summary 87 Social Media 119

Introduction 120 Healthy Eating 88 In action 121 Introduction 89 Interaction with Retailers 123 Technology Usage 90 Benefits of Interaction with Retailers 124 Push Vs. Pull 91 Summary 125 When Shoppers Prefer to Receive Marketing Messages 92

Methodology 126

This Report…

All the information in this report relates to main Food & Grocery shoppers who own a smartphone.

Please note…

All of the information provided is in relation to primary household food & grocery shoppers who own smartphones!!


Digital media encompasses all forms of communication that are delivered using a binary electronic format, utilising technology such as computers, mobile devices and screens. Digital media lies in contrast to traditional forms of mass media such as analogue radio and television, print (newspapers and magazines), signs and banners.

The digital media landscape ranges from text messages, e-mail and social media to internet websites, smartphone applications – and more. Internet connected devices form the backbone of many forms of digital media, and underpin the huge growth in electronic and mobile commerce, and social media in recent years.

Digital marketing in food and grocery is quite simply the marketing of brands and retailers to consumers using digital media channels. Importantly - digital marketing shares all the same characteristics as traditional marketing. It is just marketing delivered using digital channels and should not be considered in isolation from traditional marketing.

Although we will touch on other forms of digital marketing, the majority of this report will focus on mobile marketing (i.e. the use of smartphones).

Digital Mobile Marketing: Introduction


Smartphone apps can

offer shoppers the latest

personalised coupons,

offers and points

rewards based on

their shopping

habits and location

E-mail remains one of the most popular forms of digital media for push marketing

Smartphones bring digital media such as e-mail, websites and apps to mobile devices

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Benefits

Engage more directly with consumers as

shoppers outside the

store Reach shoppers who use traditional

media less

Drive brand consideration

and loyalty through targeted

vouchers and offers

Capture shopper

preferences & habits via opt

in schemes Break down the ‘marketing

is intrusive’ barrier with

improved personalisation

Improve response rate and ability to

measure return on investment

Improve shopper

involvement and use of

loyalty schemes

Influence shopping list and basket before the

shopper enters the store

Digital Mobile Marketing: Benefits


Shopper marketing traditionally focuses on

marketing actually in the retail environment.

Initiatives seek to target the consumer in shopper

mode while they are in the store, and are

designed to influence their decision making

process up to the point of purchase.

There are strong opportunities for digital shopper marketing

in food & grocery. E-mail, SMS, websites and smartphone

applications can enable targeted, personalised

marketing messages reach the grocery consumer in shopper

mode, both inside and outside of the supermarket.

Moreover, since digital shopper marketing allows for

improved targeting of shoppers, the results - and

ultimately the return on investment - are often easier

to measure.

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Use regularly for an increasing number

of tasks

It is interesting to understand the ownership and usage of other types of technology. Here we can see that the vast majority of smartphone owners also have a computer at home.

Digital Marketing: PC/Laptop Ownership & Usage


Don’t own and not considering

Only use for basic tasks

Use frequently

Don’t own but would like

4%

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Only 4% of smartphone owners

don’t own a PC/Laptop

Ownership and usage of PC/Laptop by smartphone owners:

2 2

77

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Smartphone ownership is seeing a steep increase year-on-year. We expect this trend to continue as tariffs become cheaper and contracts come up for renewal.

Digital Marketing: Ownership of Smartphones – Year-on-year Change


2010 2011 2012

37% of shoppers

own a smart-phone

47% of shoppers

own a smart-phone

60%* of shoppers

own a smart-phone

Smartphone ownership: Year-on-year changes

*who are primary food & grocery shoppers

Smartphone have all kinds of uses for cooking – recipe ideas, timers, ingredient lists, share ideas, cooking instructions, sharing photos, etc.

Recipe Ideas: Push Vs. Pull


Pull refers to shoppers actively seeking out information on their

smartphone, through a marketing channel.

Push refers to information being

delivered to a Smartphone without

request from the shopper.

40% - Pull

PULL PUSH

21% - Push

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Here we can see the ownership and usage of the Ocado shopping app amongst smartphone owners.

Mobile Apps: Ownership & Usage


17%

83% 20%

29%

37%

15%

Frequently

Occasionally

Rarely

Never

Have app

Don’t have app

Ownership Usage

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Social media is having an ever increasing influence on how people shop, leading to the rise of the ‘social shopper’ (social media guided shoppers). Currently, a quarter of all FMCG purchases are made with the influence of social media, and is set to rise.

Recent studies have found that ‘social shoppers’ spend on average 27% more than those without digital mobile devices. Retailers and FMCG’s are racing to up their social media game with an ever increasing portion of their advertising budgets being spent on digital channels, with a bid to strengthen shoppers connection with their brand.

Social media is used to gain a multitude of information from what people this of you/your product, trends shoppers are interested in, and general attitudes and opinions.

The proportion of the UK population to have a Facebook account is reaching 50%, with the highest user group being the 25-34 year olds. Twitter users aren't far behind with an explosion up to 26 million in the UK, up from 12 million last year.

Social Media: In action


Spent over $1bn on digital promotion

41% of shoppers expect to receive special offers in return for following a brand on Facebook

78% expect brands to have an active Twitter feed

37% of shoppers access a stores social media site

Facebook fans: (million)

51

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76% rely on recommendations from friends when making purchases compared to 15% who rely on advertising

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Methodology

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Secondary and desk research

Preliminary quantitative survey

Focus groups Main quantitative

survey

Insights

Evolution carried out a preliminary survey of 100 shoppers , to test questions for the main survey.

Detailed secondary and desk research was conducted to define the digital shopper marketing landscape, macro drivers and trends, scope and examples of initiatives to date.

Initial insights gained were used to help further design the main survey.

The main survey was completed by 1,044 UK adults who said they regularly shop for food & grocery and own a smartphone.

Comprehensive and detailed assessment of all the data received was then used to discover insights.

Throughout this process, primary research was supported by secondary research drawing on Evolution’s proprietary databases, national statistics, news and industry resources.

Evolution’s consultants also maintain close relationships with industry figures across retailers and manufacturers.

Methodology


Evolution’s methodology

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Detailed shopper insights were gained from a survey of 1,044 UK adults who say they regularly shop for food and grocery and own a smartphone. The samples were fully representative of the UK population.

The survey contained 35 questions relating to technology ownership and usage; awareness, usage & appeal of digital shopper marketing initiatives, and methods of reach – in addition to standard demographic profiling questions.

The questions were designed to give maximum insight into shoppers perspective on their awareness, usage and appeal of digital shopper marketing initiatives in food and grocery.

The survey was carried out online during October 2012.

Methodology: quantitative survey


Themes including personalisation, disclosure of information, push versus pull marketing and location based marketing

General perspective on the use of digital media for food & grocery marketing

Perspectives on preferred location and timing

Awareness, usage and appeal of a variety of different digital shopper marketing initiatives in food and grocery

Main supermarket retailer used for grocery shopping

Ownership and usage of technology

Demographic profiling

Topics of questions in quantitative survey

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Glossary

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Glossary


3G – Third generation mobile phone network capable of improved data connectivity 2G – Second generation (GSM) mobile phone network technology ABC1C2DE – Socio demographic profile using job type (if applicable). Above the line (ATL) – Advertising using the main 5 media types of television, press, radio, cinema, and posters to promote brands. App – A smartphone application AR – Augmented reality Below the line (BTL) – Advertising using non-media communication. Typically sales promotions as short-term incentives, largely aimed at consumers in-store. Big Four – The largest four grocer retailers in the UK by market share. Category driver – key influences driving the growth of any given category Channel – Retail distribution type for example supermarket, c-store, CTN Circumstances – The circumstances of the shopper when they undertake their shop Demographic – Characteristics of the population (including sex, race, age and income). Digital media – digital marketing medium for example social media, mobile, digital signage. Digital shopper marketing – Shopper marketing that utilises digital media DSM – Digital shopper marketing EAN – European Article Number (barcode standard) E-commerce - buying and selling of products or services over electronic systems such as the Internet and other computer networks ePOS – electronic point of sale system, e.g. checkout technology EDLP – Everyday low prices. FMCG – Fast moving consumer goods, often used to refer to a manufacturer. Food and grocery - Foodstuffs and various household supplies Gondola end - The promotional position at the end of a main aisle. GPS – global positioning system (technology incorporated into mobile devices for geographic location identification and tracking) Impulse – A sudden wish or urge that prompts an unplanned act or feeling. Location based delivery – delivery of marketing to mobile devices based upon GPS location M-commerce - buying and selling of products or services over mobile electronic systems such as the smartphones Microsite – Internet website dedicated to a particular brand, using a different (branded) URL Modality – The way a shopper behaves in-store NFC – Near-field Communication

On-the-go – Buying any food and/or drink for immediate consumption, i.e. outside the home Personalisation – Targeting of marketing campaigns to individuals based upon detailed information about their demographic and shopping habits POP – Point of purchase POS – Point of sale POS Material– Marketing communications at the point of sale. Push delivery – delivery where content is sent to the recipient without their interaction at the time of delivery Pull delivery – delivery where content is requested by the recipient reactively. QR code – Quick response code (new form of 2D barcode that carries more information) Revenue – Total reported turnover (excluding VAT). ROI – Return on investment Shopper marketing – Any marketing activity aimed at the shopper throughout their path to purchase. Shopper mission – the reason/purpose of the shopping trip from the shopper’s perspective. Smartphone – An internet enabled mobile phone device that runs applications (‘apps’). SMS – Short message service (mobile text messaging) Socio-demographic - Characteristics of the population (including sex, race, age and income). Social network – electronic social interaction platform for example Facebook, Twitter URL – Uniform resource locator (web standard for internet website addressing)

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Contact us

Evolution Insights Ltd

Prospect House 32 Sovereign Street

Leeds LS1 4BJ

Telephone: 0113 336 6035

e-mail: [email protected]

Web: http://www.evolution-insights.com

Company No. 07006001

Country of Incorporation: United Kingdom

© Evolution Insights Ltd. All rights reserved 19

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Digital Marketing in F&G 2012

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