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March 2016
Who should I focus on instore? Win Both Shoppers and Retailers Through Execution Excellence
SHOPPERS VERSUS RETAILERS
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WHY BOTHER?
Source: Retailer Sentiment Study Q1, 2015
1.3 M GROCERY STORES ACCOUNT FOR
>85%
TT FMCG SALES
US$ 9.9 Billion
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ENCOURAGING PROSPECTS
Source: RMS Data Nationwide MAT
30% Fragmented – Cigarettes – 50% Concentrated – Home/ Personal Care – 15-20%
There is so much value in a single % point reduction of OOS
Cigarettes 3% to 2% US $54+K / day
CSD 4% to 3% US $180+K / day
turnover 80%
store
No need to turn every store to get the opportunities
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HOWEVER, IT ALSO COMES WITH CHALLENGES
Source: Retailer Sentiment Study Q1/2, 2015
DAUNTING TASK 1.3 mil stores can look overwhelming for manufacturers
WAIT AND SEE MODE RCI 71 pts vs CCI 106 pts – Retailers are not yet fully confident about state of business
LIMITED CATEGORIES Cannot handle more than 15 SKUs in the space available
LIMITED SPACE Average store size is only 19 SQM
RETAILERS NEED MONITORING Just 40% of retail stores comply with manufacturer programs if not monitored
F&B DOMINATE SPACE
60% of limited space is occupied by food and beverage categories
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HOW TO BEAT THESE CHALLENGES
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5 INSIGHTS TO WIN IN TRADITIONAL TRADE
IN VIETNAM
WIN THE SHOP, SHOPPER & SHOPKEEPER
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1. STORE FRONT IS THE GOLDEN GATE
Source: Traditional Trade Thought Leadership Q4, 2015
Any brand exposure (product display or POSM) should aim to land at store-front to maximize visibility.
55% Image on Sign-board
53% Image on fridge/ Visicooler
32% Image of Shelf
% Who noticed POSM
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Transactions happen outside the store with the golden gate in full view.
97% Shoppers stand outside of the store
98% Shoppers ask store’s owners to get the products
Source: Traditional Trade Thought Leadership Q4, 2015
1. CAPTURE THE GOLDEN GATE
Shoppers are running auto-pilot on their transactions. The challenge is how to get them engaged to open up more purchase opportunities
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2. SHOPPERS ARE GONE IN 90 SECONDS
Source: Traditional Trade Thought Leadership Q4, 2015
ORDERING
FIRST 10 SECONDS
NEXT 60 SECONDS
LAST 20 SECONDS
MAKING PAYMENT WAITING FOR RETAILER TO GET THE ITEM
IDLE TIME = OPPORTUNITY TO INTERVENE
…
Stores get an average 404 customers visiting every day. 3 out 4 transactions are less than 2 minutes. Things happen fast but there’s a whole minute to capture the shopper while he/she is idle.
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ENGAGEMENT OPPORTUNITIES TO CAPTURE IDLE TIME
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3. SHOUT OUT YOUR PROMOTIONS
98% of the
shoppers are not
aware of
1% of the
shopkeepers actively talk
about
PROMOTION
The best way to shout about it is through the retailer. Unfortunately, it is not a very common practice currently.
retailers made a recommendation to shopper
3% 2 out of the 3 shoppers will follow the retailer’s recommendation.
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4. EDUCATE RETAILERS WHERE THE MONEY IS
SHOPKEEPERS
10% Recommend to shoppers
when product is out-of-stock
10% Engage shoppers in
conversation about product feedback, price, new
launches
Source: Retailer Sentiment Study Q2, 2015; Traditional Trade Thought Leadership Q4, 2015
Consumer Off-take
Competition from other retailers
Revenue/Margin
Stock quantity/ stock price/ sufficient stock
Supporting store management (inventory, space planning, shopper engagement) are vital needs raised – opportunities to engage retailers. Concepts such as upselling & cross-selling will be valued as it can drive growth for their business.
RETAILER CONCERNS
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4. SHOW RETAILERS WHERE THE MONEY IS Create a WIN – WIN opportunity for manufacturers and retailers to drive growth and at the same time addressing issues such as out-of-stocks
AVERAGE RATE OUT-OF-STOCK FOR CIGARETTE
3% = US $2 mil/day TOP 3 BRANDS THAT ARE OUT-OF-STOCK
JET (7%) CRAVEN A (6%)
HERO (6%)
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5. DISRUPT THE TRANSACTION Not all is lost with most transactions being planned. There are opportunities to intervene and create opportunities for unplanned purchases and build your brand.
95% planned
purchases 60
seconds you can…
SHOPPERS
SHOPKEEPERS
IN-STORE COMMS
SMS promo exclusive in TT
Mention there’s a new product or a promo item
Play a 15 sec TVC 4x via LCD display
PG Hand out a product sample
Source: Traditional Trade Thought Leadership Q4, 2015
In
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5. DISRUPT THE TRANSACTION Opportunities to increase basket size can be explored by partnering with often bought categories. On the other hand, if your product is part of the destination categories - protect your stock levels and ensure compliance from retailers.
Source: Trade Thought Leadership Q4, 2015
Cigarette
Food (Instant noodles,
Snack)
Beverage (CSD, Beer, Liquid
milk)
Personal care (shampoo)
48%
36%
31%
6%
Food (Instant noodles,
Fish/soy sauce) 60%
38%
17%
12%
Beverage (Liquid milk, RTD Tea)
Personal care (Sanitary napkin,
shampoo)
Household care (Dish washing liquid,
washing powder)
46% 54%
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Co
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WHERE TO FROM HERE
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WINNING CAN LOOK LIKE THIS
Product assortment identified and in
stock Branded store
sign secured
Retailer standard response after getting
shopper order: “Brand X is on promo today”
Dynamic POSM (LCD, product
samples for sniffing, touching, etc.)
located in front of store,
Disruptions created like a
promo Girl handing out
product samples
All possible front of store surface
area is maximized for branding.
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RETAILER VOICE NEEDS TO BE HEARD
Listen to retailers’ voice to help
manufacturers to innovate and elevate
the relationship
Question: To sell more in Tet, which activities would you like manufacturers to support?
Source: Retailer Sentiment Study Q3, 2015
76%
Product Quality
65%
Promo for consumers
42%
Stock return/ Money-back
38%
Delay payment
34%
Incentive scheme for stores achieving Tet
sales target
31%
POSM/Display
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Space Planning and Management
POS and Inventory Management
Community of Entrepreneurs
Business Training
Microfinancing
Engaging retailers of traditional trade and taking the business to the next level is very much possible
TRADITIONAL TRADE EVOLUTION
Source: hapinoy.com
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PARTING WORDS…
Have them
shout out your PROMOTIONS and watch the conversion grow.
Maximize branding opportunities in the
Golden Gate
Capture shoppers while they are idle. You have
60 seconds to make this happen
WIN-WIN opportunities in retailer engagement – help grow each other’s businesses
WIN RETAILERS To
Win Shoppers
BE DISRUPTIVE use interactive marketing activities that could shake up the shopper’s idle time.