A Category Management View of Post Lockdown Shopper Missions
Same, same but different.
Let’s start this piece with a selection of absolute understatements. Covid 19 changed many things. Covid 19 led to a total reset of how many of us live and work. Covid 19 triggered unprecedented levels of change as to how customers shop in store and online.
Throughout and following periods of unprecedented change, evolution is heightened and often very visible. After a recession, we often see new spend allocation amongst consumers, in times of plenty we may see excessive consumption and new purchase occasions. One thing is certain, retail has always responded to the challenge and evolved.
Post March 2020, retailers, suppliers and shoppers have reacted and pivoted in response to extraordinary events. In the retail context, heightened levels of evolution have resulted in a renewed focus on ‘value for money’ and we have seen fluctuating and still evolving channel shifts. For the key players in the FMCG industry, retailers, suppliers and shoppers, life is very different.
During the height of the pandemic, closed stores, limited online slots, social distancing, queuing, one-way systems and a reluctance to leave the home significantly affected our shopping missions. Where we shopped, why we went there and what we searched for became very different to pre-lockdown life.
Before March 2020, the FMCG industry regularly referred to missions as Top-up shop, Main/Big shop, Health & Beauty, Non-food, Evening Meal, Food to go and Food for tonight. FMCG Category Managers would build ranges, propositions, visual merchandising and marketing activity around key shopper missions. Focussing on shopper missions allows retailers and suppliers to focus activity around giving shoppers what they seek and want during these missions. If retailers succeed in satisfying or meeting the shopper mission, they will naturally convert shoppers to purchasers, driving spend and driving loyalty.
This article discusses changes to shopper missions caused by the pandemic and what this means for FMCG suppliers and retailers. Particular focus is given to the role of the FMCG Category Manager who is ultimately responsible for understanding how we shop, where we shop and the subsequent development of the opportunity and the optimisation of the shopper mission. It is also the responsibility of the category manager to work out practically and tactically what this means as we move into new 2022 planning cycles with realigned strategic priorities.
But first, it is often useful to revisit what FMCG Category Management actually means. FMCG category management is a global discipline combining strategic thinking, a marketing perspective and a focus on commercial acumen to deliver optimal purchase opportunities, conversion and absolute fulfilment of the customer’s needs.
Still a relatively new concept in the UK and Europe, the term “Category Management” was created by Brian F. Harris, a former professor at the University of Southern California and the founder of The Partnering Group (TPG) in the late 80s. Over the past few decades, the FMCG industry has fully embraced the idea of grouping SKU’s (stock keeping units) into relevant categories and managing them as strategic business units. Examples include, baby care, personal care, first aid, home baking and recently Free from and Plant Based.
Dupre and Gruen (2004) refer to Category Management as a movement away from the ‘brand centred practices of the past’. Instead of selling as much of what you have, wherever you can; Category Management describes an arrangement or process whereby instead of focussing solely on the brand, retailers and manufacturers work together to create and manage strategies for specific product categories (Araujo and Mouzas, 1998; Dupre and Gruen, 2004).
Next time you find yourself standing at a bakery fixture or a dental fixture in a major multiple, pay attention to which products, brands, pack counts/sizes and prices are included. Spoiler alert, nothing is left to chance, it is highly likely that a category management team has optimised this range from a customer and mission perspective.
The importance of the FMCG shopper mission
Clarity around changes to existing missions and emergence of new missions is key as we continue our multi-layered journey back to normal. Reconnecting with our shoppers after the pandemic is vital but will take time, the picture needs to emerge, the EPOS and loyalty data need to grow and every shopper has their own rate of emergence back into store, at their own pace, in their own time. The quickest way to maximise interactions with shoppers in times of great upheaval is to focus on shopper missions. What do we know about how people shop now vs. Before the pandemic, growth and decline of current accepted missions and new post pandemic missions?
A shopper mission is based around the shopper’s intent. This intent is usually linked to satisfying a need which will be fulfilled by entering a store, making a choice and converting to purchase. As Category Managers or Marketeers working in FMCG, we need to know why shoppers are in store, what drives them there, what their mission is and what the key purchase triggers are. By focussing on need and intent, Category managers can ensure the right product is ranged in the right channel or store, at the right time, in the right location.
The use of mission-based ranging, activity and focus is now accepted and widespread across global retail allowing Category Managers and retail teams to develop ranges of products, propositions and messages based on key shopper groups and missions. Missions in retail are not new, they have existed for decades, the focus on maximising missions has only become possible since the advent of retailer loyalty systems which allowed us to analyse what shoppers put in their basket, what they buy with our product, what time they made their purchase and how this could be linked to their overall shopping habits, lifestyle and socio demographic classification.
Traditionally, missions have been widely described as Top-up shop, Main/Big shop, Health & Beauty, Non-food, Evening Meal, Food to go, Food for tonight. During the pandemic, all established missions were challenged by a myriad of factors including store closures, working from home, less commuting, scarcity of online delivery slots and the advent of meal delivery solutions.
Shopper missions during the pandemic
From March 2020, shopper missions such as the ‘big shop’ became a national focus as we queued outside supermarkets or searched for online delivery slots. At the height of the pandemic, retailers scrambled to hire additional delivery drivers to fulfil our needs and some Grocers prioritised vulnerable groups, both and Asda Sainsburys gave older shoppers or shoppers who were shielding priority online booking slots. Our ‘top up shops’ became more convenience chain focussed than main estate grocery and our food to go needs changed as we stopped commuting and worked from home.
With the closure of pubs and restaurants, shoppers attempted to recreate the out of home dining experience. Our evening meal missions became large feasts as we looked to cheer ourselves up by adding to our meals with additional accompaniments and multiple courses.
Health and Beauty missions moved online and retailers scrambled to replicate the in-store beauty counter experience by hosting online customer events including live shop-alongs and expert led demonstrations. When Health & Beauty retailers did open their doors post lockdown, the experience was very different and admittedly quite bleak with a distinct absence of testers, experts and a generally muted experience. Retailers like John Lewis in Victoria Gate Leeds used QR codes pasted onto counters linking shoppers to link shoppers to the Instagram pages of counter staff who could demonstrate make up looks to beauty fans.
Upon reopening, the traditional ‘missions’ did not immediately return to normal and it is likely that there is further significant and elevated levels of evolution to come. New health concerns and a focus on overall wellness will undoubtably increase plant based and alternative diet ranges featuring heavily in many missions. As all retailers respond to this change, the race continues to divert shoppers’ attention to this mission.
Bringing back ‘Disruption’
Once we fully understand the shopper mission and intent, category managers need to put plans in place to fulfil but disrupt and interrupt this mission where possible. Disruption occurs when our attention is disrupted from the mission in hand. We are distracted by an offer, some brand activity or even new products. The objective is to increase basket spend, brand perception or trigger some word-of-mouth activity (social or actual!).
In order to disrupt or interrupt a shopper’s missions, brands have to work hard to offer compelling, attractive and resonant propositions.
Retailers have put substantial effort into revisiting instore signposting, fixture navigation and ‘off fixture’ space. With space restrictions, we saw an almost overall removal of all ‘out of aisle’ space. Free standing display units, feature space and marketing installations were reduced drastically to make the shopping experience safe.
Traditionally, free standing cardboard display units have been branded in a uniform (brand guidelines are anathema to most retail marketeers) and sometimes poorly thought-out way with poor use of space for both design and product display. In the time since lockdown and Halloween this year, we have seen some great examples of visual merchandising, solutions that work exceptionally hard to disrupt shopper missions. This metamorphosis into something more than just additional in store space is one of the most exciting changes seen since the pandemic and offers the biggest opportunity to disrupt planned /semi planned shopper missions.
https://www.collectivestories.co.uk/blog/retail-stories-autumn-issue
Offline to online interaction
Following on from the success of the NHS Track & Trace QR code-based app and the subsequent national adoption of the unloved and frankly amazing QR code, we now regularly see QR codes at fixture for those who require more interaction and information in store. Shoppers who are comfortable with an offline to online experience can now scan codes and see Percy Pig dancing in the aisles at Marks and Spencer. Shoppers can even get make up and skincare advice from brands like Clarins and La Roche Posey without human interaction including skin analysis. The use of QR codes also allows brands to collect valuable customer information with the consent of the user.
Larger ranges available online
Space has always been a focus for retailers, every millimetre on shelf is accounted for and tracked in terms of performance. At the height of the pandemic, some product ranges were reduced make way for new covid specific products including antibacterial propositions. Other ranges were removed entirely to facilitate social distancing measures including one way customer flows. Many suppliers including clothing and seasonal suppliers saw ranges reduced where possible due to massive reduction in customer footfall.
On a practical level, QR technology allows retailers to expose shoppers to larger ranges than their physical stores can house. From a branding perspective, allows additional customer touchpoints. John Lewis recently added QR codes to their windows directing customers to a larger online range of their flagship ANYDAY range. During the pandemic, Marks and Spencer added QR codes to clothing racks to drive shoppers online to access larger ranges. The pandemic taught us that immediacy of purchase is not an absolute, delivery times are short and the online transaction experience is increasingly frictionless.
Collated and simple product propositions
Recently in stores we have seen some great examples of the acknowledgement of new shopper missions including simple, collated product solutions for those who do not wish to linger, Asda recently collated products from their ‘Extra Special’ range in the foyer at the front of the store. Cross category products were merchandised together at the front of store with ‘Extra Special’ branding. Marks and Spencer have also collated a range of value for money fruit and vegetable products at the front of their larger stores.
Test & learn activity remains essential
Category Managers should be empowered to make robust mission-based propositions with clear test and learn activity built in. This behaviour will then inform wider customer insight activity and move the industry back to a position of clear customer behaviour.
A new era of collaboration?
When faced with an opportunity to pivot and elevate amid so much change, where should we begin? What could future mission-based activity look like for suppliers and retailers? Generally, in the Grocery and high street FMCG industry, there is a feeling of freedom and agility emerging. The pandemic allowed suppliers and retailers to work together with agility and empowerment, removing barriers to make things happen in exceptional times and certainly there is a feeling of new possibilities in the industry. Marks and Spencer have openly committed to harnessing the positive learnings from the pandemic through their transformational Never the Same Again initiative.
Category Managers: When faced with significant Macro based change; start with shopper mission
During the height of the Covid crisis, throughout lockdown and eventual emergence, Category Management teams within FMCG have been faced with significant amounts of multi-source
information, uncertainty and unprecedented changes to every area of our discipline.
When faced with such upheaval and disarray, FMCG Category Management, a concept based on data analysis, clear strategic direction and strong customer understanding naturally has to face into a significant period of reset. When everything you know is tested and challenged, where do you begin to unpick and understand your new situation and how do you make plans for the future. This is particularly vital when working with Grocery Multiples, variety discounters or high street pharmacy who have longer lead times, more advanced planning systems and let’s face it, huge scale. Focussed planning is required in the face of such change.
Category Managers are both collectors of information and storytellers who make sure that analysis and strategy align and inform. Over the past 12 months plus, most of the stories we have told have been challenged or irrevocably changed and as we enter new retailer planning cycles, we need to take stock of what we know to be true and identify any knowledge gaps.
Big tip; Start with shopper mission, establish what has changed and what this means for your business. Be bold with your hypotheses around emerging need states and shopper missions.
References
Dupre, K. And Gruen, T.W. (2004), “The use of category management practices to obtain a sustainable competitive advantage in the fast-moving-consumer-goods industry”, Journal of Business & Industrial Marketing, Vol. 19 No. 7, pp. 444-59.
