Shopper Marketing Trumps Digital in Spending Plans for CPG Marketers

Still, Study Finds Two Disciplines Are Converging

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BATAVIA, Ohio ( -- Despite the continued growth of digital media, shopper marketing projects as the fastest-growing area of marketing investment for packaged-goods marketers over the next three years, according to a study released today by Booz & Co. for the Grocery Manufacturers of America.

The report found 62% of shoppers search for deals digitally before at least half of their shopping trips.
The report found 62% of shoppers search for deals digitally before at least half of their shopping trips. Credit: AP
At the same time, digital and shopper marketing increasingly are converging, according to the report, which found 62% of shoppers search for deals digitally before at least half of their shopping trips.

In all, 83% of CPG executives responding to the Booz/GMA survey said their companies plan to increase spending on shopper marketing over the next three years, and 55% said their companies plan to hike such spending 5% or more annually. None planned a decrease in shopper-marketing spending.

That compared to 76% who planned to increase digital spending, of which 36% planned to hike spending 5% or more annually. Only 3% planned to cut digital spending.

Social media and internet brand-advertising, among other digital areas, beat shopper marketing in terms of overall respondents -- 93% and 86% -- projecting increased spending by their companies. But shopper marketing still beat them in terms of overall projected spending increases based on how much the surveyed executives said they expect spending to increase in each area.

Projections were far less favorable for other forms of promotion and advertising. For traditional media advertising, 31% predicted cuts vs. only 25% who predicted increases. And even traditional trade promotion, categorized separately in the study, was expected to be cut by 31%, vs. only 10% who planned an increase.

The convergence of digital and shopper marketing also has come up increasingly in studies, with Jim Lecinski, managing director of U.S. sales for Google, in industry talks this year referring to a "zero moment of truth" where consumers do research and make decisions during search prior to shopping or buying online. That's a play on the "first moment of truth" made popular by former Procter & Gamble Co. Chairman-CEO A.G. Lafley in describing the decisions shoppers make, generally at the retail shelf. And while the recession has driven a surge in print coupon clipping, it drove an even faster 185% increase last year in redemption of internet coupons, which made up around 10% of redemptions, compared to about half from free-standing inserts.

Prior versions of the GMA study have also predicted increases in shopper marketing at the expense of other media, but the new report delves into an analysis of which of the growing array of shopper-marketing vehicles are best to address varying marketing objectives, based also on surveys of 2,000 consumers.

Search and "thematic content" ranked highest among shopper approaches in developing awareness and consideration. Deals, digital apps, in-store display and advertising and relationship-marketing programs work best in getting consumers to try products or otherwise take action, the GMA and Booz found. And social media and relationship marketing ranked highest among respondents in building loyalty and advocacy among consumers.

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