Canny promotion sees sales volume and value increase
With a frenzy of shopping activity beginning every Autumn, Christmas is a key time of year for most B2C retailers and brands. So, how can brands ensure their promotional strategies will work, maximising sales and minimising what they give away?
Our work with a major confectionary brand shows how we helped them move away from their traditional Christmas promotional strategy to sell more while decreasing the volume discount they offered.
Faced with fierce competition and increasing supply-chain costs, this brand wanted to reduce the cost of their give-aways with promotional offers such as ‘buy one get one free’ or ‘buy one get one half price’. With the need for gifts and special treats for the family, chocolate plays a significant role in many consumers’ festive celebrations, meaning there are huge opportunities for brands that get their strategies right. We know that removing special offers tends to damage the performance on the whole Christmas chocolates category, especially in volume. So, when changing their strategy the brand could not afford to make the wrong choices.
With these risks in mind, we helped the brand pre-test their promotional ideas to get accurate sales forecasts for each option. We were able to assess the best promotions for the brand to utilise in their strategy, by estimating the sales performance of each promotional device (penetration, volume and value). This meant they could maximise sales, while minimising what they gave away.
Super realistic immersion in a seasonal shop environment
Using our flexible micro-model was necessary to get a full picture of the promotional options at hand. Because of the large size of the chocolate category, we needed to immerse buyers in a realistic and real-size environment of the Christmas chocolate universe. With so much variety and so many promotions, a to-scale experience was crucial in understanding the authentic behaviour of the consumer. We were able to expose respondents to a real size video-screened virtual tour, with each island, promotion and product enhanced using 3D digitisation to increase the realism of the experience.
Flexibility to test different scenarios that we could not do in real life
The experience requires realism, but testing the promotions in a real shop does not provide enough flexibility. In a video screened virtual tour consumers can view multiple promotions at once, which cannot be achieved with an in-store experience. We were able to test different scenarios and possibilities that could never have been recreated in real life. Our method means we can control what we test and isn’t dependent on the logistics of an actual supermarket.
For accuracy: Flexible micro-model using AI-modelling of individual behaviours
Our micro-model accounts for each buyers’ behaviour and response to different offers, providing invaluable information at such a key time. For successful sales forecast prediction, every consumer is considered as unique throughout the modelling process. This means recognising that individuals buy from different repertoires, in different quantities and see and react to marketing collateral differently. These behaviours then need to be recreated using powerful AI and then inputted into the right context purchase through a realistic setting. By getting these steps right, brands can unlock consumers’ real behaviour to make risky decisions risk-free and boost their confidence in sales volume forecasts.
By using our full micro-model, it was possible to project the penetration, volume and value of the various scenarios that we tested for the brand’s Christmas promotional strategy with two of the brand’s products. We worked out that although one product would benefit from a ‘buy one get one half price’ offer (purchase quantities would drop, but there would be a potential to recruit more customers), a different product would actually suffer (this offer would be far less attractive than that of its main competitor). We were able to identify the optimal option to move forward with, see the potential opportunities to consider and the promotions that would be risky to go ahead with. This ultimately allowed the brand to optimise sales and beat the competition in the key festive season.
For more information on forecasting success of promotions or new products, contact Dorte Torpe Hansen
Why shopper motivations are more relevant than emotions
More and more brands and agencies are using implicit measurement to provide a holistic understanding of how consumers make decisions. Indeed, anyone lucky enough to be at ESOMAR Congress in Edinburgh last week would have come away thinking that behavioural science in the insights sector is a becoming a mature discipline.
However, many brands are still making packaging decisions based on conscious thought – measuring consumers’ attention and preferences by asking rational questions. Even when they are using implicit measurement tools, many brands only analyse the unconscious emotions and not the underlying motivations that drive those emotions, and which in turn drive purchasing. In fact, many marketing initiatives fail because they are not implicitly evaluated, failing to understand the consumer implicit purchase motivations.
Marketers need to know consumers’ implicit purchase motivations in order to make safe business and marketing decisions themselves. Consumers make implicit decisions when looking at packaging, company logos and product colour and shape, to judge whether a product is attractive and relevant to them. All sensorial input is implicitly evaluated by the brain and if this evaluation is positive, it will ignite a purchase intent. Implicit evaluation happens incredibly quickly – between 300 and 1500 milliseconds – and has a high influence on decision making – a much higher influence than explicit evaluation (conscious mind).
When it comes to implicit measurement many companies will be looking purely at the emotion that resonates in those 300 to 1500 milliseconds, whether that’s happiness or disgust, anger or surprise. Understanding these emotions can be good indicators in better understanding the potential success of consumer goods, however, to get the full picture you will also need to understand what is motivating those emotions.
Whenever a consumer buys something there is an implicit and unconscious cost-benefit equation. We pay for something in exchange of the fulfilment of 2 sets of motivations, functional & psychological. When we pay for something the area of the brain that feels pain is activated. When we satisfy our motivations the area of the brain that is associated with reward is activated.
To have a positive cost vs benefit equation, a brand must satisfy the consumer’s most relevant motivations. By doing so the brand will have a higher perceived value, power of attraction and influence on the purchase decision.
By unlocking these unconscious motivations we can unlock the real reasons that consumers buy a product. Allowing brands to pivot their positioning, packaging and communications, improve campaigns and regain dwindling market share. A biscuit brand, for example, found that through explicit testing consumers stated their purchase motives centred on the perceived health and nutrition aspects of the product and brand. However, when tested implicitly we found that the primary reason mothers were buying the biscuit for their child was to reinforce their mother child bonding, while the secondary motivation was ‘appraisal’ they chose this biscuit over alternative own label brands because they wanted to be seen as a good mother.
Understanding these deeply embedded psychological motivation which influence the purchase allowed the brand to increase the impact of their communications tools by evoking these motivations across all of their consumer brand interactions, and five and a half months later the brand was back to positive growth.
There are many quotes from business leaders like Henry Ford and Steve Jobs that suggest consumers don’t know what they want until they’re given it. However, that’s not entirely true, we’ve just been asking the wrong part of the brain. We just need to go beyond the rational and even beyond gut emotion, and get to the real motivations and drivers of human behaviour.
If you wish to know how to measure your consumer’s implicit purchase motivations, contact Dorte Torpe Hansen and don’t get left behind.
Unlock pack power by incorporating 360VR and implicit purchase motivations in pack evaluation
More than ever, the role of pack is crucial as the retail environment becomes continually more competitive.
Designing a new pack is challenging and launching it is often risky. A brand needs to be sure that its pack is impactful, motivating and aligned with brand values.
Strategir is relaunching Packagir® into a new generation of packs test that include virtual, to better predict shopper response, and measurement of implicit motivations, to ensure that the pack meets the true motives for buying.
At Strategir our pack testing solutions integrates the 3 key conditions for designing powerful packs to help marketers make their pack launches a success.
1. A pack has two lives
Over the years, we have seen that the biggest risk to pack success is in-shelf performance. A pack must succeed in both its ‘social’ and ‘private’ lives to be successful.
In store, a pack must win shoppers, who have little or no conscious control over what grabs their attention. It must be seen, recognised, attract and establish its positioning.
Once bought, the pack has to convince consumers. It must tell them the right story, build on its positioning and meet expectations of use, handling, information and image.
2. Context counts
Most people underestimate how the way we think and act is affected by context. Yet shopper behaviour is influenced by psychological biases which have developed over time.
As people don’t know how they make decisions, it is essential to set a realistic environment to connect them to the retail situation and allow them to behave in their usual way.
Immersion has been long been one of our areas of expertise; from a life-size shelf of real products, to a full-size poster, a video projection and now 360 virtual reality.
This latest innovation is the result of 3 years multi-award winning research and development from our partnerships with Samsung and then Firmenich on the impact of VR on respondents and the quality of results.
Now, we have incorporated our agile 360VR into our flagship pack testing solution, Packagir®, to better understand consumer behaviour.
3. Unlock purchase motivation
Neuroscience teaches us how we make decisions and the how important the unconscious is in them. Modelling reveals, and allows us to prioritise, the deep and genuine motivations of consumers.
The Beyond Reason Implicit Motivation model (BRIM), hacks the purchase decision by unlocking the unconscious motivations that drive purchase decisions in mere milliseconds.
The methodology and model developed by our partner, Beyond Reason, focuses on understanding the functional and psychological motivations against which a new package is instantly evaluated. These motivations drive purchase if they outweigh the pain of the price.
In our case study, measurement of their functional and psychological motivations pulls apart two packs that were not separated by traditionally elicited attributes. With this, the marketer can launch a pack that is in line with brand values and consumer motivations. Without it, they could have been forced to choose the pack on internal preferences without really understanding any risks that could be associated with the brand.
New Packagir® more efficiently measures pack performance in its 2 lives, delivering more predictability and more truth from our interactions with consumers.