Do you buy “Charmin” or “Toilet Paper”? Category Managers Know, Even if You Don’t
November 4, 2014
When you make your shopping list, do you think about buying a category or a brand? Even if you think about buying a brand for some products (say, for toilet paper), you probably think about buying a category for others (maybe olive oil) – waiting until you see what’s available at the best price. For all of us, there are categories where we will only buy specific brands and categories where we will buy whatever seems best at the time. And even if we don’t know what we will do individually when we head to the store, retailers do know, collectively – because they have data that is smarter about us then we are ourselves.
At IMC, our clients are global brands focused on how to keep consumers buying their products instead of their competitors’. We help them by identifying other categories where their brands are strong enough to drive sales. Like retailers, we have to know at least as much about categories as about brands.
Surprise! Retailers care more about categories than brands. Marketing gets the attention, but category management is a more important tool in understanding how consumers make choices at the shelf.
Over the last 15 years, brand owners have learned the painful lesson that retailers care more about categories than brands. Marketing gets all the attention, but category management is a more important tool in understanding exactly how consumers make choices at the shelf. For that reason, it drives IMC’s work in retail development and in licensing strategy consulting and keeps us focused on two elements that some marketers prefer to avoid: shopper data and on shopper marketing.
Marketers have always relied on data measuring the impact of advertising and marketing on consumers. But today’s most important data relate to shopping patterns rather than ad impressions. This includes point-of-sale data, in-store video research, loyalty-card use, and social media/coupon use, all of which inform us how consumers actually behave (not just how they say they’ll behave) with regard to given categories. And the results aren’t always bad for brands; it often confirms the great value retained by brands, and can illustrate the unmet needs that drive the most successful new product ideas.
Just as category management forces us to look at real-time behavioral data more than subjective marketing reactions, it also makes us consider shopper marketing over brand marketing. Category management makes us look at reaching consumers not just through magazine ads and television commercials but actually where they shop.
“Shopper marketing” has historically referred to finding ways to present ads to shoppers in stores. But brand licensing is another form of shopper marketing – using a new category to market your brand in a new way, and then getting consumers to pay to associate with your brand.
Shopper marketing also means getting as close as possible to the “moment of truth” when the consumer puts your product in her shopping cart, whether real or digital.
The partnership we negotiated between Kellogg’s and Rocky Mountain Chocolate Factory reflected category management in both of these ways; it was data-driven, and it has resulted in some amazing shopper marketing. Kellogg’s gives Rocky Mountain immediate credibility with consumers, who pay to associate themselves with a brand that previously had no role in this important category. Next step? Stretch into more categories.
We started with some challenging category-based facts. For many reasons, people are buying less cereal, so cereal has to capture new consumer need-states. That includes eating cereal as a snack or indulgence. We helped Kellogg’s identify a number of brands that could deliver this message to consumers and support an innovative new product. Consumers liked the idea of Rocky Mountain to test it. Sales data confirmed the idea, and a national rollout followed.
As for Rocky Mountain, Kellogg’s cereal turns out to be the best kind of shopper marketing you could imagine. Rocky Mountain itself is a retail chain, with no presence in supermarkets. Kellogg’s gives Rocky Mountain immediate credibility with consumers, who pay to associate themselves with a brand that previously had no role in this important category. The next step? IMC’s Retail Development team is helping Rocky Mountain stretch into more categories.
We love brands, but you don’t achieve results like this just by thinking about brands; you have to mine category and consumer data first. When you use insights to put the two together (brands with new categories), shopper marketing takes care of itself.
IMC is a leading product and brand licensing agent that has helped companies worldwide. Reach out today to schedule a quick introductory call.