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Spring 2012 / Issue 66 (originally published by Booz & Company)

Consumer Packaged Goods: Invest in Shopper Marketing

No single group of capabilities can serve all consumer products companies; the industry is too broad and diverse. Nonetheless, one capability — shopper marketing — represents a rich opportunity for growth in all consumer packaged goods (CPG) categories.

Shopper marketing is a term given to efforts to engage with and influence consumers at the time of purchase. These include in-store shelf displays, digital kiosks, shopping list apps, and e-coupons — all of which generate digital data that marketers can use to further refine their pitches. For example, ConAgra Foods Inc. developed a menu-based shopper solution program, “Give Every Night New Flavor,” that offered recipes for popular meals, such as stir-fry and pasta, and all the products needed to prepare them, displayed together. The company reinforced shopper awareness away from the stores by creating a microsite, providing digital coupons, and advertising on search engines as well as in print. Within stores, signs and coupon books led shoppers to pallets that featured the recipes and their ingredients.

This program delivered double-digit growth over the prior year in numbers of items sold, revenues, and profit. It also generated significant market share gains for a leading grocery retailer that partnered with ConAgra. By creating wins for retailers this way, manufacturers can gain more valuable opportunities, such as better display space, visibility on retailer websites, and access to retailers’ loyalty program members.

No consumer company has yet figured out all the ramifications of shopper marketing or created the capabilities required to fully exploit it, especially when combined with digital media. But many companies — in the U.S., Europe, and parts of China — are trying hard, and are outpacing their competitors in the process.

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