Shopper Marketing: how important is Secondary Locations ?

Hi FMCGers,

How important is having secondary location (product placement out of home shelf) ? and how can the brand benefit the most from it ?? 2 questions that a lot of FMCGers are trying to answer ? I will try to make it as simple as possible by highlighting the positives, negatives and the watch-outs:

The Positives:

1. It is add extra visibility in-store & increase off-take opportunities (every shopper marketeer dream)
2. it is easier to put extra communication (POSM) as it has more flexibility than the home shelf.
3. It has only one brand instead of multiple brands so the shopper will have less options to pick from, on the home shelf all the brands will be there and it will create a lot of confusion. 
4. It puts more qty in-store; means extra sales-in and if done right defiantly more sell-out.
5. It create more brand awareness by having different communication point across the stores.
6. Increase the probability of shopper purchasing the product; meaning a shopper may not visit the product home shelf if he/she doesn't need it, but if the secondary location was well put in one of the store's high traffic area then the shopper will definitely notice. (you can check type of shoppers blog: Part I / Part II )

The negatives:

1. It is more costly than the home shelf.
2. it needs more operational management in-store by the merchandising team. (most frequent issue)
3. It is mostly periodical not on-going.

The watch-outs:

1. The location, FMCGers needs to make the best possible secondary location for the product. The best location may very from product to another, for example the best location can be the area with highest traffic in-store, or the best location might be next to a certain section, for example cheese display next to the bread section. 
2. The medium for the secondary location: the FMCGers need to put the secondary location objectives 1st, the possible objectives includes (but not limited to):

      a. A new communication/product the brand has, then they need to focus on highlighting the communication more than the qty to be merchandised. 
      b. Push extra qty or stocks to the store to capture a certain period/season high sales, then the focus should be maximising the capacity of the secondary location with less effort on the communication.
     c. Competing with a competitor for reasons like; shifting shoppers, fighting a new launch or a new communication the competitor has, in this case the secondary location criteria should be to be placed next to the competitors.

3. Very important watch-out is the level of planning and alignment, such initiative will alway include at least:
1- The brand management team.
2- Trade marketing team.
3- Sales / Customer management team
4- Logistic team.
5- Merchandising team (very important as they are they represents the brand in the store)
6. The customer.

Every stakeholder of the above needs to be aware and aligned on the plan as everyone has work to do in the chain, managing to aware and on-board every stake holders on the initiative objectives & their roles in the process will always resulted in the initiative success.

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Thanks all for your time, and as always every feedback and comments is highly appreciated. Please share with your friends and colleagues, it is matter of button click below :)

Hasan Bashammakh

Follow @HasanBash

Understand your shopper: A journey to win in-stroe (part II)

Hi FMCGers,

I will start by apologising for delay and lateness in posting this blog, it has been almost a month since last post (part I) I have been extremely busy in the last couple of weeks.

Last time we started discussing the different types of shoppers' characteristics and what are their winning strategies, in summary they are:

1. Loyal Shoppers      (discussed in part I, Link)
2. Bargain seekers      (discussed in part I, Link)
3. Impulse shoppers
4. Need-base shopper
5. Browsing shoppers

Today we will continue discussing the other 3 types, but before that I just want to emphasis that these discussions will give thinking framework not an absolute final solutions, as FMCGers your personal skills and experiences inputs will complete the cycle and make the plan more likely to deliver on its objectives. The reason I am saying this is that I have received a couple of questions on how these types are applicable to industries like beauty or pharmaceutical, if you add your personal input to this thinking framework, you can find that not all types are applicable for you and you will consider 3-4 types only

Going back to the topic :) 

Type 3:  Impulse Shopper: 

• This shopper will rarely consider buying the product as it is not on top of their minds or needs, these can very applicable to industries like chocolate, gums, etc, where the FMCGers need to make sure to remind the consumer about the product and quickly make them buying, they usually need to consider 2 critical points:

1. Strong call to action message: to make the different between seeing & noticing the product, it is impulse purchase they shopper may see the product but the shopper needs to notice it also, the shopper must see why he/she needs to make a quick (impulse) decision and purchase the product.
2. Easy access: very important point where so many FMCGers don't put this as a high priority, understanding the shoppers way of thinking will make this an essential part of any plan. To further clarify the point let's take an example from the chocolate industry: imagine that you are shopping in the supermarket and after doing a great job by completing a long shopping list between all the long isles in the outlet, and while you are waiting on the cashier line you noticed a small AD or you just remembered a chocolate brand you love and decided to reward yourself with a small bite, but guess what ?? the chocolate isle is  all the way back at the store end, and there is no way to make before your time for the cashier, you will immediately drop the idea, after all it was an idea to reward yourself not make your life harder. A strong yet a simple plan for example will introduce a small stand filled with the product at the cashier waiting area to deliver on both; the strong call to action message and easy access for the product, such elements will always add value to the impulse purchase shopper 

note: Retailers are becoming more knowledgable & stronger; they understand the important of such spots to these types of shopper and they are fully aware that companies are willing to pay more to get such spaces, to avoid being over charged a strong and unique customer plan is needed when approaching the customers. Convincing customers without paying pace rental money is an art that any strong Trade Marketeer/ customer marketeer should master.

 Type 4: Need Base Shopper:  

• This type of shoppers don't have strong brands' preferences, they purchase based on need, for example, the will go shopping for coffee not for brand X for example, they will go the coffee shelf and start looking for the brand they want, this type if they only want coffee, they will enter the store go directly to the coffee shelf get the coffee and go out of the store without and further steps; they just buy what they want.
• It might be easy to attract these shoppers to your brand but again it is very difficult to maintain them, and that's why the FMCGers need to fully and throughly understand the purchase habits and the shopper decision making tree, these 2 will put a strong base to put a strong strategies for the brand. (it is a topic we can discuss on a later posts)
• In summary, the need base shopper cares about their needs at the first place, brands should be positioned on how to address thees needs, or even to convince the shopper that they have these needs while the actually don't :) :)                                                                                                                     

 Type 5: Broswing Shopper: 

• A mix of all, these shoppers love shopping, they enjoy going to store and browse they may not buy anything put they want to see what's out there, and that's way I said they are mix of all.
• If you have any in-stroe communication; this type will be the first to notice, you have a new brand launched they will notice.
• This type of shoppers love comparing stuff, they enjoy looking at different brands and compare them, they even like this about themselves, this gave them the satisfaction of being a smart shopper and these 2 words are the key to win this type, FMCGers need to communicate how it is the right decision to purchase their product, again understanding shopper purchase habits is very important.  
• Also, these shoppers need to be entertained in their store visit, entertaining shoppers has so many benefits, it increases awareness, positive referrals, happy feeling linked to the brands and ofcourse increases the purchase decision probabilities.

Understanding your brand / category different types of shoppers is a very important task to any FMCGers in any brand or any project, it will always have positive impact on your strategy building, route-to-market plan and delivering different action touch points a long the project life cycle.

as simple as the differentiation may sounds above (I hope) the difficult part will be the brain storming sessions to apply them in a real brand or product, but from my experience strong understanding will result into strong action plan / project and will always lead to amazing results. 

I hope you enjoyed this blog and found it helpful, please let me know what you think on the subject it self or on the blog overall in the comments sections or over emails, any feedback is highly appreciated, also, please share with your friends and colleagues, it is matter of icon click below :)

Hasan Bashammakh

Follow @HasanBash

  

Understand your shopper: A journey to win in-store (Part I)

Hi FMCGers,

I'd like to start by sharing my happiness of the great support & interest the blog is getting, I wasn't expecting to get more than 1,000 views in less than a month specially that we only have been discussing a focused part of the FMCG world (Trade Marketing), it is also shows how important Trade Marketing and Shopper Marketing is getting to all FMCGers year on year,  actually I have received a couple of emails and calls asking about how to implement the concept correctly within the the companies' structure, and some asked on what are the Arabic translation of this concept ( I will soon post a blog in Arabic to address these request). Again thanks all :) :)

After we shared the pillars of trade marketing & shopper marketing; meaning (Link) , classification (Link) and importance (Link), we need to start discussing how to win the shoppers' hearts, trust and purchases decisions.

There was a time where FMCGers only cared about understanding consumers habits and how to direct them to love their brands, these days are long gone, also nowadays the retailers are bigger in size and power, 100's of brands are available in the store and the competition is getting severe. 
Every brand want to stand out for the shoppers and starting to spend more time and efforts to understand shoppers behaviours and how to win in-store by addressing their shopper needs, but who are these shoppers ? we will start by classifying the different types of shoppers.

Shoppers types:

1. Loyal Shoppers
2. Bargain seekers
3. Impulse shoppers
4. Need-base shopper
5. Browsing shopper

Going into the details of each type we will find the following:   

Loyal Customers: FMCGers favourite type, 

• This shopper will go for the brand no matter what, for them the rest of the shelf is just a black box they don't care about it, it is the highest level of brands equities.
• This type makes 20% of the brands' shoppers however the make 50% of the sales which is without a doubt an excellent figure
• The sad news this type is shrinking with the time due to cost of living getting higher and higher, and they start considering other options.  
• This type is high in the cosmetics products, medium in food & beverages and low in home care products.
• This type preferred to be recognised by the brands by getting special gifts (promo packs)
• The key winning strategy to keep this shoppers is to make the brand easy to find and visible in style. 

Bargain seekers: A volume generator but a continuos risk

• This type have higher care for the price and managing their grocery budget carefully.  
• they may keep the brand equity in mind but they will always look for the best value deal. 
• In Saudi Arabia this type is getting bigger & bigger, go to any retailer in Saudi Arabia and see the number of people browsing around carrying thy customer weekly leaflet looking for the best deal, also, look at the crazy offer some retailers put to attract these types of shoppers, some retailer they may go to the extreme of losing in some key products to attract shoppers to their outlets and making up for that lost from other products. 
• The key winning strategy is to keep promoting your high volume products with good offer that will keep the cash flow running and avoid high share loss to other competitive brands

We will park for now and continue the topic in the next blog to go through the other 3 types and also we will support that by another blog discussing how to know which type your categories shopper follow.

 Meanwhile I'd really appreciate your feedback and comments to make the discussion and next blog stronger and more beneficial, take care for now.

>>>>>> Link to part II <<<<<<<

Hasan Bashammakh

Follow @HasanBash

   

Why Shopper Marketing is important: the 1st moment of truth

Hi FMCGers,

     "I'd like to start by thanking all my friends who congratulated me and supported me on the blog, it is really motivating & inspiring for me to keep the blog going. Also, I got a couple of request to define (or translate) the terms and titles into Arabic which is something I am currently working on and I will share very soon."

   over the last couple of post we started by defining what is trade marketing, shopper marketing and customer marketing, which was mainly the base for this blog and future discussion, the 2nd pillar is to understand why these functions are important and how FMCGers can benefit from them.

So, why shopper marketing is important ?

well to start it called the 1st moment of truth :) 

Most shoppers are claiming that they know what they are purchasing before entering the stores, however, researches show that shoppers only plan to purchase 20% of their actual store basket, if you added another fact which the average basket size in the saudi market is SR 500 = $ 130; you will have another SR 400 (80%) to be an impulse/unplanned purchase, which is a quite attractive number to capture.  

Further to that researches also show that 76% of shopper purchase decisions are made in store that means that there is also a chance to eat from the 20% already planned purchase.  

another important factor is that In Saudi Arabia shopping is becoming to be an entertaining process for the family rather than a duty for the parents, entertaining this family in the store is becoming an effective tool to attract them to the different brands. Reachers show that the average shopping time in UK is 12-15 mins, in the US 18-24 mins and in Saudi Arabia (believe it or not) the number jumps to 70-90 mins, which is by far much more than the entire family watching TV's ads time. Shopper marketing is not only a tool to increase purchase, shopper marketing can be very affective tool in brand communication and awareness building.

But why companies are investing more in shopper marketing now?

"According to Deloitte FMCG companies like P&G are growing their shopper marketing budget by 21% annually, which a quite interesting number in a time where companies are cutting budgets."

It is for a fact that FMCGers and marketers are not considering shopper marketing as sexy as direct consumer marketing (above the line activity), also, shopper marketing can be a more dynamic and complicated process than direct marketing. the reason for that is the fact that there is another medium / step to take, which the our friends the retailers, the retailers are growing stronger and more greedy and they understand their role and power in the brand shopper marketing communication. Managing to manage retailers is a difficult task, also the shoppers within the different retailers behave differently, for example, what might work with Panda (biggest retails chain in Saudi Arabia) may not work with Danube (another retailer), what might work with Panda's shoppers may not work with Danube's shoppers and even what might work with Panda's shoppers in Jeddah might not work with Panda's shoppers in Qassim. 

Trade marketers should know their customers (retailers), the customers' shoppers and also the different behaviours of shopper between the different regions and some time between the different area within the same city. While it may sound like a difficult and complicated process the reality is that it can be much easier with the right knowledge, experiences and approaches. which is what will be talking about in the future posts :).

I hope that you benefited & enjoyed the article, please share your thoughts and experiences on shopper marketing on the comments section below, also, I'd really like to hear if you have any recommendation on how to make the blog better, sharing with your friend is a much appreciated support. 

Hasan Bashammakh

Follow @HasanBash

  

The difference: Trade Marketing, Customer Marketing & Shopper Marketing

Hi FMCGers,

When I started writing this blog I started 3 subjects and stopped in the middle as they were some usage of Trade Marketing terms & Trade Marketing sub-functions, then I noticed it can be a good opportunity to share what are the classification of Trade Marketing for myself and the reader to stand on the same platform for future discussions.  

This is classification is not a text book guideline it is just my humble understanding and data collecting put on my words. 

As I mentioned earlier, most companies until now are considering the Trade Marketing as concept not as a function and they place trade marketing functions separately between different departments; mainly marketing and direct sales. 
In the last blog we shared the definition of Trade Marketing and where the companies place this function within it is structure (Link to the post: What is Trade Marketing), this time we will go through the Trade Marketing different sub-functions and how these sub-functions as a whole form the term "Trade Marketing".

The Trade marketing functions are:

• Customer Marketing
• Shopper Marketing 

These two functions have very different application and approaches, it is even to the extend that in some companies these two functions are placed in two separate department (an option I am not in favor of, however each company has it is own nature and needs, also, the trade marketing concept is not developed enough specially in Saudi Arabia to be a unique department by itself).

To share the main difference between the two functions I needs too many pages, but I tried my best to have a quick summary table below that highlight the key differences.

The table give a general idea about the main deference and the below are just example of each function:

Customer Marketing:

Goody Kitchen initiative with Panda is an example of a customer marketing initiative, it is a customer based initiative, the objective was to grow the joint partnership with Panda across Goody brands and products, note that from supplier/brand point usually customer marketing initiatives are aiming to grow the customer), again customer marketing is customer based initiative

Shopper Marketing:

RedBull example of having brand related initiative where the communication is based on the brand and the customer is just a platform, the same displays can be placed with totally different customers; as the base here is the brand and the shopper not the customer, also, the displays aim to attract the shopper section shopper to RedBull ignoring the other brands. 

Finally, if each customer marketing and shopper marketing are placed in the right department supported by the right process and objective understanding, the companies will be able to be more efficient in their efforts and budgets, also, the impact in-store will be superior.

Kindly share with us in the comments below if you have any customer marketing or shopper marketing experiences, enquires or feedback, every contribution or article sharing is much appreciated. 

Hasan Bashammakh
FMCGers
Follow @HasanBash

What is Trade Marketing

Hi FMCGers, 

Disclaimer:
I'd like to start by a small disclaimer: "the blog is intended for FMCGers and that's why some terms, functions definitions and structures can be a bit difficult for non FMCGers but I will try my best to make it easy to understand"  

BackGround:
I have been thinking of what my first post should be about specially if i wanted to target FMCGers in Saudi Arabia focusing on Trade marketing, in the process I faced the same issue I kept on facing any time I wanted to get any resource about Trade Marketing; there is no clear definition of it in the Saudi FMCG industry, every company has it unique understanding (if any). 

On the advanced FMCG markets you can find much better understanding and case studies on Trade Marketing and customer marketing but that's about it !!, even in universities (despite the booming trend toward Trade Marketing) there is no true Trade Marketing major / courses and the training institutes are focusing on the marketing front (I refer to it a out-of-store consumers communication) or the direct sales function (the distributer model in KSA). 
It is very difficult to find a good Trade Marketing/Customer courses, but again the truth is that Trade Marketing is not a guidebook kind of learning or skill, it is mainly by the market understanding (experience) and applying certain FMCG management knowledges. For example, it would be very difficult for a non-saudi-market-expert trade marketer to shine in the Saudi market if he has no knowledge about the channel/region/customers dynamics "which takes some time to understand given the huge diversity we have in the Saudi market" 

I will try to briefly share what is my understanding of it based on the different references I found and my experience in the matter.  

So what is Trade Marketing?
Trade Marketing is not sales. However, most companies in KSA have the Trade marketing Function (again if any) under the sales umbrella, there are very few exceptions though . The truth is that the word Trade in the term "Trade Marketing" is a bit misleading and that's why most FMCGers refer to it as a sales function.

In some companies the Trade marketing / customer marketing is a channel or customer based, meaning the person title will be for example " Key Account Channel Trade Marketing Manager" if this how is naming structure is than the function should be under the sales or customer development department, if the trade marketing position is brand or product based and the title is similar to "Brand ABC Trade Marketing Manager" the function should be either with the marketing function or a separate function all by it self.  

I know companies who still refers the merchandising team as the Trade marketing team :) 

Again what is Trade Marketing ?

The best definition I could find with minor changes from my side to fit the Saudi market it the following:
      "Trade Marketing is  a marketing discipline that relates to increasing demand with both the shoppers (in-store Marketing) and the supply chain partners, such as distributors, wholesalers and retailers, rather than at the consumer level."

From here we can see why there a confusion about the Trade marketing and why companies place the function differently within its structure: let's take a close look as this will help us to strengthen our understanding of the function and how can companies better structure it. we have 3 options for the function:

1. Placed with sales team (most companies): these companies' trade marketing team is/should focus on the 2nd part of the definition; the customers, with minimal (if any) focus on the shopper side (customer based not brand/product based, the success driver is linked to customer development and growth.
2. Placed with the marketing Team: (or the responsibility is part of the marketing team a.k.a brand management team ) are focusing on the shopper side and the in-market marketing aspects (brand based), the success drivers here are linked to brand strategies (shares growth, upgrading consumers, competitor blocking, etc.)
3. Placed as a separate function all by itself:  have a mix of customer based and brand/product based and their success drivers are generated from and based on the brand's strategies and Sales department strategies. 

Such different placements and responsibilities can cause a lot of confusion between the sales machine and brand teams, hence, synergizing the plans between the sales and marketing is a key responsibility for the Trade Marketing team and it's the is main pillar toward delivering on the above definition and the company vision.

I will not discuss with placement is the ideal or the best as there is no such thing; every company has it is nature and needs and the leaders of the companies should place the function accordingly, however, the difficult part is to the set the right KPI's and expectation from the functions based on it is placement. ( I will have a later blog about the right KPI's and expectation given the different placements).

I really hope you enjoyed this blog and found it interesting and informative, I'd really appreciate if you can leave a comment on any part or share an experience in the matter, also, since this my first blog I would be happy to hear what you think and how to make it better. 

In the next couple of blogs I will be writing about the trade marketing different sub-functions, the right KPI for the main function and the sub-functions, the Saudi market different dynamics and distributer management for 

Hasan Bashammakh

Follow @HasanBash

FMCGers

Welcome to FMCGers (brief introduction)

Welcome:
Hi all and welcome to my new blog :) 
This blog is an idea I have been thinking of  for quite some time and I just kept on delaying and delaying, finally, I decided that I have to start and take the 1st baby step.

please feel free to comment and share feedbacks as they are most appreciated and will help me a lot to develop and understand more on what & how to write better blogs.

Blog background: 
During my experience in the FMCG industry I always have to answer the questions "What is Trade Marketing?, what are the expectations from a trade marketer and what is the importance of trade marketing for the organisation?" I have to answer such question with the new members in my teams, during interview for the Trade Marketing function and with fresh grads looking for a bright careers; the understanding of the trade marketing concept is still weak in and still taking its first steps despite the fact that in the last 10 years there has been a major shift in the FMCG industry from focusing on marketing toward trade marketing, customer marketing, shopper marketing, sales planning, etc. Saudi Arabia is no exception to this trend, actually Saudi Arabia is the fastest moving in this direction when compared  to GCC and middle east markets. However, if you have tried to find any valuable information or resources to help in the Trade marketing area specially in Saudi Arabia you will notice that there is only few if none, hopefully this blog will build the 1st steps to to have more references for all FMCGers.  

FMCGers:
I picked this name as I will talk about most of the different FMCG's functions and for the blog to be a quick reference to all FMCGers in Saudi Arabia currently and hopefully GCC in the future. 
The blog will focus on the following subjects: 

1. Brand Management: including: brand strategies, placement and promotion strategies, profit & loss management, future planning, brand's glide path, etc.
2. Trade Management; including Trade marking, customer marketing, shopper marketing, channel and customer planning and briefly about sales planning. 
3. Saudi Market dynamics understanding: understanding the different dynamics of the saudi market, channels, customers and regions, also, we will go as to share how different channels behave differently across different regions and which channel is the strongest in each region. 
4. Market Assessments: how asses a market for new launched, initiative, product, etc, and how to develop the right strategy that match the Saudi market dynamics. 

 

A brief about me:

My name is Hasan Bashammakh, I am Trade Marketing Manager and an entrepreneur with 7 years of experience in the FMCG industry in Saudi Arabia between multinational and local companies. I have worked in developing existing brands and launching new brands across the trade different channels and customers, I also worked in developing brands' essences and strategies. 



Again welcome all to FMCGers

Hasan Bashammakh

Follow @HasanBash