Brand prosperity is a lot like the root system of a tree. Although hidden beneath the soil, the root system of a tree is the origin of its strength, stability and capacity to flourish. A nourished root system grows a tree that produces a bountiful yield. Conversely, a deprived root system can compromise the tree’s ability to produce at all. In similar fashion, the root system for a brand must be strong and healthy for the brand to prosper. Each root is an integral part of a brand’s path to not just bear fruit, but flourish. A strong root system for a brand is rooted in a disciplined and methodical Go to Market strategy. This is the fourth in an 8-week series outlining the framework of a successful Go to Market strategy. The previous articles can be found here: First: Purpose Second: Product Strategy Third: Production Strategy The fourth root in a successful Go to Market strategy is the focus of this article: People (Consumer) Strategy Thank you for your interest in this topic. We welcome your feedback and comments, and the opportunity to help you on your journey. *** *** *** *** *** *** *** *** *** *** *** *** *** *** *** *** *** *** *** *** *** If we work “backward” to create a successful product, we start with identifying the market gap or need for a solution. Subsequently, we identify when or how this solution would be used (use occasions), and third, we define the consumer or user who benefits from this solution. Let’s stop there for a moment - we have yet to consider it’s selling price, what content should be on its Amazon.com page, from where ingredients are sourced, or even naming our founding values. Implicit in the very notion of this process as the “backward” version is that it’s either wrong or it’s not common practice. Unfortunately, it’s the latter, and the result is short lived or underperforming products because the go to market structure focused on the logistics, operations, and B2B partnerships to get a product on shelf, and/or grossly over simplified the consumer as a ‘millennial’ or ‘millennial mom’, which is too broad to effectively, efficiently, and financially target. Whether we work “forward” or “backward” to dive into our consumer strategy, there are three key questions to ask at this critical stage to define the consumer who benefits from our solution:
Who Is My Target Consumer and Why? If I asked you to describe yourself, you might enumerate your demographics:
Before proceeding, consider the implications of each and every one of these demographic segments: each points to your focus in life, the lifestyle you probably lead, the people you are likely surrounded by – and particularly, the needs you likely have: The needs of a single 30 year old African American woman in an urban neighborhood working a white collar job earning $70,000/year are worlds apart from the needs of a retired 68 year old married man living in the suburbs with 3 kids and 2 grandchildren. While there are a gazillion permutations of the above segments, figuring out what they mean to your brand is incomplete until you consider what are broadly termed as psychographics: an accounting and classification of
In a word, their “Why”. When campaigning, politicians (used to) attract voters based on their position on the “issues”. The same is true for Fast Moving Consumer Goods (FMCG) – knowing what matters to your target consumer matters more than only knowing their age, gender, income, etc. Certainly, the two are intertwined, and knowing both is vital, though it is possible to extrapolate generally what matters to an individual based on their demographic composition. Thus if we return to my question to describe yourself, in addition to the black & white demographic questions, you might start to explain your favorite & least favorite things, your emotional frame of mind, what you get excited about, your religious & political views (we’re in a safe space to do so), where, with whom, and how you spend your time, and other signals and indicators of what makes you, you. We are of course complex individuals with gradations of preferences, making this portion of profilng more complex than just demographics. The complexities here also underscore the essential need to know your consumer in this way in order to efficiently and effectively use your time and money to find them and compel them to buy your product. Following is an actual persona we developed for a client based on an exercise we conducted for them: Your brand’s target consumer is an urban dweller exposed to evolving ethnic influences. She is an older millennial advancing her career and may be single, part of a couple or a young/new parent. Her continued growth socially, financially and personally supports her expanding desire to discover and experience new, yet not extreme products. These products are a means to treat and occasionally indulge herself. She may have friends and family that are located in other major urban centers, and she travels with ease with a depth of familiarity with those cities. Thus, she carries the potential to extend influence outside her local tribes. She also desires travel to explore exotic locations and would enjoy sharing her experience with others. This description is rich with useful information and data, either directly or by extrapolation, to target this consumer. How much time and money will this brand save by knowing where & with whom its consumer lives, works, plays, and shops rather than trying to market to “the millennial”? One other crucial aspect of knowing your consumer target is knowing how quickly they will adopt your product. The formal theory and model developed primarily by Everett Rogers in the 1960's is called the Law of Diffusion of Innovation, which models the percentage of consumers adopting a product over time: Let’s define the groups on this adoption curve:
To arrive at adoption, a consumer will move through a set of stages, each of which can be influenced by different marketing tactics to drive consumer engagement or action:
By overlaying the innovation adoption consumer group with the myriad “why they buy” insights and demographic profile, we now have a deep understanding and prioritization of our most valuable consumer targets in order to more effectively and efficiently build our consumer base… Now we just need to know how they shop. How Do They Shop for My Kind of Product? The factors included in “How” a consumer shops involves multiple criteria and behaviors:
Across these various activities, behaviors, and considerations, suffice it to say that the touch points on an individual shopper’s journey are disparate and fragmented:
Various technologies are used to track shoppers at various points in this journey, and companies are emerging to bring it all together for a unified picture of an individual shopper’s habits. The paradox is technology developments are making it possible to track individual behavior and activity across platforms, which created the fragmentation originally. These tracking developments are also a major concern for privacy issues, but I won’t explore that here. Lastly, it’s not cheap right now to acquire all these points of view as an emerging service/technology, but at least there is hope these capabilities become more accessible and democratized as competition in this sector builds. More on data acquisition in a moment. Accounting for how your target consumer shops completes the strategic picture of how and where to best reach them to generate the biggest influence and impact. Leveraging consumer insights will provide fact based confirmation of the consumer targets with the greatest potential to drive volume for your brand. Monitoring actual buying behavior on-going will help you understand the strength of the consumer commitment to your brand. Let's explore those data options next. Can I Confirm with Data and Research? Traditional consumer panel data is sourced from one of two methods:
Increasingly, platforms are being offered in the market that do a better job capturing consumer’s on-line and omnichannel shopping behavior. IRi, Nielsen, Numerator (formerly InfoScout+MarketTrack), and several others have access to consumer’s mobile & web browsing activity, and shoppers’ receipts from online purchases (as an opt in), helping to close a gap that existed in the National Consumer Panel. Additionally, these and other firms provide services to analyze content and sentiment in social media to gain real time insights into what consumers are saying and doing across social media. There are pros and cons to each type of data and each source. There’s also a LOT of data out there now, so it’s important to invest in the right data to give you the most relevant and productive information for your objectives. What if you’re not in a position to justify the investment? Use your own observation and ask questions yourself:
One other element of data to embrace is how the consumer drives your sales numbers. Retail scanner (POS) data in isolation might show dollar sales are up, which could be a function of changes in unit sales, distribution, pricing or velocity, or any combination of these. Consumer buying behavior data provides the diagnostic data behind POS sales data, which are completely different metrics by which to understand that dollar sales growth figure. Dollar sales are a function of: how many people bought the product, and the rate at which they bought it. Diving deeper, the buying rate can be further decomposed to: the frequency of purchases, and the amount purchased each time. Below is a simple example: (HH = Households) Each of these metrics directly correlates to a marketing strategy depending on which lever you want to move: gain more consumers, increase the amount purchased each trip, increase the frequency in which a product is bought, etc. Below is an example of different tactics to employ depending on your consumer purchase objective: In closing, I would note that the classic marketing mix of 4 P’s (Product, Place, Price, Promotion) actually does not mention People/consumer, yet modern interpretation of basic marketing principles considers consumers/people the 5th “P”. It is impossible to exclude consumers from your strategic planning because it is in fact the consumer that is responsible for demand, which becomes your revenue. Knowing this, I cannot emphasize enough that you must know your target consumer profile, behavior, attitudes, lifestyle, motivations, and shopping behavior better than you know your brokers, distributors or retailers. Further, market first to your innovators and early adopters, as these folks become your consumer champions who advocate and influence others to try and use your product. Lastly, prioritize your decisions to be consumer-centric and consumer-first, rather than company- or operations-centric decisions. Next week: Commerce Strategy Comments are closed.
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About The Author...Michael Movitz has more than 25 years natural/organic products industry experience across retail, manufacturer, broker and market research organizations... Archives
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