Social Marketing

In the evolving digital landscape, shoppers are doing more shopping at home than ever before -- researching products online, interacting with brands on Facebook, downloading coupons off retail websites. But according to Ron Ladouceur, executive vice president at social marketing agency Media Logic, they are not housebound: "All that activity is re-energizing the physical location."Ladouceur, whose Albany, N.Y.-based company is the social agency of record for electronics retailer FYE, argues that online and offline shopping are becoming increasingly symbiotic. After all, the brick-and-mortar store has always been a social experience. "Social media, like Facebook, extended the store into the virtual space," he says, "but now mobile applications like foursquare and Shopkick are extending that social space back into the store. If you can 'play' that store and get deals and integrate that experience with what has become your comfortable online experience, all the better."Defining the SpaceThere are seemingly limitless digital vehicles, tools and strategies that a brand or retailer could use to reach a shopper before she hits the aisles. Executives at Google refer to this space as the "Zero Moment of Truth," part of the overall path to purchase. Taking poetic license with Procter & Gamble's First Moment of Truth (the brand connection in-store) and Second Moment of Truth (using the product in the home), Google describes its Zero Moment as everything that happens online, in transit or near/inside a store between a first stimulus (a TV commercial, billboard, friend's suggestion, etc.) and the First Moment of Truth. Furthermore, one person's Second Moment of Truth can trigger someone else's Zero Moment through online product ratings, reviews, blog postings, or comments on Facebook and Twitter.Jim Deitzel, manager of eMarketing at Newell Rubbermaid Co., says his biggest challenge is prioritization: "There are so many things out there from keyword advertising to working with retailers on their digital storefront to Facebook. You can't do them all, so you have to pick and choose and be very smart about what you do. You have to understand your shopper and be able to say, 'I know the things that are going to work for them.'"Seth Diamond, vice president, insights, Catapult Action-Biased Marketing, Westport, Conn., lists other social networking tools like "blogs and Twitter, brand-owned websites, co-branded websites, paperless coupons loaded directly to a frequent shopper card, online circulars and printable shopping lists" as possible priorities. "And there are certainly more."But according to Tyler Murray, retail digital lead with Saatchi & Saatchi X, New York (a builder of digital shopper marketing strategies for brands such as Procter & Gamble, Diageo, LG and Wendy's), fundamental tools such as search marketing on Web engines like Google and Yahoo, contextual display ads, e-blasts, mobile ads and branded content on retailer websites continue to be the most valuable. And for Murray's clients, paid search remains the most important of all: "This is the highest measured ROI consistently across all measured mediums and therefore is a staple of all our online initiatives." The Google StudyToday, a marketer like P&G can "own" a "digital shelf" on Google.com, blanketing consumer searches for "laundry detergent" with display ads. During holiday seasons, General Mills surrounds searches for terms such as "frozen vegetables" or "side dishes" with ads that spark offers, recipes or redirection to sites like Target.com or BettyCrocker.com. But do search tactics drive traffic to the store? Teaming with Chicago-based SymphonyIRI and the In-Store Marketing Institute, Google conducted a matched market test to see if a Google search and display campaign can increase offline sales. It did -- and at the expense of the retailer's private label.On behalf of one of its clients, a cereal brand, Google launched four test markets, including a control market that ran no search or display ads. The other three markets tested both a search text ad and a contextual display ad, but each market had different assigned messaging. In all three scenarios, the cereal brand saw sales lift in stores: One market tested messaging around the product (using a slogan along the lines of: "Buy Cereal X, a great source of nutrients"), and sales increased 2.6%. Conversely, private-label sales dropped 2% in that market.Another market tested messaging around the brand family ("Buy Cereal Maker's Cereal X, and buy Cereal Y and Cereal Z"), and sales increased 2.2%. Meanwhile, private-label sales fell 2%. The other market tested messaging around a coupon ("Buy Cereal X, save $1.50 on Cereal X") and directed shoppers to a website to download a coupon. There was a positive lift of 4.7%, while private-label sales dropped 4.5%. Deb Eskra, testing and media solutions, SymphonyIRI, says that the improvement in brand sales from the search and display ads directly caused the drop in private-label sales -- the outcome the client desired. The overall category's sales, however, were flat. "That's almost to be expected," Eskra says. "If you have two large brands going in opposite directions with everything else being normal, then you would expect the category to be flat." The cereal brand had been facing pressure from a certain retailer's private-label product, so the test geo-targeted markets that were dominated by this particular chain. Catherine Roe, head of consumer packaged goods at Google, describes geo-targeting: "Take a piece of paper and a compass, and draw a circle right around a store. These are the zip codes and/or IP addresses that I want to target for this promotion. That's as surgical as you can get. In this particular test, the same thing was done but around a market [for example, Atlanta and Indianapolis]."Google's SymphonyIRI/Institute study did not use ads that directed shoppers to a specific retailer or a retailer's website. It simply focused on the client's brand. But Roe says that calling out specific retailers is where search will evolve in shopper marketing. "[It's] saying, 'Lower sugar in these cereals, healthy for your kids,' or 'Start your day right' and then calling out the savings at Meijer or Jewel-Osco. A co-branded coupon or co-branded message is more beneficial."Facebook is Prom KingWhile search may be the building block of business, buzz is building over another tactic: Facebook. "We just got out of a meeting with an agency, and we're hearing from some brands that they don't even want to put any more effort into keeping or maintaining their website page," says Addie Braun, head of Midwest CPG-food and beverage at Google. "They're going to place their bets for the next year on Facebook. All of their offline messaging is driving to Facebook, all of their online messaging is driving to Facebook, and their search will also go to Facebook."Patrick Boegel, director of media integration at Media Logic, agrees: "Facebook has become, for lack of a better term, a de facto entry point into the Web, whereas you would probably say, three or four years ago, that the homepage for people was Google."Boegel says that despite the large amount of information passing through a person's Facebook news feed, it's not like e-mail, in which people become annoyed with spam and uninvited messages. "You can sort through what you do or don't want to pay attention to," he says. "There's a casual nature to the information that flows through your news feed that people are tolerant of."At the same time, Deitzel believes that Facebook will eventually go the way of e-mail. He says that some brands already are using Facebook to acquire names and build lists the way they did with e-mail newsletters or paper catalogs. "There's no doubt in my mind that it's on the same trajectory," he says. "You would sign up, get their e-mail, and pretty soon you'd have 42 e-mails from brands. You'll say, 'I'm opting out of this.'" Ladouceur of Media Logic says that for consumers, "There's good money to be had for 'liking' a brand on Facebook." He says that apparel retailer Justice recently offered a coupon for 40% off anything in the store just for "liking" the brand. The retailer's "Likes" skyrocketed.Deb Hannah, director-integrated marketing planning at Kimberly-Clark, says "as long as you're considering all of your digital communications as part of your marketing mix and as part of your brand communications with consumers, it ultimately doesn't matter if you choose Facebook as your Web page. But I would really caution those brands that are just after 'Likes' and name acquisition. ä Just collecting a name for the sake of collecting a name doesn't get you any benefit." With a brand like Depend, Kimberly-Clark leverages a very robust website instead. "We aren't going to do much with mobile. You're not going to go on Facebook and 'Like' the Depend brand."Diamond of Catapult is leery of all social strategies. He cites the agency's annual Digital Shopper Marketing study that found that while shoppers use social networking tools like Facebook, Twitter and blogs, they find them to be unhelpful and not necessarily influential regarding their shopping needs.CrowdsourcingAnother hot tool is crowdsourcing or group buys. The idea: An attractively priced item is offered online if a prescribed number of consumers are willing to opt into it; once the minimum number of buyers is achieved, the offer is made official. Since November 2010, Walmart has been posting deals on the CrowdSaver tab of its Facebook page every week. For example, a down comforter, everyday-priced at $59.99, is offered for $39.99, and if enough people "like" it, the deal will go live on Walmart.com. The website also offers store pickup, which drives traffic to brick-and-mortar locations as well.According to Ravi Jariwala, Walmart spokesperson, "The CrowdSaver application ... leverages the principles of our founder, Sam Walton, who made it his business to talk to customers in stores to find out what they wanted. CrowdSaver utilizes modern tools to essentially have that dialogue with our customers within the social space."Chicago-based Groupon Inc., a website and mobile app, offers a deal of the day that users can redeem upon visiting local retailers, service providers and cultural events. Spokesperson Julie Mossler says the company has launched Groupon 2.0 to offer personalized deals to targeted shoppers based on location, gender and shopping habits. It also enables these users to follow their favorite businesses and brands directly. "Merchants can maintain a static storefront to create and manage their own deals," she says. "It's our goal to bring users deals that make the most sense for them. By filling out some quick information in their Groupon account profile -- including exact location and gender -- we're able to learn what types of deals they're interested in receiving. Over time, consumer-shopping habits will shape the features they see." She says Groupon 2.0, already functional in select cities, should roll out in all North American markets by early 2011.Groupon has, for the most part, focused on small, local businesses, but the company has worked with national brands. A recent Nordstrom Rack deal sold more than 624,000 $25 Groupons for $50 worth of goods, and a 2010 offering for Gap reeled in 440,000 buyers. "We've found success with national consumer brands and will continue to work with brands that resonate with our consumers, such as Kodak and the Body Shop," Mossler says. Roe of Google is impressed by the crowdsourcing idea and believes it will grow. There are already Groupon imitators such as CrowdSaver, LivingSocial.com and Mamapedia.com's "Sweet Deals" (deals that directly target moms). Ladouceur says what's different about Groupon is its successful focus on local retailers and finding relevant buys. As Mossler says, "We're known to be selective. We turn away seven businesses for every one that we feature, simply because they're mediocre or not up to our customers' expectations. We will never be the site that gives you 50 cents off your favorite toothpaste."How We Got Here, Where We're GoingPatrick Rodmell, CEO of Watt International, Toronto, says expectations are far ahead of reality. "The novelty factor of new media is both a blessing (encourages trial) and a curse (we move on to the next big thing)."The truth is digital shopper marketing has only emerged within the last couple years, says Deitzel of Rubbermaid. "It's not even that long [ago] that people started to realize how the digital space influences the purchasing decision in-store," he says, "whether it's from a research perspective -- 'I need to research my purchase beforehand' and use all of the tools that are available to do that -- to, 'I want to know where to buy this,' which then influences the in-store. Even further, when you're in-store, how do people go online via mobile and get additional information about the products they're considering in-aisle?"And geo-targeting is at the heart of digital's potential. Kimberly-Clark's Hannah says, "When you look into the future, there's even more excitement about what it can deliver. Each year, the communications get more targeted, more personal, more able to reach the consumer with an offer that she personally is going to love and not her neighbor, best friend or her sister. You get to know her one-on-one. That's the Holy Grail, and of course there are privacy concerns, but that aside, the ability to build a relationship with a consumer is any brand's dream."

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