Marketing from the Grocery Aisles: Funnel Management

Reeling in customers to purchase your products and services has risen to a science, starting with the lure, proceeding with progressively more enticing bait, and concluding with the capture or sale. Drawing potential customers into the funnel, and nurturing them through marketing automation can take anywhere from days to months or even years for large or infrequent purchases, such as cars and vacation timeshares for consumers, and capital equipment and IT systems for enterprises.

Entire departments and agencies are devoted to the structuring, feeding, and fine-turning of companies’ sales funnels, employing a range of marketing vehicles to nurture, and push leads through the funnel. Tactics include the use of social media, email, direct mail, landing pages, PPC, blog, and content, such as white papers, ebook, articles, and more.

Leads are scored, assigned a temperature – hot, warm, cold – and then relegated to another layer of the funnel. They are then treated to personalized content or if cold, discarded. If everything works correctly, a handful of leads turn into sales.

Companies of all sizes are adopting the new language and strategy of funnel management. But what about grocery stores?Shopping_vintage

According to James Russo, Senior Vice President, Nielsen Global Consumer Insights, 97% of grocery store sales are in-store with 61% of buyers fulfilling their immediate needs. The remaining 39% of buyers are “filling in,” doing routine shopping or stocking up on items.

Even if a grocery store were to implement a nurture campaign, it wouldn’t impact most consumers’ urgency in needing to dash to the closest grocery store to buy food, a personal or household item, floral bouquet, greeting card, or bottle of wine.

Explain Russo in his webinar, What’s in Store: 2016 and Beyond, mealtimes are under pressure with the time spent preparing meals declining, and eating habits becoming more flexible. Multi-generational households, often with several wage earners, are accelerating the need for accessible, portable, flavorful, and nutritious food options.

Given this trends, consumers don’t need a nudge to shop. There is a need, however, to persuade them to choose one store over another. According to TIME, between 2010 and 2012 membership in store loyalty programs grew 26.7%. By 2012, the average number of loyalty programs per U.S. household was 21.9, up from 18.4 two years earlier.

The catch, however, was that only 9.5 of these memberships were active. When it comes to supermarket loyalty programs, membership fell from 173.7 million in 2010 to 172.4 million two years later. Several companies, such as Albertson’s, Shaw’s, Acme Markets, and Jewel-Osco, have eliminated their loyalty programs, touted that everyone who shops can enjoy the same savings.

The overarching value of loyalty programs is the opportunity to glean information on shoppers’ habits and preferences, and thereby tailor shopping experience to further win shoppers’ loyalty and willingness to choose their store over competitors. However, grocers have found that winning over customers isn’t tied to meticulously capturing and assessing their purchases, but tailoring offerings to specific neighborhoods. A grocery store in a town with young families and singles might have more prepared foods, and shelf space for baby and toddler foods, diapers and infant care, toys, and paper items.

Grocery stores are also drawing customers through their sales funnel with customized marketing and personalized pricing. Using customer’s shopping histories, grocers present them with personalized deals and coupons to boost spending. Fred Meyers, a Pacific Northwest chain owned by Kroger’s, regularly sends personalized booklets to customers, filled with colorful pages with highlighted products, entertaining tips, recipes, and personalized coupons that match shoppers’ buying patterns.

Several years ago, when my husband and I were caring for my mother, the booklet we received had coupons for instant pudding, whipped topping, and pie shells, which exactly matched what I purchased every week when I made my mother her favorite chocolate cream pie. After she passed away, the coupons we received were more utilitarian, consisting of packaged baby kale, fresh herbs, canned tomatoes, salsa, salad dressing, Greek yoghurt, Cheerios, and thankfully, Velveeta.

Other stores are offering personalized pricing via mobile apps. Users receive personalized coupons via the app, which are targeted to their needs, and offer considerable savings. Eventually, mobile apps could enable supermarkets to serve up personalized offers in real time.

Imagine having a phone app that tracks your movement through a store, and then alerts you to the opportunity to save $1 on Cool Mint Oreos as you waltz down the cookie aisle. It’s the lollapalooza of funnel management.

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