Professional Documents
Culture Documents
2. Shopper behavior in the fresh department 3. The Basics of In-store technology 4. Adapting the Retailer marketing process to in-store promotions 5. Case study: Product merchandising in the Meat & Seafood department 6. Recommendations Appendix A: Functionality of Content Management Systems Appendix B: Content Administration Appendix C: Resources and Noted Research
Introduction / Overview
2
White Paper
1. Introduction
Visual merchandising and the use of digital signage in grocery retail is exploding. Video monitors presenting information, entertainment, and promotions to shoppers are pervasive. Retailers are using content management technologies to deliver marketing strategies more targeted and more distributed; whether creating an integrated brand experience in the store, or for category and product merchandising. The technology opens the door for affecting shopping behavior and delivering more effective marketing in the grocery store. Nowhere else is there a better opportunity for retailers to influence the purchasing decisions of its customers than in the fresh department. Fresh food counters offer a unique opportunity for in-store marketing. Besides the cashier, the fresh departments are an important touch point between the shopper and a store associate. Research shows that the fresh department has the highest density of shoppers in terms of traffic and time. The shoppers are a captive audience, typically waiting over two minutes as they make their fresh purchase. Visual merchandising at the fresh food counter places the message at the point-of-purchase while shoppers are making buying decisions. The technology to deliver digital signage across a grocery store network adds new complexities to the IT infrastructure. Retailers must select the right technology partner to project manage, rollout, and support such networks over hundreds of locations. But the keys to successful visual merchandising lies in the marketing processes and how the network is utilized. This white paper provides retailers with guidance for implementing in-store, fresh department marketing programs including the following elements: Statistical analysis and current research on shopper behavior in the fresh department Overview of available digital signage technology to deliver in-store promotions Retailer marketing processes for managing content Case study results from in-store promotions in the fresh department Recommendations & lessons learned from digital signage projects Marketing communications technical resource information
METTLER TOLEDO
say the shopping experience is very important feel merchandising displays are very effective in influencing purchase decisions want more product comparisons want more information on product quality feel merchandising displays are very effective in influencing brand decisions say in-store communications are very effective say out-of-store advertising is very effective
METTLER TOLEDO
White Paper
Shopper behavior
4
White Paper
Sorensen Associates 2
METTLER TOLEDO
Note: Shopper research is representative of typical fresh department performance. Results will vary with store formats, shopper demographics, time of day, seasonal impact, and other factors.
Average wait time (queue to be served) = Average transaction time (being served) = Total average time at fresh counter =
Customer tracking indicates that 64% of shoppers have to wait to be served at the fresh counter. While waiting to be served and during the customer service process, 76% of shoppers focuse their attention on the fresh counter, store associate, and service counter scale. This is a logical result as fresh products are generally sold by weight and shoppers are interested in the transaction; the calculated price and product information. Eye-level displays receive the highest attention within the first 3-5 seconds of entering the area.
METTLER TOLEDO
White Paper
Digital Media6
White Paper
METTLER TOLEDO
Software Enterprise Implementation7 Retailers must decide how best to implement the CMS application across the enterprise. There are two accepted approaches: a.) a self-hosted enterprise application, b.) Software as a web-based service. CMS solution providers can generally adapt to either architecture. 1.) Self-hosted Software application Retailer IT manages an enterprise application and all necessary IT infrastructure to support it. (e.g. servers, network bandwidth, service patches, security, internet access) 2.) Software-as-a-Service (SaaS) Retailer purchases a use license and the application is provided as a service delivered via web browser over the internet. The software application provider is responsible for IT infrastructure and scalability of the solution.
2. Device Players
Standard flat-screen monitors require a smart device to connect to the network and manage display information. Device players are typically dedicated PCs for driving content to the in-store displays. Players require retailer IT support and integration to the in-store network. Content Management Systems (CMS) applications install player software with each in-store display to manage content updates and monitoring.
METTLER TOLEDO
White Paper
Advantages of PC-based scales: Positioned at shoppers eye level and at the point-of-decision Multi-purpose device, integrated device player and network connectivity Cost-effective alternative to printing and maintaining in-store signage Disadvantages of PC-based scales: Limited to positions on the fresh counter
Corporate Marketing
Brand ownership
Category Merchandising
Promotion planning
Marketing Communications
Creative design
Category Merchandising
Content management
Category Merchandising
Measurement
Promotional campaign plan Categories, product lines, supplier lines, Co-op marketing identified
Internal or external agency Campaign creation Test market, focus group, piloting
METTLER TOLEDO
White Paper
Spot Creation
Messaging
Build Playlist
Promotion sequence
Targeted Distribution
Location, Timing
Import advertisement Add graphic images, flash, dynamic content Use templates
Drag & drop spots in sequential order Copy & paste playlist frames
Assign playlists to stores, regions, departments, devices Set playlist timing calendar, daypart
Note: Content management process defined based on METTLER TOLEDO Fresh Look Content Management Solution, but may be provide framework for general requirements
10
White Paper
METTLER TOLEDO
A. Overview
A regional, high value grocery supermarket chain wished to boost sales in the Meat & Seafood departments. They also wanted a new, innovative way to extend their established brand experience with minimal impact on internal resources and infrastructure. The Category manager and IT director co-sponsored a pilot project to test the effectiveness of in-store marketing right at the point of a customers decision by putting a digital promotions solution on the meat / seafood service counters in three of their stores. The retailer selected METTLER TOLEDO as a technology partner to provide the Fresh Look Content Management Solution and PC-based, UC Professional service counter scales with large promotional displays.
B. Marketing objectives
Category management intended to test effectiveness of in-store digital promotions to enhance the traditional use of an in-store, printed, weekly shopper. The category merchandising team duplicated promotions from the weekly shopper to the promotional screens on the service counter scales. Each week, Fresh Look CMS broadcast 3 to 5 promotions per week based on items chosen from the retailers printed weekly shopper. Promotions for meat & seafood category items and cross-selling items were included in the test. Pilot target measures for sales lift of 10% or greater would be considered an excellent result.
C. Marketing process
Category Merchandising selected 3 to 5 promotions per week from the weekly shopper ad schedule. Artwork for promotion spots were provided by the retailers marketing department in order to meet branding guidelines. Signoff and approval of promotion spots were received prior to automated distribution out to individual stores and scale devices. Using common graphic design elements, the additional in-store promotions added approximately 1 2 hours per week in additional work for the marketing department.
METTLER TOLEDO
White Paper
11
D. Test methodology
The performance measure for the pilot program was to compare items promoted only in the weekly shopper to items also promoted on the service counter scales. Sales growth of promoted items in the 3 test stores was compared to sales growth of the same items in the 22 control stores. The pilot involved a total of 9 service counter scales, 3 in each Meat / Seafood department. The pilot program began in late 2009, with the weeks leading up to and including both Thanksgiving and Christmas excluded from the test results. Also excluded were results from the top two performing control stores and bottom two performing control stores for each promoted item.
E. Results
Same item weekly sales were compared between the test stores and control stores. Based on 13 weeks of data, the In-store promotion was shown to have delivered +11.5% sales growth above controls stores with only weekly shopper promotions. After the pilot test and over an additional 33 week period, sales growth performance continued to average +13.2%. Subjective results were positive, as well. Department managers confirmed that the service counter solution was creating sales lift. One noted, [Customers] are asking our associates about promoted items all the time. Category management experimented over a 2 week period with service counter promotion of items not offered in the weekly shopper. The In-store promotion delivered an average of +48% sales lift.
METTLER TOLEDO
6. Recommendations
The following points are a checklist of recommendations and considerations to improve the likelihood of a successful in-store, fresh department promotions program.
A. Marketing Objectives
Determine primary objective Experience / Branding or Product Merchandising promotions. Agreement to measureable success criteria. Recommended target for product merchandising = +10% sales lift over control stores. Select objectives for Experience / Branding In-store solution more information, more product comparisons, easier access to information.
B. Marketing Process
Integrate in-store promotions program with current weekly shopper or branding programs. Leverage existing images, messages, videos content etc. to ensure seamless marketing integration Improve buy-in with merchandising / marketing. Process design to minimize increased labor on internal staffs. Actively measure performance of campaigns: e.g. POS comparisons, CPM, reach
C. IT Infrastructure
Selection of CMS application legacy systems or new application suited for in-store digital signage networks. Determine software implementation - Self-hosted applications or Software-as-a-Service Position in-store displays for maximum reach with shoppers: In the fresh department counter, eye level, on the fresh counter.
D. Technology Partners
Identify technology supplier with system design capabilities and expertise in enterprise integration. Identify supplier experienced in large store network rollouts of in-store infrastructure with local support. Select a digital signage supplier that brings stability to a new, emerging technology.
E. Keys to Success
1. 2. 3. 4. 5. Physical placement eye level, where the shoppers are focused Visual quality uncluttered, appealing, adding to the experience Messaging relevance to the shopper, integrated with other media Part of the marketing process content integrated into current merchandising / marketing processes Educate & inform the store associate supporting the message
METTLER TOLEDO
White Paper
13
Appendix
Sources:
Internal communications departments Braodcasters traditional television/radio Cottage industry content creators that produce content to sell to anyone Network operators operate a network of digital signage Advertising agencies Aggregators
Digital Media6
14
White Paper
METTLER TOLEDO
A. Overview
Content Management Systems (CMS) is software used to control the content displayed on PC-based displays in retail environments, including LCD/Plasma displays and scale displays. Normally, the CMS is a central Webbased application which determines the media content to be displayed when and on which set of in-store player devices. The displays can be operated either in full-screen or split-screen mode. On service counter scale displays, the legally required weighing data always remains visible at the top edge of the screen.
B. Content Scaling
It is important to remember that the Fresh Look Player software scales the media content. This means that media content does not have to be generated exactly in the indicated pixel resolution; only the aspect ratio has to match. The software takes care of converting the material to the exact pixel count. However, the production of precisely adjusted content typically results in sharper results with higher performance.
C. Codecs
The Fresh Look Player application uses carefully selected software components ("codecs") to optimize the display output for various types of digital media files, as described below. Inclusion of a customer-specific codec to increase the displayable formats is available upon request.
METTLER TOLEDO
White Paper
15
Appendix
16
White Paper
3. Video formats
Typical CMS Device Player software adjusts video material to the screen type. This only pertains to the resolution and not to the aspect ratio. This means that videos in the format 360x768 will be displayed correctly in a screen window with the resolution 800x450, since both formats have an aspect ratio of 16:9. Videos with a different aspect ratio are displayed with black bars. For optimal results, the aspect ratio of the video should match the aspect ratio of the screen (or, in case of split screens, the aspect ratio of the corresponding screen segment). Caution: 16:9 videos sometimes are in the format of 4:3 videos with a black bar at the top and bottom. When such videos are played in a 16:9 window, the system will not recognize that the actual aspect ratio is 16:9 and the video display will show additional black bars on the left and right. In that case, the video display appears minimized. Note that videos typically are displayed without sound on in-store monitors. Pilot testing received generally negative results when sound was added to the store environment. The following video formats are normally supported: MPEG1 MPEG2 MPEG4 WMV (recommended codecs: WM Video V9) MOV (recommended codecs: Sorenson3, H.264 up to version 7.6) AVI (recommended codecs: XviD, DivX, On2 VP6, Intel Indeo) Flash video (recommended codecs: on2, Sorenson) Note: For performance reasons, WMV, MPEG2, and MPEG4 are preferred formats METTLER TOLEDO does not advise the use of full HD-format (1920 x 1080) videos, since this resolution cannot typically be displayed and negatively impacts bandwidth.
METTLER TOLEDO
METTLER TOLEDO
White Paper
17
Appendix
Store Brand Equity and Incremental Sales, Miller Zell, 2009 Managing Store Traffic for Maximum Profit, Herb Sorensen Ph.D, Sorensen Associates, 2008 Achim Fringes, www.achim-fringes.de, 2010 Retail Process Analysis, Ms. Kelli Berner, METTLER TOLEDO, 2009 2010 Digital Out-of-Home Brand Planning, SeeSaw Networks, 2010 Digital Signage: Still a young industry, Digital Media, 2009 SaaS vs. Self-hosted systems, Digital Signage Insider, 2010 METTLER TOLEDO Fresh Look pilot, U.S.A., 2009 2010
18
White Paper
METTLER TOLEDO
METTLER TOLEDO
White Paper
19
www.mt.com/retail