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Smart Insights: Consumer Goods

The number of touchpoints between brands and consumers is increasing at an unprecedented rate. Consumers are seeking richer retail experiences, rather than simply acquiring new products. There is also an intense competition for loyalty.

To be successful, consumer goods (FMCG, domestic appliances, home and living) companies need a comprehensive understanding of what is driving consumer choices and experiences at every touchpoint.

GfK's consumer goods research and insights illuminate the trends behind today's market realities and tomorrow's consumer demands.

Fast Moving Consumer Goods

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Latest insights

Here you can find the latest insights for consumer goods industry. View all insights

    • 11/07/17
    • Retail
    • Consumer Goods
    • Global
    • English

    Beware the star player: Why category management is the ultimate team game

    Category management is the ultimate team sport. Smart retailers, just like good football club managers, know that it takes a range of skills to create a winning team. The secret to category growth and success lies in picking the best combination of SKUs to achieve the highest category penetration. So why do so many categories look like a jumble of products all individually vying for the shopper’s attention? Manufacturers need to face up to shrinking shelf space. Four key trends are converging to create a perfect storm, and the result is that some SKUs will be relegated to the bench. Discounters such as Aldi and Lidl are redefining the notion of convenience and enabling shoppers to save on their two most precious resources, time and money. Meanwhile “ambient categories” which don’t need to be hand selected are increasingly transitioning online. Barriers to new entrants have fallen meaning that existing brands are at risk of being squeezed out. And to cap it all, private label brands are growing both in volume and prominence.

    Teamwork is the key to success

    Against this backdrop, the need to create a winning team on the shelf is paramount. Every SKU needs to earn its place on the shelf– and to make a match-winning contribution. Tesco is currently playing an excellent game on their whiskey shelf with a hero area. The bottles displayed behind the wooden and glass cabinet are super-premium, and with a price tag to match. Old Pulteney, at an eye-watering £100 per bottle, is priced well beyond the average Tesco shopper. So what game is the retailer playing? Including Old Pulteney in the assortment achieves two important objectives. The listing is intended to attract a different shopper who probably wouldn’t visit the store otherwise. They are likely to be affluent with a higher spend per visit. Secondly, Tesco wants to frame the value of other products on the shelf. Having a price tier with an attractive product which is unaffordable to most often has the effect of making the other (still relatively high ticket) items appear more palatable. So, brands at opposite ends of the spectrum become teammates.

    Train for success

    But how can we test what is happening at the shelf? How can retailers and manufacturers be sure that they are fielding the right team? The answer lies in observing shopper behavior. Fundamentally, category managers need to understand which SKUs are substitutable (i.e. easily interchangeable), and which are incremental (unique to that buying occasion). The difference is crucial, and it is vital to understand the interplay between the two. Using a virtual store platform, we can identify shopper repertoires and establish which products they consider. We then ask shoppers to make product selections based on various versions of the shelf to establish which products consistently end up in the shopping basket.

    Creating a winning team

    Using this data, we can identify which combination of SKUs create the highest total penetration. As well as establishing the point of diminishing returns, we can identify the niche products that will deliver incremental sales. Armed with these insights, category managers can optimize their assortment, and create effective team sheets which can be adapted according to the channel to deliver a winning team every time. James LLewellyn is the UK Head of Shopper. Please email James.Llewellyn@gfk.com or leave a comment below to share your thoughts. hbspt.cta.load(2405078, 'e4b9c2bf-f5ab-44f4-987f-f13c79aea956', {});
    • 10/31/17
    • Retail
    • Consumer Goods
    • Global
    • English

    Enticing shoppers to buy: Time to communicate the benefits to shoppers

    In a recent study, 62% of shoppers in a mature, low involvement category interacted with the shelf but failed to buy. Although this experiment featured a staple item which every household needs, featuring highly substitutable brands, almost two thirds walked away from the shelf. So, what’s the problem and, more importantly, how do we fix it?

    Give shoppers a reason to buy

    Supermarkets are notorious for failing to communicate the benefits of the products they sell. Often, categories within the store are unclear on the different types of products within the category and how these meet various needs and occasions. A buoyant economic climate until 2008 meant that retailers didn’t have to actively sell in stores. Marketing activity was confined to price promotions and volumes continued to rise. Things have changed, and the passive approach to category marketing is well and truly out of fashion. If you want shoppers to buy, you need to give them a reason to do so.

    Rethinking category marketing

    Retailers can help shoppers make the right decision – that is, to buy rather than walk away. When our client added point-of-sale material (POSM) to the category we described above, conversion significantly improved. This promotional activity succeeded in helping the shopper understand the choices available to them. By observing shoppers in situ, we have been able to demonstrate a clear link between proactive category marketing and increased sales.

    Virtual testing

    Testing campaigns in a virtual environment is one way to establish the effectiveness of a new strategy. Using a virtual store, we enable clients to test out new material to gauge its likely impact and to fine-tune before real store tests. For example, we worked with a client in the spirits category to reinvigorate a category experiencing low engagement in store. Our client needed to improve their “distant ID” and make the shelf more recognizable and appealing from a distance. A new planogram was created, together with a header-board on top of the shelf to entice shoppers. Virtual testing enabled us to refine the concept. The category achieved a significant lift in its ability to entice shoppers to the shelf – up from 24% to 39%.

    Ask the right questions

    To maximize their effectiveness, category stakeholders need to be able to answer three key questions:
    • Am I attracting traffic?
      • Is my category noticeable and understandable from a distance in store?
    • Are the different types of products available on the shelf clear to shoppers?
      • Are the sub-segments that meet different need states explained at the shelf?
    • Is my brand communicating the right message at the shelf?
      • Is on-shelf communication and pack design meeting consumer goals?
    The answers to these lie in understanding how shoppers behave in a store. By replicating shopper behavior in an agile, risk free environment, virtual testing offers a highly cost effective and time efficient way to maximize the effectiveness of category marketing. Combining behavioral and survey data enables us to connect with what people buy and why. Only when we have answers to these questions will we be able to stop consumers walking away from the shelf empty handed. Category marketing is changing. If you don’t give shoppers a reason to buy, someone else will. James LLewellyn is the UK Head of Shopper. Please email James.Llewellyn@gfk.com or leave a comment below to share your thoughts. hbspt.cta.load(2405078, '8fd4cbb1-cada-41ae-87a9-806a15f4e1ba', {});
    • 10/31/17
    • Retail
    • Technology
    • Consumer Goods
    • Consumer Life
    • Global
    • English

    UK Consumer Confidence down one point in October

    GfK’s long-running Consumer Confidence Index slipped by one point to -10 in October.
    • 10/27/17
    • Consumer Goods
    • Global
    • English

    Top factors for consumers in deciding what to eat or drink

    Low-sugar and GMO-free are top factors when deciding what to eat or drink, according to the results of our international online survey of 23,000 consumers.  Asked how important certain factors are when deciding what to eat or drink, nearly half of the study’s participants (48%) responded that “low sugar or sugar-free“ and “free from GMO ingredients“ are very or extremely important factors. These factors ranked as the highest in importance from a given list, followed by “low-sodium, low-salt“ products (45%). Also listed as very or extremely important were products that are organic, products that are low fat or no-fat, and products that are fortified with vitamins or minerals (44%).  Rounding out the list were products that are made locally or use local ingredients (38%), products that contain pre- or probiotics (35%) and products that are gluten-free (26%).

    Differentiators among survey respondents

    Age played a significant role in the results, with food and drink shoppers aged 30-39 years old being the most selective amongst all age groups, and those under 40 years old placing more importance on organic, probiotic, fortified and gluten-free products. When looking at income, people from high income households set consistently higher importance on all the factors, especially products that are GMO-free (55%), low sugar or sugar-free (54%) and low sodium or low salt (52%).  Low income households ranked the factors in a similar order of very or extremely important, but at a significantly lower percentage. Out of 17 countries surveyed, China was the most selective on what to eat and drink, with the highest number of respondents for top levels of importance on eight out of nine decision factors.  The below chart shows the top five countries per factor, with China giving way to Italy only in importance of food and beverage products that are “made locally or uses local ingredients”. With access to this kind of wide-ranging survey data, food and beverage brands are able to truly listen to the consumer and understand their individual market needs.  By combining these self-reported insights with data from areas such as point of sales tracking, consumer panels and geo-marketing, we can begin to see the full picture around what consumers do, say, and think on their trip to the grocery store or the vending machine.

    About the study

    The survey question asked, “When deciding which food or beverage product to eat or drink, how important are the following in making your decision?”, with options listed as It is organic or made from organic ingredients; It is made locally or uses local ingredients; It is a low-sugar or sugar-free product; It is low fat or no fat; It is a low-sodium, low-salt product; It is fortified with vitamins or minerals; It contains pre- or probiotics; It is free from GMO (genetically-modified) ingredients; It is gluten-free. GfK interviewed 23,000 consumers online in 17 countries in the summer 2017. Data are weighted to reflect the demographic composition of the online population aged 15+ in each market. The global average given in this release is weighted, based on the size of each country proportional to the other countries. Countries included are Argentina, Australia, Belgium, Brazil, Canada, China, France, Germany, Italy, Japan, Mexico, Netherlands, Russia, South Korea, Spain, UK and USA. hbspt.cta.load(2405078, '56337b7a-3b87-40b8-b8ea-10cc80a65e1b', {});
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  • Brand and Customer Experience (BaCE)

    Brand and Customer Experience (BaCE)

    Brands are under pressure to develop emotional connections and relationships with consumers and business decision makers.  Brands need to respond in-the-moment, to enrich the customer experience – and develop strategies that influence ”moments of truth” throughout individual brand journeys.  

  • Consumer Panels

    Consumer Panels

    Your business is all about your consumers. So understanding them is essential in ensuring your products and services meet their needs, and in identifying opportunities for growth.

    Our international consumer panel data and research expertise provide you with smart customer insights into who your consumers are, their attitudes and behaviors, across channels.

  • Digital Market Intelligence (DMI)

    Digital Market Intelligence (DMI)

    When consumers shop, search, communicate, gather information and engage with companies or brands online, they behave differently depending on which device or screen they are using. They expect a consistent experience regardless of the channel or device they are using.

  • Point of Sales Tracking

    Point of Sales Tracking

    Retailers and manufacturers are under pressure to develop products and services that maximize sales and profit and to keep customers coming back.

    Success relies on having the most up-to-date sales data, combined with robust analysis to understand which products and services are performing well in the market – and which are not. With this information, clients can set clear strategies for commercial growth and increase return on investment.

  • Market Opportunities and Innovation (MOI)

    Market Opportunities and Innovation (MOI)

    Brands are under constant pressure to maintain relevance in an increasingly crowded market. Identifying when, where and how to deliver compelling experiences that deliver new value for both consumers and brands is critical.

  • Shopper

    Shopper

    Digital continues to open up new paths to purchase, changing how and where people shop. More and more data becomes available every day, as shoppers embrace multi-channel brand experiences. To stay competitive in this big data, multi-channel environment, businesses need to identify and leverage the most relevant data along the entire path to purchase. 

  • User Experience (UX)

    User Experience (UX)

    Our user experience (UX) research and design experts help our clients create and improve customer experiences for existing or new products and services

    Today’s consumer is bombarded with promises for compelling experiences. They are sophisticated and demanding.  To be successful, a new product or service needs to be intuitive, usable, engaging and desirable. The user experience needs to be emotional in order to be memorable.

  • Geomarketing

    Geomarketing

    Our geomarketing solutions and consultancy provide our clients with smart insights into location-specific factors that impact the success of business sites, shops, sales territories, target groups, as well as chain store and distribution networks.

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