P2PI-Jan/Feb 23

JAN/FEB 2023 P2PI.com

BATTLING INFLATION

How marketers are dealing with the impact of high prices at the shelf

SHOPPER ENGAGEMENT

PHYSICAL EXPERIENCES

DIGITAL

MARKETING

OMNICHANNEL

MEASUREMENT

ECONOMY & INFLATION DATA SHARING

BUSINESS-RELATED CONCERNS

METAVERSE

IN-STORE TACTICS PERMANENT DISPLAY

BRAND

MARKETING BUDGETING

SOCIAL OUR SURVEY RESULTS COMMERCE REVEAL THE TOP CHALLENGES AND OPPORTUNITIES

SHOPPER MARKETING SUPPLY CHAIN

DIRECT-TO-CONSUMER

JAN/FEB 2023

P2PI.com

SOCIAL MEDIA

ROI

DATA SHARING

2023 TRENDS

RETAIL MEDIA

TARGETING EFFECTIVENESS

SUPPLY CHAIN

TEMPORARY DISPLAYS

DATA TRANSPARENCY

E-COMMERCE

RETENTION & TURNOVER

RETAINING TALENT

FOCUS: RETAIL MEDIA

A look at the forces shaping the current and future landscape

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Contents SHOPPER ENGAGEMENT

DIGITAL

MARKETING

OMNICHANNEL

MEASUREMENT

ECONOMY & INFLATION DATA SHARING

SOCIAL MEDIA

ROI

DATA SHARING

BUSINESS-RELATED CONCERNS

2023 TRENDS

RETAIL MEDIA

TARGETING EFFECTIVENESS

PHYSICAL EXPERIENCES

Our annual path to purchase survey examines the challenges and opportunities facing the commerce marketing industry as we enter a new year.

TEMPORARY DISPLAYS

SUPPLY CHAIN

Trends 2023

FEATURES

E-COMMERCE

COVER STORY

VO LU M E 3 6 | I S S U E 1

RETENTION & TURNOVER

T Y

RETAINING TALENT

22

Jan/Feb 2023

DATA TRANSPARENCY

LE

METAVERSE

IN-STORE TACTICS PERMANENT DISPLAY

BRAND

MARKETING BUDGETING

SOCIAL OUR SURVEY RESULTS COMMERCE REVEAL THE TOP CHALLENGES AND OPPORTUNITIES

SHOPPER MARKETING SUPPLY CHAIN

DIRECT-TO-CONSUMER

34

Battling Inflation CPG brands continue to focus on product quality, creating value for consumers and strengthening retailer relationships.

Path to Purchase Institute magazine (USPS 4568, ISSN 2835-0219) is published bi-monthly by EnsembleIQ, 8550 W. Bryn Mawr Ave., Ste. 200, Chicago, IL 60631. Subscription rate for the U.S.: $80 one year; $155 two year; $14 single issue copy (pre-paid only); Canada and Mexico: $105 one year; $185 two year; $16 single issue copy (pre-paid only); Foreign: $115 one year; $215 two year; $16 single issue copy (pre-paid only); $56. Periodical postage paid at Chicago, IL 60631 Copyright 2023 by EnsembleIQ. All rights reserved. No part of this publication may be reproduced or transmitted in any form or by any means, electronic or mechanical, including photocopy, recording, or information storage and retrieval system, without permission in writing from the publisher. POSTMASTER: send address changes to Path to Purchase Institute magazine, 8550 W. Bryn Mawr Ave. Ste. 200, Chicago, IL 60631.

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Contents DEPARTMENTS

6

16

38

Editor’s Note The Pulse of the Industry

8

P2PI Member Spotlight

10

Perspectives

12

Focus: Retail Media Q&A with Criteo

14

The New Consumer

16

Brand Watch Molson Coors and Drizly

18

18

In-Store Experience Ulta’s Merchandising Overhaul

20

On Trend E-Commerce Product Content

42

38

Activation Gallery Holiday 2022

42

Solutions & Innovations

46

Insider Intel Sour Patch Kids gives Circle K an exclusive flavor.

46 Editorial Advisory Board Keith Albright Kimberly-Clark

Lianna Cabrera L’Oreal Paris Cosmetics

Dana Barba Coca-Cola North America

Mia Croft Native

Stephen Bettencourt CVS Health

Christiana DiMattesa Under Armour Gregg Dorazio Giant Food (Ahold Delhaize)

Paige Dunn FIJI Water, JUSTIN Vineyards & Winery, Landmark Vineyards & JNSQ Wines

Travis Harry Home Depot

Jeff Sciurba Dyson Americas

Tony Fung Bob Evans Farms

Brendon Lynch Jushi Holdings

Kelly Sweeney The J.M. Smucker Company

José Raul Padron The Hershey Experience

Rodney Waights Beiersdorf

Jonny Rigby Amazon

Ethelbert Williams Johnson & Johnson Consumer Health

Patrick Hallberg Apple

Follow the Path to Purchase Institute here: 4 l Jan/Feb 2023

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Editor’s Note

8550 W. Bryn Mawr Ave., Suite 200, Chicago, IL 60631 773.992.4450 www.p2pi.com

The Pulse of the Industry As I write this month’s Editor’s Note, I am listening to an inane series of nursery rhymes blasting from a tablet at an absolutely outrageous, brain-rattling volume. “This is our class pet, her name is Jellybean. She has such tiny feet, she’s cuddly and sweet.” On repeat.

(Bonus points if you know where that line comes from, and my condolences if you’ve been subjected to it as well.)

This is the world many of us work in now thanks to today’s remote and hybrid office models. Don’t get me wrong, I would not trade working remote for anything in the world — the flexibility to be home with a sick child (as outlined above) can certainly make the logistics of life easier — but it can be both a blessing and curse. The challenges of evolving workplace models are affecting all businesses in how they recruit and retain talent and operate — and the commerce marketing industry is no exception.

In the Path to Purchase Institute’s 27th annual Trends Survey (page 22), we take a deep dive into the challenges and opportunities that commerce marketers are facing in their roles. And this year, we specifically asked our readers and members what challenges, if any, their organizations are facing in regard to recruiting, training and/ or retaining talent. The responses followed similar themes: Concern 1: Remote/hybrid workplace models or the lack thereof • “Trying to get leadership onboard with remote work. Employees want to work from home, and we are not where we need to be with that. So, struggling to attract the right talent.”

• “Difficult to get anyone to move to our location and willing to have on-site requirements.”

Concern 2: A competitive marketplace with high turnover • “Turnover is higher than ever. Keeping high-level employees engaged and fulfilled requires evolution of previous strategies as well as intentional management. Remote work has opened opportunities for recruitment of high-caliber individuals from a broader geographic base.”

• “It’s a HOT labor market. My best people are being approached weekly, if not daily, with offers to jump ship in return for more money or some other condition that might appeal to them. So far, we’ve been able to do a good job of retaining our people, but the pressure is there.”

Concern 3: Expertise issues/knowledge gaps • “Finding people with an understanding of the emerging omnichannel (e-commerce) space and what it takes to be competitive in that space, along with the right level of customer/shopper marketing experience.”

• “Not many people trained in the new digital capabilities. Digital companies stole them (Amazon, Netflix, Instacart).”

In our Trends Survey, we also polled our audience on a host of other topics to take the pulse of the industry — including asking them to evaluate and rate key retailer media network metrics (the retail media section starts on page 30).

We hope you find the results of our survey insightful and helpful in navigating the year ahead!

JESSIE DOWD, Editorial Director

BRAND MANAGEMENT Vice President, Brand Director Eric Savitch esavitch@ensembleiq.com

EDITORIAL Editorial Director Jessie Dowd jdowd@ensembleiq.com Executive Editor Tim Binder tbinder@ensembleiq.com Managing Editor Charlie Menchaca cmenchaca@ensembleiq.com Digital Editor Jacqueline Barba jbarba@ensembleiq.com Director, Member Content Patrycja Malinowska pmalinowska@ensembleiq.com Managing Editor, Member Content Cyndi Loza cloza@ensembleiq.com Editor, Member Content Heidi Bitsoli hbitsoli@ensembleiq.com Events Content Director Lori Pugh Marcum lpughmarcum@ensembleiq.com Contributing Writers Michael Applebaum, Ed Finkel, Erika Flynn, Chris Gelbach, Jenny Rebholz, Bill Schober

ADVERTISING SALES & BUSINESS Associate Director, Brand Partnerships Arlene Schusteff 773.992.4414, aschusteff@ensembleiq.com Regional Sales Manager Orlando Llerandi 678.591.8284, ollerandi@ensembleiq.com

MEMBER DEVELOPMENT Director, Membership Development Nicole Mitchell 203.434.5733, nmitchell@ensembleiq.com Director, Membership Development Christopher Barry cbarry@ensembleiq.com Membership Experience Manager Ann Estey aestey@ensembleiq.com Manager, Membership Development Brady O’Brien bobrien@ensembleiq.com Membership Experience Manager Heather Kurtik 724.553.0093, hkurtik@ensembleiq.com

DESIGN/PRODUCTION/MARKETING Senior Creative Director Colette Magliaro cmagliaro@ensembleiq.com Art Director Michael Escobedo mescobedo@ensembleiq.com Production Director Ed Ward eward@ensembleiq.com Marketing Director Marlene Shaffer mshaffer@ensembleiq.com

SUBSCRIPTION SERVICES List Rental mbriganti@anteriad.com Subscription Questions contact@pathtopurchase.com

CORPORATE OFFICERS Chief Executive Officer Jennifer Litterick Chief Financial Officer Jane Volland Chief People Officer Ann Jadown Executive Vice President, Content & Communications Joe Territo Executive Vice President, Operations Derek Estey

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Solving Today’s Business Challenges and Driving Tomorrow’s Growth

NOW is the Perfect Time to

JOIN! Membership has its Benefits

The only community that is committed to serving the needs of consumer brand marketers, retailers, agencies and solution providers in the quickly evolving realm of commerce marketing.

••••••• Exclusive access to the most comprehensive collection of commerce marketing insights and intelligence in North America.

••••••• World-class events that unite the community through networking, education and fresh perspectives.

••••••• Are you ready to put the power of the P2PI community to work for you?

••••••• Contact us at JoinNow@P2PI.com

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Member Spotlight

Meet the Marketers HERE’S A SNAPSHOT OF INDUSTRY LEADERS FROM THE P2PI MEMBER COMMUNITY.

ALI DEMBISHACK Senior Manager, Omnichannel Marketing Lactalis US Yogurt

RICK SHUMAN Head of Shopper Marketing Grey

Main job responsibilities: I conduct strategy, planning and execution across our portfolio of brands, including Stonyfield Organic, Siggi’s and Brown Cow.

Main job responsibilities: I lead the shopper marketing practice for Grey North America, as well as partnering with our global offices to deliver borderless shopper solutions. I’m responsible for strategy, capabilities, vendor evaluation and, in general, developing our shopper and commerce department.

How you win with shoppers during uncertain economic times: We begin with consumer insights, focusing on shoppers and buying behaviors to personalize offers and meet their needs.

New marketing tactic that you use: We have seen success in working with vendors that are able to tap into firstparty data sources and using that to inform our targeting methodology and approach. Also in the toolbox are tactics that allow for shoppable integrations and personalization.

Best career advice you’ve received: Dare to be a leader. Leaders are people who hold themselves accountable for recognizing potential in people and ideas — then developing that potential. Stay curious and ask questions.

What you are watching right now: “City on a Hill” and eagerly awaiting the next season of “Succession.”

What you do when you’re not working: Spend time with my family and friends, and I added a few road trips on the East Coast to the mix.

How you win with shoppers during uncertain economic times: Uncertainty brings immense opportunity to shopper marketing/commerce, as we know shoppers are obsessed with finding a good value and brands are focused on delivering a strong ROI on their marketing spend. This brings together the perfect opportunity to find ways to add value for shoppers (not always a discount), as well as to deliver on ROI goals, due to shopper marketing/commerce sitting at the point of sales conversion.

New marketing tactic that you use: I’m finding success with anything that breaks through conventional behaviors to disrupt and reach the shopper in an unexpected way. Sometimes this means what’s old is new again. For example, out of home (OOH) is now becoming prevalent in many additional locations versus the past world of billboards.

Measurement has come into the space, as well as digitalization and the ability to buy programmatically. As a result, the tactic is growing exponentially and

is being adopted in areas that were not possible previously.

Another area that I’ve been pushing into is Web 3.0 and expanding our capabilities to deliver solutions for any brand within the space. One of the biggest mistakes I see brands make in this area is jumping in because everyone else is. Instead, we must focus on having a clear objective and desired outcomes. A full-on metaverse or NFT may not be the right experience for your brand at this point, but there are many ways into this world to begin testing and learning with low risk.

Best career advice you’ve received: Never lose your curiosity. There is always something new to learn. To be impactful in your position, you must be deeply curious about new technologies, platforms and innovative approaches others are taking. When I started my career, brands were beginning to form “digital marketing,” but in 2023 “digital marketing” is just marketing. If you don’t understand the importance of digital due to a loss of curiosity, you now find yourself behind. The next example of this I see in the making is Web 3.0. Many people don’t understand the space or think it will be decades before it gains mass adoption. But it’s coming and if you are not learning now you will be left behind by the industry.

Memorable aha moment in your career: As cliche as it may sound, there is no one-size-fits-all approach in marketing.

I’ve worked in beauty and personal care for most of my career — both on the agency and client side. I can say with confidence that what works for one category, brand or retailer is unlikely to work universally across the board. As marketers, we must seek to gain as much data and implement

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Never lose your curiosity. There is always something new to learn. To be impactful in your position, you must be deeply curious about new technologies, platforms and innovative approaches others are taking. strategies to constantly be testing and learning in a small way before we scale into new tactics.

What you are watching or reading right now: I’m watching “Mad Men” for the third time. Now that I work in advertising again, I just can’t get enough.

And I’m reading “Meditations” by Marcus Aurelius.

Recent travels: My wife and I have family all over the country, so during the fall we traveled to California and West Virginia to see much of them. In December, we headed to Spain, France and Italy for two weeks of relaxation.

Stand in the Spotlight If you are a current member of the Path to Purchase Institute and would like to see your colleagues (or yourself) in a future spotlight, send their name and email address to cmenchaca@ensembleiq.com.

LISA TRAVIESO Senior Manager, Shopper Marketing Nestle Coffee Partners

Main job responsibilities: I am focused on developing strategy and communication frameworks for how we connect with our shopper in the future.

I’m leading a shopper consumer journey that bridges our brand team campaigns with shopper-facing communication.

I also oversee our annual planning process, shopper marketing toolkits for innovation launches at retail, and measuring our program success by leading our marketing mix.

How you win with shoppers during uncertain economic times: A coffee purchase is so personal to different shoppers. Some are only focused on price, and they have their preferred brands that work for them. Others are focused on taste and how they craft their cup. For these shoppers, we are balancing quality and experience, while being mindful that everyone is making tough choices when they shop. Therefore, we are laser-focused on what we say, how we say it and where our communication shows up, so that we drive behavior change and purchase.

New marketing tactic that you use: I’m in a measurement state of mind these days. Shopper marketing measurement is so complex, but we have to use the data we collect in a way that captures our impact to the business without oversimplifying and not focus on tactics that might erode brand equity.

Memorable aha moment in your career: When I led shopper marketing

for the dollar channel, I saw the magic of shopper marketing — how you can connect with the shopper, meet retailer objectives and deliver profitable growth for your company. It all started by sharing an insight with the buyer, collaborating with other CPG partners to develop a holistic shopper activation plan (before omni was a thing) and drive profitable results by selling in incremental merchandising. It is so satisfying to see hard work pay off and be a win for everyone.

We are laser-focused on what we say, how we say it and where our communication shows up, so that we drive behavior change and purchase.

What you are reading right now: I’m reading “The Midnight Library” by Matthew Haig. It’s a great story that takes the reader through the journey of a young woman who lives a dull and uninspiring life. Then, when she takes some action, she enters a magical library where she gets to try out different lives and see how different choices result in different outcomes. It’s been great to think about all the choices we make in life and how changes could make small or significant impacts in our lives.

Recent travels: We visited family in Texas over the holidays. Then I’m going to make a trip to Hawaii a reality this quarter. I’ve unsuccessfully planned a trip there four times, and this time, it’s going to happen!

P2PI.com

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Perspectives

All About Shopper Measurement HERE ARE THREE KEY PRINCIPLES TO CONSIDER FOR THE FUTURE OF THIS PRACTICE. B Y M AT T H E W S H A R P

After all these years, shopper marketers still have a unique and challenging job. With advances in technology and increased access to data, one would think the job would get easier, and the path to impact would be clearer. But with data coming from different directions — and at different levels of granularity — it’s hard to know what’s most useful and actionable. Some data is not easily accessible, which creates unfortunate gaps and blind spots.

For these reasons, the SM2 Commission was formed to standardize definitions and measurement approaches of shopper marketing for the industry.

With the release of our updated “Industry Playbook” last fall, I believe we took a meaningful step forward.

Based on that effort and my previous work on the marketing science team at Meta, I’d like to offer a vision of the future of shopper marketing measurement that’s grounded in three key principles.

Increase the quality of data inputs.

“Garbage in, garbage out.” We’ve all heard and likely used this phrase to express the idea that poor quality inputs will always produce poor quality outputs. The future of measurement for shopper marketers — a future with higher-quality, actionable outputs — relies greatly on improving the quality of data we feed into our measurement systems, or inputs.

This starts with increasing secure access to data that enables meaningful analyses and measurement of business outcomes that truly matter. From there, granularity and consistency of those inputs is key if shopper marketers hope to conduct any cross-channel analyses. The SM2 Commission learned this in our modeling pilots, and Steve Tobias, an executive in the Media Center of Excellence practice at IRI, summarized it well. He said, “If we benchmark shopper marketing impact as an aggregate effect versus measured down at a more tactical level, the models with more disaggregate shopper marketing inputs actually produce a greater total contribution and ROI.”

Similar dynamics were seen at Meta. In a marketing mix modeling (MMM) meta-analysis completed with Accenture in 2022 (and involving 30-plus brands and five verticals in North America), Meta found that its ROI increased by 7.8% to 12.7% when using granular data inputs in MMMs. Whether measuring a key component of a CPG’s marketing mix like shopper marketing, or the impact of an individual channel like Meta, model outputs can vary significantly when more granular data is used.

Innovate new and better measurement solutions.

Working closely with trusted third-party solution providers will continue to be an important part of the measurement and analytics strategy for shopper marketers, given these third parties’ access to data and specialized skills.

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From left: Kelly Kachnowski of The Mars Agency, Matthew Sharp, Cheryl Policastro of TPN, Steve Tobias of IRI and Patrycja Malinowska of P2PI participate in a panel discussion about shopper marketing measurement at P2PI LIVE in October.

Additionally, it is so important for shopper marketers to take note of and consider capitalizing on new technologies that can advance their own organizations’ capabilities. For example, Open Source Techniques (OSTs) aim to democratize access to advanced analytics tools leveraging publicly available, open-source code. These techniques represent opportunities for shopper marketers to move capabilities in-house and enable their teams to increase focus on business outcomes, adding rigor to existing measurement practices.

Improve marketing performance by prioritizing experimentation.

Experimentation is the primary means of helping all businesses grow by transforming marketing practices grounded in data and science.

One of the valuable outputs from the SM2 Commission’s modeling work is the set of findings from the modeling phase that, while not conclusive and scalable on their own (we only modeled three brands), provides the industry a strong basis for further experimentation on three important variables: • Core product messaging versus innovation messaging; • Presence of an offer or incentive; and • Channel-level performance (namely digital versus traditional shopper tactics).

To wrap up this piece, I want to give a few shoutouts. I want to recognize all of my fellow panelists from the P2PI LIVE event last fall. I’m

The future of measurement for shopper marketers — a future with higher-quality, actionable outputs — relies greatly on improving the quality of data we feed into our measurement systems, or inputs.

talking about Kelly Kachnowski, vice president, commercial development, Marilyn Platform at The Mars Agency; Cheryl Policastro, chief strategy officer at TPN; and Steve Tobias. Thank you for your thought leadership and for sharing your expertise with myself and the commission.

Thank you to Patrycja Malinowska, P2PI’s director of member content, for wrangling our points of view into a cohesive narrative and for hosting a successful panel discussion at P2PI LIVE. Finally, I’m grateful to all my fellow commission members for your collaboration over the past twoand-a-half years. I’m proud of the work we’ve done together to move the industry forward.

About the Author Matthew Sharp was most recently part of the marketing science team at Meta, where he partnered with some of the world’s largest CPGs to measure the impact of their marketing investments. Sharp is an expert in experimental design, as well as research and measurement methods. He advises marketers on how to leverage both to drive learning and ultimately make better marketing decisions. Sharp brings 15 years of experience across marketing analytics and primary research disciplines. He has a bachelor’s in psychology from Whitworth University in Spokane, Washington.

P2PI.com

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FOCUS: Retail Media

‘Retail Media Unplugged’ CRITEO’S COURTNEY COCHRANE DISCUSSES THE PATH TO PURCHASE INSTITUTE’S NEW VIDEO SERIES AS WELL AS THE STATE OF RETAIL MEDIA.

BY CYN DI LOZ A

The Path to Purchase Institute, in partnership with Criteo, is launching a new retail media video series to explore the latest trends, strategies and tactics for success. The six-episode “Retail Media Unplugged” series will take viewers behind the scenes with special guests to dig into their approach to navigating the constantly evolving realm of retail media. P2PI chatted with Courtney Cochrane, Criteo’s managing director, enterprise, Americas, to discuss the challenges and future of retailer media networks (RMNs) and what viewers can expect from the series.

P2PI: Can you tell us a bit about Criteo and how the company works with retailer media networks?

Cochrane: Criteo has been enabling retailers and marketplaces to scale monetization and media programs while serving brands and agencies for more than six years. Put simply, we’ve built a leading platform for retailers to manage their entire retail media business.

We offer everything from on-site sponsored product and display advertising to off-site audience extension on the open internet. Criteo has one platform for all ad formats and demand sources, which reduces operational and tech management complexity and allows advertisers to easily optimize their campaigns.

We help retailers by providing the ability to acquire and retain targeted customers, but also scale their retail media businesses. Just as importantly, we have the experience and knowledge to work with retailers and RMNs across different types, sizes, categories and retail media experience levels. Clientcentricity, or putting the client at the center of our focus, is how we approach each and every relationship. While the front end looks seamless and intuitive, on the back end, there is no “one size fits all” and that’s our strength.

P2PI: There has been a proliferation of retailer media networks in the past five years. Can you share a bit about how your company has seen retail media evolve?

Cochrane: We could go deep here, but I’d say the biggest and most obvious change has been that retail media has gone from an opportunistic play to an integrated part of digital strategies for retailers, brands and agencies. Retailers have watched Amazon and Walmart create multibillion-dollar, high-margin businesses and are looking to capitalize on the same opportunity with their own unique audiences. Brands have seen the incrementality and performance of retail media and are restructuring their strategies and budgets to better take advantage of these opportunities. Agencies have formed or expanded to help guide clients to success.

P2PI: What is the biggest challenge in retail media?

Cochrane: If you asked 10 different people this question, you’d get 10 different answers, naturally.

My perspective is that managing complexity is the biggest challenge we face. With the kind of growth this industry is facing, everyone is moving so quickly that things are getting very complex, very quickly. This pertains to how to structure your retail media program, how to offer and access ad inventory as broadly yet simply as possible, how to measure consistently and uniformly, and more.

But all of these roll up to complexity challenges.

P2PI: How do you see retailer media networks evolving in the next few years?

Cochrane: There are a lot of possible answers to this question, but I’ll highlight two key trends. First, we see even more retailers and marketplaces willing to get into the retail media game, especially coming from more specialized categories. Michaels, the leading arts and crafts retailer in North America, launched with Criteo this year and is a great example. Nordstrom, operating in the luxury segment, is another. Some of these will want to operate as their own RMN, while others prefer not to run their own media business and will enlist partners like Criteo to

Managing complexity is the biggest challenge we face. With the kind of growth this industry is facing, everyone is moving so quickly that things are getting very complex, very quickly.

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enable them to succeed. The reason [Boston Consulting Group] is forecasting the retail media industry to grow to $42 billion by 2025 is that it’s clearly successful!

Second, in order to capture the trade marketing budgets that are shifting online, networks will continue to expand their product offerings, both on-site and off-site. This will happen via expansion of existing solutions and a move to new, creative formats and targeting across the open internet. Reaching a shopper across their entire journey is more critical and more possible than ever before.

P2PI: What are you hoping listeners will gain from tuning into the “Retail Media Unplugged” video series?

Cochrane: We’re looking forward to sharing insights from industry players on the front lines of retail media evolution, partnered with the view Criteo has from operating with 160-plus retailers, 1,500-plus brand advertisers and 175-plus agency partners globally. A lot of the information out there about retail media is generalized, but with this series, you’ll be able to hear unique and specific perspectives. We’re very excited to be sponsoring this series to bring these perspectives to a broader audience.

The Path to Purchase Institute, in partnership with Criteo, presents a new six-episode video series:

Retail Media Unplugged The first episode will drop in late January. Subsequent episodes will release in March, May, July, September and November.

The series will dive deep into retail media, exploring the latest trends, strategies and tactics for success. In each episode, we’ll go behind the scenes with special guests to reveal how they’re navigating the evolving realm of retail media.

Visit P2PI.com/RetailMediaUnplugged

P2PI.com

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The New Consumer

Digital Commerce Trends SEPARATE RESEARCH FROM RAIN THE GROWTH AGENCY AND CHICORY EXAMINES HOW SHOPPERS, BRANDS AND RETAILERS ARE BEING IMPACTED.

BY JACQU ELI N E BARBA

The COVID-19 pandemic accelerated digital shopping behaviors across the board over the last few years and subsequently impacted how brands reach consumers. Recent research examining these trends and behaviors closely, particularly as they relate to the affluent Baby Boomer demographic, shows how things have quickly evolved.

Rain the Growth Agency, an independent DTC advertising agency, in December published a report titled “Boomers Digital Shopping Trends,” which looks at the social media platforms, apps and other digital tools that are impacting buying decisions.

The report identified three discrete segments within the Boomer population, which Rain the Growth says represents more than $2.6 trillion in buying power: “Nostalgic Conservatives,” “Seniors Living Simply” and “Progressive, Knowledgeable Nesters.”

Key findings from the report include: • Boomers primarily use digital tools (e.g., Amazon, search, retailer and brand websites, product reviews, mobile apps) to make shopping easier (47%) and to save money (45%) and time (40%).

Importance of online shopping tools

• With Boomer social media users, Meta’s Facebook and YouTube are the primary platforms (78% and 63% usage rates, respectively), followed by Etsy and Pinterest.

• Younger, tech-savvy Boomers (ages 55-64) are more open to advertising, are active on social media (typically using a smartphone), and don’t shy away from video streaming services (77%).

• Younger Boomers’ favored channels include TV (37%), direct mail (33%), print magazines (25%), billboards (25%), online (23%) and radio (22%).

• Search is the shopping gateway for seniors — reinforcing the importance of investments in paid search.

• 26% of seniors say that social media has inspired purchases from never-before considered brands and products.

GenZ Millennials Gen X Boomers

Silent Generation

High Importance

(among tool users)

(Top 2 Box)

Amazon (Amazon.com)

50%

64%

64%

55%

54%

Search engine (e.g., Google, Firefox, etc.)

71%

75%

69%

61%

53%

Retailer websites

49%

68%

54%

50%

49%

Brand websites

58%

67%

68%

46%

44%

Emails from retailers

17%

36%

61%

35%

28%

Emails from brands

24%

51%

59%

32%

36%

Mobile apps

34%

65%

57%

47%

30%

Source: Rain the Growth Agency’s “Boomers Digital Shopping Trends” report

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Top Challenges with Retail Media Networks (The CPG respondents could select more than one answer) Budget requirements

68% Internal bandwidth

48% Effectiveness — Return on ad spend [ROAS]

48% Effectiveness — Ability to reach new shoppers

40% Selecting the right RMN partner[s] out of the many different options

40% Effectiveness — Size of the audience reached

20% More walled gardens that limit data access

20% Building a supporting marketing tech stack for RMN strategy

16% Other

16% Source: Chicory’s Top CPG Advertising Trends of the last 12 Months

How CPGs, Grocers Are Responding Brands and retailers are evolving how they target and connect with shoppers digitally as their behaviors change. Chicory released a report exploring how brands and grocery retailers are responding to key advertising trends, including the rise of retailer media networks (RMNs), the depreciation of third-party cookies and the emergence of new media tactics such as commerce media.

The “CPG and Grocery Digital Advertising Report” is based on survey results primarily from Chicory’s CPG clients, as well as a select number of grocery retailer partners.

Some key data points from the report include: • Growing e-commerce sales, followed by the rise of RMNs, had the greatest impact on CPG advertising strategies over the past 12 months.

• The emergence of new media tactics is expected to have the greatest impact on CPG advertising strategies over the next 12 months.

• 84% of respondents said in-recipe commerce media (e.g., shoppable recipes) will be the most popular commerce media tactic in 2023, then retail media strategies, on-site and off-site.

• Amid inflation, add-to-cart value has increased 28% year-over-year while item count remains the same, per Chicory recipe network data.

Growing e-commerce sales, followed by the rise of RMNs, had the greatest impact on CPG advertising strategies over the past 12 months.

In addition, most CPG marketers said they are “satisfied” or “somewhat satisfied” with their current RMN relationships and feel optimistic about digital advertising in 2023. Their main concerns include budget requirements, internal bandwidth and ROAS/effectiveness.

For retailers, the top challenges they faced in 2022 include: • Managing different partners and technologies (due to the emergence of new media tactics).

• Alignment among internal teams that interact with the CPG community.

• Increased competition with other RMNs. • Competing for media spend with digital-first grocery delivery platforms.

• High advertising demand.

Other trends and predictions echoed by study respondents regarding the future of grocery advertising related to growth in the metaverse, connected TV, increased privacy as well as a shift to prioritize off-site media with the latest integrations with DSP providers.

P2PI.com

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Brand Watch

Molson Coors Celebrates with Drizly THE BEVALC COMPANY’S TOPO CHICO HARD SELTZER FINDS AN AUDIENCE ONLINE.

BY CHARLI E M EN CHAC A

The summer selling season was the perfect time for Molson Coors Beverage Co. to highlight one of its hard seltzer brands on the Drizly platform.

In August 2022, the manufacturer executed a delivery-forward brand activation to create awareness of Topo Chico hard seltzer on Drizly’s BevAlc e-commerce site. The program focused on hard seltzer versions of a raspado, or a Mexicanstyle shaved-ice drink, traditionally topped with fruit, flavoring, syrup and various condiments.

“Topo Chico hard seltzer has an authentic legacy and tie to the Latin community, so crafting a raspado with this brand was a meaningful extension,” says Stephanie Spesia, senior marketing manager, e-commerce, at Molson Coors. As part of an agreement with The CocaCola Co., Molson Coors produces, distributes and markets Topo Chico hard seltzer.

The idea promoted both Drizly and the hard seltzer, furthering the partnership with Drizly and delivering excitement for the consumers, Spesia says. The target audience was Gen Z and Millennial consumers ages 21 through 34.

These consumers are likely already familiar with using delivery platforms as a way to explore and experience new brands, she says.

Four unique raspado recipes were developed with a mixologist to align to four flavors within the Topo Chico hard seltzer variety pack. “The

Topo Chico hard seltzer has an authentic legacy and tie to the Latin community, so crafting a raspado with this brand was a meaningful extension.

Stephanie Spesia, Molson Coors Beverage Co.

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promotional assets — from recipes to media to photography — were developed to deliver a one-of-a-kind experience for our Drizly shopper,” Spesia says.

Molson Coors’ influencer partners, including @nibblesnfeasts, @cocktailsbyc and @Bad_Birdy, posted their own video on Instagram demonstrating how to create one of the raspado drinks.

The paid influencers, earned media and recipe-focused ads on Facebook drove drinkers to a Topo Chico hard seltzer brand page on Drizly. This is where Molson Coors staged a sweepstakes to drive awareness of the hard seltzer and its delivery availability via Drizly. For a chance to win a raspado party at home, participants were asked to text “Raspado” to a dedicated number or visit TCHSRaspado.com.

The program resulted in a 3.5% increase in dollar share of seltzer during the program timeframe and an increase of 2.5% dollar share of seltzer in the four weeks post-program, Spesia says. Paid media delivered 136 million impressions, which was three times the benchmark. There was also an 83% message penetration, which exceeded the benchmark by 13%.

Nicole Werner, customer marketing manager, e-commerce, and Bill Holland, associate marketing manager, e-commerce, partnered with Stephanie Donelson, associate marketing manager of the Topo Chico hard seltzer brand team, to ideate and execute the program.

Learn More For details on BevAlc activations from Molson Coors and other brands, visit P2PI.com.

P2PI.com

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In-Store Experience

Ulta’s Merchandising Overhaul ULTA BEAUTY’S NEW LAYOUT SHOWCASES BRANDS AS WELL AS CATEGORIES, WHILE ALSO EMPHASIZING SERVICE OFFERINGS.

BY JACQU ELI N E BARBA

In 2022, Ulta Beauty began rolling out a new layout that better spotlights mass and prestige brands and emerging categories, while also emphasizing its service offerings, navigation and discovery at dozens of stores. Ulta has said that all new stores and remodeled stores will feature the new layout going forward.

In January, the Path to Purchase Institute visited one of Ulta’s recently remodeled stores in Skokie, Illinois, just outside of Chicago.

Upon entering, shoppers are surrounded by both conjoined and freestanding floorstands, merchandising tables and racks, some branded but most outfitted in retailer-led signage promoting current savings events and deals.

Ulta’s last substantial merchandising overhaul came in 2018.

The latest redesign keeps some of the improvements introduced

then, while taking others to a new level.

While prestige and mass brands are still separated on opposite sides of the store, each section has undergone noticeable enhancements.

Expanded brow and makeup services, offered in collaboration with Benefit and MAC Cosmetics, respectively, feature beauty bars located near the center of the store.

On the prestige side of the store, MAC also secures an illuminated gondola to merchandise its extensive assortment of cosmetics next to a Chanel wall vignette.

Also in prestige, a Chanel-dedicated half-gondola showcases individual tester products from its N°1 De Chanel skincare collection with illuminated mirrors for try-on. Other brands spotlighted in the section include Hourglass, Stilla, Urban Decay and Two Faced.

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Decked-out gondolas elevating upscale brands, such as Estee Lauder, Clinique and Lancome, are positioned near the middle of the store to transition shoppers to the mass-market brands on the other side. Kylie Jenner’s Kylie Cosmetics and Kylie Skin also fall near this section, sharing merchandising space with cult-classic skincare brand Drunk Elephant with colorful shelving units.

One brand that particularly stands out in the skincare section is Kiehl’s. Garnering substantial space at the back of the store, located between Ulta’s Skin Bar services section and its instore hair salon, the brand’s extensive product assortment is merchandised on a wall underneath an illuminated and permanent Kiehl’s sign.

Facing the wall is a unique display on one side of a gondola showcasing “Men’s Skincare and Grooming” and resembling a lab, complete with a desk, two lampshades and an enclosed glass case displaying “Mr. Bones,” a skeleton in a lab coat similar to the one Kiehl’s used in its New York apothecary to educate consumers about the brand’s remedies. A shelf on the desk spotlights individual tester products from Kiehl’s, inviting shoppers to “try our best sellers.”

Notable is that many brands and categories that enjoy prime merchandising space via a dedicated endcap display or freestanding table display located up and down the aisles are mostly new and/or exclusive to Ulta, celebrity-backed or have earned Ulta’s Conscious Beauty designation.

The latter signifies brands that use clean ingredients, are cruelty-free and use sustainable packaging.

Also present in this store is The Wellness Shop, an initiative that was introduced in 2021 and has rolled out online but only in select stores. Less of a physical shop and more of a dedicated space for self-care items “for the mind, body and spirit,” The Wellness Shop spotlights products such as bath salts and relaxation products like gummies and even sexual wellness products, a category relatively new to the retailer.

With the new layout, mass and prestige skincare brands have been brought together — no longer separated like the cosmetic brands still are.

The fragrance section has been moved nearer the middle/back of the store, leaving more space in the front of the store for dedicated brand and product launches across categories.

P2PI.com

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On Trend

Seeing Brands Clearly COLGATE-PALMOLIVE AND 1WORLDSYNC SHARE BEST PRACTICES FOR PRODUCT CONTENT.

BY CHARLI E M EN CHAC A

With the seemingly endless number of SKUs that shoppers have to choose from, accurate information is a must at retail.

“Relevant, impactful product content is essential everywhere commerce happens,” says Steve Sivitter, CEO of 1WorldSync, an e-commerce product content platform. “While consumers might be tightening their wallets, they’re spending more time researching and reviewing product content.”

In this Q&A, Sivitter provides further insight on this topic with Todd Hassenfelt, e-commerce director, growth and planning, at Colgate-Palmolive.

P2PI: How has the role of product content evolved in today’s market?

Sivitter: A majority of online shoppers say poor content (or no content) often dissuades them from making a purchase.

As ongoing economic uncertainty and inflation concerns continue, consumers have modified their shopping behavior, from streamlining their budgets to visiting multiple websites and product detail pages before making a purchase decision. When brands fail to deliver impactful product content across multiple channels, they risk failing to meet customer expectations and damaging their reputation.

P2PI: What about product content platforms? How do they help brands?

Hassenfelt: Consumers expect up-todate and expansive product details across different platforms, while retailers want more data in more formats and often require disparate information. Product content platforms help companies fi netune and safeguard the product information management process, providing the information consumers want and data retailers need. Robust content platforms empower brands to maintain a consistent image across all e-commerce, retail and distribution channels, automating the validation of product attributes to ensure accuracy. These platforms help create a single source of truth for all digital assets and help brands manage, upload and tailor their assets for various digital scenarios. This allows companies to sidestep manual processes, eliminating costly errors and saving their teams valuable time.

P2PI: What role does search data play in optimizing product content?

Hassenfelt: Search is a critical aspect of product content strategy. Most e-commerce shopping experiences begin with a simple query on a search engine or an e-commerce marketplace. To ensure maximum visibility, brands must

MOBILE RESEARCH The percentage of shoppers who look for one or more of the following while on their phones in-store:

53%

PRICE COMPARISONS

46%

CUSTOMER REVIEWS

35%

DETAILED PRODUCT DESCRIPTION

28%

HEALTH NUTRITIONAL INFORMATION

26%

INFORMATION ABOUT BRAND REPUTATION Source: 1WorldSync 2022 Consumer Product Content Benchmark Report

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thoroughly understand keyword trends for their categories. They must adhere closely to each of their trading partners’ internal search engine optimization best practices and style guides.

Believe it or not, SEO also plays an important role for in-store shopping. According to a 2021 1WorldSync survey, 61% of shoppers use search engines to research products before they go to the store.

Companies must learn — and incorporate — all the ways customers talk about their products. For example, consumers are more likely to use nonbranded search terms like “whitening toothpaste” than search for a branded product like “Colgate Optic White Renewal toothpaste.” Prioritize writing engaging and authentic product descriptions to reach more customers.

P2PI: How can brands tell their story on a product detail page (PDP) while still adhering to their retailer partners’ requirements?

Sivitter: PDPs allow brands to tell their story in myriad ways and elevate above the competition. The most impactful PDPs include product imagery. High-quality product photos influence the purchasing decisions of more than half of shoppers. The most helpful imagery styles include 360-degree spin, action, customer and scale. But while images are critical, they tell only part of a product’s story. A PDP also needs creative, concise and conversion-driving copy to highlight unique specs

and features to generate sales. Customer reviews also build brand loyalty, especially when brands engage with customer feedback — both the good and the bad.

Brands can comply with retailer requirements by using a product content platform. For instance, Colgate leverages 1WorldSync to facilitate storytelling while applying content rules and vendor formatting to ensure brands distribute current, brand-verified product content.

P2PI: How can brands’ success in e-commerce inform strategies for the physical shelf?

Hassenfelt: A digital shelf strategy helps companies draw customers to their websites and leverage rich product data to engage and increase purchases. When successful, a digital shelf strategy significantly impacts physical store sales. By strengthening its online performance, a brand can directly impact a customer’s overall retail experience. For example, even when shopping in-store, 90% of shoppers use smartphones to look up product information like reviews, features and specs (according to 1WorldSync’s 2022 Product Consumer Benchmark Report). Bridging the gap between the physical and digital commerce worlds helps brands maintain momentum and retain sales growth.

P2PI: What challenges remain for CPGs as it relates to product content? What are some possible solutions?

Sivitter: Digital technologies are reshaping how people discover and shop for consumer packaged goods. Grocery shopping has also migrated online, and CPG marketers must adapt to meet new demands in the crowded e-commerce market. To achieve success in the CPG space, brands must display product information — including updated availability and price — that consumers can easily find.

7 of 10

The number of online shoppers who often decide not to buy a product due to poor quality product content, or lack of content.

Source: 1WorldSync 2022 Consumer Product Content Benchmark Report

P2PI.com

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TEMPORARY DISPLAYS

E-COMMERCE

BRAND MARKETING

RETENTION & TURNOVER

RETAINING TALENT

BUDGETING

SHOPPER ENGAGEMENT

MET

RETAIL MEDIA

MARKETING

OMNICHANNEL

PERMANENT DISPLAY

MEASUREMENT

ECONOMY & INFLATION DATA SHARING

CHALLEN

OPPOR DIRECT-TO-CONSUMER

SHOPPER

IN-STORE TACTICS

DIGITAL

Path to Purchase Trends 20

SOCIAL MEDIA

PHYSICAL EXPERIENCES

TARGETING EFFECTIVENESS

MARKETING SUPPLY CHAIN

22 l Jan/Feb 2023

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SUPPLY CHAIN

DATA TRANSPARENCY

ROI

DATA SHARING SOCIAL COMMERCE

BUSINESS-RELATED CONCERNS

METAVERSE

ends 2023

ENGES AND

ORTUNITIES

ER

Our 27th annual survey finds commerce marketers concerned about navigating inflation and the economy, while also trying to figure out how to leverage the promise that retailer media networks bring.

BY TIM B IN DER

RETAIL MEDIA TRENDS:

Ratings of retailer networks, chain by chain — Page 30 P2PI.com

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Path to Purchase Trends 2023

I

dentifying commerce marketing trends and opportunities is our primary goal each year as we conduct the Path to Purchase Trends survey. This go-around, our 27th annual survey (which was fielded in November 2022) saw two areas of focus jump to the forefront: retail media and inflation.

Retail media and, specifically, retailer media networks aren’t new on our radar; they have been a major part of our trends report for the past three years.

But retail media is continually growing, and increasing in importance, as this year’s survey results indicate — 58% of respondents said their organization’s investment in retailer media networks increased in 2022.

And it will come as no surprise that inflation and the economy were hands down the most frequently mentioned businessrelated concerns for our respondents as they headed into 2023. With our survey, we were able to pick the brains of 166 marketing executives, who shared their opinions on various other important topics as well. Read on to dig into the results…

How investment (budgetary spend and/or attention) in the following areas changed in 2022 compared to 2021 Increased

Stayed the same

Decreased

2022 INVESTMENT CHANGES

37%

Retailer media networks 58% Shopper marketing 52%

36%

Social media 52%

37%

E-commerce content (PIM, DAM, delivery packaging, etc.) 52%

40%

Other digital media beyond RMNs & social media (paid search, internet ads)

49%

12% 11% 8%

45%

Insights & analytics 48%

6%

44%

Consumer promotion 38%

8%

42%

Trade promotion 37%

20%

49%

Mobile (SMS, mobile app/website advertising) 36%

14%

50%

In-store marketing 34% Traditional media (TV, print, etc.) 23%

5%

14%

44% 40%

22% 37%

Source: 2023 Path to Purchase Institute Trends Study, November 2022

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Strategies/tactics most important in the past year 50%

Retailer media networks E-commerce content (i.e., product pages)

48%

Digital media (other than retailer networks and social media)

34%

Social media

33%

In-store display activity for brand-driven programs

21%

In-store media/signage

14%

Direct-to-consumer sales

12%

Traditional media

9%

Mobile marketing

Significant Change YoY

8%

In-store sampling/demos

6%

Alternate venue sampling/demos

6%

Something else

(+ 9 pts)

18%

In-store display activity for retailer-driven programs

Online sampling/demos

(+ 18 pts)

5% 6%

Source: 2023 Path to Purchase Institute Trends Study, November 2022

Strategies & Tactics We asked what strategies or tactics have been most important to survey participants’ organizations over the last year, allowing them to choose up to three from our list of 13. Fifty percent selected retailer media networks — which was 18 points higher than the results from our fall of 2021 survey when we asked the same question.

E-commerce content finished second with 48%, followed by digital media (other than retailer networks and social media) at 34% and social media at 33%. In-store display activity for brand-driven programs was selected by 21% of respondents, and that percentage was 9 points higher than in last year’s survey.

With an open-ended question, we asked respondents to tell us more about the strategies and tactics they’ve used. Here’s a sampling of what they had to say: • “We have relied more on retailer media networks as they have become more advanced and offered more tactics to invest in. We have also put more budget and analysis into paid search.”

• “Retail media networks have been the most important due to the spend we

had to invest per the retailer. We’re spending time to ensure it is working as hard as it could and evaluating it almost on a daily basis.”

• “We have almost doubled our in-store trade spending to increase velocities on our base items. From a marketing standpoint, we have moved away from base TV advertising and put more of the dollars into connected TV advertising options.”

• “We’ve increased social media based on the significant ROI derived from TikTok and continued to invest in consistent performers Instagram and Facebook, among others.”

• “We focused on e-commerce business opportunities and are building fewer, bigger, better programs.”

• “We relaunched our direct-to-consumer to drive more loyalty, so there has been a big focus there and driving DTC exclusives.”

• “We have increased more upper funnel tactics to drive category/brand engagement to drive traffic to top retailers during our key season to get shoppers to engage.”

Retail media networks have been the most important [strategy/tactic] due to the spend we had to invest per the retailer.

We’re spending time to ensure it is working as hard as it could and evaluating it almost on a daily basis.

P2PI.com

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Path to Purchase Trends 2023

Concerns & Challenges

Biggest business-related concern heading into 2023

Without steering them in any direction, we Economy/inflation/recession 60% asked respondents what their biggest businessDemand management/supply chain related concern was heading into 2023. Sixty 13% management percent of them mentioned the economy, inflation Controlling costs/prices 8% or a possible recession in their answers. And more Targeting/awareness/retention 7% than a few resurfaced the topic of retailer media networks — mainly the required spend being a RMN costs/optimizing spend 6% top challenge.

Optimizing marketing investments 5% In their words, here are some concerns: Budget 4% • “Navigating ever-changing economic conditions.”

Consumer sentiment/behavior 4% • “Inflation and impact on consumer buying General growth 4% behavior.”

Category downturns/business volume down 4% • “Inflation and recession. That coupled with retailers asking (or demanding) manufactur- Source: 2023 Path to Purchase Institute Trends Study, November 2022 ers/marketers invest in their media networks.”

• “The increasing demand from retailers on ‘forced’ spends on their platforms. We don’t What challenges are you facing with regard to have allocated budgets to meet their demands recruiting, training, and/or retaining talent? and it is causing friction on the relationships.”

This “biggest concern” question also brought Desire for remote work 23% an ongoing challenge to the forefront — the Difficult to recruit talent with 22% appropriate experience workforce. “Labor,” said one respondent. “There’s Retention/turnover no one to hire.”

14% In a separate part of the survey, we also Competitive marketplace 9% asked respondents about the challenges their Budget limitations 7% organizations are facing with regard to recruiting, training and/or retaining talent. Of the 10 possible Layoffs/growing pains 4% responses we presented, “Desire for remote work” Difficult to recruit and retain young talent 2% and “Difficult to recruit talent with appropriate Finding talent in timely fashion 1% experience” were the clear leaders, with one-fifth of survey takers naming each. Fourteen percent Internal challenges 1% answered “retention/turnover,” while 19% said No challenges 19% there were no challenges in this area.

Respondents were asked to explain their Source: 2023 Path to Purchase Institute Trends Study, November 2022 answers, and here’s a sampling of the workforce challenges they’re facing: Convergence of brand and shopper • “Turnover is higher than ever. However, remote work marketing roles/responsibilities? has opened opportunities for recruitment of high-caliber individuals from a broader geographic base.”

• “Not many are trained in the new digital capabilities. Digital companies (Amazon, Netflix, Instacart) stole them.”

• “Digital marketing and analytics positions are highly competitive and [employees are] hard to keep.”

We then asked respondents if the roles and responsibilNo Yes ities of brand and shopper marketing were converging at

!

!

their organizations — and 56% said yes. “These used to be much more siloed,” explained one respondent. “As the state of the market is changing, so is the landscape of our internal teams and their responsibilities when it comes to omnichannel approach.”

44%

56%

Source: 2023 Path to Purchase Institute Trends Study, November 2022

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In Stores & Beyond When choosing up to two answers from our list of seven options to most effectively drive shopper engagement inside the store, 50% of respondents said that a “true omnichannel approach” was the way to go. Forty-five percent chose the tried and true “pricing/promotion” path, while 30% said innovative merchandising was the key.

When asked if they leverage physical experiences outside the traditional retail environment, 45% said yes. As for which types of experiences: 73% named “Demos or experiential activations” and 65% said “hosting or being

What will drive shopper engagement inside the store?

50%

True omnichannel approach Pricing/promotions

45%

Innovative merchandising

30%

Complimentary merchandising of products

19%

Experiential marketing

13%

Exclusive products

12%

On-shelf signage

8%

Source: 2023 Path to Purchase Institute Trends Study, November 2022

Retailers’ ability to share actionable shopper data to drive more effective marketing Excellent

Good

7-Eleven (n = 27) 4% 33%

19%

39%

21%

45%

35% 19%

Aldi (n = 21) 48% Amazon (n = 74) 27%

40%

Best Buy (n = 10)* 40% CVS (n = 47) 15%

17%

Dollar General (n = 55) 2% 47%

53% 37%

Hy-Vee (n = 46) 2% 41%

31%

Kroger (n = 72) 43%

65% 50%

34%

66%

15%

48%

52%

44% 24% 33%

59%

41%

10%

45%

55%

6% 7%

42%

58%

42%

58%

29%

40%

20%

52%

63%

35%

31%

Loblaws (n = 17)* 47%

61%

37% 50%

26%

44%

39%

15% 27% 30%

Meijer (n = 67) 12%

47% 63%

18%

36%

Home Depot (n = 27) 55% Instacart (n = 59) 15%

67% 50%

28%

38%

H-E-B (n = 56) 1% 36%

33%

12%

33%

Family Dollar (n = 39) 3% 44%

50% 60%

50%

30%

40%

50% 40% 13%

20%

35%

Data sharing is a revenue source

33% 16%

40%

Costco (n = 62) 35%

Lowe’s (n = 30) 7%

Data sharing is collaborative

44%

Ahold Delhaize (n = 53) 4% 36% Albertsons (n = 60) 7%

They don’t share any data

Poor

24%

12%

48%

52%

58%

50% —

Petco (n = 6)** 17%

50%

33%

—

PetSmart (n = 6)** 17%

50%

33%

—

—

55%

45%

45%

55%

Publix (n = 59) 2% 37% Sam’s Club (n = 63) 6%

34%

27%

54%

29%

ShopRite (n = 50) 42% Sobeys (n = 9)** 22%

16%

45%

Southeastern Grocers (n = 45) 36% Target (n = 73) 21%

11%

42% 33% 40%

24%

56%

18%

Total Wine & More (n = 12)* 58%

25% 17%

Ulta (n = 9)** 45%

22%

Walgreens (n = 50) 4% 48% Walmart (n = 80) 22% Wegmans (n = 44) 2% 39% Whole Foods Market (n = 33) 6% 30%

5%

33% 24%

24%

55%

14% 32% 43%

27% 21%

5%

39%

61%

0%

100%

44%

56%

46%

54%

56%

44%

83%

17%

49%

51%

37%

63%

47%

53%

36%

64%

*Sample size is <20. Use caution when interpreting results. **Sample size is <10. Use caution when interpreting results.

Source: 2023 Path to Purchase Institute Trends Study, November 2022

P2PI.com

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Path to Purchase Trends 2023

Do you leverage physical experiences outside the traditional retail environment?

73%

Demos or experiential activations Hosting or being present at local/community events

Yes

45%

65%

Large event sponsorships (e.g., concerts, races, festivals) Retailtainment

32%

Popups

32%

No

55%

51%

Something else

8%

Q. Does your brand leverage physical experiences outside the traditional retail environment?

Q. What types of physical experiences outside the traditional retail environment does your brand leverage?

Source: 2023 Path to Purchase Institute Trends Study, November 2022

present at local/community events.”

When asked if they incorporate social commerce into their omnichannel marketing budgets, 61% said yes. Facebook (55%) and Instagram (54%) were the platforms named most often.

Staying outside the physical environment, we asked if respondents’ organizations are activating in the metaverse. Eleven percent answered yes, and another 15% said they were planning to do so soon.

When asked for more details about this next era of commerce, respondents answered: • “We’re mostly creating digital universes for people to explore and buy NFTs.” • “Our brand teams launched NFTs and another had a small execution within the metaverse.”

• “All plans and strategies concerning the metaverse are being managed by our head office; at the moment, it is not a local focus.”

Are you incorporating social commerce into your omnichannel marketing budgets?

If so, which platforms?

55%

No

54%

39% 41%

Yes

61%

37%

(-17 pts)

27% Significant Change YoY Source: 2023 Path to Purchase Institute Trends Study, November 2022

Does your brand have a direct-to-consumer (DTC) capability?

All plans and strategies concerning the metaverse are being managed by our head office; at the moment, it is not a local focus.

41%

22%

Yes, it’s been around for a while

Yes, it’s newly launched

17%

No, but we’re thinking about/working on it

20%

No, we’re not going there

Source: 2023 Path to Purchase Institute Trends Study, November 2022

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Investment in permanent and/or temporary displays 60%

Are you activating in the metaverse?

Yes

11%

No

31%

No, but we’re planning to soon

15%

Yes

69%

23%

17%

No, and we have no plans More in permanent

More in temporary

Equal investments in both

Q. Does your organization invest in both permanent and temporary in-store displays?

Q. Does your organization invest more in permanent or temporary in-store displays?

74%

Source: 2023 Path to Purchase Institute Trends Study, November 2022

Source: 2023 Path to Purchase Institute Trends Study, November 2022

Insight from a CEN member ...

WHICH EMERGING COMMERCE MARKETING TRENDS ARE YOU EXCITED ABOUT? John Stanwood, Senior Marketing Manager Strategic Channels, Sargento Foods, says …

The emergence of social commerce, where people are shopping in traditional social channels. Also, how has the emergence of video commerce impacted this? And why? With Gen Z’s and younger Millennials’ high rates of mobile usage, this trend will become more impactful as the Gen Z’s mature to heads of households.

The impact of retailer (food & mass) recipe hubs to the e-commerce shopping journey (food, Walmart, Target). Why? As food and mass retailers want to impact a bigger portion of the e-commerce shopping journey, it’s important to understand their recipe approach, how successful they are, and how CPGs should respond to this.

P2PI.com

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Path to Purchase Trends 2023

Retailer Media Networks:

RATINGS AND CHALLENGES B Y C Y N D I L OZ A

From Google’s third-party cookie deprecation plans to the rise of e-commerce grocery adoption, there are a variety of reasons retail media has become a hot topic in recent years. In spite of continued growth, however, challenges related to data sharing and transparency persist.

“Lack of attributable data — they are getting better, but it’s still essentially a black hole of information,” said one survey respondent when asked what has been most challenging in working with retailer media networks (RMNs). “You spend money with a lack of understanding on the return you are receiving for that investment.”

“Data sharing and transparency” was cited as

What’s your assessment of retailer media networks?

A simple money grab for the retailer

21%

Effective, but no more so than other digital media

32%

2021 Results 33% 43%

More effective than other digital media

34%

Other

13%

15% 10%

Source: 2023 Path to Purchase Institute Trends Study, November 2022

Do you work with retailer media networks?

From which budget is your retailer media network spend most often allocated?

56%

Not sure

11%

No

21%

Yes

68%

19%

Shopper marketing

National media

13%

12%

It’s determined campaign by campaign

Other

How much of that spend is incremental to base budget(s)?

None

44%

1-10%

11-20%

21-30%

16%

31-40%

41-50%

16%

> 50%

6% 6% 6% 6%

Source: 2023 Path to Purchase Institute Trends Study, November 2022

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a challenge in working with RMNs by more than a quarter of respondents. Survey takers also shared issues with the investment level required and consistency in measurement across platforms.

“It’s expensive and we don’t have the budget to do all we would like,” noted a respondent.

“Because it is fairly new for us, we are learning what is the most effective campaign as we go.”

Another respondent agreed, sharing “investment levels are hard to meet given current budgets.”

The number of RMNs in the marketplace also makes it difficult for a company to manage, said one survey taker. “It is incredibly inefficient for our organization to manage these programs — especially when there are so many programs run across so many different retailers.”

[RMNs are] expensive and we don’t have the budget to do all we would like.

Because it is fairly new for us, we are learning what is the most effective campaign as we go.

When it came to rating specific RMNs, some stood out above others with regard to different performance metrics. We asked respondents to rate the retailer media networks with which they work based on their relative strengths in targeting effectiveness, measurement capabilities, ROI, data sharing, sales growth, creative freedom and traffic-driving capabilities.

Not surprisingly, Walmart Connect, Target’s Roundel, Kroger’s Kroger Precision Marketing (KPM) and Amazon DSP were the networks our brand respondents worked with the most followed

by Albertsons Media Collective and Instacart.

Among these networks — and among most other networks included in the survey — KPM and Amazon led the way across metrics.

At least half of respondents gave KPM an “excellent/very good” (EVG) score — the highest marks — for traffic-driving capabilities and measurement capabilities, and nearly 60% gave the network an EVG rating for targeting effectiveness and data sharing. For Amazon

Challenges in working with retailer media networks 28%

Data transparency/sharing Investment level required

21%

Difficult to manage

19%

Does not deliver on promised outcomes

13%

No consistency in measurement across platforms

13%

Lack of creative freedom Lack of collaboration Audit compliance

9% 6% 4%

Evolving capabilities to address critical gaps

2%

Alignment across teams

2%

Aligning to the needs of our business

2%

Contract cycle

2%

Legalities due to alcohol beverage laws

2%

Source: 2023 Path to Purchase Institute Trends Study, November 2022

DSP, 93% of survey takers gave the network at least a “good” rating for return on investment (ROI).

Among other results: • 70% or more of respondents gave Walmart Connect at least a “good” score across all metrics.

• 80% of survey takers who worked with Instacart gave the platform at least a “good” score for sales growth.

• 70% of respondents gave Roundel at least a “good” score for measurement capabilities.

When asked from what budget their retailer media spend is most often allocated, 56% of respondents noted shopper marketing, up from 50% in last year’s Trend survey and the year prior. Despite their challenges, 34% of respondents also noted RMNs are more effective than other digital media, a huge jump from 15% who said so last year and 14% the year prior.

Skeptics remain, however, with 21% noting RMNs are a simple money grab for the retailer and 32% citing they are effective, but no more so than other digital media.

“It is a money grab, but I believe in the promise,” said a survey respondent.

“I am just waiting for it to be reality.”

SURVEY METHODOLOGY In November 2022, marketing executives at consumer product manufacturers were emailed a questionnaire to be completed online. The names were drawn from P2PI Magazine subscribers, Path to Purchase Institute members and others in the EnsembleIQ database, with an emphasis on people with manager, director or senior executive titles. From those emails, 166 executives submitted surveys. Each respondent was entered into a drawing for one of four $100 Amazon gift cards.

P2PI.com

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Path to Purchase Trends 2023

RATING RETAILER MEDIA NETWORKS For any retailer media network you have worked with, please rate its performance in the following areas …

Excellent/Very Good

Ahold Delhaize

Measurement capabilities

(Albertsons Media Collective)

14% 7%

Data sharing

7%

Sales growth

7%

Traffic-driving capabilities

57%

21%

ROI

Creative freedom

Fair/Poor

Albertsons

(AD Retail Media)

Targeting effectiveness

Good

29%

36%

43%

36%

Measurement capabilities

12%

25%

ROI

13%

29%

Data sharing

17%

50%

36%

57%

43%

7%

17%

57%

43%

14%

Targeting effectiveness

Sales growth

43%

43%

Creative freedom

50%

Traffic-driving capabilities

Respondents: 14

29%

54% 63% 58%

29%

12%

54%

25%

63%

24%

38%

29%

21%

38% 50%

Respondents: 24

Amazon

Costco

(Amazon DSP)

48%

Targeting effectiveness

49%

Measurement capabilities ROI Data sharing Sales growth Creative freedom

34%

4%

Targeting effectiveness

41%

10%

Measurement capabilities

7%

ROI

10%

Data sharing

14%

Sales growth

59%

31%

59%

38%

48%

31%

41%

41%

Traffic-driving capabilities

48%

28% 45%

14%

Respondents: 29

14%

72% 43%

14% 57%

14%

57% 43%

29% 57%

71%

Creative freedom

14%

Traffic-driving capabilities

14%

29%

43%

43%

57%

29%

Respondents: 7 Interpret with caution: Results are directional only as base size is small.

CVS

Dollar General

(CVS Media Exchange) Targeting effectiveness

(DG Media Network)

24%

38% 75%

Measurement capabilities

50%

ROI Data sharing

38%

25%

25%

Targeting effectiveness

7%

ROI

7%

Data sharing

7%

Sales growth

13%

50% 50%

Sales growth

12%

Creative freedom

12%

63%

Traffic-driving capabilities

12%

50%

50%

25% 38% 25% 38%

Respondents: 8

20%

Measurement capabilities

53% 40%

27% 53%

60% 53%

33% 40%

67%

20%

Creative freedom

33%

27%

40%

Traffic-driving capabilities

33%

27%

40%

Respondents: 15

Interpret with caution: Results are directional only as base size is small.

Source: 2023 Path to Purchase Institute Trends Study, November 2022

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The Home Depot

Instacart

(Retail Media+)

Targeting effectiveness Measurement capabilities

(Instacart Ads)

22%

33%

11%

33%

11%

Traffic-driving capabilities

22%

45%

30%

45%

25%

Measurement capabilities

30%

45%

25%

22%

33%

22% 11% 33%

Targeting effectiveness

Data sharing

22%

67% 45%

35%

35%

30%

45%

Sales growth Creative freedom

22%

40%

ROI

44%

45%

Sales growth Creative freedom

56%

56%

ROI Data sharing

45%

35% 35%

25%

45%

40%

Traffic-driving capabilities

25% 20% 30%

35%

25%

Respondents: 20

Respondents: 9 Interpret with caution: Results are directional only as base size is small.

Kroger

Meijer

(Kroger Precision Marketing) Targeting effectiveness

59%

32%

9%

Targeting effectiveness

Measurement capabilities

56%

35%

9%

Measurement capabilities

38%

ROI

41%

21%

59%

Data sharing Sales growth

38%

Creative freedom

32%

26% 47% 53%

50%

Traffic-driving capabilities

38%

ROI

15%

Data sharing

15%

Sales growth

15%

Creative freedom

12%

Traffic-driving capabilities

Respondents: 34

36%

36%

14%

43%

7%

43%

43%

50%

28%

36%

36%

28%

43% 21%

28%

21% 36%

36% 36% 36% 43%

Respondents: 14

Sam’s Club

Target

(Sam’s Club Member Access Platform) Targeting effectiveness Measurement capabilities ROI Data sharing Sales growth

14%

43%

7%

57%

29% 14%

(Roundel)

43% 38% 57%

Measurement capabilities

14%

36%

21%

Targeting effectiveness

50% 58%

21%

ROI

13% 11%

Data sharing

24%

Sales growth

22%

Creative freedom

7%

36%

57%

Creative freedom

Traffic-driving capabilities

7%

36%

57%

Traffic-driving capabilities

Respondents: 14

30%

13% 24%

32% 57% 40%

38% 30% 49%

38% 46% 41% 38%

38% 32% 46% 38%

Respondents: 37

Walmart

(Walmart Connect) Targeting effectiveness

51%

32%

Measurement capabilities

41%

ROI

35%

41%

Data sharing

41%

32%

Sales growth Creative freedom Traffic-driving capabilities

41%

49% 32% 46%

36% 38%

16% 18% 24% 27% 16% 30%

38%

16%

For additional findings from our annual survey, Path to Purchase Institute members can view the full Trends 2023 survey report at P2PI.com under the Research tab in the Members-Only Resources section of the navigation bar.

Respondents: 37 P2PI.com

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How CPG Marketers are

BATTLING INFLATION

To offset the impact of high prices at the shelf, CPG brands continue to focus on product quality, creating value for consumers and strengthening retailer relationships.

BY MICHAEL APPLEBAU M

Anyone under the age of 50 probably has little or no memory of the runaway inflation of the 1970s, which is the most recent historical comparison to today’s sky-high prices at the gas pump and grocery store. That includes many CPG marketers, who were forced to confront the spike in food and household goods inflation in 2022 on the heels of an unprecedented global pandemic that sent household budgets and shopping behaviors into a tailspin.

Once again, those marketers found themselves in uncharted territory and they had to make major adjustments — including price hikes at the shelf — to account for the sudden inflationary shocks and resulting changes in consumer behavior. Now, marketers must determine which strategies to keep in place, with inflation starting to cool but likely remaining elevated for much of this year. While the U.S. Department of Agriculture expects food inflation to be lower in 2023, it still forecasts price increases of 3.5% to 4.5% — well below the 10% average increases of 2022, but a far cry from the 2.4% national average of the last 20 years.

“Most CPGs didn’t have the muscle memory to be able to execute price increases effectively and were scared to death to do it, because there was a lot of pushback from the retailers,” says Ken Harris, a veteran CPG industry executive and managing partner at Cadent Consulting Group. “There were real input costs going up, and there were CPG organizations that were not equipped to pass along that pricing, because they didn’t know what the choreography was or what the language was that they had to use.”

But they soon learned. In food categories hit hardest by inflation — such as milk products, beverages, lunch meats, pet food and eggs — many national brands either raised prices or shrank package sizes without lowering prices (a controversial practice often referred to as shrinkflation) in order to offset lower margins. At the same time, marketers stepped up discounts and promotional offers while delivering messages of quality and value to dissuade consumers from trading down to lower-priced products.

“In many cases, consumers don’t want to trade down, but they

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have to do what makes the most sense economically for themselves and their families,” says Alex Harrison, vice president of sales at Breaktime Media, whose clients include General Mills, Mondelez International, Nestle and Unilever. “When the perceived value of a product outweighs the cost, it becomes easier for the consumer to justify the purchase.”

Responding to Changing Shopping Patterns U.S. consumers have adapted to inflation by altering many of their “normal” pre-pandemic shopping behaviors. For example, surveys conducted last spring revealed that shoppers were cutting their budgets and taking fewer trips with shorter lists at grocery stores, while increasing club channel

memberships and buying more items in bulk at discount stores.

In response to these trends, major marketers, including Coca-Cola, adjusted assortments and pack sizes, a strategy presumably designed to help compensate for the fewer grocery trips.

Joe Vizcarra, group vice president of customer marketing at Coca-Cola, told audiences during a Path to Purchase NOW webinar back in October that the company’s new Value Collection was the result of a six-week sprint in which agile principles were used to develop innovative ways to help shoppers stay within budgets while filling their baskets at the store.

“Most CPGs didn’t have the muscle memory to be able to execute price increases effectively and were scared to death to do it, because there was a lot of pushback from the retailers.” ­KEN HARRIS, Cadent Consulting Group

“It is basically a different mix, item count and lower price point than what you would normally find, and in some of the sizes and flavors that people really wanted to purchase,” Vizcarra explained. “These value packs, if you will, started being featured in large stores, including Walmart, convenience and some value channels. They were extremely well-received. So now we’re taking a look at the next iteration of that strategy.”

David Schneidman, director of Alvarez & Marsal Consumer Retail Group, says that brands can maximize store visits with more meticulous digital marketing in the pre-shop phase and messaging that makes it clear why the consumer needs a particular product. Retailers can also help offset the impacts of price increases with a targeted approach to discounting.

“There are a lot of different types of discounting retailers can do,” says Schneidman. “For example, when bulk buying, buy one, get one 50% off, or for impulse purchases, do heavy discounts to drive penetration and trial. If it’s a good product with a good proposition, the repeat should inherently follow.”

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Different Ways to Create Value Most marketers would agree that creating value for the consumer wherever possible is a critical component of any campaign strategy in an inflationary environment. CPG brands have been deploying a variety of value-added tactics — with a particular emphasis on consumer promotions and giveaways — as part of their ongoing campaign efforts.

“Brands are continually looking for ways to create rewarding experiences for their customers, and we’re seeing chance-to-win promotions as an increasingly popular tactic for delivering those moments,” says Breaktime Media’s Harrison. “In the last few months alone, we’ve seen an uptick in clients looking to incorporate social as an extension of their promotional strategies. Tactics like social giveaways are becoming quite popular again as brands look for meaningful ways to engage with shoppers where they are.

And the shopper, in turn, appreciates being recognized and rewarded for their brand passion.”

“[Our Value Collection] is basically a different mix, item count and lower price point than what you would normally find. … They were extremely wellreceived. So now we’re taking a look at the next iteration of that strategy.”

JOE VIZCARRA, Coca-Cola

His agency has seen results that reinforce those strategies. “Year-overyear offer engagement [as of December 2022] within our experiences is up 39%,” Harrison says. “We believe that this is a direct result of inflationary prices and consumers’ efforts to save on their favorite products when and where they can.” In 2022, campaigns run by Breaktime that had consumer promotions or giveaways showed a 1.7x increase in incremental return on ad spending (ROAS) versus those that did not, according to third-party sales measurement studies.

“Nothing about the strategies that we have deployed is revolutionary or earth-shattering,” notes Harrison. “They are, in most cases, simply good examples of getting back to the fundamentals of providing a great consumer experience and communicating personalized value.”

Still, there is more than one way to communicate a particular value, even for the same brand or product. Procter & Gamble is demonstrating this principle with its recent “Cold Hard Savings” and “The Bargain Jug” commercials for Tide detergent. The original Tide cold-water campaign, which began in 2021 as part of a company-wide focus on sustainability, featured humorous spots with celebrity cameos from professional wrestling and the National Football League. By contrast, the new ads depict everyday consumers talking in blunt terms about their energy bill savings thanks to

Tide’s ability to clean effectively in cold water — a message that seems more specifically tailored for the current economic climate.

Bringing Transparency to Retailer Relationships Much of the work that CPG brands did to account for those initial inflationary spikes last spring, including raising list prices, was done with retailers behind the scenes. Cadent Consulting Group’s Harris says that this work must be done “before you earn the right to talk to the consumer” about price hikes. And he says that transparency and constant communication — vital components of brand/retailer relationships at any time — are especially critical to this process.

“Transparency means that you are communicating regularly and in multi-touchpoints through the manufacturer and the retailer organization,” says Harris. “So you can’t just say, ‘Hey, we’re taking our prices up, here it is.’ It’s constant policing of the conversation, so that you’re keeping them informed about what, when, where and how.

You’re doing multiple levels of spending at the organization, so it’s not just buyer to salesperson; it’s CEO to CEO. Otherwise, the price increases don’t get executed the way you expect them to. It comes down to a matter of trust.”

Schneidman says that CPG companies may be tempted to increase prices on all products by an arbitrary amount and assume this will automatically offset cost increases arising from inflation. “What brands and retailers need to do instead is have a validated pricing architecture and understand price increases in the context of the consumer’s willingness to pay,” he says. “The

“Nothing about the strategies that we have deployed is revolutionary or earth-shattering. They are, in most cases, simply good examples of getting back to the fundamentals of providing a great consumer experience and communicating personalized value.”

ALEX HARRISON, Breaktime Media

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“There are a lot of promotions and deals that serve a purpose of attracting customers based on price in an inflationary and recessionary environment. [But] do they stick with the brand, or do they just buy it one time and then they just let go?”

JUAN CAMILO GOMEZ, Church & Dwight

question becomes how you develop an appropriate new promotion and discount strategy to keep profits and drive repeat and incremental penetration.”

Of course, the trust issue also extends to the brand’s customer relationships. Juan Camilo Gomez, head of connected commerce acceleration at Church & Dwight, spoke to how this issue is playing out during a time of inflation at another Path to Purchase NOW virtual event last fall. “There are a lot of promotions and deals that serve a purpose of attracting customers based on price in an inflationary and recessionary environment.

That’s a tactic that works,” he said. However, he added, “What is the longevity of that purchase? Do they stick

with the brand, or do they just buy it one time and then they just let go?”

Church & Dwight is looking at two strategies in particular — building subscription models and retargeting customers through media — as a way of improving customer retention and strengthening brand loyalty while inflation remains high, according to Gomez. “It’s working more around the targeting piece and retention, versus the deal piece of it, because that becomes very transactional versus building that emotional connection with the brand and the stickiness to it,” he noted.

Stickiness — now that is something all CPG marketers would like to bank on this year.

Why Private-Label Growth Wasn’t a Slam Dunk in 2022 During normal periods of economic downturn or inflation, sales of private-label products rise as consumers look for lower-priced options to help them stay within budget. But there is nothing normal about this latest downturn.

Many people still have jobs and savings rates were relatively high last year, in part because of the pandemic-induced government stimulus checks and lower consumer spending on activities like dining out and entertainment.

Those factors may help explain why store brands only gained a modest share in 2022. According to IRI data, total private-label dollar share across all outlets was up 0.7 points to 17.9% for the 52 weeks ending Dec. 4, 2022. That was a reversal from the previous 52-week 0.4-point drop, a period in which the robust store brand growth experienced during the pandemic began to level off.

“There are a lot of factors driving the numbers. Price is only part of it,” says Jim Wisner, a private-label expert and president of Wisner Marketing Group in Lake Forest, Illinois. Wisner expects store brands to continue gaining share in 2023. “We are seeing retailers place substantially increased emphasis on their private-label programs,” he says. “Some of the majors, including Walmart, Kroger and Ahold, which had been aggressive, have announced new goals and plans for both market share and the number of new items they will introduce.”

There is also some good news for national brands on the loyalty front. Despite recent sales erosion in household categories like razors, laundry detergent and paper towels, there has been no significant drop-off in loyalty for major CPG brands, according to the results of the Brand Keys 2023 Customer Loyalty Engagement Index survey.

“Price and value increased in importance with much higher expectations held by consumers, which is a usual trend we see during times of inflation,” says Robert Passikoff, president of Brand Keys. “Inflation has a greater effect on customer expectations, which are of course linked to loyalty. All brand values — emotional and rational — are affected by the economic environment, but in so far as big brands are concerned, not to a degree that significantly affects brand loyalty within the 110 categories and nearly 1,000 brands we track.”

P2PI.com

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Activation Gallery

3

2

1 Holiday 2022 2 Despite inflation and continued concerns of a recession, the 2022 holiday season saw both online and in-store sales increase slightly. However, the season did differ from recent years as retailers discounted heavily while consumers diversified their spending and shopped earlier due to the overall rise in prices and a hunger for experiences and gatherings post-pandemic.

As consumers headed to stores, brands and retailers began rolling out festive marketing initiatives and materials in late October/early November.

On the following pages, we provide a glimpse at how some retailers and brands activated during the holiday season — online, in stores and beyond.

BY JACQU ELI N E BARBA

1

Unilever partnered with singer Mariah Carey to create a limited-edition collection for its Walmart-exclusive Find Your Happy Place line. The collection comprised 19 candles and personal care items, which rolled out to stores and Walmart.com ahead of the holidays. In stores, a four-way pallet display depicting Carey merchandised the collection, while a brand showcase within Walmart.com spotlighted the items and the available scents.

PepsiCo’s SodaStream released a white-and-gold version of its Terra sparkling water maker exclusively at Target ahead of the holiday season. An endcap display merchandised the new SKU, encouraging shoppers to “Give the Gift of Gold,” while also stocking the standard black SKU, bartending accessories and a variety pack of flavor drops from sibling brand Bubly that included a recipe booklet. The Bubly packs were merchandised on a shelf tray carrying a QR code that linked shoppers to more recipes.

3

Lindt & Sprungli USA launched its first interactive virtual storefront in mid-November.

The fully 3D storefront offered a photorealistic store interior,

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5

WonderBar

®

The System That Sells ™

Tray, Hook & Bar Merchandising System

Easy, Tool-Free Installation

Target teamed up with Nestle for a digital campaign matching homemade treats from the manufacturer with crafts from private label Mondo Llama. A co-branded promotional page within Target.com spotlighted recipes, such as pumpkin pie and banana cake, using ingredients from Nestle brands. Each treat was paired with a holiday-themed Mondo Llama paint

5

Multiple-Depth Trays & Custom Sizes COMPETIT IV NO

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Since

1965

ND

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4

Mars Inc.’s M&M’s ran a festive digital ad on the Rite Aid website that linked to an account-specific landing page touting the candy brand’s holiday flavors.

Communicating a “make holiday magic” message, the ad directed to the branded page using a “Shop Now” button.

Adjust Tray Width from 13/4" to 17 1/2"

E

or activity kit. Employing a “bring home the merry makers” message, the page also let shoppers click to add ingredients for each treat to their cart and directed them to Nestle brand websites for the full recipes.

V

colorfully decorated for the holidays.

Site visitors could move around the store and click on different departments and areas, such as the Chocolate Lab, the Lindor truffles wall and the gifting and boxed chocolates station, to explore the brand deeper and complete special activities.

N

4

Multiple Bar & Plug-In Hook Styles

O R STAT

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www.TrionOnline.com Toll-Free 800.444.4665 © 2020 Trion Industries, Inc.

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Activation Gallery

7 6 9

8 6

Albertsons Cos.’ Safeway hosted gingerbreadmaking events on Dec. 3 and 17 in the bakery section at select stores. The event was free and open to shoppers who purchased a gingerbread house and registered in advance. Participating stores merchandised boxes of gingerbread kits from brands, including Wilton Enterprises and Albertsons’ Signature Select private label, on a festive table display next to a standee promoting the event near the bakery.

7

Nestle Purina Petcare deployed a holidaythemed vending machine at pet-friendly Westfield Century City Mall in Los Angeles, doling out free dog and cat treats through Dec. 24.

The machine included a digital touchscreen that asked shoppers a few questions about their pets to determine which treat to recommend, from brands including Beggin’ and Fancy Feast.

8

Talking Rain’s Sparkling Ice ran a holiday-themed digital ad on Meijer’s website in November. The ad depicted a “Get festive flavor” message and branded imagery on one side and spotlighted individual products from the brand that could be rotated manually.

Each highlighted item included an add-to-cart button and linked to the product details page.

9

At Kroger, a branded floorstand from Ferrero Rocher invited shoppers to send a holiday wish to loved ones. On the display, a QR code below a “Give a Golden Greeting” message directed users to a dedicated mobile landing page where consumers could create and send holiday wishes and enter a sweepstakes. From Nov. 14 through Dec. 12, consumers could enter weekly drawings for prizes, including a personalized Cameo video from actress Mandy Moore or a pyramid box of Ferrero chocolates.

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V t

RL Pro Fu

2023 Predictions & Trends WHAT RETAIL CAN EXPECT TO SEE IN THE YEAR AHEAD...

With all of the noise surrounding the industry and consumer in 2022, where do we go from here? There have been bright spots of growth within the industry and not all categories have been similarly impacted by inflationary pressures. In 2023, my assumption is that we are in for more of the same in terms of consumer behavior and its impact on the general retail industry.

KEY TAKEAWAYS & 2023 PREDICTIONS: The U.S. retail consumer’s wallet will continue to tighten in 2023, as student loan repayments, credit card debt and investment portfolios pull their share of attention and money away from retail.

Retailers and brands need to watch movements and behavior of high-income shoppers closely, as they may soon begin to feel the same effects that lower-income consumers felt this year.

New store concepts from retailers — both large and small — will focus on efforts to curate assortments for consumers and also provide better efficiency and in-store solutions.

2023 is certainly going to bring headwinds to the retail industry, and we will likely see new waves of consolidations, operational challenges and store closures.

2023 will prove to be the real test for both the consumer and the retail industry, which may be our indication of the shifting of the tides away from the consumerism of the pandemic into a more long-term pattern.

Elizabeth Lafontaine Chief Retail Analyst Retail Leader Pro

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Solutions & Innovations

Tech Tools

WE COVER WHAT’S DRIVING CONSUMER UNDERSTANDING, ENGAGEMENT AND CONVERSION ALONG THE PATH TO PURCHASE.

BY B ILL SCHOB ER

Kellogg Co. is incorporating NaviLens into the packaging of Corn Flakes, Special K, Rice Krispies and Crispix. The boxes have an optical smart code that enables blind/lowvision consumers using a NaviLens app to locate the products from up to 40 feet away, navigate to them, and hear the product names, sizes and nutritional information in 36 different languages. Unlike with QR codes, users don’t need to know exactly where a tag is or focus in on it to be able to read it.

In November, eBay opened “Luxury Exchange,” a New York storefront that appraised and assigned a “currency” value to pre-owned items such as designer watches, handbags and jewelry. Shoppers could then look through the store’s inventory of authenticated goods from brands such as Gucci and Rolex. If they found an item within their currency range, they could exchange it. If nothing in-store appealed to them, shoppers could visit an on-site photo studio and list their items online via eBay itself.

Mid-December saw the launch of Trendio, a video shopping app that lets customers engage with personalized content and purchase beauty products with a single click.

Founded by former Amazon and CVS executives, the platform lets users interact with creators via live or prerecorded videos and pin favorite products to a dashboard.

“Video-AI” capabilities will be introduced in 2023 that will enable the site to automatically edit videos to suit each user’s unique preferences.

Instacart recently launched Community Carts, an app feature that lets users donate groceries to their local food bank throughout the month of December. The app listed a “wish list” of needs from more than 100 Feeding America member food banks. Users simply selected and paid for items for donation, which Instacart’s staffers then delivered, with all service fees waived.

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EIQ Gro

Solving Big Problems, Inspiring Bold Ideas EnsembleIQ is a premier business intelligence resource that believes in Solving Big Problems and Inspiring Bold Ideas. Our brands work in harmony to inform, connect, and provide predictive analysis for retailers, consumer goods manufacturers, technology vendors, marketing agencies and service providers.

EnsembleIQ’s integrated suite of solutionsbased, total-market resources give you all the tools you need to achieve a strategic market advantage, giving you the insights, positioning, focus, and access, along with a team of dedicated strategic consultants to help you bring it all to life.

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Solutions & Innovations

Foundation is the most-searched category within makeup, but the range of shades traditionally shown online and on packaging doesn’t reflect the diversity of shoppers. In December, Google announced an AR shopping feature to help shoppers better match a product to their skin tone. Google worked with beauty brands to develop a photo library with 148 models representing a wide spectrum of skin tones, ages, genders, face shapes, ethnicities and skin types. Once a shopper finds a match with a model, they simply have to select a retailer.

Bold Metrics, an AI body modeling company, has introduced a redesigned Smart Size Chart interface that guides online clothes shoppers on how a given style will fit. The company claims its machinelearning system outperforms standard size charts, camera-based technologies and other questionbased fit recommenders. Once integrated into a retailer’s site, the AI can predict — based on a shopper’s height, weight, age and shoe size — 90 other body measurements and create a realistic-looking avatar to “try on” styles.

Last fall, Jane Technologies launched a “first-of-itskind” iOS app that lets users discover cannabis products based on local inventory, verified reviews and “feelings and effects.” The app allows users to discover products based on personal interests as well as curated lists for everything from sleeping to socializing. Jane powers more than 2,800 dispensaries and brands across 38 states.

Experify is an interesting shopperoriented startup seen at CES 2023’s Swisstech Pavilion. Online reviews can often be a mixed bag, forcing shoppers to wade through fake purchasers, paid-for influencers and camouflaged ads. Experify, which launched in 2020, is a platform that places an interactive window on a brand’s site. A shopper can use it to connect online to a genuine person who is a verified owner of the product, pose questions and, if geographically feasible, even test out the product during an in-person meetup.

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In celebration of Macy’s 96th annual Thanksgiving Day Parade, the retailer presented it as a virtual parade using OnCyber’s metaverse, which was accessible via both desktop and mobile apps. It also included virtual galleries from five major NFT collections (Boss Beauties, Cool Cats, gmoney, SupDucks and VeeFriends); viewers voted to turn one of them — Cool Cats — into an IRL (“in real life”) balloon to be carried in the actual 2023 parade.

In mid-December, Searchspring, a merchandising and personalization platform, joined “Yotpo Grow,” Yotpo’s yearlong program to help Black-owned e-commerce brands. Yotpo selected eight Black-owned brands to join the 2022 accelerator class (which ends in May 2023).

They are offered personalized events, a network of mentors, training with a dedicated “Customer Success Manager,” and free access to all platform tools, including data, insights and best practices.

In late December, Seattle-based CasaWire launched an Apple/Android app version of its digital B2B2C platform for home decor.

The app has a “dating-esque” swipe feature that lets interior designers and consumers examine products from brands, artisans and artists.

The app’s AI feature “learns” customer preferences based on swipes, purchases and other interactions, and then recommends products of interest.

While letting users discover trending products, it also gives the brands data on how users are responding to their offerings.

Heard of Temu yet? This online marketplace of consumer goods went live in the U.S. in September 2022. Within weeks it was the most downloaded free app on both the App Store and Google Play. Temu is a U.S. subsidiary of Pinduoduo, a social commerce platform from China. Temu has 730 million monthly active users, offers 10-day delivery on everything from clothing to electronics to car parts, and boasts a “Next-Gen Manufacturing” program that uses real-time consumer insights to quickly create products.

Sustainability-tech platform Clarity AI recently announced that Klarna will use its data to promote environmentally conscious brands to 150 million shoppers. The initial 2023 rollout will focus on electronics in 22 countries, telling shoppers via “brand badges” about a company’s greenhouse gas emissions, its use of energy from renewable sources, its climate change policies, and its transparency in reporting of climate-related information. Clarity AI’s platform can analyze data on 50,000 companies, 320,000 funds, 198 countries and 188 local governments.

P2PI.com

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Insider Intel

A Sour Patch Kids Exclusive THE MONDELEZ CANDY BRAND DRIVES AWARENESS AND SALES OF NEW FLAVORS THROUGH A CIRCLE K FROSTER FROZEN BEVERAGE PROGRAM.

BY SAMANTHA N EL SON

Mondelez International’s Sour Patch Kids gave Circle K an exclusive “strawberry watermelon” flavor for the retailer’s Froster frozen beverage last July, as the brand expanded its line of fruit-flavored candy.

Sour Patch Kids last year was focused on increasing sales of its watermelon- and strawberry-flavored gummies while also introducing new peach and grape flavors. The brand also wanted to drive overall category growth and spending at Circle K by building store traffic and shopper loyalty.

“The Circle K Froster program was a great opportunity for Sour Patch Kids and Circle K to activate against all of these objectives and provide a win-win-win scenario for the brand, retailer and shopper,” says Ashleigh Zysko, customer director, shopper marketing at Mondelez International.

In stores, a custom floorstand stocking the four fruit-flavored candies plugged the exclusive, limited-edition Froster drink flavor.

A wobbler affi xed to the display promoted a $4 deal for two 8-ounce bags of the candy, available through Sept. 6, 2022. Another wobbler on a fountain machine plugged the packets of gummies for $1.50 each with the purchase of a Froster during the same promotional period.

“The Froster collaboration was developed to drive awareness and sales of our candy innovation, create an exciting snack/beverage pairing for shoppers and build baskets for the pairing with increased dollars per transaction at Circle K stores,” Zysko says.

The partners further promoted the bundle with a fully integrated marketing campaign designed to engage shoppers across the path to purchase. Mondelez worked with New York-based iHeartRadio and Houstonbased Hire Influence for digital, mobile and social engagement.

Consumers who commented on sponsored Instagram or TikTok posts from Hire Influence

Sour Patch Kids sees a huge portion of its candy sales come through the convenience channel.

Extending the brand with a frozen beverage partnership was a natural fit.

— Ashleigh Zysko, Mondelez International

from July 18-Aug. 31, 2022 — using #SPKCoolKids and #Sweepstakes and tagging two adult friends — received entry into a sweepstakes awarding $500 to 10 winners.

Sour Patch Kids also played ads on Circle K gas pumps through GSTV and drove impulse purchases through ads on the retailer’s proprietary Lift checkout solution. The goal was to target younger Millennials and older Gen Z shoppers on the go.

“Sour Patch Kids sees a huge portion of its candy sales come through the convenience channel,” Zysko says. “Extending the brand with a frozen beverage partnership was a natural fit.”

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Featuring special retailer guests in each episode, join us for a dialogue about current trends and strategies that are driving innovation for the next era of retail.

In partnership with Great Northern Instore, the Path to Purchase Institute invites you to listen in to a discussion with executives from today’s leading retail chains, emerging brands and parallel industries as we dive into the issues impacting the evolution of retail.

Attendees will:

2023 WEBINAR TOPICS

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MAY 2

Experiential Retailing

JUNE 6

Grocery Trends & Tactics

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SEPTEMBER 28

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Hear firsthand retailer insights and experiences navigating successes and challenges in the market

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Explore the shifting dynamics that will impact commerce marketing across all channels of the retail arena Sign up now to gain insights, get inspired and go enact change at your own organization with the learnings from Retail Intel 2023.

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uture orward

A PATH TO PURCHASE INSTITUTE EXPERIENCE

NEW ORLEANS

SAVE THE DATE MAY 16-18, 2023 WWW.P2PIFUTUREFORWARD.COM The Path to Purchase Institute’s most exciting event experience returns in 2023 in New Orleans, LA.

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