Cpgs Struggle To Move ‘Share of Shelf’ and Other Metrics Online

The purchase of online grocery items has begun to increase, with 40% being made on mobile devices and 43% of shoppers searching online for a coupon -- the highest percentage of any promotional activity, according to a white paper released Monday.

Shoppers -- specifically the Millennial generation -- say it's easier to search and buy products online, especially while on the go, according to the Criteo white paper titled Clicks, Bricks & broccoli: The CPG & Grocery Trend Report.

The white paper analyzes consumer attitudes about online grocery shopping, as well as trends and challenges for marketers. The results are based on the behavior of 600 online shoppers -- mostly during the third quarter of 2016, but the analysis also pulls in data from the company's December 2016 study.

Millennials with children report that 56% of their total purchases are made with mobile phones, while health and beauty aids (HBA) comes in slightly lower at 44%; home items follow at 43%, grocery store items at 40%.

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While Criteo estimates that the average cart size or average order value during the third quarter of 2016 grew to $132.23, marketers face a variety of challenges online that they do not have in physical stores.

One of the biggest challenges for marketers, per the white paper, involves how to adapt offline marketing tactics and metrics and measurements to online.

In the online world of grocery shopping, there are no end cap or checkout displays. The cost for fulfillment and delivery increases. On mobile, the limited space creates tunnel vision. And companies have yet to sort out measurement and metrics for attribution.

While this market segment continues to grow and expand with newcomers such as Amazon and Google, measuring online share of shelf isn't quite as clear cut as comparable measurements and metrics used in stores.

For instance, brands use gross rating points and reach and frequency tied to media-mix models offline, but how will they measure effectiveness online? Clicks cannot encompass share of shelf. Criteo and others in the industry have begun work to develop a similar metric and measurement for digital.

John Roswech, EVP of brand solutions at Criteo, said that although there is no way to duplicate a metric from offline to online, it is important to take concepts from one channel and see how they apply to another. For example, there is a "share of digital self" used online that offers insight for brands, but measures different results.

"There is important data from the quality of product content, pricing and positive reviews that can influence product placement on the 'digital shelf'," he said. "In the online world, this is the concept of retailer search engine optimization and is the basic equivalent of the offline world’s sales per square foot measure."

Similar to other market segments such as clothing, marketers have an opportunity to cross-sell products. It turns out that 43% of grocery shoppers and 41% of health and beauty aids (HBA) shoppers say they browse within a site. Sometimes they browse for other types of items.

Selection keeps the shopper on the site. In fact, 36% of grocery buyers, 30% of baby care and 24% of HBA say selection is important, but price is the most important factor across all categories. Description ranks high in grocery and HBA products, but reviews rank high across all four areas.

Online sales has its advantages, especially when it comes to cross-selling. About 46% of baby care purchases are impulse buys, and marketers should consider cross-selling to take advantage of this trend, per the white paper. Grocery items are next with 36%, followed by home at 35% and HBA at 33%.

The white paper, released at Shoptalk in Las Vegas, analyzes demographics and buying patterns of the consumers, especially from mobile devices; notes the products most frequently searched, viewed and purchased; runs through historically successful promotions that don't work on digital; and examines how brand loyalty affects online shopping behavior; and provides tips on attribution.

Source: Media Post Mobile