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Monday, January 23, 2012

What does it take for consumer products companies to grow in the UK market?"

The title of this blog is the question that Bain Company's attempted to answer in the report: "UK shoppers and the choices they make."

At the core of the research is the influence and importance of the 20% of shoppers who make up about 60% of all sales in every category.

They, on average, spend six times more than the rest of the category’s shoppers. In categories such as jewellery and watches, they can account for up to 70% of all UK sales and spend up to 12 times as much as everyone else.

Bain concludes that it is very tempting to spend all your time (and budget) trying to attract them to your brand and make them loyal. That would be wrong (Bain believes).

These are the biggest mistakes that companies make.

They don’t spend enough time on activities that will make shoppers consider their brand at the point of sale, particularly for repertoire categories. It’s less about what they think about you and more about making them think of you in the first place.

Too often, companies don’t invest the time to understand or act on the specific influences on shoppers’ brand choices and how they respond to in-store promotions, signage, assortment layout, point-of sale merchandising and advice from shop assistants.

Putting too much emphasis on online and mobile channels. Let me just repeat that one again in case you thought it was a mistake - Putting too much emphasis on online and mobile channels. The first priority should be to target shoppers who are researching and buying today.

Offering an overly complicated range of products that fails to offer shoppers relevant choices or reasons to trade up. Complexity is not only annoying, it can stop people from buying.

From the work we have been doing, these observations are bang on the money when it comes to the older age group who will comprise a significant part of the top 20% of buyers. Dick Stroud

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