Shopper Marketing What’s Working & the Road Ahead

1. Shopper MarketingWhat’s Working & the Road Ahead

2. PART I Shopper Marketing It’s Official Impact on Media Strategy Top 10 Countdown: What is Working PART II Where are we Headed? Consumers are smarter and always on The purchase pathway has changed Impact on media strategy

3. Five Years Ago No retail media opportunities No common name - POP advertising, at-retail advertising, etc. Trade marketing lacked control over strategy, creative, timing and tracking No dedicated expertise at agency Digital Marketers could not directly impact the purchase pathway

4. Today Established media programs on NA’s leading retail sites Shopper Marketing Industry Established brand-building strategy Media agencies restructuring internally to influence buying decisions Fastest growing sector of ad spending (200% since 2008 and increasing 15% per year) * • Quick stat: 83% of CPG companies surveyed expect to increase their shopper marketing * Source: Ad Age Insights Jan 2011, In-Store Marketing Institute

5. Impact on Media Strategy Client education needed for mandate Manage differentiation with trade marketing Strategy shift from indirect contextual relevance to influence buying decisions Move from awareness to impacting conversions Created new objectives and more meaningful ROI vs. non-retail media

6. TOP 10 COUNTDOWNWHAT IS WORKING?

7. 10 Retail Audiences are Growing in Canada • E-Commerce sales will be doubling in 2010-2015 • 82% of internet users are online shoppers (18 million Canadians) • 57% of internet users have made at least one purchase in the last year eMarketer, February 2011

8. 9 Reach Audiences in Buying and Research Mode

9. 9 Reach Audiences in Buying and Research Mode NPD Canadian E-commerce Report, July 2010.

10. 8 Impact Sales & Branding

11. 8 Measuring the direct sales impact online & in-store (Smart Shopper Survey, 2011) 1 1 1 (Amazon, 2012) (1) Retail Advertising Whitepaper, Mediative 2012

12. 8 Shopper Marketing is Good for Branding

13. 7 The Almighty Inbox is Back 2012 retail email volume is forecasted to grow by almost 50% compared to 2010 More people with access to email anywhere (i.e. in-line at nearby grocery store or in mall) Retailers are increasingly focusing on optimizing CRM with mobile marketing

14. 6 Shopping tools guide consumers and positions brands as recommended products

15. 6 Recent shopping tools

16. 5 Increasing use of video to shop

17. 5 Increasing use of Video to Shop • Retail is transforming from text and reading to viewing and experiencing • 2 out of 3 of consumers agree; video is superior in building confidence towards purchase • 2 out of 3 of consumers watch videos multiple times during their purchase consideration cycle • Top video content wanted by consumers are short product demonstrations and quick objective reviews Source: Invodo Whitepaper March 2012

18. 4 • Reach even larger audiences with In-Store Digital Signage • >> Digital in-store displays expected to triple by 2013 Source: iSuppli Corp. market research

19. 3 Mobile is Growing

20. 3 Reach Shoppers Anywhere, Anytime In Canada, 53%of smartphone owners used their phone for retail-related activities in a store (2012 Mobile Future in Focus, comScore)

21. 2 Rich, Creative Content Engages & Converts Shoppers

22. 2 Retail Splash Pages

23. 2 Retail Brand Stores

24. 2 Editorial Centre & Custom Content

25. 2 Inspire the Shopper & Watch them Convert • Consumers who visited retail shopping content pages were 73% more likely to complete a purchase compared to shoppers who visited product pages through traditional retail navigation 73% More likely to complete a purchase Walmart Canada, 6-week trailing average, multiple content projects (2012)

26. 1 • Reaching Audiences who have clearly demonstrated their Intent to Buy

27. 1 • Reach Shopper Audiences with Intent to Buy Digital Moms Gadget Geeks Gamers Connected Dudes Beauty Toys, Kids & Baby Health, Wellness & Grocery Household Packaged Goods

28. 1 • Audience Reach at a Glance: • How to Reach Digital Moms in Canada? • They make more than 80% of household buying decisions • Reach 3.7 million women shoppers / mth • More than 2x AOL Lifestyle, Sympatico Lifestyle and Chatelinecombined • 2.6x time spent vsiVillageWomens Network comScoreDecember 2011

29. “2012 will be an inflection point in retail, shopping, and paying. You’re going to see more change in how consumers shop and pay in the next three years, than we’ve seen in the last 20 years.” John Donahoe President and CEO, eBay (January 24, 2012)

30. 3 Key Forces of Change 1- Consumers are smarter and always on 2- Technology has disrupted the way weshop 3- Purchase pathway has changed

31. 1. Consumers are Smarter and Always On • Half of Canada owns smartphones • Consumers have specific expectations at each step of the purchase pathway • Nearly half of shoppers are willing to use two or more technologies to shop (IBM Institute Oct 2011) • Consumers are smarter and expect more • They are empowered and demand more • They want to be served (not sold to) • They want personalization

32. 2. Technology has Disrupted the Way We Shop • Location; ability to deliver offers based on purchase location proximity • Information; on-demand and self-serve tools, learning, reviews and convenient information • Personalization; data helps that customizes offers to individual consumer behaviours • Social; consumers have access to trusted recommendations • Mobile & tablet; instant access to rich information and apps anywhere on smartphones and tablets

33. 2- Technology has Disrupted the Way We Shop Mobile: Game Changer

34. 2- Technology has Disrupted the Way We Shop Mobile Usage Insights • The “Showroom Effect”: Consumers are increasingly using smartphones at POP to learn about products, compare products / pricing and reading reviews

35. 3. The New Purchase Pathway “Customers will come to us” “We need to sell online” Many customers, shopping across many channels – one channel per purchase Seamless approach to purchase pathway simultaneously through all available shopping channels Retail Outlook 2012, Deloitte Canada

36. 3. The New Purchase Pathway OmniChannel Shopper at a Glance

37. Impact on Media Strategy

38. 1- Deliver relevant messaging A) Location, location, location 83% looking for deals when shopping 79% Find location based alerts appealing • 79% of consumers find location based alerts from retailers appealing (comScore) • 83% of mobile users are looking for deals at nearby stores when shopping (comScore)

39. 1- Deliver relevant messaging B) Information Retail sites are evolving to “kingdom of content” Products will not sell themselves; Marketers need to provide info for immediate purchase decisions • Benefits • Lifestyle and context • Shopping tools • Comparison • Reviews • Video, and more…

40. 1- Deliver relevant messaging C) Personalization One message is not for all Data gives marketers better signals as to when to communicate, what produce and which message

41. 1- Deliver relevant messaging D) Social Help consumers access social communities and uncover recommendations they trust “1 out of 3 of people are more likely to buy a product if it is has a high number of likes” 8thBridge Consulting, 2012

42. 2- Understand the shopper buying cycle & channels In an OmniChannelworld, each step of the purchase pathway is an opportunity to give the shopper what they need to make a buying decision

43. QUESTIONS?