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Defining Opportunities for the Drug Store Shopper

Defining Opportunities for the Drug Store Shopper. Kelly Marr – Group Director, Commercial Strategy NRS , Small Store Channel Strategy & Marketing. Info.shoppermarketing@coca-cola.com. DRUG. Agenda. Shopper. Basket. Trips. Agenda. Shopper. Basket. Trips.

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Defining Opportunities for the Drug Store Shopper

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  1. Defining Opportunities for the Drug Store Shopper Kelly Marr – Group Director, Commercial Strategy NRS, Small Store Channel Strategy & Marketing Info.shoppermarketing@coca-cola.com

  2. DRUG

  3. Agenda Shopper Basket Trips

  4. Agenda Shopper Basket Trips

  5. Who is the Drug Channel Shopper? 107 Index 15% of HH’s 108 Index 12% of HH’s Cosmopolitan Center Struggling Urban Core 13% African- American 108 index Gender 45% 55% 31% Age 55+ 108 index 2 Member Households 33% 105 index INTERNAL USE Classified - Internal use Source: Spectra March 2011 data

  6. Uniquely, Drug Shoppers Are Most Influenced by In-Store Coupons 55% of Drug Shoppers Said They Were Influenced by Marketing Q37: While you were shopping at [INSERT STORE], please indicate if any of the following influenced one or more of your purchases. (Select all that apply)

  7. AA & Hispanics are making more trips to purchase beverages in smaller channels

  8. Agenda Shopper Basket Trips

  9. Baskets up in all channels but Supercenters & Warehouse Clubs Average $ Basket Ring ** *Includes Kmart, Target & Walmart ** Note: Conv/Gas channel behaviors understated because of the high level of gasoline-only buys & purchases of immediate consumables Source: Nielsen Homescan, excludes gas-only or Rx-only trips

  10. CVS and Walgreens Pursuing Divergent Strategies, Reflect Core Focus Source: Kantar Retail research and analysis, ECRM Marketgate 52 Week Period

  11. Value 7% 103 index CR 45% 729 index The Drug Shopper is Stopping at CR to Purchase a Beverage for Immediate Consumption Immediate Consumption (6% of Trips) % of Trips with Departments Purchased The MFS Drug Shopper In that Channel for an Immediate Consumption trip Source: 2011 Landmark Shopper Study

  12. CVS higher IC Beverage Impulse purchases Bought as Planned Unplanned Color coding reflects over/under index to Drug MFS Source: 2011 Coca-Cola Landmark Study 30a. What are the top products that BROUGHT you to the store? (Select up to 3 items.) 31a. What types of products did you BUY at [INSERT STORE] on this occasion? (Select all that apply.)

  13. DESTINATION & BASKET ITEMS: Candy, Gum, Mints are high impulse items What (products) brought you to the store? (Q30a) What types of products did you buy? (Q31a) Q30a. What are the top products that BROUGHT you to the store? (Select up to 3 items). Q31a. What types of products did you BUY at [INSERT STORE] on this occasion? (Select all that apply) Source: 2011 Coca-Cola Landmark Study

  14. Drug Responding to Value Channel Competition Big 3 Introducing OPP Brands to Compete Source: Kantar Retail ShopperScape™, April 2011

  15. Agenda Shopper Basket Trips

  16. Sunday is the most important shopping day! Share of trips by day of week Source: Nielsen’s U.S. Retail Trends deck, March 2011 Update Expected share (if trips were evenly distributed by day of week) would be 14.3% Source: Nielsen Homescan, Total U.S., 52-weeks ending 12/25/2010

  17. Competition at the CornersThe Challenge and the Opportunity in Drug Cross-Shopping Other Drug Store Retailers during Past Four Weeks Source: Kantar Retail ShopperScape™, April 2011

  18. Drug MFS Trips in All Channels 8 Trip Mission Segments % of Trips % of Trips 4 Household Stock-Up 21% 22% 27% 29% FAMILY Just-in-Time (Meals) 2 SELF Browsing Immediate Consumption TIME 3 Speedy Fill-In MONEY Urgent Item 1 Bargain Hunting Everyday Savings Source: 2011 Landmark Shopper Study

  19. Trip Missions Across Channels Source: 2011 Landmark Shopper Study

  20. Drug shoppers’ trips are shifting from Urgent Item to become more Speedy Fill In and Bargain Hunting SHOPPER TRIP MISSION TRENDS Drug MFS Trips Drug FAMILY SELF TIME MONEY Maximize the shift in trends to capture the more valuable Speedy Fill In Basket

  21. Shopper Trip Mission Trends By Retailer Compared to Drug Competitors, Rite Aid Most Frequent Shoppers are shifting more of their trip missions to Browsing Percent change 2011 Vs. 2010 FAMILY SELF TIME MONEY Threshold for Color coding <=10% of Trips

  22. CVS: heavy shoppers’ $ per trip CVS’s heavy shoppers’ basket size continues to increase as CVS continues to focus on up selling and cross selling 2007 2008 2009 Source: Mid year 2009 IRI Panel Data

  23. INTERNAL USE

  24. THANK YOU For additional information please visit the Shopper/Customer Marketing Community at www.KOSCMarketing.com

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