Family Dollar Shopper Strategy

The Way of Shopper Marketing Classified - Internal use 1

Family Dollar Shopper Strategy

[email protected]

Beth Egan Shopper Marketing Director,

CCNA Marketing – HQ Department

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Content & Connection Planning: Family Dollar Example

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We Follow 4 Critical Steps To Create An Effective Shopper Strategy1. Identify WHO the shopper is

2. Understand WHAT is important to the shopper

3. Determine HOW the brand best fits with the shopper needs

4. Plan WHERE to engage shoppers along their path to purchase

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Step 1: Identify WHO The Shopper Is

1. Begin with the brands consumer core target and understand her feelings and attitudes

2. Identify the target consumption occasion

3. Determine who most often purchases the brand for the occasion

4. Identify the store and mission where the purchase occurs

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• The median household income in the U.S. has fallen for the last three years; due to stagnating income and food price inflation

• Median income was 7% less in 2010 compared with 2000, while the cost of living continued to increase.

• Disposable personal income stagnated between 2009 and 2010, stemming from declining median household incomes.

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7.0%

9.0%

11.0%

13.0%

Consumer Confidence

Cons

umer

Con

fiden

ce

Unem

ploy

men

t

Consumer ConfidenceConference Board Overall Index

The Family Dollar Shopper Has Been Affected By Negative Macro ForcesFalling Income + High Inflation + High Unemployment = Feeble Consumer Confidence

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• Shops at FDO about twice a month, spending shy of $15 per trip

• Accounts for roughly 70% of total FDO revenue

• 85% female

• 7 out of 10 report HH income of $40K a year or less; more than half receive government benefits outside of SS

• 8 out of 10 are above 45 years of age

• Median = 56 years of age

• She wants the best for her family and likes to spend time at home with them

• She feels a bit let down (by society, by government) but in no way hopeless. Her support network is very important to her – friends, family, community

• As a caregiver, she wants to be able to create special moments at home – even if only once in a while

• 31% of shoppers agree they have spent more on entertainment, year over year. Over 30% on watching movies together.

• This shift to investing into the home shows a new archetype – the cocooner

Notable for being focused on bringing the family together for entertainment, family projects and being involved with non-

household family members

Demographics: Psychographics:

But Make No Mistake: She’s Strong, Resilient And Resourceful And Always Finds A Way, Through Thick & Thin

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“Consumers are proud of the deals they get and often tell friends and family about them. Whereas buying items at a discount once had implications that a lack of disposable income (i.e., a lack of success) stood in the way of paying full price, in a post-recession era, not only is bargain shopping no longer something to hide—

it’s something to brag about.”

– Fiona O’Donnell, Senior Lifestyles & Leisure Analyst

She’s Also Proud Of Being A Smart Shopper…

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Cocooners are in no way hopeless in their situation.

They are proud of what they have achieved, especially within the Hispanic shopper segment. They are confident, relaxed and in control in the shopping environment.

They are Super Moms. They treat trips to store as a challenge to get the best deals, the best price and the brand names their family will love

Happiness is not found in dollars & cents – it’s found in connecting with others

Budget shopping is SMART SHOPPING AND IT HELPS CREATE THE MOMENTS THAT MATTER

…Because SMART Shopping Helps Her Create Moments That Matter At Home

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We Want To Help Her Create Special Moments At Home For Her Family

Multicultural Families on Low Income

Consumer Target Consumption Occasion

Store & mission where purchase occurs

Super Mom = Heavy FDO Shopper

Who Most often Purchases?

Leisure At Home(Outside of Family Meals)

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Step 2: Understand WHAT Is Important To To The Shopper

1. Understand how they feel during the shopping mission

2. Identify what’s important to them as shoppers how that translates to purchase decisions

3. Learn how Family Dollar performs against most important purchase drivers

4. Identify Strengths & Barriers

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Overall, The Heavy Shopper Expresses Positive Feelings About Family Dollar…

• Heavy Shoppers have a very positive outlook on their experiences at FDO. Describing the experience as ‘nice’ and saying they ‘love the experience’ due to “quality products at a cheaper price”

• There seems to be a relationship between fun and low prices. Heavy Shoppers value ‘deals’ and ‘feeling smart’ along side ‘ good offers’ which all add to the experience.

Q7: Please explain briefly how you feel about shopping at Family Dollar. How is the experience of shopping at Family Dollar for you? Please be as specific as possible.

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…And Feels In Control, Confident, Relaxed/Calm and Trusting When Shopping At FDO

In Control

Confident

Relaxed

Calm

Trusting

Leisurely

Happy

Energized

Excited

49%

45%

45%

44%

42%

40%

39%

33%

30%

Heavy FDO ShoppersShops FDO at least once a month

Q9: Please rate the way you feel when shopping at FAMILY DOLLAR for your household (for example, for snacks, beverages, household cleaners, paper products, etc.) using the table below – TOP BOX SHOWN

Feelings when Shopping at Family Dollar

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Has low everyday prices

Has quality products

Has good sales

Consistantly has the products I want on the shelf

Has a safe shopping enviroment

58%

54%

53%

53%

53%

The Heavy FDO Shopper Wants To Shop A Store That Consistently Carries The High-Quality Sodas And Snacks She Wants At A Low Price In A Safe Shopping EnvironmentTop 5 CSDs and Snacks Purchase Drivers – Heavy FDO Shoppers

Q18: When buying carbonated soft drinks or snacks how important are each of the following in selecting the store where you will make a purchase? TOP BOX SHOWN

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Is conveniently located

Has low everyday prices

Has good sales

Is family-friendly

Is easy to get in and out of quickly

38%

37%

35%

33%

33%

The Heavy FDO Shopper Recognizes FDO As A Conveniently Located Store That Offers Low Prices and Great Sales In A Family Friendly, Easy To Shop EnvironmentTop 5 Family Dollar Performance Attributes – Heavy FDO Shoppers

Q19: How would you rate FAMILY DOLLAR performance on each aspect below? TOP BOX SHOWN

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We Compared Purchase Driver Importance And FDO Performance To Identify Strengths, Barriers & Gaps… Introducing The Driver Importance & Performance Matrix

Driver Importance

FDO

Per

form

ance

EVALUATENot important today, but FDO performs well. Discuss if these

can be turned into comparative advantage or need to be ignored

STRENGTHThese attributes should be part

of our value proposition

FORGETDo not communicate or invest

money to develop

BARRIERS & GAPSWe ought to overcome

performance gaps to drive purchase

HighLow

High

Low

Q18: When buying carbonated soft drinks or snacks how important are each of the following in selecting the store where you will make a purchase? TOP BOX SHOWNQ19: How would you rate FAMILY DOLLAR performance on each aspect below? TOP BOX SHOWN

Driver Importance & Performance Matrix

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…And Thus Learned About Things We Can Leverage And Things We Have To Address

25% 30% 35% 40% 45% 50% 55% 60%15%

20%

25%

30%

35%

40%

Driver Importance

FDO

Per

form

ance

EDLP

Conveniently Located

Good SalesEasy to Get In/Out

Convenient HoursEasy/Quick Checkout

Quality Products

Family Friendly

Friendly/Comf. Atmosphere

Clean Restrooms

Good loyalty program

Good to grab quick meal/bev.Fun to shop

PrivateLabel

BrandNames

FamiliarLayout Helpful

EmployeesAcceptsManuf.Coupons

Safe shopping environmentConsistently has products on shelf

Product SizesOrg./Easy Shop

Good varietyClean Shopping Area


FDO Heavy Shopper - Driver Importance & Performance Matrix – CSDs & Snacks

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*Borderline drivers could be placed in both quadrants


…And Thus Learned About Things We Can Leverage And Things We Have To Address (Contd.)

Driver Importance

FDO

Per

form

ance

EVALUATEFamily Friendly

Friendly/Comfortable Atmosphere

STRENGTHEDLP

Conveniently LocatedGood Sales

Easy to Get In/OutConvenient Hours

Easy/Quick Checkout

FORGETGood Loyalty Program

Clean RestroomsGood to Grab a Quick Meal/Beverage

Fun to Shop

BARRIERS & GAPSQuality Products

HighLow

High

Low

Safe Shopping Environment*Clean Shopping Area*

Good Variety*Offer Sizes I Buy*

Organized/Easy to Shop*Consistently has the Products I Want on the Shelf*`

Private Label*Brand Names*

Accepts Manuf . Coupons*Familiar Layouts*

Helpful Employees*

FDO Heavy Shopper - Driver Importance & Performance Matrix – CSDs & Snacks

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…And Thus Learned About Things We Can Leverage And Things We Have To Address (Contd.)• Leverage FDO strengths, specifically low prices/sales &

convenience (location, shop, hours)• Evaluate family/family friendly as differentiating factor

• Address the perception of not carrying quality products as #1 barrier

• Reassure shoppers they will find the quality sodas and snacks they want in a clean, organized and safe shopping environment

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Step 3: Determine HOW The Brands Best Fit With Their Shopper Needs

1. Understand the core positioning and brand attributes of each partner brand

2. Develop the sweet spot that aligns the occasion and shopper needs with all relevant brand attributes

FDO Shopper

Leisure At

Home Snack Time

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Two Brands, One Occasion, One Shopper

FDO Shopper

Leisure At Home Snack Time

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Our Shopper

FDO Shopper

She wants to savor little moments with her family

She is constrained by budget

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The Occasion: Leisure At Home Snack Time

Is about bringing the family together

Creating a break from the daily routine

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Family Dollar

Family Dollar helps you say “yes”

Provide the options the family wants, at Family Dollar Low Prices

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Coca-ColaCoca-Cola enhances moments of Happiness

Builds trust through established high quality reputation

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Helping Her Say Yes To

More Moments of Happiness

FDO ShopperSavor little moments

with her familyConstrained by budget

HappinessTrust/High

Quality


Bring family togetherBreak from Routine

Two Brands, One Occasion, One Shopper = ONE Core Creative Idea

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Step 4: Plan WHERE to engage Shoppers along their path to purchase

1. Identify the most influential media nodes for the core shopper

2. Determine which media nodes will be activated along the path to purchase

3. Based on the shopper profile, determine what is the optimal messaging by media node

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A sign I saw as I entered the store

A family member

A circular or other offer I received with the newspaper

A sign on the store's window

A circular or other offer I received in the mail

A friend

Coupon from manufacturer

A sign I saw on the shelf

A circular or other offer was given in the store

A sign I saw at the end of the aisle

Coupon at bottom of receipt

Family Dollar Website

Advertisement on the newspaper or magazine

Advertisement on television

20%

17%

17%

17%

16%

16%

15%

15%

15%

12%

11%

11%

11%

10%

Twitter

Advertisement on radio

Coupon from manufacturer

A family member

A text message from friend / family

Emails from store

Coupon at bottom of receipt

A circular or other offer I received in the mailA circular or other offer I received with the

newspaperAdvertisement at a bus stop

Family Dollar website

Family Dollar Facebook page

Couponing site (for example, coupon.com)

A friend

A sign I saw on the shelf

55%

53%

53%

51%

50%

50%

49%

48%

47%

47%

45%

44%

42%

42%

42%

Incidence Influence

We Sought To Understand How Different Media Nodes Affect The Purchase Decision Of Core FDO Shoppers

Top Media Nodes – Incidence & Influence – Core FDO Shoppers

Q15: Thinking about your recent purchases of Carbonated Soft Drink (Soda or Pop) or Snacks (like Cookies, Crackers, Salty Snacks or Candy) at [Family Dollar/Elsewhere], did you see, hear or experience any of the following sources of information, relating to these products at Family Dollar, prior to making a purchase? Check all that apply Q16: How important or unimportant was each source of information in influencing your decision to purchase these products at [Family Dollar/Elsewhere]? TOP BOX – VERY INFLUENTIAL

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After Analyzing Incidence And Influence We Categorized Media Nodes Into BucketsMUST And RAMP UP Will Be Critical To Our Shared Media Connections Plan

Incidence

Influ

ence

RAMP UPThese media nodes are not used very frequently, but when they

are, they’re very influential

MUSTThese media nodes are used

frequently and have high impact in the purchase decision

AVOIDThese media nodes are not as

relevant as others

SCALE DOWNThese media nodes are

consumed frequently, but do not affect purchase decisions as

much

HighLow

High

Low

Q15: Thinking about your recent purchases of Carbonated Soft Drink (Soda or Pop) or Snacks (like Cookies, Crackers, Salty Snacks or Candy), did you see, hear or experience any of the following sources of information, relating to these products at Family Dollar, prior to making a purchase? Check all that apply Q16: How important or unimportant was each source of information in influencing your decision to purchase these products? TOP BOX – VERY INFLUENTIAL

Incidence And Influence Matrix

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2% 4% 6% 8% 10% 12% 14% 16% 18% 20%20%

25%

30%

35%

40%

45%

50%

55%

60%


Incidence

Influ

ence

Sign – Store Entrance

Family Member

Sign – Store Window

Friend

Circular - Mail

Sign - ShelfFDO website

Circular - Store

Coupon - Mfr

Circular - Newspaper

Sign – End of Aisle

Coupon – Receipt

FDO Facebook

FDO Employee

Coupon - Site

Text – Friend/Family

Online Forum

BillboardAd – Online

Ad – Newspaper/Mag

Ad – TV

Ad – Bus Stop

Text - Store

Email - Mfr

Email - Store

TwitterAd - Radio

MUSTRAMP UP Incidence And Influence Matrix – Core FDO Shoppers

The Shared Media Connections Plan Will Integrate MUST And RAMP UP Media Nodes

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Incidence

Influ

ence

RAMP UPTwitter

Ad – Radio, Bus StopText – Friend & Family

Email – StoreFDO Facebook

Coupon Site

MUSTFamily Members & Friends

Circular – Mail & NewspaperCoupon – Manufacturer’s and Receipt

Sign – ShelfFDO Website

AVOIDText from Store

Ad – Billboard, Other OnlineOnline Forum

Email – ManufacturerFDO Employee

SCALE DOWNSign: Store Entrance, Window, End of Aisle

Circular – StoreAd – Newspaper/Mag, TV

HighLow

High

Low


The Shared Media Connections Plan Will Integrate MUST And RAMP UP Media Nodes (Contd.)

Incidence And Influence Matrix – Core FDO Shoppers

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While Messaging For MUST Media Nodes Should Be Centered Around Value And Deals…

Emotional Benefits

Functional Benefits

Product Attributes

Perfect Occasion

Value/Low Price Specific Deal General Deal

Family & Friends ✓✓ ✓

Circular – Mail & Newspaper ✓✓ ✓

Manufacturer’s Coupon ✓✓ ✓

Coupon - Receipt ✓✓ ✓

Sign - Shelf ✓✓ ✓

FDO Website ✓✓ ✓

Q17: You indicated that INSERT ANSWER FROM 16 was important to you. The content of the message was about: (please check all that apply)

✓✓ = Primary Message ✓ = Alternative Message

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…RAMP UP Media Nodes Will Accommodate A Full Range Of Message Types…

Emotional Benefits

Functional Benefits

Product Attributes

Perfect Occasion

Value/Low Price Specific Deal General Deal

Twitter ✓✓✓

Ad - Radio ✓✓ ✓✓✓ ✓✓ ✓

Ad – Bus Stop ✓✓✓✓Text – Friends

& Family ✓✓✓ ✓✓

Email - Store ✓✓✓

FDO Facebook ✓✓✓

Q17: You indicated that INSERT ANSWER FROM 16 was important to you. The content of the message was about: (please check all that apply)

✓✓ = Primary Message ✓ = Alternative Message

Coupon Site ✓✓ ✓✓✓

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Pre-Shop Shop Post-Shop

Shopper Insight

CommunicationObjective

Connection

ILLUSTRATIVE

Key Message

Store location is the key driver when

choosing where to shop

Increase awareness of Family Dollar ubiquity

“We are NEAR YOU”

OOHRadio

Shoppers preferred store is influenced by

peers choice

Establish FD as a snack destination as

evidenced by shoppers’ choice

“We snack @ FD”

Facebook, Twitter

Connection Source: from Family Dollar, from Coca-Cola, Developed Jointly

Shopper focused on core categories

Shopper is looking for best value for

money. Clear price communication is key

Shopper is thinking about items they

might have missed

Search Select/Deselect Buy

Drive impulse through solutions

“Complete Perfect Snack”

Store WindowSecondary Display

Reinforce affordability of bundled offer

“Best Value”

Shelf RailT-Dangler

Last reminder to buy

“Hungry & Thirsty?Grab-n-Go”

Checkout laneCooler

The Task: Develop An Integrated Shared Media Connections Plan

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Pre-Shop Post-Shop

Shared Media Connections PlanPreliminary Media Nodes Along The Path To Purchase

Shop

Trad

ition

alDi

gita

lAc

tivat

ed a

s WO

M

Ad - Radio ✓

Sign – Shelf = Destination Rack ✓

Ad – Bus Stop ✓

Checkout ✓

Store Entrance ✓Circular – Mail & Newspaper ✓ ✓

Family & Friends ✓ ✓

Twitter ✓ ✓Text – Friends & Family ✓ ✓

Email - Store ✓

FDO Website ✓ ✓

FDO Facebook ✓ ✓

The Way of Shopper Marketing Classified - Internal use

THANK YOUFor additional information please visit the Shopper/Customer Marketing

Community at www.KOSCMarketing.com

Documents

Family Dollar Shopper Strategy