ROI driven communication

planning for Retail sector

Sergey Matveyuk

BrandScience, Analytics & Insights Director

March 21, 2013

Retail market from media point of view

Retail market from media point of view

Top category since 2006 with ~14% of Ad Market

CE 22%

Clothes 18% DIY

13%

Auto 11%

Food 9%

Shopping Centres

7%

Cosmetics 5%

Internet-shops 4% Jewerly

4%

Sports Goods 3% Distant

Selling 2%

Children's goods

1%

Drugstores 1%

36 299

17 683

10 152

Retail Auto Finances

Retail market from media point of view

Very diverse by subcategories and regions (Ad Spends)

Consumer Electronics

Retail market from media point of view

With different communication rules

Cinema

Radio

Press

Outdoor

TV Nat

TV Reg

Consumer needs in retail

CONSUMER

PRODUCT

EMOTIONAL

BENEFITS

RATIONAL BENEFITS

Differentiation from competitors

Image

Smart consultants

Wide range of products / brands

Network

Price

Rules of communication for retail

Differentiation from competitors

Image

Smart consultants

Wide range of products / brands

Network

Price

Price / Product demonstration

Short term actions

Vendors co-promo

Differentiation from competitors

Seasonal peaks

New outlet opening

Russian consumers are very different

9 time zones

13 hours by plane…

6 days by train…

Impossible by car…

With different culture

18 250 GRP’s \ month

Average t= 9°C

25 800 GRP’s \ month

Average t= 2°C

31 600 GRP’s \ month

Average t= 6°C

14 850 GRP’s \ month

Average t= 3°C

And changing population structure

0

10

20

30

40

50

60

0-15 16-30 31-55 56+

Mln

. 2007

2011

2015

0%

Ready

to retire Kids /

Teens

Middle

aged

Economically

active

The population of Russia

is getting older, share of

the most active

audience is

decreasing but the

share of retirees is growing

At the same time new technologies are changing

world dramatically

At the same time new technologies are changing

world dramatically

TOP 5 countries by population

Everybody and everywhere can share the information

1 340 1 187 1 000

310 238

At the same time new technologies are changing

world dramatically

Monthly Reach of Internet achieved 70% in January 2013 (Russia

100К+ / 12+ y.o.), and about 95% for 18-35 TA

Broadband and 4G development

i-Choose generation want to get all here and now

Download series

Watch series on-line

At the same time new technologies are changing

world dramatically

Tablets growth +366% (volume) +256,7% (value). Average price

decrease 24% (15 600 RUR)

Smartphones growth +69% and +60% accordingly

Audience in control on-the-go 24/7

At the same time new technologies are changing

world dramatically

24.2 % of audience watch TV content via Internet (21.2 % previous

year)

0.8 mln never watching TV

Content is the king – consumer choose by himself where and when

to watch preferable programs

Source: Synovate Comcon (Russia 100К+ / 10+ y.o.)

New trends

appears each year

In 2014 in Russia will be sold

more than 2 miln Smart-TVs

Total Smart-TV market will

achieve 3,5 mln

New trends

appears each year

Google Glass is an augmented

reality wearable computer with a

head-mounted display

New trends

appears each year

Additive manufacturing or 3D printing is a process of making a three-

dimensional solid object of virtually any

shape from a digital model.

Which influence media

Traditional

Media

“New Media &

Touchpoints

Weekly

reach

, %

0

25

50

75

100

2007 2012

0

10

20

30

40

50

60

2000 2013

2012- 48%

19% 13% 5% 9%

5%

2000 2013

Share of Ad Market

Share of electronic media is growing while share of non-electronic decreases

Retail market

Private labels

Mobile applications

On-the-Go price comparison

E-Commerce

And consumer

Today a person is subjected to more new

information in a day than a person in

the middle ages in his entire life

And consumer

And consumer

became not just listener,

he starts to select and choose information

Decision making process not linear anymore

The consumer considers

an initial brands, based on

brand perceptions and

exposure to recent touch

points

Consumers add

subtract brands as they

evaluate what they want

After purchasing a product or service, the

consumer builds expectations based on

experience to inform the next decision journey

Ultimately, the

consumer select a

brand at the moment

of purchase

It’s different for different retail categories

Grocery Cosmetics Clothes DIY CE

Research

Previousexperience

Impulse

And even within

one category

SME WG AV

Communication has to reflect all this changes

Communication has to reflect all this changes

From Monologue To Dialogue

From direct advertising To ecosystem

From media plan To POE approach

From short term To long term

From promo / direct sales To environment building

From product oriented To consumer centric

Chosen strategy should meet business objectives

By focusing on needs of most

valuable customers based on

consumer segmentation

Chosen strategy should meet business objectives

By focusing on needs of most

valuable customers based on

consumer segmentation

By using relevant touch points for

chosen TA segments on each

stage of consumer journey

62% 60% 54%

59% 63%

72% 78% 82% 82%

84%

71% 66%

76% 72% 71%

69% 65% 64%

42% 41%

M12-17

W12-17

M18-24

W18-24

M25-34

W25-34

M35-44

W35-44

M45-54

W45-54

TV Internet

TV vs. Internet daily Reach (%) by TA segments

Chosen strategy should meet business objectives

By focusing on needs of most

valuable customers based on

consumer segmentation

By using relevant touch points for

chosen TA segments on each

stage of consumer journey

By combination of traditional and

special projects for strategy

activation

Chosen strategy should meet business objectives

By focusing on needs of most

valuable customers based on

consumer segmentation

By using relevant touch points for

chosen TA segments on each

stage of consumer journey

By combination of traditional and

special projects for strategy

activation

With ROI analysis of each

communication solution

Results forecasting is crucial

Results forecasting is crucial

As the marketplace becomes ever more complex and

competitive the need to maximise return on

investment through efficient and effective marketing

and advertising becomes increasingly critical.

4 departments support each stage of communication planning

Strategy planning dpt.

Market research

Media research

Econometric modeling

Set of tools

Snapshot (Campaign analysis)

Brand Navigator (Tracking & Econometric modeling)

Ad campaign effectiveness evaluation

Creative materials testing (concepts,

spots, layouts)

What is the impact of each communication

channel to ad campaign recognition?

Which ad materials are better working?

Is there enough branding in the add?

Our approach to marketing

effectiveness evaluation:

Key question?

Our approach to marketing

effectiveness evaluation:

…

Brand Health Monitoring

Brand KPIs \ Image \ Change of attitude

Ad Performance Monitoring

Ad awareness \ Liking

What are the changes in brands’ positions?

Which brand is the most effective in work

with consumers?

What’s the effectiveness of the media

investments? (ROI Analysis)

Key question?

…

Our approach to marketing

effectiveness evaluation:

It’s very important who work with data

As the marketplace becomes ever more complex and

competitive the need to maximise return on

investment through efficient and effective marketing

and advertising becomes increasingly critical.

The BrandScience team has been developed to help

marketers solve this problem, from regional and

national markets through to global brands

Russian BrandScience team consist of 22 employees:

6 have research background (4 COMCON, 2 TNS)

2 from client side

Our beliefs

Use modern

Trends

Follow the

Consumer

Track Ad

investment

effectiveness

Modern Trends overview

Best cases presentations

Consumer segmentation