Hershey Enhances Process with Shopper Behavior Analytics
By John Karolefski
Traditional category management is a product-focused process. The new category management, dubbed Catman 2.0 by the Category Management Association, is focused on the shopper first. CMA experts say that is the future of the process.
The Hershey Company understands the difference. That is why it is staking a claim to its place in that future by putting the shopper into its category management process via in-store behavior analytics.
‘We think this is game changing for the convenience channel,” said Alan Tobin, Senior Manager, Category Strategy & Insights, The Hershey Company. “It really changed the game for us for merchandising and advising the retailer in [the confection] category,” he said in a presentation at the CMA annual conference in Las Vegas recently.
Hershey’s technology partner for shopper behavior analytics is VideoMining Corp., with whom Hershey has worked for nine years.
“There is a big gap between consumer data and buyer data,” said Rajeev Sharma, Founder & CEO of VideoMining Corp., who spoke with Tobin. “That gap is in-store behavior. Who is shopping? Were they exposed? Did they engage? Why did or didn’t they buy? Filling this gap is critical for shopper-centric strategies.”
The executives said the availability of in-store behavior data and corresponding analytics empowers the next generation of category management.
At the conference, VideoMining unveiled a product called ShopperImpact@. It uses granular in-store behavior data and analytics at the retailer account level to empower shopper-centered practices in category management and shopper marketing. The platform uses proprietary IoT sensing devices called OmniSensR and patented machine learning and AI technologies to capture, analyze and interpret big data on in-store shopper behavior from a representative panel of stores.
“This new platform will enable access to ongoing retailer-specific data and tools needed to bring shopper-centric approaches to retailing, including enhancement of the scorecarding and assessment steps as recommended by CatMan 2.0,” said Sharma.
Tobin said getting the primary aisle location right is critically important to the success of the retailer’s candy category. Almost two of three shoppers (64 percent) obtain candy in its primary location in the store, while slightly more than a third (36 percent) obtain candy at secondary locations such as the front counter and other locations.
Hershey’s work with VideoMining yielded several shopper insights that affected in-store merchandising in convenience stores. Among them:
- Confection purchasing happens quickly with less than 30 seconds dedicated to item selection.
- Aisle placement should be on the path to or from the cooler to maximize both planned and unplanned purchases.
- Merchandise top items and brands in the first four to six feet to optimize sales and conversion.
- Cross promote candy with food service items, beverages and snacks.
- Due to the high cross-purchase incidence of candy, placing secondary displays throughout the store increases sales.
- Coffee and soft drink bundles have delivered tremendous lifts for the category.
- Optimize productivity of endcaps by displaying snacking items that appeal to shoppers across all day parts.
Except bakery, snacking shoppers are evenly distributed throughout the day, Tobin explained. Salty snacks and candy deliver significantly more sales and shopper interaction than any other snacking category.