Global trends always move from market to market, country to country. The “category creep” I have written about before, where retailers with a core offering begin to introduce adjacent offerings – food into Target in the US, alcohol into drug stores in the US, handsets into postal outlets around the world, and now clothes into Coles stores – happen because the shopper wants or accepts them.
More recently, I have been analysing the rise of targeted checkout offers in the UK. A new version of an established shopper offer model, which has given Sainsbury’s, Boots – and more recently, Iceland and Morrisons – a significant increase in transactions from existing shoppers is taking hold. Shoppers are using their checkout dockets to buy things they want to buy, as opposed to items retailers or manufacturers want to sell. That may sound odd, but it hit home for me in a recent checkout offer I experienced.
My grown-up family descended on the family home last Friday night, so wine and beer were needed. In preparing for the evening, Mrs Moore reached for a docket offer because it provided a deal for her favourite wine varietal, Sauvignon Blanc. Importantly, it was the varietal she liked. The wine label was not her favourite; in fact, she had never heard of it, but she bought four bottles via the offer. The wine was OK. Not bad, but not like her favourite brand. Three bottles are still at home, not chilled, while a bottle of her favourite label is now in the fridge.
The next weekend, same again. Mrs Moore reached for a docket and there was an offer for Yalumba Y series. Now, I happen to know that Yalumba is a wine label, but there was no mention of varietals on the docket. No response from Mrs Moore, the docket went into the bin.
What she had just been through is the process Australians have experienced with docket offers for years. The retailer and manufacturer had products to clear, which is fine, we all like a deal. But in 2012 we assume that the retailer knows us or at least knows what we want. We are experiencing the “days of miracle and wonder” where big data gives companies true insight into consumer wants and matches them to offers. That’s what store loyalty cards do for retailers.
So why are the shopper docket offers in Australia so different when compared to Sainsbury’s or Boots in the UK? Their systems treat the checkout transaction like a mini-website. It reads, in real time, what we have just bought and immediately makes an informed adjacent offer. What kind of offer? One more of the same at a lower price, something else that complements what you’ve just bought or a bundle offer are some examples. This is a transaction outside of a loyalty scheme, but it is directly related to the shopper, right here, right now.
This technology isn’t easy to replicate, and a couple of big European retailers have tried to home grow it and failed. In Australia it’s offered by Mirador, a partner of CROSSMARK’s, and it’s clever stuff.
As CROSSMARK CEO, Kevin Moore looks at the world of retailing from grocery to pharmacy, bottle shops to car dealers, corner store to department stores. In this insightful blog, Kevin covers retail news, ideas, companies and emerging opportunities in Australia and across the world. His international career in sales and marketing has seen him responsible for businesses in over 40 countries, which has earned him grey hair and a wealth of expertise in international retailers and brands.
CROSSMARK Asia Pacific is Australasia’s largest provider of retail marketing services, consulting to and servicing some of Australasia’s biggest retailers and manufacturers.