Why your New Year’s diet should include data
Can you predict the future? Perhaps not always, but when it comes to shopper behaviour, history can be a good indicator of what trends happen at certain times of year: an uptick in more fresh produce consumption in the spring, turkeys during the holidays, and a focus on healthy eating come the new year.
As we head into the new year, we know that Canadians look to make changes to their daily habits. According to Nielsen, in 2015 four out of ten Canadians (39%) made the New Year’s resolution to get fit, stay healthy or lose weight. This gives retailers an opportunity to identify strategies on product, price and promotion to meet the ever-changing needs of today’s customers.
To capitalize on recurring events and the overarching desire for healthier products, going with your gut (pun intended) probably won’t deliver the kind of lift you want. Instead, your New Year’s resolution should be to include more data in your diet, starting with these areas:
1. Use data to follow changing trends among your most important customers. These insights will help create more relevant retail strategies to build greater relationships and drive loyalty, to in turn provide even more data (see a pattern here?).
For example, Precima analysis with a leading North American grocer demonstrates that intuition is not always correct about customers. We found that, as expected, the health conscious segment purchased weight management products over 50% more than the average customer.
Though seemingly contradictory, were similarly likely to purchase specialty cheeses, a product typically viewed as less healthy. Tracking these trends using analytics will help retailers to promote and merchandise to effectively appeal to health conscious customers.
2. Drive Promotional Planning by Customer Life Stage. Healthy choices mean something different for every life stage. By understanding what key categories and brands appeal to each customer, you can build the right promotional plan to win the health-focused shopper.
For example, a recent study by Neilsen says Generation Z places more importance on ingredients sourced sustainably, versus baby boomers who say sugar-free and low-sugar products are more important to them. If you know your customer you can determine the right offers to implement.
3. Work with suppliers to create product innovation and extensions that highlight health and wellness. We know from a 2015 study by Brandspark that 77 percent of Canadians say they are concerned about their personal health.
However, the same study reveals that 49 percent believe that there aren’t enough convenient healthy options. While perimeter items like fresh produce present obvious healthy options; retailers and suppliers can improve the centre store by introducing products that highlight fewer calories, increased vitamins and minerals and easily recognizable ingredients.
Precima analysis of health conscious segments found they were 87% more likely to purchase healthy alternatives versions of products, highlighting a clear opportunity for product innovation.
By understanding the key categories and brands that consumers want at specific times, along with their changing needs to drive innovation and price responsiveness, you can build the right assortment, price and promotional plans to win the health-focused shopper.
Shoppers’ changing needs are predictable during key periods and life stage, and using real-time insights on how consumers shop a retailer can create tailored marketing and merchandising strategies. The outcome is an increase in higher margin, providing customers with healthier options while maintaining a balance between the perimeter and centre store.
Retailers who are equipped to evaluate and understand shifting behavior via current and dynamic insights will be equipped to move at the pace of their shoppers for a more relevant and profitable customer experience.