Our CPM Expert Speak article this month comes from Andrew Potter, Group Managing Director, CPM Australia.
Andrew has been in sales and marketing roles for over 25 years (including a few years in the UK) working across a number of channels including merchandising, contact centres and direct sales. His key drivers are to deliver what our Clients have purchased from CPM, that being “more sales with insights”. His other objective is to somehow reduce his golf handicap.
From Brand Ambassadors to “Engagement Specialists”
For many years, Brand Ambassadors have been a ubiquitous part of the shopping environment. Used as a standard in-store promotional tactic by grocery and non-grocery manufacturers alike, their traditional role has predominantly involved increasing brand awareness, as well as driving sales. However, in recent years we have been observing changes in the Australian market, which in turn has led to an increasing sophistication in the role of Brand Ambassadors.
How things have changed?
We have heard from our clients across both the grocery and non-grocery categories that they are facing a range of new challenges, and that the business of retail is undergoing radical transformations. A broader analysis shows that these challenges and transformations are not unique to the Australian market. Some of the major challenges and transformations impacting our clients include:
Consumers are thriftier and smarter
The consumer is in greater control, more so than ever before. These empowered consumers have easy and rapid access to information from many sources, both trusted and more informal; online sources such as social media and consumer review websites are significant among these. Australian consumers have high expectations, particularly from the in-store experience, and these empowered consumers will shop elsewhere, both online or offline, if their needs, expectations and desires aren't met.
According to a recent research¹, Australians want retailers to be consultants, not just cashiers. They expect retail salespeople to provide them with honest and expert guidance in their quest to make the right purchase decision. Receiving personal face-to-face guidance gives shoppers confidence in their buying decisions.
Competition is tough
The consumer’s path to purchase has become increasingly complex and cluttered. Brands and retailers need to ensure that the ‘last three feet’ of the consumer’s journey lives up to their expectations. Hence knowing how, where and when to engage consumers along their purchase journey has never been more critical.
Online retailing offers fierce competition to store-based retailers in Australia, particularly in the clothing and technology industries.
Private Label continues to grow both its range of products and its market share in Australia, particularly in the grocery channel. Consumers have fewer concerns about buying private-label products as quality improves
A shift in the balance of power to retailers
A significant challenge is the division between marketer and retailer. The marketer is attempting to sell their brand through any retail distribution channel and is making budget allocations with that in mind. Alternatively, the retailer generally doesn't care what brand the shopper buys as long as the category purchase is made in his store.
Factors such as the GFC saw consumer spending drop significantly. This, along with the growth of online retail, has seen retailers in the technology industry strip back their floor workforce of Retail Sales People (RSPs) in efforts to cut cost overheads. This in turn puts pressures on the salespeople themselves, and can result in fickle salespeople who sell to achieve aggressive revenue and margin targets, with a lesser focus on the qualification of needs and best solution for their customers. Brands can train RSPs on the sales floor on how to demonstrate and sell their products, but ultimately, the RSP may go against this to serve his/her own interest.
We have observed that there is a disconnection where brands feel they are educating RSPs around how to sell, and feel they have good advocacy with RSPs but they don’t achieve the desired results. By being aware of this situation, we are able to help our clients ensure that they put their own brand ambassador on the shop floor to engage consumers and highlight the advantages of their products directly right up to the point of closing the sale (at which point it is handed over to an RSP).
A new model
In the FMCG channel, competition is tough and marketing budgets are shrinking. This is resulting in a push for agencies to create retail activation strategies that present a clear and achievable ROI – it’s all about sales. This environment has seen CPM and Retail Safari lead the way with a more intelligent approach to activating brands. We have developed a direct sales model referred to as ‘Sales In Action’ (SIA). The step-change from traditional in-store activations, which are built around Brand Ambassadors creating brand exposure and the opportunity to ‘try before you buy’, is that SIA is designed to achieve the final stage - get the sale - which is so often overlooked in a traditional offer.
How is this new model different from traditional in-store activations, and why are clients increasingly asking for this?
The use of Brand Ambassadors as an in-store tactic is rapidly shifting from a traditional low-key store activity to being a part of a lively shopping experience. High-advice Brand Ambassadors as representatives of brands not only enhance product knowledge and launch new products; they become tangible sales generators. They are there in the ‘last three feet’, creating one-on-one interactions with shoppers where they have the opportunity to close the sale. And that’s what our clients are looking for.
Key features of the SIA program are:
1. Talent – staff with proven sales experience and a winning attitude are engaged.
2. Training - clients need to invest in high quality sales training conducted by professional sales trainers. This can be 1-2 days in duration depending on the job scope. Regular activations would require no more than a 30 min online training module.
3. Reward and Recognition – a range of incentives are utilised to motivate high levels of performance across the program duration. A mix of points-based programs and cash are used, with clients investing anywhere from $5K to $40K to support the incentive program. The critical point is that whichever reward method is incorporated, the sales agents see it as authentic and achievable.
4. Team Engagement - Yammer is a powerful enterprise social network that allows employees to share wins, news, ask and respond to questions and collaborate in a social way and is our preferred tool for the High-advice Brand Ambassador program to drive engagement, team culture, performance and retention.
Client Case Study
Product: Daily Fibre Supplement – located in Medicinal Category of all major supermarkets and Pharmacy outlets.
Price point: $15-$23
Average sales per four hour session with traditional in-store activation: 5
Average sales per 4 hour session with SIA strategy: 11
¹ ‘The Consulting Consumer’ by AMP Capital Shopping Centres 2014