Hey, Get Your Own "Purchase Decision" Level

The fact that "70% of brand purchase decisions are made within the store" is the most misunderstood historical fact since Columbus "discovered' America.

That comparison, of course, is pure hyperbole -- which is fitting, because the statistic in question has been greatly exaggerated for more than a decade.

Since the figure emerged from POPAI's Consumer Buying Habits Study in 1995, it has been cited so often that it became hackneyed -- often misused because it wasn't properly understood. Along the way, a valid, informative piece of research that primarily focused on supermarket shoppers undertaking stock-up trips was appropriated for every channel, every product category, every shopping occasion.

In 2008, it's become trendy among conference speakers to dismiss the statistic. But what's really being criticized isn't the statistic itself, but the misunderstanding that has developed around it. (In addressing the "controversy" at a conference last July, POPAI's own Martin Kingdon noted that the 70% "average" contains category-specific levels ranging from more than 90% to practically zero.)

The misunderstanding was evident again this summer as some media outlets -- most notably Advertising Age -- compared the legendary 70% statistic with data from a new study by OgilvyAction presenting a lower percentage of brand-level purchase decisions within the store. (We present that study to members this month. See "Highlights," below.)

But you can't compare the two: Statistics in the POPAI study reflect the number of purchase decisions made by shoppers within the store; OgilvyAction's data represents the number of shoppers making decisions. Comparing the two is like comparing the number of Major League Baseball pitchers with the number of pitches they throw.

But even if direct comparisons could be made, doing so would be irrelevant for an industry that is embracing "shopper marketing" as the focal point of its activity. If future success will require an ability to target individual shoppers on particular trip missions at specific stores, of what use is a top-line average for in-store decisions? None, really.

The OgilvyAction study is valuable not for any single data point within it, but for the fact that it contains many data points, finding that the level of in-store decision-making varies significantly based on product category, store format and other factors. (POPAI's study, incidentally, offered many similar insights. It's just that most people were content with collapsing 15 volumes of research into a single bullet point.)

The "70%" statistic helped POPAI place an invaluable stake in the ground for this industry. But that specific percentage was never -- or at least, never should have been -- as important as the marketing truth it illustrates: that in-store activity can influence purchase decisions, and therefore is vital to a brand's success.

Likewise, the important learning from OgilvyAction's study is that influencing shoppers at the point of purchase is a complex task, the specifics of which vary widely based on the brand, the store and the shopper.

That depth of understanding will never be gained from an industry average. Marketers truly looking for shopper insights need to stop parroting someone else's statistic and go get their own damn data.

On the other hand...
If you simply can't live without an eye-catching factoid for the first slide in your deck, consider this: OgilvyAction's study reports that 13% of shoppers leave a store without buying a product they had planned to purchase when entering.

If you consider that point, along with the study's data on the different types of buying decisions being made, you might reach this conclusion: No matter what preconceptions they may have, no matter what marketing activity may have previously informed their purchase intentions, no matter how firm those intentions may be, shoppers always make their ultimate decision in the store. So the potential for in-store stimuli to influence that ultimate decision is always there.

So, if you want, go ahead and claim that 100% of purchase decisions are made in the store. Technically, you won't be wrong.

Peter Breen
Managing Director, Content
In-Store Marketing Institute

Members: More information here.

Research: "Shopping Decisions Made In-Store" by OgilvyAction

More than two-thirds of packaged goods shoppers make purchase decisions within the store, where they are influenced by a variety of marketing vehicles, according to a comprehensive research study conducted by OgilvyAction. Based on approximately 6,800 intercepts of U.S. shoppers last winter, the study examines the impact that channel and product category have on impulse decision levels and the types of marketing stimuli that shoppers remember.

Members, view the study.

Store Checks: Back to School 2008

Forget Elmer's glue, Bic pens, or even those omnipresent school bus spectaculars: "Hannah Montana" and other teen-friendly personalities provided the dominant imagery for the 2008 back-to-school season, as retailers sought to add a hip veneer to otherwise standard promotions targeting students and their parents. The Institute's coverage of marketing and merchandising activity at 30-plus retailers includes a gallery of more than 350 images, including photos provided by Carroll Media Services, Atlanta, a national in-store intelligence agency.

Members: View the store check.

In-Store Media: The Walmart Smart Network

Chief marketing officer Stephen Quinn calls it "one of the most innovative customer contact systems anywhere," and he may not be wrong. If nothing else, Walmart's ambitious overhaul of its in-store TV network represents the next generation of retail media: shopper-focused, locally (and temporally) relevant, and directly connected to the merchandising plan.

Members: View the article.

Desktop Marketing Conference: "Digital Signage Solutions for the Advanced Marketer" by Mark Zwicker, St. Joseph Content

Dynamic digital displays are effective "because they influence the customer at the time of purchase, when they've got money in their pocket," according to Mark Zwicker, vice president of business development at St. Joseph Content. In a presentation from the 2008 In-Store Marketing Summit, Zwicker outlines a "framework of excellence" for deploying digital media that involves setting clear objectives, defining opportunities for shopper engagement and leveraging existing marketing assets.

Members: View the presentation.

Welcome New Institute Members

The In-Store Marketing Institute is delighted to welcome new and renewing members to the Institute family. Below is a list of the companies that signed up recently. Welcome aboard.

• ACCO Brands
• AMD Industries Inc.
• Bluedog Design LLC
• Canadian Tire Corporation Ltd.
• Circle One Marketing
• The Clorox Company
• Cows in Trees
• The Dannon Company
• Doner Advertising
• Equity Marketing
• Hallmark Cards Inc.
• Hasbro
• KAO Brands
• Kar's Nuts
• Larson Manufacturing
• Leader Enterprises
• ModivMedia
• MP Displays
• Olson Communications
• Osram Sylvania
• Phillips Foster & Boucher Inc.
• Pierce Promotions
• Procter & Gamble
• Protagon Display
• St. Joseph Content
• VideoMining Corp.
• W/M Display Group
• YoYo USA, Inc.