Brand marketers looking to virtual shopping to gauge likely consumer behaviour

Posted by Daniel Palmer on 19th November 2008

The Kellogg Company is attempting to utilise consumer insights collected from virtual shopping to enhance the packaging of its breakfast cereals.

Consumers are now more demanding than ever, private label is placing greater pressure on ‘national brands’ and the economic crisis is softening demand and reducing impulse purchases. As a result, virtual shopping has become an increasingly popular tool for brand marketers in the US, in particular, as the ability, and tools used, to understand buyer behaviour become more critical than ever before.

A number of global CPG manufacturers have begun to employ such technology to gain insights into what people do during purchase decision-making as opposed to what they say they will do. With 30 per cent of brand decisions made in-store and one in five shoppers buying from categories they did not plan to before they entered the supermarket (according to the Ogilvy Group), the ability to influence the consumer at point of purchase is vital. One such way is to ensure the packaging of a product stands out from the array of other alternatives on the shelf.

Recently the world’s largest cereal maker, Kellogg’s, employed virtual shopping for developing packaging for their Smart Start cereal, which is positioned as a heart-healthy cold cereal. They teamed with Decision Insight and their SimuShop technology, as they sought to improve awareness and trial of a product that had high brand loyalty but limited awareness.

“Awareness was somewhat low because it was a relatively young brand and because the heart-health category was already crowded with brands such as Cheerios, Oatmeal Crisp and Quaker Oatmeal, among others,” Brian Seel, associate manager of market research for Kellogg Company, said. “Beyond awareness, a key barrier to trial was skepticism of the taste. Finally, qualitative research found that the packaging had been criticised as being too ‘medicinal’ and lacking in warmth.”

Packaging is a decisive marketing lever because most purchase decisions are made at the shelf, according to Brad Barash, vice president of Decision Insight. “So it’s not surprising that most companies are investing in packaging because they know how important it is.”

“Packaging is not simply important, but crucial,” Mr Seel agreed. “Say you have three or four alternative treatments for packaging. How do you enable consumer insights to drive the decision of which alternative is best?”

For the virtual shopping insights a panel of qualified consumers was selected and a scenario was set up for a shopping trip. A combination of text and video cues set the context for an online shopping experience. Video took shoppers from the parking lot into the grocery store and into the breakfast aisle. They then can click on products for more information such as size, nutrition and price and to make a purchase. Consumers could buy or not buy any product, or even walk away without any purchase.

Designers had developed four versions of the Smart Start package that aimed to ‘stand out more on the shelf, present a warmer feel, and generate more trials’.

At the center of the virtual research was a four-part hierarchy of measures consisting of Sales, Shelf Presence, Brand Equity, and Aesthetic Appeal.

Sales represented the most important measurement because it’s a huge investment to change packaging, according to Mr Barash.

Food labels

“The most important metric really needs to be sales,” he said. “If you’re going to make this investment, are you getting more consumers to purchase your product or to purchase more of it?”

“That becomes very important to retailers, too,” he continued, “because they want to find out how sales in the category will be impacted by any of these changes. The best story, of course, is to demonstrate that we’re growing the category.”

Shelf Presence
Does the package break through the clutter and stand out on the shelf? If it doesn’t get noticed, shoppers won’t be persuaded to trial it.

After consumers finish their virtual shopping trip, they are asked what products they recall seeing on the shelf. In a “findability” exercise, consumers are asked to find a specific product on the shelf after they’ve gone through the shopping experience.

“We can say, ‘Go back to that same aisle and find Smart Start,'” Mr Barash advised. “We can time that exercise to find out how long it takes the respondent to find the product and how many products they clicked on before they got to the correct one; what percentage of people click on the correct one on their first try, and so on.”

Brand Equity
What does this packaging treatment communicate about the brand and does the consumer perception correlate with the image that the company is try to deliver?

“When you ask somebody to evaluate a package, they think more like a designer and less like a consumer,” Mr Barash explained. “So we show them the Smart Start package and ask them to rate their impressions of product in terms of taste, quality and nutrition.”

Aesthetic Appeal
“The most straightforward way to evaluate the aesthetic appeal is to simply show the design and ask, ‘Do you like it and how would you rate it – in the case of Smart Start – on attributes such as ‘warm and inviting’,” Mr Barash noted.

The exercise on aesthetic appeal also involves Hot Spot Analysis in which shoppers can actually click on each element of the package that they find appealing. Virtual shopping may also involve a combination of qualitative and quantitative exercises. After respondents have gone through the quantitative survey and virtual shopping, they can be intercepted by a live moderator for a one-on-one discussion. The moderator drills down more deeply into their likes and dislikes about package design.

Mr Seel suggested, in a presentation to an AMA (American Marketing Association) Market Research conference recently held in Boston, that the insights had proven invaluable.

“In our Smart Start test, we have the validation that it does work,” he said. “Our brand and sales teams have embraced it. This is a methodology that our management trusts.”