Originally Published by The Hershey Company.
By Kate Silver
Leah Ingram puts a lot of thought and research into her grocery shopping. Ingram, who lives in Slippery Rock, PA, frequently does cost comparisons between in-store and digital prices and makes calculated purchases that give her the most value for her time and money (she even shares her findings on her consumer blog, The Confident Spender). Recently, she found herself veering off her list during a shopping trip, when two boxes of chocolate chip cookies wound up in her cart. “Now how did that happen” she asks. “Oh that’s right, I shopped while hungry!”
Ingram isn’t alone in making an unplanned snack purchase while shopping. Research shows that 68 percent of consumers make their impulse purchases in physical stores. While there are many avenues for shopping today home delivery, mail delivery, click and collect and more those physical store visits are still happening, but they are often the result of a hybrid approach to shopping. According to research by Retail Dive, 67 percent of consumers say that they start researching their purchases online before shopping for those items at a physical store. In other words, both the online and in-store shopping experience are, and will continue to be, important to the path to purchase.
Doug Straton, chief digital commerce officer with The Hershey Company, says that when it comes to grocery shopping and snacks retail, customers don’t see a divide between a store’s digital and physical presence; rather, they rely upon both in their shopping journey unplanned cookie purchases and all. “If you talk to any of the big retailers, any of the retailer’s peers that are getting deep in digital, what they will say to you is that digital is the front door to their store. And what they mean by that is that the digital visits are preceding the physical visits,” says Straton. In fact, shoppers spend six times more when they shop all of a retailer’s commerce platforms. But to capture those dollars, retailers must offer a seamless experience. According to Straton, and others with Hershey, visuals, location and pairings are critical. With those in mind, here’s how retailers can win more snack sales.
Visuals are key, both online and offline
Packaging can make or break a sale, according to Straton. Customers are drawn to bags that are bright, simple, eye-catching and brimming with appetite appeal. But you don’t just want a bag that’s foot-stopping in the aisle, says Straton. You also need packaging that’s “thumb-stopping” online. “The packaging needs to be seen on a 5-inch screen, but it also needs to be easily identifiable in the same way from about 20 feet,” says Straton. Product type and product count should be visible with a quick glance, because in a digital world, consumers can’t pick up a bag and turn it over to find more information. Remember that if a customer isn’t impressed with a store’s online presence, he or she may opt for another store altogether. “If you don’t merchandise the digital shelf correctly, people may choose not to shop with you in the digital OR the physical store,” says Straton.
Location, location, location
In physical stores, consumers need to be able to easily navigate the aisles and find what they want quickly, says Phil Stanley, chief customer officer with Hershey. Stanley says that stores can expect a 5 to 10 percent lift by making their candy aisles easier to shop. By that, he means placing top-selling candy bars in the “strike zone,” which is three to four shelves from the top, at eye level for shoppers, and ensuring that packaging is attention-getting, simple and easy-to-read. “We really believe when you improve findability you drive conversion,” says Stanley. Location is just as important in online sales, and in the digital realm, “search” is the new shelf. Here, the goal is to get products on “the list.” Research shows that 80 percent of online orders are sourced from “favorites” lists. When an item gets on “the list,” it has potential to go from an unplanned, impulse purchase to a planned, regular purchase. “We firmly believe that shifting unplanned to planned shopping unlocks much more opportunity than simply re-creating the impulse buy online,” says Stanley. A number of tactics can help snack items make the leap to the list, including search engine optimization and paid advertising. Smart messaging by retailers can also help. After a shopper places an online order, the retailer can send them a message asking if they want to add a treat, such as a Reese’s or a Hershey’s bar. If the answer is yes, it’ll go on the list. In addition, online shoppers have a tendency to buy larger quantities of snack items, such as chocolate bars. That means there’s an opportunity to market larger packs on digital shelves.
Pairings can build baskets
Some items simply go together like, well, peanut butter and chocolate. Stanley says that when particular items are displayed side-by-side, sales can get a boost. “We know that fountain drinks and Reese’s have a real overlap, and when you do that well in promotional periods, there’s over 100 percent sales lift. And Kit Kat and coffee, we’ve measured a 55 percent uptick,” says Stanley, referring to convenience store sales. “So the more you can find the natural pairings that consumers already want and make them available and visible, it grows traffic.” The same goes for online. There, retailers have unlimited space to suggest pairings. They can create themed pages dedicated to meal planning occasions, like recipes for a birthday meal that also include suggestions for a fun dessert, like a S’more’s blondie pie. In doing so, the store is helping the consumer find what they need, and that’s something they’ll remember.
When it comes to grocery shopping today, consumers have many choices on how to shop, including their phones and their feet. But it’s not an all-or-nothing decision. To bring convenience to the consumer, retailers must offer both options. “There is no online and there is no offline,” says Straton. “[Shopping is] a continuum across online and offline, it’s happening 24 hours a day, seven days a week.” If a retailer does it well, they’ll have unlimited opportunities to give the consumer what they want.
Want to learn more about how online and in-store retail work together Download our review of the biggest snacks retail trends and insights, “Experience and Convenience in a Shopper’s World.”