Examining shopper habits, from promotion to devotion – using on-pack promotion to drive loyalty

Estimates suggest that UK shoppers will spend more than £20bn on purchasing groceries online alone by 2021. E-commerce is snowballing and it’s unsurprising that retail marketing budgets are being stretched to accommodate the exponential growth of e-commerce.

Despite the boom in online shopping and e-commerce revenues, stores still play a vital role in the shopping landscape and, as a result, the opportunity for on-pack promotions remains. In order to fully appreciate the role of promotions today and the impact that they are having on the consumer, we created a bespoke consumer survey to extensively question the general population’s shopping habits. The findings provided valuable insights for brands who want to create winning retail strategies in the face of digital. The research found that promotions still exist as an important part of the marketing mix, with 66% of consumers reporting that promotions make brands more attractive. Bringing these promotions into the digital age to meet consumers’ expectations is vital for accelerated success.

In an ever-evolving digital world, on-pack promotions are one of the most widely used form of sales promotion in a retail environment. Our research actually found that they still play a key role in making brands more attractive to consumers. It’s about getting to grips with how consumers wish to interact with promotions and what impacts their loyalty to a brand. 68% of consumers feel that receiving a reward would increase their likelihood to stick with a brand – and it’s clear that there is an opportunity for brands to increase ROI if they can make it easy for shoppers to redeem offers.

McDonald’s Monopoly stickers for this 2018 game – the 13th year the game has run – are now featuring on meal packs. Fast-food lovers can collect them to try to win an array of prizes – including large cash sums, cars and holidays. The current game ends on May 1.

It’s about drawing the customer in and simplicity is key in doing this. Take McDonalds Monopoly, the much-anticipated yearly promotional activity engages consumers from the get-go and exists as a great example of how a brand is getting it right.

Asking the question of ‘how consumers want to shop?’ is strategically important, yet it lacks a straightforward answer. Whether it’s striving to stimulate impulse purchases in-store, or to replicate a streamlined buying experience across many platforms, technology has changed retail significantly. An easy option for brands is to jump on the tech bandwagon and assume that consumers are also ready for the change. But actions like this assume brands are delivering the style of shopping experience that consumers are asking for, and that is not always the case. New tech like Chatbots and AR apps may be popping up in every sector and hold a novelty appeal, but shoppers still very much care about simple but effective offers and promotions.

The survey also found that 77% of those aged 25 to 34 found brands with promotions most attractive, but this swiftly fell to 51% for people aged 55 and over, establishing that younger generations are more influenced by rewards. On-pack promotions also offer a great opportunity to help win new shoppers, which is vital to a brand’s development, especially considering it costs five times as much to attract a new customer, than to keep an existing one. Because of the visual appeal and marketing of on-pack promotions, over half of consumers can be easily be distracted from their go-to product if it lacks the engagement that a competitor product may have. It’s about keeping customers engaged and loyal.

Through exploring what consumers prefer, over half agreed that hassle free and easy to redeem promotions were favourable and, when it comes to enabling and progressing this, technology is key. Reaching the shopper in-store has always been a challenge for marketers, but this research shows that on-pack promotions still play a vital role in marketing.

Technology to drive loyalty

Technology provides a real opportunity for brands to be more intelligent when looking to connect with consumers. Some 53% said that the ability to upload a photo of their till receipt to claim a promotional offer and receiving an instant notification would incentivise them to redeem an offer. Clearly showcasing the requirement for the SwiftReceipt technology that validates customer redemptions in less than an hour. This not only shows how companies like SwiftReceipt can help brands fulfil consumer needs, but also provides a call to action for brands when assessing how to build a winning retail strategy in this digital age.

In the FMCG sector, promotions need maximising to encourage the shopper to switch from one product to another, while encouraging the manoeuvre into creating repeat purchases. Manufacturers should use promotions to build loyalty across their brands or categories, not just a single product. While FMCG marketers may be best placed to capitalise on promotions, this doesn’t mean that brands in other categories should ignore the process.

Looking to the future is important for any brands, as having a clear sense of direction helps highlight what can and what needs to change. Through cross-examining the findings of the survey, brands can find trends and synergies that can help shape campaigns for future success. Also, being transparent in your data protection policy statement will in turn provide an added opportunity for brands to engage and build trust with their customers. Brands can improve redemption rates by capitalising on customers’ need for a great experience and ensuring rewards are relevant.

The key to success lies in ensuring that the promotion is both relevant and clever, as convenience is the most important motivation.

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