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June 14, 2017

MBR Conference: Getting Attention in Today’s Retail World

Compelling covers, as important as they are, are only the start when it comes to winning and keeping retail space and grabbing the in-store attention of the new breed of multitasking, distracted consumers.

Speaking at MBR’s 2017 Conference, Kantar Retail SVP John Rand described key dynamics within the shifting retail landscape and laid out possible strategic approaches, as well as new merchandising and display opportunities, that might be employed to advantage by magazines and books.

The first step is understanding how retailers’ priorities and strategies are shifting in response to revolutionary changes in consumer demographics and behaviors, he said.

Retailers are struggling with how to transform their businesses to serve an increasingly diverse, fragmented and factional consumer base, Rand stressed. “Mass” marketing is, in many respects, a thing of the past—even though just 10 diverse retailers account for nearly 60% of all growth (Amazon, Wal-Mart/Sam’s, Walgreens, Kroger, Home Depot, Apple, DVS, Target and Lowe’s).

Behavior-wise, consumers are making smaller, more frequent shopping trips to fewer outlets, making loyalty and retention imperative. The ratio of physical versus online shopping forays used to be three to one; now it’s two to one, and headed for one-to-one, he said.

Add in the rapidly growing “click-and-collect” option, and retailers — along with categories traditionally driven by impulse purchases, including magazines and books — are faced with the challenge of how to expose consumers to impulse items that increase basket size and margins.

“One thing you need to figure out is how to make that physical connection with the consumer when they’re picking up orders—such as including a sample magazine with the order,” Rand said.

In macro terms, retailers are engaged in “recalculating how to monetize the value of space and time,” he said.

The current shift to smaller formats within traditional grocers, as well as rapid expansion of convenience and dollar stores (Kantar projects that there will be 300,0000 small stores in the U.S. by 2022), reflect a population shift back to cities and consumer demand for convenience, but also retailers’ understanding that “agility is required to deploy scale with precision,” Rand pointed out.

The magazine/book category already knows how to target, but must now target with precision based on three “clusters of demand,” he said. The three core retail principles remain, but are evolving in transformative ways. “Value,” once defined by consumers as comparable pricing, is now defined as “unique purpose,” Rand said. Convenience has evolved from location-driven to curation-driven. And again, engagement is evolving from mass-market to individualized.

When it comes to store formats, “small doesn’t mean uniform,” he emphasized, noting that some concepts are “nuance-driven” (Whole Foods’ new 365 stores, Trader Joe’s, Five Below); some are price-driven (Walmart, Aldi), and some are “reason” or “justification” driven (Sprouts, Bfresh).

Precision is also the driver behind retailers’ emphasis on customer data and analytics — and their expectation that their vendors will share data-driven insights and work closely with them to formulate and implement strategies and tactics that benefit overall categories and enhance customer loyalty, to the benefit of the overall retail business.

With SKU-by-basket analytics driving strategy, the magazine and book category must assess itself according to the factors on which retailers are judging all categories. These include: What is the incremental value of the SKU, and capacity to trigger inclusion of other SKUs in the basket, to grow transaction size? What is the role of this product in the basket? How does the product role differ by the three basket “dimensions” (mission type, shopper type and fulfillment method)? 

Another core question for the category and individual publishers: What are the relevant basket combinations and shopper priorities, by retailers, that we can impact? “To compete, retailers need products that are differentiated — but also high margin,” Rand said.

Publications, like other products, must be “authentic,” and publishers need to determine — and convey to retailers — where their specific brands/titles fit within the four quadrants of shopper “missions”: personalization, functionality, convenience and emotion, he said. 

Some other specific recommendations from Rand for magazines and books: 

*Work through MBR to create and implement an integrated industry approach to retail strategy.

*Bring more data-informed insights and ideas to retailers as part of that strategy. “Understand that retailers and vendors are interdependent, and be good at that,” he advised. "And be flexible," in recognition that rapid change is the new reality at retail. 

*Understand that because checking out is viewed as a physical-store negative by consumers, once Amazon or some retailer breaks the code for using mobile technology to avoid checkout entirely, all retailers will rush to adopt that technology.

In addition, retailers are “closing stores, reformatting and remodeling existing stores at an unprecedented rate,” Rand stressed.

For magazines, these dynamics point to a compelling need to focus on how they can shift focus away from the checkout. “You need to go beyond checkouts—you need to determine where else magazines should be within stores,” he said. The category should also consider how magazines might contribute to retailers’ revenue through other channels—such as bringing subscription services to retail, he added. 

*Understand the need for “breakout experiences” in stores as retailers, and specific categories, must compete with growing physical and online competition. “Retailers are open to radical ideas now,” said Rand. “They need to make predictable, boring categories and products attention-grabbing.” 

Retailers will value categories that help them use lighting, LEDs, e-paper signage and other now relatively inexpensive formats that can not only grab attention and invite consumers in, but change their messaging rapidly to reflect consumers’ demand for  constant novelty and change. 

*One experiential key: Understand that mobile opens the door to “engagement everywhere.” The magazine/book category needs to begin leveraging digital to drive incremental sales and awareness.

*Analyze the dynamics online (which shoppers, triggers and discounts?), in store (interactive tools to drive conversion) and store fulfillment (incremental item at pick-up). 

“You are not just selling magazines and books; you are the keepers of the word,” Rand declared in conclusion. “I truly believe that there is nothing more important than how we use the printed word to communicate.”







MBR Publishing & Retail News
Original Articles
2018 Retail Conference
  MBR 2018 Wrap-Up
  Magazine, Book Shopper Research Lays Groundwork
  Common-Sense Lessons for Today’s Print Media
  Channel Leaders Report Innovation, Determination, Progress at Retail
  Publishers Talk SIP, Bookazine Opportunities
  Leveraging Everything, Part 1
  Leveraging Everything, Part 2
  Marketing Analytics Wiz Reveals Secrets
2018 Articles
  New Front End Focus Study Quantifies Profitability of Magazines, Other Power Categories
  First Priorities: Let’s Focus On Reinventing Our Marketing Approach
  What If We Leveraged Everything
2017 Retail Conference
  Newsstand Execs: It’s Time to Invest in Retail Partnership-Building
  Men’s Health’s Bean on Covers, Print’s Unique Value
  Achieving Relevance for Retail Success
  Books Going Strong, Even in Fragmented Retail Environment
  New SuperStudy: Magazines, Books Yield Strong Retail Profitability
  Channel Executives Focus on New Retail Opportunities
  Getting Attention in Today’s Retail World
  Mainline Study Finds ‘Huge’ Sales Opportunities

2016 Retail Conference
  PBAA, IPDA Agree to Merge
  Magazine Media Executives Propose Innovative Disruption at Retail
  Magazine Bright Spots at Retail
  Best Practices for Powerful Newsstand Covers
  Kantar Exec: Magazines Well-Positioned To Partner On Retail Solutions
  Print (And Digital) Books Are Doing Just Fine, Thank You
  Retailers, Channel Partners Discuss What Moves the Needle
  Research: Millennials Often Prefer Reading Print Vs. Screens

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  Fighting Back With Facts
2015 Retail Conference
  5 Things to Know About Newsstand Buyers' Economic Prospects
  How Magazines Engage and Turn Consumers Into Buyers
  How National Geo Leverages Social Media
  Takeaways from Day One of Conference
  Finding Opportunities in Retail's Transformation
Sept. 9, 2015
  IPDA Magazine Study, Article Summary
March 9, 2015
  Willard Bishop SuperStudy 2014
February 26, 2015
  John Cowley Q&A
December 17, 2014
  The Underlying Strength Revealed By Disruption
June 17, 2014
  Innovating at Retail: Recent Tests and Success Stories