How Shopper Insights Managers Break-Down Category Growth

How Shopper Insights Managers Break-Down Category Growth

One of the biggest differences between consumer insights managers and shopper insights managers is the focus of their roles.  In shopper insights — whether you support sales or category management — your focus is growing categories and departments.  In contrast, consumer insights managers focus on growing individual brands.  This can be a challenge for consumer insights managers making the transition to the world of shopper insights.

However, if you are a consumer insights manager and familiar with the principles of volume forecasting and the “Three A’s” of trial, you have a strong foundation for bringing insights to retail.  They key is to translate these principles into a story that is relevant to understand.  You can do this by focusing on three questions.  “How many?” “How much?” And “How often?”

When Shopper Insights Asks, “How Many?” They are Talking About Trial

The question “How many?” is short-hand for “How many shoppers buy this category/product/department/etc. from this retailer?”  Said another way, the question is asking is “What is the trial-rate for the category at this retailer?”  This is important because retailers rely on sheer volume of foot-traffic in order to grow their category.  If a category is under performing, or if you are trying to help the sales team build a selling-story, the first thing to do is try to show the retailer why your recommendations will bring more people to their store.

If you understand how to drive trial of a product, you understand how to diagnose the factors that determine “how many” shoppers choose to shop at a retailer’s store.

  • Appeal Drivers for Retailers:
    • Category pricing strategy
    • Overall assortment of items available
    • In-store experience
    • Unique and differentiated offerings not available elsewhere
    • Store service and services available
  • Awareness Drivers for Retailers:
    • Store circulars/flyers
    • Apps
    • Store website
    • Retailer coupons and other promotion events
    • TV copy
    • Real-estate location
  • Accessibility Drivers for Retailers:
    • Geographic presence
    • Real-estate strategy
    • Local distance from shoppers’ homes
    • E-commerce portal and its shipping options

As you can see from this short list above, many of the same factors apply to a retailer and their individual categories as apply to a new product.  If you can shift your lens from driving product trial to driving category trial at  a retailer, you will be well on your way in the transition to shopper-insights-based thinking.

When Shopper Insights Asks, “How Much?” They are Talking About Volume Per Purchase

There is a slight nuance here in that consumer insights typically focuses on actual product volume per purchase, whereas, shopper insights focuses on dollar volume per purchase.  Either way, this is an important measure to communicate to retailers.  If shoppers are buying “much less” from their store than before, it’s a big problem.  Usually, this results from one of two main causes:

  • Shoppers are Trading-Down:  Whether from assortment decisions, pricing decisions, shelving decisions, or new trends, shoppers are purchasing products that cost less overall.  If a shopper insights manager sees this occurring, they can add value to their retail partner by developing strategies to help orchestrate shoppers trading-up to larger or more premium products in the category
  • Shopper Trip Missions are Changing:  Perhaps a retailer’s role for the shopper has changed.  Before the store was a stock-up destination for shoppers.  Now the store is a fill-in destination for shoppers.  This is usually driven by new retail competition or fundamental shifts in assortment or placement strategy.

Nine times out of ten, if the answer to, “How much?” is, “Less than before,” the retailer is in big trouble.  Those rare instances where it is not a huge issue are:

  • The retailer is absorbing a new and incremental group of shoppers who spend-less, but who they were not reaching before.  As a result, the average basket on-paper is going down while the overall number of shoppers (“How many?”) is increasing.  Eventually, the retailer will still benefit fro a trade-up strategy for these shoppers.
  • The trade-down in dollar volume is off-set by an increase in trips to the store.  This is a thin-ice strategy since fill-in trips tend to breed fill-in trips and the retailer has no guarantee they will win the majority of those all trips.

If the second case is true, then as a shopper insights manager, you need to ask the third and final question . . .

When Shopper Insights Asks, “How Often?” They are Talking About Repeats Per Repeater

“How often?” is short-hand for “How often do shoppers make trips to the store to buy this category?”  This is the hardest of the three drivers of category growth for a retailer to influence intentionally.  It also might be a factor that the retailer chooses to strategically concede depending on its business model.

For example, a Warehouse Club might be OK with shoppers returning less frequently since they are often buying large-size, durable, or one-time goods.  In contrast, a local Drug Store may live or die by the number of trips its shoppers make because it relies so much on quick, convenience, fill-in trips.

While this measure is important to the category growth formula, it is hard to diagnose without the context of the other two measures.  If shoppers are walking away from the retailer overall, trips are going to be down.  Conversely, if the retailer is making adjustments to its trade-up strategy, it could also be willing to concede a few trips for the bigger basket-rings.

If you feel that there is a strategic imperative behind driving trips to your retailer, you may want to provide both a trip growth perspective AND a share of trips growth perspective in you diagnosis.  For example, a retailer may be OK if their new assortment decisions cost raw trips because they are now winning a disproportionate share of their shoppers’ trips.  In other words, they are happy to see trips leaving the overall market place since it suggests fewer opportunities to leak to competition.  This is especially true if the retailer is seeing bigger basket-rings at the same time.


The math behind the formula [How Many] x [How Much] x [How Often] is just a simplified version of the Fourt-Woodlock model of product volume forecasting.  It is jsut re-framed to allow shopper insights managers to communicate in a concrete and relevant way to retailers.

In this formulation, on-paper, each variable appears equally important.  This may optically seem different than new product forecasting where trial is king.  In the category growth model, trial falls under “How many?”  If you were to ask a retailer, “Which would you least want to lose forever? One shopper, one dollar per basket, or one trip per shopper per year,” the answer would be the one shopper.  If a shopper walks away from the store, they take all their future dollars, and all their future trips go with them.  In fact, according to Stuart Aitken, CEO of shopper insights firm 84.51 (formerly DunnHumby),

“It takes 12 new customers to replace an existing one – our mantra is like that (Stephen Stills) song ‘Love the one you’re with,’ ” . . . “But a lot of companies don’t do that because it’s hard and it’s expensive.”

So as you can see, even in the category growth model, trial is king.  Therefore, if you are comfortable with how product trial grows as a consumer insights manager, you have a very transferable skill-set to shopper insights.

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