Welcome to the 2012 and fifth annual Hub Top 12 report on shopper marketing excellence that, thanks to industry growth, has now become the Hub Top 20! We want to thank all who participated in the survey this year and especially those who took the time to add insightful comments.
The University of Tennessee is pleased to continue the tradition of tracking shopper-marketing excellence, initiated and created by Hoyt & Company and The Hub Magazine in 2008. The intent of this study is to allow brand marketers and retailers to evaluate working relationships with agencies on 13 criteria and to let agencies evaluate working relationships with brand marketers on 13 criteria, as well.
This year we had 990 usable surveys — up 224 from 766 in 2011, or up 29 percent! That’s great! This speaks to the attention being given to shopper marketing in the industry. Brand marketers and retailers named 153 agencies while agencies named 144 different brand marketers.
Although these numbers are up from last year, reflecting continued growth in the industry, what’s interesting is that, in a few cases, brand marketers and retailers named a brand marketer or retailer (sometimes themselves) as able to perform on certain criteria better than any agency. If this is a sign of things to come, it might reveal the increasing competency of brand marketers and retailers to perform some agency-type work in-house.
More and more agencies are getting involved in shopper marketing, and roles and responsibilities are changing, even blurring. Brand marketers and retailers are engaging more and more in shopper-insight research, defining visions of shopper marketing and developing creative. Brokers are deeply involved in promotion work, such as Acosta Marketing Group and Twin Oaks within Crossmark. Agencies work tightly with both brands and retailers now. No, the roles are not as clearly defined as they were five years ago, but this makes things exciting as well. Let’s look at what we found.
As always, we created an index score for each performance criterion by comparing the intensity of the voting for each criterion to the average across all criteria. There are some interesting results this year. Regarding the performance areas used to rank agencies, key account management knowledge received the most voting attention while global capabilities received the lowest — and by a large margin. In fact, the data suggest that not many brand marketers or retailers could rate agencies on global capabilities, or that most didn’t think agencies had significant expertise here. The former could make sense, as those voting simply may be unaware of their agency’s global competencies. However, shopper marketing is a highly localized process in many places, dedicated to specific initiatives for brands being run with geographically bound retailers.
What’s intriguing is that agency research capabilities, which received the least attention (i.e., lowest index at 68) in 2011, crept back up to the middle ranks with an index score of 104. Could this mean that brand marketers and retailers have stronger opinions about agency research capabilities this year than last? Do the results mean that agencies are doing a better job at research?
It’s hard to say. It could also be that 2011 was a bit of an anomaly with respect to research. The comments shed some light, but not all that is needed. It would seem, however, that performing well at shopper research is still important for agencies.
Regarding the performance areas used to rank brand marketers, the four leading areas (i.e., those receiving the most voting attention) remained the same for the past three years: vision, integration across departments, understanding shopper motivations and clearest strategy and objectives. How strong brands were in their retailer relationships — a new performance area added last year — moved up from the seventh spot in 2011 to fifth this year.
As we saw last year, and as we saw in the voting for agencies, the criterion of global capabilities did not attract as much voting attention as other criteria did. Given that this has been the result for two years now, we need to discover whether global capabilities are simply not relevant to shopper-marketing relationships between agencies and their clients; if respondents simply do not know about their partner’s global capabilities; or if few firms are performing well globally in shopper marketing.
About Our Methodology
As in previous years, we screened and recorded every response to ensure integrity, eliminate duplicates and prevent ballot stuffing. This year, we culled 3,308 total responses down to 990 good ones. The 2,318 responses that we removed were due to several factors. Most were simply ballots recorded as started but never completed, i.e., they were blank or nearly so. After that, there were a number of ballots where voters did not identify themselves. For integrity reasons, we ask that everyone indicate his or her name, company and email address. We actually check these to ensure that people are working for legitimate companies (i.e., agencies, brand marketers, or retailers) and that they are voting ethically (i.e., not voting for themselves!) In some cases, when the given email address was vague, we double-checked by visiting LinkedIn account profiles.
We closely examined each and every response as well as the participant providing each response (name, company, position, email address verifications) to ensure that meaningful input was being offered by qualified individuals.
As always, we looked for anomalies such as an inordinate number of votes coming from a single company. To address this particular issue, we decreased the weight of subsequent votes from any single company source for one company after a reasonable and fair number of votes had been reached, so that the 30th, 50th or even higher vote did not add nearly as much, if any, value.
The number used for “reasonable and fair” is determined by examining the average votes other top vote-getters were receiving from any single firm. For example, if on average, the top 8-10 firms received no more than 15 votes from any one firm, then the weighting of the 16th vote onward from any one firm for any company would be gradually diminished using an algorithm.
We often receive questions about this, but here is the logic: It is simply unfair to allow one large firm to stuff the ballot box for its partner by convincing them to vote 100 times when what we are after are the highest number of votes for a firm from many different sources.
A firm that receives votes from 100 different partners is great! It also speaks more to the extent of that firm’s capabilities than 100 votes from one client. We made no judgments of our own that would affect the rankings, except to a) verify respondents’ qualifications (i.e., that they currently work for an agency or manufacturer in a position that qualifies them to answer the survey’s questions), and b) screen all responses as described above. This means that, as in past years, each and every company that won a place in this year’s Hub Top 20 earned this based solely on the judgment of their peers.
The Hub Top 20 ranking survey is not designed to determine which firms create the best or most effective shopper-marketing initiatives. Nor is it designed to measure loyalty directly. It is designed to let agencies evaluate brand marketers with whom they have productive working relationships and vice versa. We are interested in identifying those firms that have taken the long-term strategic view of shopper marketing and, as such, have invested in capabilities the industry feels are essential to solid, collaborative shopper-marketing success.
Survey participants shared numerous open-ended comments this year, more so than even last year. Here are some of the great comments on “conceptual understanding” of shopper marketing:
• JWT/OgilvyAction understands the shopper and works collaboratively with other agency partners in championing the shopper in marketing plans.
• Integrated Marketing Services understands our business objectives and has a clear understanding of our brand’s goals. They are able to tailor programming to our needs and execute flawlessly.
• Mars Advertising completely “gets” the different mind-set of a shopper engaged in the retail environment versus the consumer at home watching TV. They have helped our brand raise the bar in terms of communicating more effectively with the shopper in the shopping environment.
• Everyone on G2’s staff has great understanding of shopper marketing, but what really makes them stand out is the strong leadership that steers their work (top shopper insights, creative and strategy folks).
• Acosta Marketing Group focuses on programs that leverage shopper understanding and provide tangible in-store solutions.
Regarding “research capabilities,” even though agencies were ranked, not all comments were glowing. For example, some were a little skeptical:
• Not 100% sold on capability to provide specific actionable recommendations, but foundationally they provide a decent amount of background to augment the decision tree with valid insights.
• Only shares research on request. Not proactive.
But many were positive:
• RPM Connect has made investments in research and has an understanding that research comes first and activation follows.
• When it comes to shopper marketing, Mars Advertising appears to have the most comprehensive data that aligns to the end user and the retailer. It’s data that is relevant that I can use and share with my customer to drive our initiatives.
• Saatchi & Saatchi X is the only company I use in this area.
“Account knowledge” always seems to provoke many revealing comments. This criterion reflects loyalty, because deep account knowledge usually comes from years of experience:
• Our TracyLocke team has 10+ years, on average, with the company.
• TPN has worked closely with us for many years and has continually demonstrated robust understanding of the brand’s objectives, merchandising history and consumers.
“Strategic planning” is critical to shopper-marketing success and our study participants recognized this as demonstrated by the comments provided:
• Catapult Marketing performs research on individual retailers to customize selling of marketing concepts to fit the need to that particular consumer.
• Opticians is a category with various grades of retailers, from the large format chains to the smaller neighborhood set-ups. Draftfcb clearly understands this.
We all like creativity, whether we’re shoppers or clients of an agency. All of the top agencies garnered accolades for their creativity. Many comments were of the tone reflected in this respondent’s observations about Mass Hispanic — a newcomer to the list:
• Their programs always include a creative element that adds excitement and shopper interaction.
Or this one about Mars Advertising:
• They are creative but practical — smart enough to not operate in a bubble — they ensure all recommendations are actionable.
Creativity is related to innovation and innovation processes. But clients do not merely want new and innovative ideas; they want a selection of them from which to choose. Some agencies are better at providing options than others and innovation can be applied to shopper-marketing processes as well as initiatives:
• Marketing Drive has a wealth of ideas and experience acquired through many projects, and can provide us with options.
• Draftfcb has a bevy of experts in various domains; they bring a lot of innovative ideas and open up possibilities for ideation/execution and tracking. A few of the ideas proposed by them have led us to streamline our shopper marketing efforts.
Now, for the results. Amazingly, for the fifth year in a row, Mars Advertising took the top spot in our agency rankings. Across the board, Mars was consistently ranked first by many brand marketers and retailers. But the competition was stiff. Very close behind were the next four agencies, RPM Connect, Acosta Marketing Group, JWT/OgilvyAction, and Integrated Marketing Services. This list is tight at the top.
We decided to show a longer list — the Top 20 — to reflect the diversity of the firms who ranked well in the study as well as growth in shopper marketing. Every firm on the list had very strong supporters. This means people are working extremely hard. Very well done!
Brand Marketer Performance
Now let’s move on to agencies’ votes for brand manufacturers. How well did agency voters think brand manufacturers held a consistent and common “shopper-marketing vision?” Some of the comments suggest that the top firms do get it — across their organizations and within their partnerships:
• ConAgra Foods has offered our agency such great value over the years because we are seen as a partnership instead of just a manufacturer/agency relationship. We share the same goals and work in harmony together as one.
• Everyone at Kimberly-Clark understands the importance of shopper marketing and they are able to plan early. Kimberly-Clark’s integrated marketing planning process enables them to maximize what is possible at retail, as their vantage point of the shopper can be represented early on in the program’s start.
• Nestlé has made an investment in shopper-marketing training of their sales and marketing personnel across the organization.
• Invest resources and all three [Procter & Gamble, Unilever, Kraft] have a top-down, bottom-up approach when it comes to planning that ensures the shopper’s voice is heard.
It’s one thing to have creative ideas and deep shopper insights. It’s quite another to have an “integrated, cross-functional understanding” that enables firms to plan and execute:
• It’s simply how Clorox has built its organization. Sales, promotions and shopper marketing all work together in integrated brand teams.
• SC Johnson has a network that spans across all retailers, helping to provide insight to their brand leads and build solid plans and budgets around retail- inspired shopper initiatives.
Some manufacturers have clear “strategies and objectives” and some — well, do not. We wanted to know whom participants thought did it best. As one participant put it, sometimes clear strategies require clear communication and a tight ship:
• Coke, for better or for worse, has communications down to a science. Across all platforms, you won’t find anything that strays from their mission-at-hand.
Not everyone agrees that manufacturers have great shopper insights, as this quote demonstrates:
• I have read through hundreds of pages of shopper studies that were devoid of any true insights. There is a lot of evolutionary work needed in this area.
However, it is also recognized that some manufacturers practically invented the concept of shopper insights:
• Procter & Gamble spends a ton of money conducting shopper research to better understand their consumer. They conduct focus groups, shopper intercepts and online data surveys. This is the foundation of everything they do.
We like to read comments that reflect a realistic, in-the-trenches view of the hard aspects of shopper marketing such as “budgeting,” which is far more than simply staying within a given cost plan:
• At ConAgra, budgeting really improves in a culture that believes ongoing post-event analysis is more than just ROI and ROMO, but also identifies implications for future investment.
It’s nice to see firms sharing information not only to help their shopper-marketing partners but also the industry, as this quote illustrates:
• Unilever shares their studies externally to help not just Unilever and the retailers, but also the industry as a whole.
But at the heart of information sharing seems to be long-standing relationships. Many comments reflected that a loyal relationship fosters good, timely information sharing for planning and execution.
Impressively, Nestlé moved up several spots to capture the top spot in this year’s rankings. But the list is full of notables in the shopper-marketing space with Kimberly-Cark, Unilever, and Procter & Gamble rounding out the top four brand manufacturers.
But just as Mass Hispanic came out of nowhere in the agency list, Mike’s Hard Lemonade did so on the brand side. And for the first time a non-consumer packaged goods category brand marketer, LG, made it on the list.
What a great list of powerful and innovative firms! A breakout of how each agency and brand marketer fared against each of the thirteen criteria can be found here.
The Hub’s annual survey of shopper-marketing excellence is growing in participation and is reflecting greater diversity in the industry. It is also helping leaders and managers determine some of the best shopper-marketing organizations with whom to partner.
Our students and faculty here at The University of Tennessee are excited to learn each year how the parties rank each other, and in many cases to learn about companies they may have never thought of studying or joining as an employee.
Even more exciting than who comes in first or second is that the industry is growing as the shopper-marketing discipline gains critical mass. What began in 2008 as the Top 10 is now the Top 20. There are now so many outstanding agencies and brand marketers out there working in the shopper-marketing space who might qualify to be in the Top 30, 40 — or even 100, especially if you look globally (after all, brand marketers and retailers named 153 agencies while agencies named 144 different brand marketers).
More than ever, shopper marketers need to analyze their partner options carefully because with growth comes change, and with change comes new opportunities. Thanks again to everyone who participated, and we wish you great business success in the year ahead.