It’s a dirty job: Police nationwide
take on soaring Tide detergent theft.
Recently, I stumbled upon this headline on the website, The Daily.Intrigued, I had to read on. The article proceeded to provide details about how sophisticated criminals — not your everyday shoplifter — are targeting Tide detergent. One Tide taker in West St. Paul, Minn., made off with $25,000 of product over 15 months before he was busted last year.
In another instance, police described how Tide was being used as a currency within the drug trade: “We sent in an informant to buy drugs. The dealer said, ‘I don’t have drugs, but I could sell you 15 bottles of Tide.’ Upstairs in the drug dealer’s bedroom was about 14 bottles of Tide laundry soap.”
As a marketer, the natural question I asked myself was, “Why Tide?” What was it about the brand that made it so valuable as to spawn such unabashed criminal activity? It is just laundry detergent, after all. While a struggling economy certainly is a contributing factor, what’s fascinating was how the rationale for Tide’s theft was described in terms that every shopper marketer should recognize:
• Why Tide and not, say, Wisk or All? Police say it’s simply because the Procter & Gamble detergent is the most popular and, with its Day-Glo orange logo, most recognizable of brands.
• A spokesman for Philadelphia-based Checkpoint Systems, which produces alarms being tested on Tide in CVS stores, said: “Name brands are easier to re-sell.”
• A detective in the Prince George’s County, Maryland, police department, said Tide is known as “liquid gold” among officers.
Think about those statements for a moment and how they relate to shopper marketing. Tide is specifically targeted instead of its competitors because a) its Day-Glo packaging makes it easy to find and recognize (as shopper marketers we’d say that Tide’s packaging creates a branded sign post that enhances category navigation); b) it’s easier to re-sell (in shopper-marketing lingo we’d say that Tide has a higher conversion rate than other brands); and c) it’s “liquid gold” (that’s one of the best descriptions of shopper value and brand equity that I’ve ever heard).
Although I certainly don’t condone theft, this news story resonated with me because of what it says about the power and importance of brands to shopper marketing. One of the prevailing dictums of shopper marketing is that retailers are brand agnostic. That is, they are primarily interested in category growth and are generally indifferent as to whether they sell a bottle of Coca-Cola or a bottle of Pepsi — as long as shoppers walk away with one of them in their basket.
A byproduct of that belief is that retailers are not interested in committing their resources (shelf space, merchandising, display, etc.) toward activities that are viewed as brand-equity building or, in other words, they are not in the business of helping manufacturers build their brands.
While I can understand retailers’ desire to remain brand agnostic, given their relationship with multiple manufacturers and distributors, the Tide example clearly illustrates how important strong brands are to the retailer’s business model. While the professed “Coke or Pepsi” indifference might maintain a level playing field, think of the implications to the retailers that don’t stock Coke and Pepsi. They surely would lose shopper trips, store loyalty, and realize a lower basket ring than their competitors by not having both of these powerful brands.
Returning to Tide, while petty theft and shoplifting certainly occur within all categories and among even non-descript products, we’re not seeing private label or weak, secondary brands inciting national crime sprees. With all due respect, no one appears to be risking incarceration to stock up on Gain or Purex illegally. Strong brands, on the other hand, drive retail trips and conversion for both purchasers and pilferers.
Tide, Coke, and Pepsi are, of course, all dominant, global, multi-billion-dollar brand franchises. To better understand the role that brands play in driving shopper decision-making, we tapped into our proprietary, quantitative, online panel data. We call this “demand cycle” research, as it’s intended to help us better understand shopper behavior and what drives or creates demand within categories. In this instance, we surveyed more than 1,200 shoppers across six diverse categories and asked them to rank the factors that drove demand in each of the categories.
The results were surprising (see chart one).
In none of the categories was “brand” identified as even one of the top-three purchase drivers. Consistently across all six categories, more functional and rational product attributes (e.g., taste, comfort, flavor, etc.) ranked as the primary purchase drivers. Particularly surprising was that in categories like athletic footwear and facial tissue — home to dominant brands such as Nike and Kleenex — “brand” was ranked fourth and fifth, respectively, in terms of importance to shoppers.
The concerning implication of this research for shopper marketers is that while delivering against desired product attributes is certainly important, they won’t build long-term, sustainable value and differentiation for either shoppers or retailers the way a strong brand does.
When shopping decisions are made based on product attributes and “brand” is given low priority you: 1) risk losing share to private label or store-brand competition that deliver comparable product performance; 2) invite shoppers to price-comparison shop, thereby decreasing the overall value of the category for retailers; 3) help commoditize the shopping experience at retail because strong brands serve as navigational signposts for shoppers (e.g., Tide’s iconic orange package) and a lack of brand reference points make the shopper journey more difficult and confusing; and 4) reinforce the retailer’s “Coke or Pepsi” agnosticism.
So what can marketers do to move their brand up the proverbial “food chain” to elevate its prioritization within the shopper “demand cycle” and convince retailers that powerful brands enhance their relationship with shoppers? For shoppers, we need to communicate clearly how brands deliver (see chart two):
• Value: This can be accomplished via superiority claims, brand heritage, promotional offers, special packs, and so forth. These types of value communications justify the premium price strong brands command (which grow the category for the retailer) and make the shopper feel smart about their purchase.
• Solutions: Brands solve problems for shoppers. They “own” a benefit area that is important to shopper (fast headache relief from Excedrin; sex appeal from Axe body spray; cavity prevention from Crest) and make them feel secure and confident in their purchase.
• Simplicity: Brands simplify the shopping experience and reduce shopper angst by narrowing the set of choices. Study after study has demonstrated that, above a minimum choice set, increasing options for shoppers directly correlates to higher levels of dissatisfaction and inertia. Shoppers don’t want to “shop” a 30-foot section every time they’re in the detergent aisle — that takes way too much time and effort. They want to go directly to the orange bottle in the detergent section, know what they’re getting, pay for it (hopefully) and get on with their lives.
For retailers, powerful brands can:
• Drive traffic: Why do heavy discounters like Family Dollar and Dollar General carry versions of premium brands like Dove and Bounty? Certainly not because they are the lowest-priced options in the category. It’s because their shoppers demand them, and without them they’d lose traffic and trips.
• Provide differentiation: If brick-and-mortar retailers are to survive against the increased penetration of e-commerce and automated shopper replenishment, they need to provide a differentiated experience that justifies the trip. Brands can play a key role in this by providing exclusive offers to retailers.
For example, last holiday season, the Just Dance videogame franchise developed a partnership program with Kellogg’s to promote the launch of Just Dance 3, available only at Walmart. The power of bringing these two brands together with an exclusive offer drove record sales at Walmart.
• Increase conversion: It’s a fact that branded products are in more shopper baskets than store brands or private label.
While you may never have to worry about inciting a national crime wave, don’t fall into the trap of believing that brands don’t matter in shopper marketing. Brands play a crucial role in satisfying shopper needs, enhancing the shopping experience and building a retailer’s business. If we support strong brands and don’t commoditize them, we’ll all — brands, shoppers and retailers — be the better for it.