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Laundry detergent and household cleaning brands are masters of reinvention. Since the modern washing machine first replaced scrub boards across homes in America post WWII, innovation in the cleaning aisle has continued at a fast pace.
Consumers have even seen significant format and new product changes: from liquids and powders, bleaches for whites, stain removers and pre-treaters, all-in-one detergents, fabric softeners, varying temperature detergents, biodegradable cleaners, to color safe bleaches, tablets and more.
As shoppers are inundated with constant change in the laundry and cleaning aisle, it's imperative retailers understand and react to shopping behavior shifts in order to preserve customer loyalty. But how can retailers make sure what is taken off the shelf doesn’t affect their most loyal consumers, ultimately sending them to a competitor and putting more than just detergent sales at risk?
Take into account the massive innovation and the decisions that need to be made when a new product is introduced – something must go. With the failure rate of new product launches in grocery at 70-80 percent (Food Processing, 2013), the risk of alienating your most loyal consumers can be high if you remove the wrong product to make way for the new.
Loyalty insights are not always evident on spreadsheets; retailers must be willing to take a deeper dive and master the interpretation of data to create a better shopping experience for customers and drive brand and category growth. SKU data insights and shopping patterns not only drive ROI and sales revenue but help retailers understand customer behavior – what they love, why and how they buy and what earns their loyalty. Here are some things to think about when looking to add a new product:
- Closely analyze data to delist products with minimal sales risk. Many grocers make the mistake of dropping the lowest sale item without consideration of who’s purchasing that item. Delisting a product due to sales volume, runs the risk of losing your most loyal customers to competitors. These customers might come to your store for this brand, but they also make large purchases of other items, essentially rewarding you for keeping that brand and that particular item on your shelf. Be sure to take a closer look at your data to gather these insights and determine which products matter most to loyal customers (see Fig. 1).
- Don’t neglect consumers exclusive to these delist items. Once you’ve decided to delist an item with less loyalty, don’t neglect the shoppers who relied on it. Be proactive and start to think about the items that they are likely to substitute this product with. Sending them communications to try something else will keep them purchasing in the category when the item is gone.
- Develop a launch communication strategy. Consumers do love to try new products and 44 percent (emnos, 2014) do so regularly, but grocer communication and marketing are critical to a product‘s success. It’s important that grocers encourage consumers to try the product with an introductory offer (e.g. coupons) and information on why this product should be in their basket.
Changing the store layout or delisting products to create shelf space for new detergents or cleaning supplies could impact a retailer’s relationship with their most valuable customers. Therefore, it’s imperative that retailers take a closer look at shopper insights to create a more personalized shopping experience around their most loyal customers, while providing them with the products that matter most to them. Product reinvention that results in product selection and store layout reinvention in the cleaning aisle doesn’t have to be risky business. By viewing data through the lens of the consumer, retailers can understand the key drivers of retail performance without cleaning out customers in the cleaning aisle.
For more information, visit www.emnos.com