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How to make your shopper media budget an investment, not a spend

Updated: Jun 14, 2022

In the absence of data, getting a discount used to be the easiest way to measure whether you had a ‘good deal’ on your shopper spend. Negotiating 20% off the rate card certainly feels like a step forward and a discount is a discount, right?

For brands existing in an era of marketing budget scrutiny and zero-based budgeting, it’s easy to fall into the trap of making short-term choices about whether to invest marketing money. In my experience, such decisions are often based on demonstrating savings that will keep internal stakeholders happy.

To my mind, this really isn’t the right approach. If you were buying a new TV, you wouldn’t buy it based on a new low price alone. You’d research it thoroughly – reading reviews, working out if it has the right screen size to fit your living room, making sure it is reliable enough and so on. You’d likely judge the TV on its merits and performance first, and then you’d find it at the right price. Of course, there is a threshold for many things where a lower price does add to its value. But generally, if it was rubbish to begin with, it’s rubbish if it’s cheaper too. The aim, therefore, is to pay the right price for the best performance.

The first step is for brands to prioritise planning, selecting the right media to achieve their objectives and to deliver their message. After all, chasing a 5% discount on something that is ineffective is a 95% waste of spend!

The good news is shopper media is the most robustly measurable media out there. While you can only measure an ad at Piccadilly Circus by the amount of people that see it, shopper media can measure the impact of a brand’s campaign on sales. It is immediately quantifiable, and this data can easily be fed into the media planning process.

There are lots of things, however, that get in the way. For many brands, marketing spend is agreed upfront with the retailer, which frequently proves problematic. While it is an efficient way for retailers to manage their media estates and hit their margins, it is very rarely executed with a ‘brand-first’ mentality. Brands should be able to make an investment based on a level of knowledge that helps determine the right campaign execution. For example, how many touchpoints in a store is too many? What differences in approach are required for NPD? And so on.

On top of this, a major challenge we face is that marketing and procurement departments are fundamentally measured on different metrics. An effective measurement may be obvious to a CEO or a marketing manager, but to a procurement department who are solely tasked with landing percentage savings, it’s another story. I have nothing against procurement departments, in fact I really like them, as their job is to spend money! It can just be frustrating when the way they are measured conflicts with the best interests of the business they represent.

If shopper budgets were treated as an investment instead of a spend, I believe they’d become vastly more effective. Choosing the right channels, at the right weightings, in the right stores, targeting the right shoppers, will always be the better determinant of positive ROI. And then if you can negotiate with your spend to ensure you get a fair price too, even better.

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