THE PLUME

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Retail Evolution

The Power of Getting on the List: Moving from Unplanned to Planned Purchases

In-store impulse purchases have long been a key revenue driver for retailers and manufacturers alike. A recent study shows that the average American consumer spends about $5,400 a year on unplanned purchases[1], and 3 in 4 Americans buy candy[2] at the register before checkout. Additionally, 68 percent[3] of U.S. consumers still say their primary location for making a spontaneous buy is in a physical store. But as consumers continue to migrate their shopping to online and mobile channels, retailers are grappling with how to retain these crucial sales and what the unplanned experience should look like online.

 

Sales of our single-serve, instant consumable products found in checkout lanes across the country are about one third of our business. While important, we know single-serve buys are just one piece of the candy shopping puzzle. For our category, seasons and occasions as well as take-home package types are also very important drivers of our business. If addressing last-minute purchases is our sole focus, then we’re leaving sales on the table.

 

It’s the same case when retailers and manufacturers think about in-store shopping separately from online. Consumers see it as one seamless ecosystem and they move at lightning speed between mobile, online and in-store shopping. In fact, look around the next time you’re in a store. Most people are price-checking or reading product reviews on their phones. Talk about lines blurring and the importance of eye-catching and thumb-stopping content.

 

Did you know? Shoppers spend 6x more[4] when they shop all of a retailer’s commerce platforms.

 

Still, we know there’s significant discussion in the marketplace about what happens to impulse candy sales as more shoppers migrate to online grocery shopping. Where others see risk, we see opportunity. To address this shift, we have examined existing shopper behavior and consumers’ expectations for a holistic shopping ecosystem. Our goal is clear: convert unplanned buys into planned purchases online.

 

“We firmly believe that shifting unplanned to planned shopping unlocks much more opportunity than simply re-creating the impulse buy online.”

 

To achieve this goal, a smart digital strategy is more important than ever; it’s the equivalent of moving your product from the dusty bottom shelf to eye level in-store. Think about it – if the product can’t be easily searched or discovered, it won’t be found and will remain unsold.

 

“Winning how the consumer searches – in-store and online – is the key to winning the sale.”

 

To demonstrate the power of an effective digital strategy, let’s first look at the traditional path of a shopper’s unplanned buying habits in-store. Say you’re waiting in the checkout line at the grocery store and you spot a chocolate bar. You debate should you/shouldn’t you, but you ultimately go for it and grab one (hey, you work hard and deserve a little reward, right?).

 

The following week, you don’t have time to go to the store, so you order your groceries online for home delivery. At this point, the No. 1 goal for the retailer is to change the impulse purchase made the week prior in-store into a planned purchase. To do so, the retailer must take an item that was originally off your list (a chocolate bar) and help it find its place on the list.

 

There are many tactical solutions to make this happen – from listing the item as a suggested purchase to offering a discount or free sample at checkout. Without this reminder at the virtual checkout counter, the candy bar would likely drop off your grocery list. This is how we change an unplanned purchase to one that’s always on your list. Human nature dictates that once something is on your list, you’re not likely to take it off. In fact, 80% of all online orders are sourced from ‘favorites’ lists.[5]

 

This dedicated digital strategy benefits our shoppers in buying the snacks they want whenever and wherever they are and helps drives growth for our customers. By creating one retail ecosystem, we’re helping our customers stay ahead of the evolving retail landscape and remain at the top of the consumer’s list.

 


Get your copy of Hershey's POWER OF SEARCH IN A SHOPPER'S WORLD

As a trusted retail partner for over a century, Hershey is committed to “wowing” shoppers. This report boldly frames the word “search” in the context of modern retail and gives you ideas on how to build an engaging retail ecosystem.


 

[1] Source:  Consumers cough up $5,400 a year on impulse purchases, CNBC, February 23, 2018

[2] Source: Shoppers spend at least $5,400 a year on impulse purchases, Retail Leader, February 23, 2018

[3] Source: Impulse purchases still happen mostly in-store – for now, emarketer.com, February 17, 2017

[4] Source: Power of Search in a Shopper’s World Report, The Hershey Company, May 2018

[5] Source: UBS Global Research, April 2018

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Doug Straton
Chief Digital Commerce

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