Evolution of Circular Webinar Presentation

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The Evolution of Circulars from Print to Digital
Todd Hale
SVP, Consumer & Shopper Insights
December 1, 2011

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Today’s presenter
Todd Hale
SVP, Consumer & Shopper Insights, Nielsen
Todd Hale serves as Senior Vice President, Consumer & Shopper
Insights for The Nielsen Company. Appointed to this role in 1999,
Todd is responsible for creating thought leadership content and
delivering client and industry presentations. A frequently soughtafter industry and client speaker, Todd shares his insights on
consumer shopping, buying and media consumption behaviors and
attitudes to provide manufacturers and retailers with strategic
visions to facilitate brand, category and retail sales growth. Hale is
often quoted in the press and in numerous trade publications on
consumer trends.
Todd has more than 33 years of experience in the consumer
research industry, including 27 years with The Nielsen Company,
where he held various marketing and sales management positions
within advertising/product testing, advanced analytics and
consumer panel practice areas.
Prior to joining Nielsen in 1984, Todd was an executive with MRCA,
a U.S.-based consumer panel company.
Todd earned an MBA and a BA in Business from Wright State
University.

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The Evolution of Circulars
Copyright © 2011 The Nielsen Company. Confidential and proprietary.


“There is a delicate balance in the shift from print to digital. All
customers will not migrate to the digital world at the same
rate. It will be important to test and learn to understand overall
acceptance in order to protect sales and profitability.”
- Erik Keptner AHOLD
“What makes the online circular exciting to our business is
less about rendering the existing circular on our website, but
rather having the circular in a digital feed that can be
published in different formats across multiple sites and
devices.”
- Kat Kozitza SUPERVALU
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The Evolution of Circulars
Copyright © 2011 The Nielsen Company. Confidential and proprietary.


Circulars help shoppers plan, but manufacturers & retailers
recognize additional digital benefits
1

2

Mfr & Paper

•Critical as pre-planner

•Slow, costly, & rigid

•¾ decisions made prior to store

•Will play a role for some time

•50% use to make lists

•Requires digital complements

•Savings & eating link to brands

3 Mfr & Digital
•Item/price shopping easy

Retail & Paper

•Less relevant as young grow up

Manufacturer
& Retailer
POV

4

Retail & Digital
•Far less costly

•Complements paper

•Multiple screens

•Requires overarching message

•Rethink promo cycle

•Inspires menu planning

•Dissects item / price

•Planning > list > shopping

•Data > Creative

Source: Joe DePetrillo, Nestle; Donald Smith, Family Dollar;
unidentified retailer

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The Evolution of Circulars

Copyright © 2011 The Nielsen Company. Confidential and proprietary.


Shoppers want paper deals now & in the future

Touch point expansion requires multi-faceted
marketing with consistent messaging

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The Evolution of Circulars
Copyright © 2011 The Nielsen Company. Confidential and proprietary.


There is a better way to reach today’s diverse and
time-starved shopper
Digital allows shoppers to be selective!
*
SUNDAY MAY 15, 2011

Delivery Type

Pages

Full page ads & coupon
booklets *

102

Ad inserts *

262

Stuff in plastic bag

54

Grand Total

418
(not counting car ads, local specialty
stores, etc.)

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The Evolution of Circulars
Copyright © 2011 The Nielsen Company. Confidential and proprietary.


Online newspapers readership will likely match
paper in next few years

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Source: Pew Research Center

The Evolution of Circulars
Copyright © 2011 The Nielsen Company. Confidential and proprietary.


Digital is officially pervasive

82%

93%

of Americans
online

of Americans with
mobile phones

25 hrs.
Avg online time
per month

19 Million
iPads sold to date

155 million
US Facebook users

130
Average Facebook
friends

8
Source: Online usage from Nielsen NetView panel - 5/2011; Mobile phone usage
The Evolution of Circulars
from Nielsen, 5/2011; iPad ownership from Apple 1Q financial report; Facebook data
from InsideFacebook.com
Copyright © 2011 The Nielsen Company. Confidential and proprietary.


What Shoppers are Telling Us
How, why, when, & where about print and digital

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Prefer paper, but digital is reaching many
Q: How often do you look at information
about the products & sales available at a
store from...?

Digital

Print
% Ever

% Weekly

% Ever

Source: Nielsen Homescan

% Weekly

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The Evolution of Circulars
Copyright © 2011 The Nielsen Company. Confidential and proprietary.


Latest technology lowest reach, but strong
weekly usage
How often do you look at sales &
product information from...?

Conversion from any
usage to weekly

Materials mailed to home

67%

Emails from retailers

67%

Newspaper

69%

Printed material in-store

38%

Store site using computer

37%

In-store kiosk

24%

In-store TV

21%

Social media

45%

Store site using tablet PC

35%

Smart or mobile phone

39%

Source: Nielsen Homescan

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The Evolution of Circulars
Copyright © 2011 The Nielsen Company. Confidential and proprietary.


Digital

Paper

Paper is most influential to store choice

Q: Influence where
you decide to shop?

% ‘A lot’ & ‘Somewhat’
Source: Nielsen Homescan

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The Evolution of Circulars
Copyright © 2011 The Nielsen Company. Confidential and proprietary.


Paper

Print influences younger generation store choice;
Millennials more tech savvy

Digital

70 total

Q: Influence where
you decide to shop?

33 total
% ‘A lot’ & ‘Somewhat’
Q: Influence where you decide to shop?

Source: Nielsen Homescan

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The Evolution of Circulars
Copyright © 2011 The Nielsen Company. Confidential and proprietary.


Digital

Paper

Asked about the future, 80%+ of consumers want
print; 70%+ want basic digital

Q: Thinking about the
future, how would you
like to get information
from…?

% ‘A lot’ & ‘Somewhat’

Source: Nielsen Homescan

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The Evolution of Circulars
Copyright © 2011 The Nielsen Company. Confidential and proprietary.


Paper

Asked about future, younger generations want
information from all sources

Digital

70’s total

Q: Thinking about the
future, how would you
like to get information
from…?

30’s total
% ‘A lot’ & ‘Somewhat’
Q: Thinking about the future, how would you like to get information from…?

Source: Nielsen Homescan

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The Evolution of Circulars
Copyright © 2011 The Nielsen Company. Confidential and proprietary.


Leverage different behavior; paper drives deal
seekers to door; digital for more loyal shoppers
Much more dealing
with Paper

Digital fewer
trips…

Major PUSH Format
Newspaper Print

…but bigger
baskets

Major PULL Format
Website via Computer

All Outlet Purchasing Behavior of Circular Users vs. Non-Users by Format Used
Source: Nielsen Homescan

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The Evolution of Circulars
Copyright © 2011 The Nielsen Company. Confidential and proprietary.


Paper about value; new tech about info gathering
Shop Their List
Coupons

‘My’ items
Sales

News paper

#1

#3

#2

Paper at
home

#2

#3

#1

Retailer e-m

#1

Store site
(computer)
Store site
(tablet)

‘My’ item
info

Impulse
Any sale

Browse

#2

#2

New item
info

Other

#3

#1
#3

Compare
Store
Prices

#3
#2

#1

Social

#2

#3

#1

Kiosk

#2

#3

#1

Q: What are top ways you use information?
Source: Nielsen Homescan

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The Evolution of Circulars
Copyright © 2011 The Nielsen Company. Confidential and proprietary.


Grocery circulars must be sharp – twice weekly
reach as Mass & Drug; they’re hunting for deals
Percent looking at information about products & sales in the past
week from …?

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The Evolution of Circulars
Copyright © 2011 The Nielsen Company. Confidential and proprietary.


Across
Market generations shoppers looking for price and
convenience; touch points and engagement vary

Structure

Traditional print

Info. seekers

‘tweeners

Status quo

Local prices

Open to digital

Frugal

Personalization

Convenience

Online due to
mobility challenges

Reduce hassle

Personalization

Q: Paint a picture about how you might get
information in the future …what kind of
information & impact it would have

Source: Nielsen Homescan & Quester Analytics

Reduce waste
Corp savings

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The Evolution of Circulars

Copyright © 2011 The Nielsen Company. Confidential and proprietary.


What shoppers are telling us
Paper

Digital

Very influential
across generations

Low reach but high weekly use

Requested for
near future

Loyal shopper tendencies

Leveraged by deal seekers
Find sales on ‘their’ items

Requested strongly by Millennials

Used for information gathering
Greater marketing & sales
potential

Your efforts must include both
Calls to
Action

Item / price remains the centerpiece
Leverage complementary strengths

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The Evolution of Circulars
Copyright © 2011 The Nielsen Company. Confidential and proprietary.


Optimizing
OptimizingPrint
Print
Getting the most out of print; it has a role
with consumers and shoppers

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Printed circular response suffering; promotions
need to be more aggressive just to maintain

Print circular lifts

22

Source: Nielsen Scantrack

The Evolution of Circulars
Copyright © 2011 The Nielsen Company. Confidential and proprietary.


Circulars combat losses due to channel blurring
Gains in lift

Losses in lift

Grocery Circular Lift

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2005

2010

Source: Nielsen Scantrack

The Evolution of Circulars
Copyright © 2011 The Nielsen Company. Confidential and proprietary.

Maximize print by understanding who won the
week and how
Ad attributes
What
we did

Benchmark vs
strategic goals

Role of
Circular

Diagnose
segment
response

What
they did

Profit

Who Won the
Week?

Shopper

Dept by
Dept

Display

ID other
factors &
“score the store”

Online

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The Evolution of Circulars
Copyright © 2011 The Nielsen Company. Confidential and proprietary.


Printed circular ad principles
Do

Don’t

Advertise for broad appeal

Worry about page count

Deep discounts, but not
excessive

Advertise multiple
competing items

Compare lift by category

Use price multiples on new
items

Price multiples
Manage national brand ad
composition

Deal low penetration;
upside argument flawed

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The Evolution of Circulars
Copyright © 2011 The Nielsen Company. Confidential and proprietary.