With consumers increasingly relying on digital tools to make purchase decisions both inside and outside the retail environment, Toronto and Montreal-based shopper marketing firm SVM has partnered with digital solutions company Piranha to launch what is being described as Canada’s first digital shopper marketing agency.
With offices in Toronto and Montreal, Digital Connect will combine SVM’s shopper marketing expertise with Piranha’s capabilities in digital technology – including e-commerce solutions, text message offers to mobile apps and digital signage – to create digitally led strategies and tools.
SVM president Stéphane Drouin, one of the three partners in Digital Connect, said he saw an opening for a company of its nature when discussions with consumer packaged goods companies and retailers indicated that while they were keen to embrace digital marketing at the retail level, the companies they approached lacked expertise in fundamentals like shopper analytics.
“They had great digital knowledge, but didn’t have the backbone of understanding the customer and the path to purchase and how to build relevant tools,” said Drouin, noting that shopper marketing is the fastest-growing marketing sector in North America. The start-up agency stems from an encounter between Drouin and Piranha CEO Dominic Gagnon at a mobile and retail conference in Montreal.
Drouin cites recent studies suggesting that 59% of smartphone owners used their device for “showrooming” purposes last year, up significantly from 15% in 2009. In addition, 15.1 million social media users admitted to referring to their Facebook, Twitter feeds before making purchase decisions in 2011, a 29% increase over 2010.
The 2012 Mobile Consumer Report, meanwhile, indicated that 82% of consumers carry their smartphone while shopping, and that 48% of the consumers who scanned or texted for additional product information felt better about their purchase.
Drouin said today’s retail clients need to deliver more value and be more competitive at the store level, particularly with more players from the U.S. and Europe establishing Canadian operations.
“Shopper marketing is all about delivering the right marketing strategy to maximize the basket size and win the loyalty of your shopper,” he said. While the in-store environment is key, retailers must also pay attention to pre-store activity and understand where they must “win” to attract – and retain – shoppers.
The path to purchase has gone from linear – a shopper makes a purchase decision and goes to a store to complete the transaction – to “all mixed up” said Drouin. Today’s path to purchase is a multi-stage, multi-channel experience that progresses from a shopper looking at an item online before going to the store to comparison shop, perhaps sharing a prospective purchase with social networks to gather their opinion before ultimately making a purchase online.
Digital Connect will operate as an independent entity from both SVM and Piranha, although it will draw its expertise from staff within both companies.