How can grocers run successful seasonal promotions in 2023?
You certainly can’t repeat what you’ve done over the past couple of years. But with macroeconomic factors from inflation to the cost-of-living crisis to regional regulations like the recent high in fat, salt and sugar (HFSS) guidelines in England, it’s also a mistake to assume you can simply repeat promotions from pre-pandemic years and expect the same results.
2023 will require a fresh and nuanced approach.
That’s why we partnered with The Grocer to unpack the answers. In our webinar, “Navigating a New Era for Seasonal Promotions,” we brought together expert panellists from across the industry to discuss how promotional strategies and seasonal campaigns might evolve over the next year.
Here are five highlights from the webinar.
The cost-of-living crisis had an extensive impact on consumer behaviour in the recent holiday season across all income levels. Keenly aware of both having less expendable income and the heightened risk of overspending during the festive period, as well as the availability of more options, consumers grew more intentional and flexible with their spending habits.
“Shoppers are savvier and more educated about price,” Britt Iversen, head of strategy at Havas London, said. “If [your product or promotion] is not something they feel strongly about, or it’s confusing or tedious, they will shift and go to a different store and a different brand.”
Consumers are also less inclined to act immediately on promotions, weighing up their options before making a buying decision. In turn, grocers are seeing lift shift from the beginning of their promotions towards the end, when the forced impulsivity of events encourages purchases.
Pricing will always be a fundamental piece of every promotion. But with consumers currently cash-strapped and more strategic with their spending, it may take more to move the needle. Especially for those impacted by the HFSS guidelines regarding a product’s in-store placement.
As managing director of Divine Chocolate, panellist Jon Marlow is as in tune with the current struggles of seasonal promotions as anyone. He identified a product’s added value as a major promotions driver this year, suggesting one should consider how certain products may have a special relevance to specific events or how they may elicit associated emotions.
Marlow also shared how retailers can rethink visibility in response to changing consumer trends and stricter guidelines on where and how items can be merchandised. Bryan Roberts, global insights leader at IGD, agreed, diving into how retailers can take advantage of omnichannel activations and smaller holidays growing in popularity for highly relevant and visible promotions.
Consumers are reluctant to give up the ways they want to celebrate key events. But with the current states of inflation and the cost of living, it is significantly harder to meet expectations.
Iversen’s insights paint a clear picture of how consumers’ seasonal shopping will likely be impacted by price in 2023 and to what lengths consumers will go to make their desired experiences happen within their budget. According to Iversen, consumers seek flexibility plus a sense of value when shopping and are set on where they will and will not compromise around the events that matter to them.
When looking at how grocers can adapt their seasonal promotions strategies, Iversen recommended a two-step process. By starting with the core products that consumers must have to celebrate and then building out with trending products that will elevate the experience on a budget, retailers can command more market share from promotions while also meeting the needs and wants of consumers within their price range.
Between consumer behaviours and compliance standards, conditions are radically different from years past. Seasonal promotion strategies will need to adapt accordingly.
“The biggest mistake to avoid is assuming something that worked for you before, because we’re back to normality, will work the same now,” said Evan Barlow, regional director, EMEA, at Revionics. “Getting it right is using predictive analytics to work out what are the underlying factors that influence the changes in demand and understanding what is driving performance for you.”
He elaborated on how retailers can pivot existing strategies by turning limitations into opportunities, and how retailers can use this time of sweeping change to re-evaluate how they utilise their store space to optimise promotions. After all, retailers still have the same amount of space to fill.
Barlow emphasized that there is no one-size-fits-all solution to planning your 2023 seasonal promotions, but that “it’s important to be very surgical” with where you place your budgets and which tactics you implement for the best possible sales lift.
In essence, less broadcasting, more targeting.
Financial factors impact different consumers in different ways, as do tactics and touchpoints. To succeed, retailers need to know what drives sales at the consumer level. Roberts shared that compounding this intelligence with targeted customer loyalty promotions can help you “hone in on people who will truly benefit from what you’re promoting to them. For the consumer, it makes the buying process more pleasurable.”
During the webinar, our panellists fully explored seasonal promotions, including why emerging holidays and trends are ideal high-growth opportunities, the critical role of relevance in promotions performance, why emotions matter in seasonal shopping and how store layouts are adapting to changing demands.
For more rich insights into the changes, challenges and solutions to this year’s seasonal promotions, watch our webinar on demand now.
Duncan Llovio is a B2B content marketer with a passion for product and distribution. If he isn't writing and researching, he's either watching basketball or trying out a new recipe.