Tactics to Target Audiences and Product Categories
The top 3 supermarkets, Tesco, Sainsbury’s, and ASDA, have the highest online population share in the UK, but zooming in to city-level, other supermarkets also compete.
Online searches for “gin” have grown rapidly over the year, and were 93% higher at the start of November, compared to the previous year.
Visitors to Amazon Fresh’s site have grown by 16% since the acquisition of Whole Foods.
1. Audience Targeting
How can Iceland attract the Organic Fruit & Veg shopper?
Tactics to increase market share by location and customer segment
Share by Supermarket – UK Online Population
The three largest supermarkets in the UK *, Tesco, Sainsbury’s and Asda, have over double the online population share compared to other supermarkets.
Share by Supermarket – Selected Cities
But when we zoom into specific cities and locations, a different set of supermarkets arise. In Manchester, people are most likely to visit Asda, Morrisons and Iceland online. In contrast, Londoners are more likely to visit Ocado and Waitrose.
Audience Zoom – In Manchester
Zooming deeper into different types of consumers by location, we can see which supermarkets are attracting which segment.
In Manchester, Asda & Morrisons are comparatively more likely to attract the Premium & Budget Range shopper. Iceland largely under-indexes for the Organic Fruit & Veg shopper.
Audience Targeting – What can Iceland do in Manchester?
If Iceland wanted to conquest the Organic Fruit & Veg shopper and saw Manchester as a strategic location, what could they do? The supermarket could firstly understand the unique interests and needs of this target segment. One such way is through search term analysis.
Iceland may also want to develop regional promotions or ad campaigns for quick online response. Below is a list of websites that the Manchester, Organic Range audience is most likely to visit. Using this insight, Iceland could then strategically select the best affiliates to partner with.
How to get these insights?
Define your target audience
Combine location, consumer type and competitive share to locate your gaps & opportunities
Understand their unique interests
Delve into the target’s online behavior, such as search terms and websites to build a wider profile
Reach your target audience
Link insights to action – feed analysis into PPC, content, display and partnership opportunities
2. Category Targeting
Who is winning the Gin Category and why?
Tactics to convert high-growth product categories
The Seasonality of Alcohol
Online searches for wine & spirits peaked over the festive season, and remained mostly flat for the rest of the year.
But, compared to other alcohols, searches for “gin” largely differed.
“Gin” searches and variations of the term have rapidly increased since March, and at the start of November, were 93% higher compared to the previous year.
Why have “gin” searches increased?
By comparing keywords around “gin” searches, we can see why gin has grown rapidly over the year.
The top rising keywords showed that new products (e.g. advent calendars and baubles), flavours (e.g. pink) and supermarkets (Aldi and Lidl) were trending, in time for this year’s festive season.
The Gin Audience: Share by Region
Growth in gin searches can be seen overall in the online population, but more so in some regions.
The chart below shows the proportion of people within each region searching for “gin”, and how this has changed since last year.
In particular, Scotland saw a 70% rise in October YoY.
The “Halo” Effect of Gin
Lidl released their award-winning Christmas gins on 31-Oct. Aldi also launched the first Scottish Gin Festival on 2-Nov.
As a result, searches for “Lidl gin” and “Aldi gin” grew by 732% and 133%, respectively, in the week of 04-Nov.
These promotions were instore, but others have benefited online. Although much lower in volume, “Amazon Gin” saw a 32% WoW rise, the following week.
How can others capitalize?
Only 38% of “lidl gin” searches went to their site directly, and 59% for “aldi gin”. The remaining traffic went predominantly to news and media sites.
Amazon, on the other hand, had 100% of traffic from “amazon gin” searches go to their site.
When we look at searches within Amazon’s site, a number of gin-related products significantly increased. These included: gin glasses, miniatures, calendars and baubles.
The opportunity to benefit from a halo effect can be direct or indirect. Amazon saw significant rises in searches for gin-related products, and not necessarily for gin brands.
How to get these insights?
Track fast moving search terms
Monitor what is trending week-on-week by product categories
Monitor the impact of competitor campaigns
Assess the uplift from competitor events or campaigns, such as searches or onsite conversions
Connect with your product and promotions
Combat or benefit from a competitor’s campaign -Look at the demand for direct or related products to determine your response
Who is Amazon Fresh competing against and for which consumer types?
Assessing competitor audience overlap and product opportunities
Amazon Fresh & Whole Foods: Online Impact
Amazon fully acquired Whole Foods on 28-Aug, and soon after, Whole Foods announced price cuts of up to 40%.
Amazon Fresh and Whole Foods currently service only a handful of locations in the UK (mainly London), so what is their impact online? Visits to Amazon Fresh have steadily grown, with the number of visitors to their site rising by 16% since the acquisition *.
Amazon Fresh: Overlap with Supermakets
Who is Amazon Fresh sharing their online audience with?
Since the acquisition, Asda, Waitrose and Ocado have seen a larger proportion of their audience shared with Amazon Fresh.
In particular, Ocado has seen a significant shift of 17% overlap.
Amazon Fresh vs. Ocado: Audience Food Habits
To see why there is a shift, we can compare the types of audiences that Amazon Fresh and Ocado draws.
Regular buyers of wine and food delivery services are similarly-indexed for both online supermarkets.
Ocado is more likely to draw the regular shopper of fresh coffee and spirits, whereas Amazon Fresh is more likely to attract the chocolate lover.
Amazon Fresh vs. Ocado: Top Product Pages
In the week ending 28-Oct, 4 out of the top 10 products viewed on Amazon Fresh were coffee-related.
But, Ocado attracted a higher proportion of “fresh coffee” drinkers
(potentially not converting as much as Amazon Fresh).
To respond, Ocado could then push promotions on coffee capsules the following week, to secure and convert this audience.
Amazon Fresh is a growing online threat, and Ocado has seen a larger audience overlap with them. To respond, Ocado could identify product gaps by linking audience data with product insights.
How can I get these insights?
Assess the impact of online disruptors
Amazon Fresh is one online disruptor, but others like My Supermarket have grown over the year. Assess their online impact to your business
Compare your audience overlap
Track the audiences shared with other supermarkets and understand why
Identify product opportunities
Link audience insight to online product performance. Identify gaps in consumer segments, such as where you don’t convert
In this report, we covered three actionable tactics for supermarkets that combines online and offline data resources. These were:
How to grow a consumer segment
The Manchester Organic Range Shopper was identified as an opportunity for Iceland. Iceland could then understand this segment’s unique interests to grow engagement, online and offline.
How to convert in a product category
Gin has seen enormous growth this year. Other supermarkets can hop onto the halo effect from Aldi & Lidl’s instore campaigns, such as Amazon, which has seen growing demand for gin-related products.
How to monitor online threats
Amazon Fresh is taking over online audiences. To differentiate, Ocado could then analyse audience breakdown and product performance, to pinpoint gaps and product opportunities.
In summary, these tactics support supermarkets targeting customers and increasing value from each segment.