Finding ways to grow sales is tough—possibly tougher than ever before. Yet despite obstacles like robust competition, a fragmenting media environment and growing piles of data, a handful of companies are finding growth opportunities within their existing customer bases. In fact, by identifying the consumers that spend a lot and engage a lot, companies are tailoring their marketing and sales efforts to boost incremental sales—even when category sales are flat.
That was the premise of a panel discussion about super consumers at Nielsen's Consumer 360—growing sales without any trade-offs. Kicking off the discussion, Eddie Yoon, principal at the Cambridge Group, described tapping into super consumers in just that way.
“What if you could grow your business without any more complexity?” he asked. “That opportunity is there, and companies can tap into their super consumers using the data and information they already have and are working with.”
According to Yoon’s research, this group of consumers can account for anywhere from 30 to 70 percent of a brand’s sales. And not only do they spend a lot, they care a lot, a key opportunity for brands looking for growth when growth is elusive. Take the home coffee category for example. Today, Keurig owners often refer to their one-cup home machines as “My Keurigs,” but that type of enthusiasm and passion did not happen overnight.
When Keurig started in 1995, it wasn’t even the first single-serve coffee maker. According to Michelle Stacy, former president of Keurig Green Mountain, the company was probably even the smallest in the category back then. So when it came to identifying what it needed to deliver on, Stacy said the company focused on three primary needs to deliver on, but only one was unique to Keurig: variety.
While other companies aimed to deliver a great cup of coffee that was also convenient to prepare, Stacy says that Keurig also built the additional benefit of variety—the one aspect that was unique in the category. And from there, it was off to the races, fueled by an overly dedicated and passionate consumer base that actually propels the company’s sales.
“A lot of sales came from word-of-mouth,” says Stacy. “We’ve even seen people say their Keurigs are their best investment ever. How can a coffee maker become someone’s best investment?”
Keurig's real differentiator in the variety plan is its partnership strategy—something that involves working with other coffee companies. The ultimate goal, however, was to benefit the consumer and bring as much variety as possible. That strategy has generated value for Keurig, its partners and consumers.
And other consumer packaged goods (CPG) companies are using super consumers to grow in categories where many would never have thought to look for it. However, as the panel explored, it became evident that super consumers are not limited to CPG companies.
For example, The Harvard Business Review used the super consumer methodology to identify four distinct customer segments that it now approaches and engages with in completely unique and meaningful ways. Those segments range from the ambitious learners who are relatively new in their roles and seeking guidance as well as practical content to big picture leaders who are trying to take their businesses to the next level.
“We’re focusing on identifying the best way for people to consume content and determining how we can deliver,” said Sarah McConville, VP of marketing for the Harvard Business Review Group. “As a publisher, there’s an expectation for personalization. And that’s where we’re focusing our efforts.”
And the media industry is turning super viewers into super consumers. Crown Media Family Networks, which runs Hallmark Channel and Hallmark Movies and Mysteries Channel, adapted the super consumer methodology in an effort to reach the viewers that are truly engaged—the super consumers of cable TV.
“It’s not just about traditional demographics anymore,” said Jess Aguirre, SVP of Research and Media Planning at Crown Media. “Now, it’s about reaching the most valuable and influential eyeballs so media buying can be more efficient and effective.”
And to reach those eyeballs, Aguirre stressed the critical role that big data played in pinpointing the upside in the 90 percent inefficiency scenario—activating the most passionate consumers. By identifying the viewers that were most engaged, Crown Media was able to obtain growth without spending any additional money.
“By shifting our spending by 10-20 percent, we were able to obtain 4-5 percent growth without any additional cost,” said Aguirre. “Knowing that 80-90 percent of cable spend was inefficient was a big opportunity for Hallmark. We proved the value of creating an emotional connection—especially for brands whose shared values benefit from the halo effect provided by our Hallmark Branded Channels.”
Creating that emotional connection can be the key to connecting further with those who are already engaged. It can also be the key to unlocking a layer of growth that might otherwise remain elusive.