IN MY OPINION 1994-01-10

ALLEN ALSTON

It's hard to imagine that not so long ago the idea of putting an ad on a shopping cart was considered radical.

Now, some 20 years later, in-store marketing has come from almost nothing to taking on a dominant, and critical, role in the total consumer marketing program.

Today we are dealing with an extremely fragmented market in which both retailers and manufacturers are facing increased competition, and an astounding 310 billion to 330 billion coupons are being distributed annually. The environment is changing. The promotions that have been successful in the past may soon be obsolete. The time has come to refine in-store marketing by taking new risks that, in their infancy, may also be seen as radical ideas.

While manufacturers and retailers have traditionally passed control of the in-store market back and forth, what really is calling the shots today is the marketplace, and that goes back to the consumer. Consumers are looking for their specific needs to be filled at a reasonable price. Both retailers and manufacturers should be scrutinizing this customer base and developing programs targeted to specific areas, regions and consumer tastes.

Indeed, some consumer marketing companies are now beginning to restructure their marketing efforts based on customer segments rather than brands. Within this structure, the customer-focused department serves as the core, with outside advertising, public relations and promotion experts as support. If we are to fit within this structure of the future, in-store promotion also must realign itself, focusing on customized programs that deal with the consumer and the retailer as individuals.

This narrow-casting of the market is what has made micromarketers, such as Starbucks, so very successful. We would not have gourmet coffee centers unless the consumer wanted more than was being offered in current outlets. And although supermarket chains cannot be as agile, they can be more focused to the specific needs of their customer base, with the help of manufacturers.

To do this, retailers and manufacturers must put more resources into developing integrated programs and events, and not just act as a distribution channel. That adaptation process is going to be more difficult in tracking and coordination, but the benefits will far outweigh the administrative headaches.

The risk in this type of targeting for manufacturers is a greater potential for miscues, as well as increased costs. But it is that customization that the consumer and the retailer are looking for. Through narrow-casting of the market you are reinforcing the brand's image and quality based on the customer's needs, and promotion is serving more than its traditional role.

Where do promotional marketing companies fit into this equation? With the growth and viability of in-store marketing, promotional companies have begun to refine their programs to deal with these new challenges. Often the retailer and manufacturer do not have the time to step outside the comfort zone and take the risks needed. But promotional companies do have the time, as well as the expertise and understanding of customization. It may well be these in-store experts who will move the industry to the next step by developing systems and programs to help lower the risk factors for both retailers and manufacturers.

In today's environment, where an overwhelming amount of information is available instantaneously, the key is what can be done with this information overload. It is here that the new frontier will occur, and it must start with progressive programs that understand the interdependent relationship among the retailer, the manufacturer and the consumer.

To make this happen, both the retailer and manufacturer must bring something to the party. If used properly, in-store marketing can and will continue to benefit each side, but both must be willing to take the risk.

Allen Alston is president of Forcefield Marketing, a field-service marketing company based in Schaumburg, Ill.