High street chemists are currently facing stiff competition from supermarkets and more fiercely, discount retailers who are looking for a slice of the growing cosmetics and toiletries pie. Sales of toiletries at discounters are currently growing at a rate seven times that of high street chemists (Kantar Worldpanel) as consumers are growing tired of the confusing ‘buy two get a third off every second shop this quarter’ type offers or the sporadic price changes for a bottle of shower gel that can see it range from £1.90 to £2.50 every other day. The brands themselves are realising this and creating strategies to capitalize on this growth area, creating larger sized, fixed price products; how does a family size pack of 20 shower gels for £15 sound? It sounds simple and sensible right?

Boots is currently undergoing a three-month pilot of its My Boots Value personalised discount scheme in 103 stores in the Bristol area. The scheme is initially launching with brands such as Imperial Leather, Elvive, Nivea, Head & Shoulders, Pampers and Listerine and is allowing Advantage Card consumers to pick their favourite brands online in order to receive a 10% discount on these products in store. The choice of brands here is key - they are not your more premium health, beauty or makeup focused ones, but are instead brands associated more with toiletries that are used day to day such as shower gels, creams and shampoos where discounters are currently thriving.

How do Boots and other high street retailers combat this trend?

Well, digital is the obvious area where they have an early mover advantage. Poundland have only recently trialled an online shop after years of placing more focus on store openings whilst Boots have been online for a number of years and already have a mobile app that allows customers to connect their Advantage Card and use offers in store. Waitrose’s current Pick Your Own Offers campaign leverages the same data sources as Boots’ My Boots Value and has led to an 18% growth in myWaitrose card holders since its launch in June this year.

Whilst the My Boots Value scheme is great, I can’t help but feel it’s only scraping the surface of what’s possible. By possible, I don’t mean technically possible, but might take years to create, I mean very easily and readily possible. The key thing missing from the current proposition is context “based on time, place and the most recent understanding of individual customer intent” (Katrina Conn). Contextualisation has been consistently getting more and more sophisticated. For example:

  • Google Now scrapes data from emails, web history, location and even 3rd party applications to push you relevant information when you need it. Forgotten where you parked your car? Google Now thought you might, and it remembers
     
  • Both Apple and Google have developed their search on mobile to show you contacts that you might want to contact because you are meeting them soon, apps that you might want to open because you use them regularly at a particular time of day or news that is breaking in the city or town that you’re currently in

  • If This Then That, a 2010 startup takes things one step further and allows users to create their own ‘recipes’ to join up the physical and digital world. Users can plug in their own connected services (like Gmail, Dropbox or even Philips Hue light bulbs) and create contextual experiences for themselves. For example I could allow it to ‘dim my lights to a light blue when it starts raining’ - brilliant

Every single experience must have a context and the key thing here is that it is no longer difficult to understand context. It is now basic and assumed that we can know things like user’s location or the current weather for example. It is also assumed by consumers that companies should know them and pro-actively make their lives easier. Combine this with the accumulated knowledge of consumer behaviour through Advantage Card and it quickly becomes apparent that an easy first step in creating a compelling contextual solution is not inconceivable at all. How about, after picking my favourite brands on the Boots app:

  • I was reminded that I bought toothpaste 30 days ago and (if I've been brushing twice a day, like, you know, you should) it will run out soon
     
  • It’s forecast to be sunny for the next two weeks (unlikely, I know) so I was pushed a notification, in store, to buy sunscreen

  • I was told that there is currently a flu outbreak in my town and it would be wise to get a flu jab

Why couldn’t this information also be used as a marketing technique to influence customers who don’t necessarily own the Boots app?

  • All users who've selected Nivea as a favourite brand are invited to a 1 hour flash sale of hand cream this Saturday at 3pm - no doubt this would create a real life buzz and that’s a good, good thing

  • Fans of Mac makeup within the Stratford area are invited to a free tutorial session in the Stratford Boots store to help them recreate their favourite looks

The great thing is that it’s an iterative process. I mention first step above intentionally. Eventually, why couldn’t I be reminded that I have booked flights to Mauritius in a month and now would be a good time to stock up on Malaria tablets? Further, I may as well pick up the newly released airport-friendly sized lemon face wash that I regularly buy (it’s so zesty) whilst I am in store.

We have the ability to more deeply understand customers across all touch points and we can also use more sources of data to build a better understanding of their context; this cycle can go round and round to ensure that we consistently deliver a better contextualised experience for the customer every time.

 

By Kurran Malhotra, Account Director of Rockpool. 

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