When Brands Grow

Byron Sharp delivered the simple truth in How Brands Grow that the ONLY route

to brand growth is through buyer acquisition. Our work looks at what happens

on the purchase occasions when a brand acquires a new buyer. These occasions

– which are essential for brand growth – are called First Purchases. By

contrasting First Purchases with Repeat Purchases we identify the drivers of

First Purchases to help brands gain new buyers. We have analysed nearly 5

million purchases spanning different countries and categories, and through this

work we have uncovered a number of ‘universal truths’ about First Purchases.

Previously we looked at the First Purchase Approach to gaining new buyers.

Today we examine a first universal truth and look at where brand choice is

made.

First Purchases Are “Won” At The Point Of Purchase

First Purchases are rarely planned in advance, instead they are “won” at the

point of purchase.

I think this is one of the most important insights from all of the work that has

been done on First Purchases to date, and it has huge implications for brands.

The finding has been replicated across country and category: the vast majority of

First Purchases of brands are unplanned – i.e. a shopper very rarely plans to buy

a new brand before they go shopping, instead something happens when they are

shopping (either in store or online) which causes them to buy a brand that they

haven’t bought previously. By contrast, when a shopper buys a brand that they

buy regularly, the purchase is usually planned in advance.

Implications

What does this mean for a brand? Brand growth is dependent upon winning

First Purchases, and to win First Purchases a brand must find a way of getting

shoppers who haven’t bought the brand before, who haven’t planned to buy the

brand on this trip, to buy it!!

How can a brand do this? This poses a chicken-and-egg type question: what is

the role that Mental Availability and Physical Availability play in driving First

Purchases? Which should be prioritised? Are First Purchases less about brand

awareness and consideration, and more about great visibility and stand-out on

shelf and/or a compelling reason to buy at the point of purchase? Or are First

Purchases driven by a high level of Mental Availability amongst shoppers which

is somehow re-awakened in store?

What the finding does suggest is that, regardless of a brand’s investment in

Mental Availability, the quality of any brand’s Physical Availability is going to be

critical to winning First Purchases.

Is It All About Price Promotions?

We have found that price promotions are NOT a significant driver of First

Purchases for brands. It’s fair to say that “it’s complicated” and I will look at how

price promotions effect First Purchases next time, but generally speaking we

would advise that this isn’t a route to buyer growth. If you don’t like a brand, or

it’s not in your repertoire, are you going to buy it just because it’s cheaper today?

Secondary Display?

Conversely we have seen that secondary displays are a good driver of First

Purchases, generating a far higher proportion of First Purchases than the main

aisle. This is consistent with what we know about how shoppers shop a store,

often covering only a fraction of the total footprint. If the shopper doesn’t visit

the brand in store they won’t be buying it, so moving the brand to meet the

shopper at a secondary display increases the brands’ chance of being bought, and

often results in a First Purchase.

What Next?

This is an area ripe for further research and understanding. If new buyers are

“won” at the point of purchase it is essential that brands understand the

activities and initiatives that will (and won’t!) drive shoppers to make unplanned

First Purchases. And if it’s not price promotions, how should a brand convince

the shopper who hasn’t bought the brand before, and doesn’t plan to buy the

brand today, to buy the brand once they are in store?