P&G takes shoppers to another world in war of the brands

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AMartian war machine, stainless steel and 5m tall, stands incongruously next to a multi-storey car park in the town of Weybridge, southern England.

It is the local authority’s homage to H.G. Wells’s futuristic War of the Worlds, in which Weybridge features.

Yards away, just as un-expectedly in a nondescript office block, lies another vision of a high-tech future: the Cave, Procter & Gamble’s latest salvo in the battle of the brands.

The virtual-reality Cave is a walk-in three-dimensional room where computer-generated imagery transports visitors to another, virtual world that they can walk through and explore.

P&G is using it to recreate, in every detail, the stores of UK retail customers such as Tesco, J. Sainsbury, Asda and Boots. Shoppers taken from the real thing to the virtual version can recognise it as their store immediately.

They can shop in the store, walk through it, stand in front of merchandising displays and “pick” products off the shelves, turning them round to read the ingredients or sell-by date, and “buying” them if they wish.

Such “cave technology” is used in the defence, oil, motor and construction industries, but this is the first time it is being used by a packaged goods company as a market research tool.

P&G marketers are using shoppers’ reactions in the Cave to test alternative store layouts, displays and packaging. They believe it will dramatically accelerate their pace of innovation and cut costs, while finding favour with their increasingly powerful retail customers.

Previously, says Gianni Ciserani, general manager for P&G in the UK and Ireland, if the group wanted to test an idea, it would have to persuade a retail customer to set up a pilot in a store. This could take months and cost thousands of pounds. Any further tests would add to the costs and the delays.

With the Cave, changes to shelf layouts, displays or product designs can be made in hours and tested and validated in days.

“In three months we have done work that would previously have taken us two years,” says Mr Ciserani.

P&G researchers have tested Cave research results against traditional real-life market research methods, and are satisfied its virtual simulations generate results robust enough to use. They are now working to remove remaining “reality” barriers.

Older shoppers were disconcerted bythe need to navigate the virtual store and “pick up” products with a mouse, so P&G is substituting a virtual shopping trolley and glove. It is working on adding in-store sounds and the virtual
presence of other shoppers.

P&G is using the Cave alongside other research tools, such as an internet-enabled focus group facility that lets marketers watch proceedings from anywhere in the world, and an eye-tracking sensor that captures what consumers look at when seeing, say, new packaging or web pages. Together, the tools mean marketers can generate, test and assess new ideas quickly with retailers.

The Cave could also help P&G steal a march on rival brand owners as they all fight to win retailer support for their marketing strategies. Hence, P&G marketers are handing the Cave over to “joint value creation” projects with retailers. The aim is to use joint shopper research to influence retailers’ strategies in ways that also benefit P&G brands.

“In the past, if you were dominant, were big and had scale, you could reduce your costs and demand higher prices for your product,” says Mr Ciserani.

Now, increasing retailer power means “the concept of a power game where the biggest one can impose his rules on the smaller one is over. With joint value creation, we still want to innovate, cut costs and stimulate shoppers to buy more. But the only way to do this is through collaboration”.

Since the Cave opened three months ago, P&G has initiated 18 projects with re­tailers, mostly in the beauty area where changes to the shopping environment create the biggest sales uplifts.

One retailer is already implementing different micro-layouts or “adjacencies” – placing products such as shampoo, sun care and skin care next to each in a different order.

Mr Ciserani says: “An indirect effect with the Cave is that it forces all the key players around the table to make the shopper central to the debate. Now, in our discussions with our retailers we are spending more time on the right goals.”

He plans to test the initiative in the UK for a year before rolling it out to other parts of P&G.

Joanne Denney-Finch, chief executive of the UK’s Institute of Grocery Distribution, expects similar initiatives from P&G’s rivals.

“There are so many different and varied ways that manufacturers and retailers can use this without actually spending thousands – and in some cases millions – of pounds,” she says.

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