Sequencing new flavors into the mix of pumpkin spice season indicates that brands are recognizing the perennial need to serve all customer preferences, especially those for surprise, while recognizing the fondness for nostalgia.
Maple pecan? Are they out of their gourd?
Some may be asking this of Starbucks, Dunkin’ Donuts and others that have embraced maple pecan as the latest flavor at the pinnacle of pumpkin spice season (Pumpkin Spice M&M’s, anyone?). But maple pecan is not necessarily a sign of seasonality gone mad. Rather, the sequencing of new flavors into the old simply indicates that brands recognize the perennial need to serve all customer preferences, especially those for surprise, while recognizing our fondness for nostalgia.
“People really do like [pumpkin spice], and they expect it in the fall, but I also think they’re getting tired of it,” Pat Cobe, an analyst at the food research firm Technomic, told The Chicago Tribune. “Everyone wants something new every season.”
However, the pertinent issue isn’t newness. It is whether these efforts retain customers and foster long-term engagement, which should be the aim of any marketing effort. The best measure of an initiative’s success is not the immediate return; it is post-event brand engagement.
Figures of pumpkin spice past
More broadly speaking, no specialty flavor guarantees year-round loyalty. However, by expanding their menus of limited-time products, Starbucks and others do widen their seasonal nets to capture a broader consumer base, which increases the chances of longer-term customer conversions.
This is especially important as consumers expand their palates. Spending on curries, chili peppers and other seasonings by food establishments has risen 7 percent since 2016, according to market researcher NPD Group. The number of national food chains adding maple pecan products to their menus rose to 14 this fall from four in 2016, according to food researcher Datassential. Limited-time offers of pumpkin spice products, meanwhile, are down to 14 this year, from 17 in 2016.
The challenge for merchants will be extending the limited-offer experience from a one-time indulgence to routine purchases. For example, separate research by the NPD Group revealed that many pumpkin spice latte buyers (not Starbucks-specific) consider the purchase an extravagance.
Almost three-quarters of pumpkin spice latte purchasers (72 percent) bought just one in 2014. Roughly 20 percent purchased the drink twice, and only 8 percent bought three or more during the offer period. (Starbucks introduced pumpkin spice lattes in 2003.)
However, those who purchased the lattes also had larger checks, often because they bought food items. This indicates that seasonal products do expose infrequent visitors to other menu items. The average check for pumpkin spice latte buyers was $7.81 in the fall and winter of 2014, while those who did not buy the drink spent an average of $6.67, according to NPD.
Rewards also go long, seasonally
Similarly, merchants have used short-term reward-program promotions to support longer-term shopper engagement.
Through multiple short-term loyalty programs, retailers have turned casual shoppers into loyal shoppers and increased long-term sales and market share. Research into limited-time reward programs, conducted in partnership with international loyalty marketing firm BrandLoyalty, shows retailers recorded an 8.8% increase in sales, on average, during the final eight weeks of the events. Four weeks after the events, they recorded a 1.3% sales increase, indicating a change in shopping behavior.
The key to their effectiveness is in creating an integrated calendar, possibly tied to special events such as movie premieres, that gives the consumer a continuous feeling of satisfaction, highlighted by an element of surprise and delight.
Turning seasonal to perennial in 3 steps
Whether the limited-time event is tied to a flavor or a marketing event, its success is determined by the continued frequency of the customer. The following steps should help ensure that those who visit for a maple pecan latte or doughnut today return through to the spring and beyond.
1. Inspire behaviors that serve a perennial goal. For most retailers, the goal of any promotion is topline sales growth. That’s a short-term objective, though, and its sustainability depends on the shopper behaviors the promotion encourages. The brand should first establish a better-defined goal and then consider the behaviors necessary to achieve it. If the goal of the promotion is to retain existing customers while gaining new ones, for example, the brand may seek to encourage positive word-of-mouth. Then, rather than emphasizing the short-term availability of the product, which gives it a special-occasion aura, the brand can position it as the gateway to a year of wonderful experiences.
2. Add spice with long-term incentives. Starbucks is especially adept at using its rewards program to encourage year-round purchases. The same tactic can be applied, with greater focus, to seasonal products. If a brand systematically increases the percentage off a future product with each purchase of the specialty item (10 percent for one purchase, 20 percent for two purchases, and so on) there is a better chance the shopper will return — and those chances improve with each subsequent visit. By the time the limited-offer product is out of rotation, the shopper might crave other items on the menu, and a pattern can be established. Importantly, that seasonal spending data can inform promotions in the following year — though it is essential the brand knows when to use the incentive in order to motivate the right customer behaviors.
3. Go for the combo. Once a defined goal is set and the promotions are aligned, the brand should view the full event as a customer-engagement platform. Sure, maple pecan or pumpkin spice may be available for just a part of the year, but their contribution should have a lasting impression on both company operations and the customer. Insights from the limited-time promotion (including insights from one-to-one consumer surveys) could serve to optimize investments in future promotions. Events of the summer can gradually ramp the shopper up to the fall, and insights from those summer promotions can establish a more complete view of the customer. Promotional partnerships with third-party brands, from Uber to day spas, answer more shopper needs while further rounding out shopper understanding.
Successful brands know that long-term loyalty cannot be achieved with flavor-of-the-month campaigns. However, variety is an important ingredient to maintaining interest. Retaining that relevance means staying top of mind even after the last pumpkin spice latte sale has been carved into the books.
Originally posted on Forbes