The Coles vs Woolworths Collectables War – Marketing Campaigns for Customer Loyalty
The battle for customer loyalty has become a crucial part of marketing campaigns for rival businesses in Australia, particularly in the highly competitive world of supermarket grocery chains. The two biggest grocery rivals of course, Coles and Woolworths have been engaged in a ‘war’ for customer loyalty and retention, particularly with the launch of Coles phenomenally successful ‘Little Shop’ mini collectables last year, and more recently with Woolworths responding to the challenge with its own collectable range of Disney-based collectables called Disney Words.
According to consumer behaviour experts, the obsession with all things miniature typically begins around around the age of four years old, when children associate miniature items with ‘play time,’ first developing a nurturing instinct that stays with them well into adulthood. Indeed, it would appear that Coles tapped into a sense of nostalgia with these mini Little Shop items, with consumers associating the collectibles with a sense of nostalgic happiness, harking back to a carefree childhood of play-time and dolls houses. Hence, the phenomenon of adults being involved in ‘swap meets’ of Little Shop collectable items in their local neighbourhoods and Coles store and online. Due to the success of this campaign, Coles has recently followed up the Little Shop promotion with the new Stikeez fruit and vegetable collectable range, to much consumer frenzy. Indeed, recently, in the Gold Coast, one Little Shop Stikeez collectable enthusiast placed a rare ‘limited edition’ Golden Billie Banana (one of only 100 manufactured) on eBay, with a starting price of $10, only to attract a startling closing bid of over $20,000.
Despite many critics being sceptical of the Little Shop collectables campaign, due to environmental concerns over an over-abundance of plastic products in the environment, causing grocery chains to ban plastic shopping bags, in consumer behaviour therapy, collectable items are said to become special due to their symbolic value, importance and mood-changing qualities. Products develop symbolic value when they remind consumers of special people, events or places. Thus these prized objects, as part of a collection, undergo a transformation from the ordinary to the special. These collectable promotions work when consumers spend a certain amount to receive a ‘surprise gift’ collectable. The surprise means that the product is a mystery until the consumers receive it. In this situation, reinforcement theory is used to a spectacular effect, as the surprise provides the excitement for the consumer of receiving a ‘reward,’ thus encouraging repeat purchases. When the gifted collectable received by the consumer is unexpected, each surprise has the potential of creating such excitement for the consumer, that it has the potential of creating a ‘dopamine rush,’ a similar outcome in the situation of addictions, such as online shopping addictions.
A collection also can become a part of a consumer’s identity, with the concept of their ‘extended self.’ Here, collectables are a signal to other people about who the consumer is, and who they aspire to be. Hence, the collections can become an intricate part of a consumer’s life, and can be a comfort for them, even holding a sacred value. Indeed, savvy retailers have tapped into consumer behaviour and psychology, by understanding how collectables can become a major part of a consumer’s identity and life.
Before the phenomenon of Coles’ Little Shop, there was the 2017 Woolworths campaign of Marvel Heroes Superdiscs, with a folder, and small discs, feature Marvel comic characters. Prior to this, was Woolworths 2015 campaign, featuring Dominos, with characters from Disney Pixar. Of course, McDonald’s have been offering special collectable promotions for decades, with Happy Meals, featuring special licenced products, with many coinciding with newly released films. Many of these collectables can obtain vintage status, attracting extremely high bidding prices in auctions.
However, sometimes these promotional campaigns can cause a consumer backlash. For example, consumers criticised Woolworths, when they became frustrated at not being able to complete their Marvel disc collections. Woolworths were accused of making it near-impossible for consumers to complete their collection, by not manufacturing enough discs.
Nevertheless, overall, the collectable phenomenon looks set to continue well into the future. Last year, marketing research group Canstar Blue surveyed 3,000 Australians, aged 18-29, to discover the influence of collectable marketing promotions on consumer loyalty to particular supermarket chains. According to the survey, one in five respondents (21%) said that promotions such as Coles’ Little Shop and Woolworths’ Marvel Heroes Super Discs said they would spend more at a supermarket. Furthermore, 22% of respondents said these collectables do influence where they choose to shop.
Indeed, the Little Shop promotion created unprecedented excitement and engagement with many Australian consumers. People spend many thousands of dollars at supermarkets for essentials, but spend even than they normally would for these ‘freebies.’ Thus, for the supermarket chains, it’s a win-win, they receive consumer loyalty, and make consumers spend more than they usually would.
The Coles Little Shop marketing promotion campaign started in July of last year, and was extended until stocks lasted. Coles were giving one collectable for every $30 spent of groceries, with 30 miniature items of large named brands to collect. Consumers needed to spend at least $900 to collect all 30 miniature items. Little Shop collectable cases, and other items such as aprons, baskets and trolleys were also available for purchase. This helped to capture the imagination of consumers that would normally be loyal to another supermarket chain.
Apart from the ‘collectable war’ campaigns, supermarket chains also receive consumer loyalty with the ongoing loyalty reward programs such as Coles’ Flybuys and Woolworths Rewards. According to the Canstar Blue research survey, these reward programs influence around 58% of consumers on where they shop, with around 36% spending more on items because of these programs. Furthermore, 63% of consumers find these programs to offer value for money. Additionally, consumers who were participating in the Coles Little Shop campaign could buy a product from a brand that was included in the promotions, and scan their Flybuys card to go in the running to win a complete Little Shop set.
Indeed, overall, the Little Shop campaign was a defining victory for Coles, given that their overall market share was declining, against Woolworths, until the ingenious idea of these miniature collectables was introduced. Recently, with the introduction of Coles’s mini collectable fruit and vegetable range called Stikeez, partnering with the Healthy Kids Association, this campaign is already being referred to ‘Little Shop 2.0,’ creating similar consumer excitement.
However, more recently Woolworths has responded to the ‘collectable challenge,’ with its own range of miniature items, Disney Words. Consumers are given the opportunity to collect one of 36 tiles that feature characters from Disney movies, for every $30 spent on purchases at Woolworths. Characters from Frozen, Aladdin, and Toy Story have been printed on one side of a tile, and a symbol or letter on the other is featured, creating characters that can be used for word games. The promotion also offers a chance for consumers to win one of 10 trips for four people to California’s Disneyland Resort.
Time will tell if this promotion will create a buying frenzy comparable to the Little Shop phenomenon. Either way, it would appear that collectables would appear to be a marketing strategy for consumer loyalty that is here to stay!