Although we love and quite literally couldn’t survive without them, consumers can be a little fickle and hard to understand from time to time. Before determining a strategy to best reach your audience, you need to focus on their motivations while understanding their concerns in today’s market. Have you ever spent hours researching a product only to spend 2 minutes in a store to purchase it? – or conversely, spent hours in a store checking out a product only to buy online elsewhere? Ever check out products on the go via your smartphone? How about wait on purchasing something until it goes on sale? You may be guilty of the same consumer trends that are effecting your retailers’ stores lately. Below are four consumer behavior trends as of late and how brands and retailers can utilize one another to employ them to their advantage:
It may come as no surprise that E-commerce continues to steadily grow; however, this is not to say that brick-and-mortar retailers are going anywhere anytime fast. More than three quarters of retail transactions are still made in-store. Although customers are still going to their local retailers to purchase goods, often times the in-store experience has been reduced to purchasing transactions, with little engagement between brands and shoppers. The Internet offers a plethora of information at consumers’ fingertips and in the comfort of their own homes. People do their homework online before making a purchase, researching products and competitors. Getting customers to your store is half the battle; keeping them engaged while there is just as important.
It is important that your retailers recognize this trend and consider different ways of making the consumers’ experience at their stores more enjoyable and memorable. A way for brands to help retailers do this is to provide them with branded giveaways to be distributed in stores and make their visits unique ones. This also helps brands stand out from competing companies, while making shoppers happy. Everyone loves free stuff!
It has probably been some time since you owned a flip or sliding qwerty phone. This is because smartphones are becoming almost omnipresent in today’s information dependent world. People hop on their phones to read news, settle arguments, catch up with friends, but most importantly, check out products of interest and reviews of them. Despite the habits of smartphone use in conjunction with E-commerce’s significant increase in revenue stimulation, conversions to sales are very low comparatively on smartphones. People’s first introduction to a product could very well be on their phone as a result of the constant flow of information streaming into the device in their pocket, but most do not finalize a transaction on this medium. To put things into perspective, Jay Yanko, the managing principal of retail for Verizon Enterprise Solutions, said, “The mobile device is essentially becoming the mouse to the physical world.”
A great opportunity to reach consumers is through mobile local ads when they are already out and about. Many brands have already adopted this technique, as mobile ad spending is forecasted to grow from $11.4 billion in 2014 to an astonishing $30.3 billion by 2018. These mobile ads can hyperlocalize your retailers’ reach, as consumers near a retailer’s location will be presented with advertisements directing them to the retailer near-by.
Promotions and sales are no anomaly for retailers during the holidays. They help products fly off of the shelves during one of the busiest shopping times of the year. In Q4, retailers saw lower foot traffic than usual in their stores and were plagued with the burden of slashing their prices even lower in order to draw people in and keep up with other stores’ sales. Consumers are less willing to pay full price and simply expect the red sale sticker on an item before purchasing.
Brands can help retailers avoid this trend in consumer behavior by marketing themselves as must-have products, highlighting what distinguishes them from competitors. This means people will shell out on the sticker price for your product because they can’t get it anywhere else. It is unique to the market and therefore covetable. Every brand should challenge themselves to become innovators of their industry. As a brand, create marketing strategies that emphasize what differentiates you from the rest and educate your retailers on these strengths.
Showrooming is a phenomenon in which shoppers go to a store in order to check out merchandise in person, but then leave the store without purchasing anything and instead finish the transaction elsewhere online to save a few dollars. Often times retailers are beaten out by websites like Amazon.com that consumers expect to have the lowest prices. Our own, Ben Carcio, almost fell victim to the phenomenon, allured by the convenience of cutting transportation and time. Luckily, he went back to the store and was able to save even more money, helped by a great saleswoman, Beth.
In order to dissuade showrooming behavior and prevent drift, encourage your retailers to ensure that their online and in-store offerings are the same, at the same price points, and have a “lowest price guarantee” in order to assure customers that they are getting the best price possible. Brands can help retailers combat loss of sales due to showrooming on the brand’s main website by offering promotional coupons to be used in-store if a customer goes to a retailer location. Again, it is important to create a great in-store experience to ensure you are holding your customers’ attention and engaging them.
A different way to ensure that your retailers are closing sales after showing products is to reach the consumer using the same technology they may use to shop somewhere else. Utilizing mobile local ads is a great way of driving consumers back into your stores.
It is important to keep all of these consumer habits in mind when strategizing with your retailers. Customers do their research before making a purchase; some only go into brick-and-mortar stores to finalize a predetermined transaction. Often times people get their first introduction to a new product through their smart phones rather than traditional print, and are holding off on purchasing an item until it goes on sale. Frugality, coupled with ease of use, is also causing the behavior of showrooming to trend. Your retailers may want to combat this, but it would be beneficial for the overall success of you and your retailers to integrate innovative technology as part of your strategy. With the incorporation of heightened in-store customer experience, mobile local ads, distinguishing marketing efforts, and integrated online and in-store price transparency, brands and retailers can work together to adapt to consumer trends and increase revenue.