Pinterest? Smartphone application? Retailer website? Google? Brand site? With so many choices, where does today’s path-to-purchase start? With shrinking marketing budgets, how can brands be sure that their marketing and trade dollars are spent on those touches that will put their product into the shopping cart?
Across the consumer categories in which we work, we’re most often asked to help brands and retailers figure out how to integrate digital into the path-to-purchase — employing the right strategies and making the right investments. Everyone wants to make sure that they aren’t just chasing the latest application or technology, but are also connecting in the right way and the right time with shoppers.
One of the first steps is getting both brands and retailers to accept some realities that will affect how they approach planning, investing and execution: The path-to-purchase as we once knew it has changed forever; current planning models are only scratching the surface; and the shopper controls the path.
The traditional path-to-purchase was an easy model to plan around. It worked because it addressed shopper needs at clearly delineated points along a linear journey — at home (planning), in-store (shopping) and usage (satisfaction).
However, as technology has evolved and been adopted widely in various forms, the path has changed. As Google, Amazon and Facebook entered our lives, the distinction between being a consumer or a shopper was erased. Today, shoppers are always on. They expect ready access to information, vast selection, the best deals and personalized forms of fulfillment.
Digital isn’t something people use some of the time; it’s used all the time. Increasingly, consumers are consuming technologies simultaneously — watching television, shopping and playing games across multiple screens. Shoppers move from browsing to buying in a click or swipe, rendering traditional models and approaches ineffective.
This isn’t to say that the traditional linear model hasn’t changed over time. It’s been modified and experts have developed more contemporary views. Most widely accepted, perhaps, is McKinsey’s “Consumer Decision” journey, which demonstrates how consumer and shopper empowerment has transformed passive consumers into active participants in their journeys in a continuous cycle with specific triggers driving behavior.
However, even this model has now become outdated. Technology adoption and penetration across shopping journey activities has accelerated, particularly as new generations of shoppers enter the market. So, what are shoppers doing and not doing?
Today’s Smarter Shoppers
Fundamentally, consumers shop differently. Our Digital Shopper Marketing (DSM) 3.0 study found that 68 percent of shoppers indicate they have changed their shopping behaviors as a result of technology — a lift of ten points from the prior year’s study.
Furthermore, 43 percent comparison shop — spending more time overall shopping, making decisions more quickly and purchasing brands that offer DSM technologies (all up an average of eight points versus the prior year’s study). Today’s shoppers know that they have control over what they choose to buy, where they buy and how much they pay.
For 58 percent of Americans, the process starts with basic search before making their purchase decision, according to Pew Internet & American Life. The GMA/Booz & Company Shopper Survey also found that 62 percent of shoppers search for deals before heading to the store.
While it’s expected that research takes place pre-shop, there has been a dramatic increase in researching at-shelf, as 52 percent of shoppers are using their mobile devices in-store to get help with those decisions, also according to Pew.
What can’t be ignored is that new concerns come with new technologies. Shoppers are more aware than ever of privacy issues. While using technologies makes shopping more personalized, convenient and productive, shoppers are also conscious of applications being used to store personal data or financial information (like mobile wallets).
Our 2012 mobile-wallet study found that roughly half of all shoppers range from either “somewhat concerned” to “very concerned” about privacy and security. That said, less than one-quarter (23%) are limiting their usage as a result, even amid well-publicized breaches involving Google, among others.
As shoppers become more adept at digital and understanding its potential, many have adopted technologies to best meet their individual needs. The fact is that shoppers are becoming sufficiently well versed in digital tools that they are finding ways to manage their shopping trips with them. A case in point is online circulars. A fairly low-fidelity digital solution, 48 percent of shoppers are using circulars to generate ideas and inspiration — beyond those who are using them to save time or money, according to our 2012 Shopper Lab study.
Self-checkout and in-store scanners (like Stop & Shop’s easyScan and iPhone application) are being used to make shopping more enjoyable (39%). Nearly three quarters (72%) of shoppers responding to our 2012 ShopperLab study indicated that they would even use Apple’s Siri personal assistant to help them shop!
Shopper selection and use of technology is purposeful; it’s driven by utility. For technologies that require new actions (e.g, check-in, or downloading an app to scan codes) shoppers need to be shown the personal return-on-investment before they adopt them into their routine.
Social media, as it relates to shopping and commerce, is a great example. Facebook has not been adopted as a useful tool by shoppers, whether for the brands they buy or stores they visit. While shoppers are aware of the Facebook pages, overall use is low by comparison, according to Comscore. This is largely because of general disinterest, a desire to keep personal information private or generally not seeing the value in “following.”
Retailers have certainly taken notice, with both JCPenney and Gamestop closing their Facebook stores because they were nothing more than additional channels for buying goods already available on existing sites. Even the most popular of the digital media darlings — QR codes, location-based check in and Twitter — lack adoption by shoppers (all down versus a year ago in our 2011 DSM 3.0 study).
From Chaos to the Cash Register
When shoppers are always on, the path starts where they want it to — whether consciously or subconsciously. To McKinsey’s credit, it’s more of a journey than a path. It’s completely non-linear and, in fact, one small difference in where shoppers start will produce completely different outcomes.
In scientific terms this is called the Chaos Theory, which Wikipedia defines as the study of “the behavior of dynamical systems that are highly sensitive to initial conditions.” The Chaos Theory inspires a new, more contemporary model for manufacturers and retailers, which we call P3, or the Personal Path-to-Purchase (see sidebar).
P3 recognizes that the shopper lives in an always-on state where success and failure reside entirely on the ability to deliver messages through experiences that are relevant and provide utility when shoppers intersect with them. That utility can serve any number of specific needs, but ultimately must be driven by insights that will inform the content, format and delivery, and assure that shoppers will embrace and gain value from them.
While it would seem that this makes planning impossible, this is not the case. Rather, the planning process must evolve. Many organizations are falling short by trying to force an outdated approach to brand, sales and shopper planning to deliver against contemporary audiences that have new expectations.
In terms of disciplines, digital needs to come out of the silo it’s been forced into and allow experiences to cut across the entire journey. It must link online and offline experiences through sometimes simple tools and tactics. These can range from social shares, mobile accessibility, presence in search, linking strategies to retailer and etailer sites and location-based content and support.
To make sure these elements are deployed properly, they need to be driven by two clearly defined strategies. First and foremost is the master brand or portfolio strategy, which helps define the overall brand architecture, essence, message and creative expression. That architecture then needs to be supported by a digital strategy that will delineate which tools from the digital toolbox (site, social, mobile, advertising, applications, search, etc.) will be used and for what purpose.
By connecting these two strategies, the infusion of digital can deliver total value and effectively move with shoppers across their journey.