Shopping Isn’t Simple

Martin Wootton, RS Consulting

#MRSlive

Shopping isn’t simple any more…

…and neither is researching shoppers

Tonight’s agenda

The changing consumer

Why shopping isn’t simple

Shopping in the future

What this means for researchers

The changing consumer

Why shopping isn’t simple

Shopping in the future

What this means for researchers

An Aging Population

Today, 14% of Europe is aged over 65. In 2050, this will be 25% - almost double.

2013 2050

Source: World Health Organisation, European Region forecasts for 2010 – 2050.

More customers will be looking for: • Bigger buttons • Touch screen icons • Lighter weights • Larger, clearer labelling

Higher disposable incomes among over 65s

mean older shoppers will become more sought after…

… until pensions crises kick in from 2030

Early adopters = older customers??

• Median age across Europe increased from 35 in 1990 to 41 today.

• Continued rise expected, reaching a median of 45 by 2030.

• Average lifespan predicted to increase by 10 years between today and 2050

The Changing Household

• Sharp increase in the number of people living alone

• Slow growth in number of traditional family units

• Decline in the number of children living in the parental home

• Total number of households will increase, but average household size will decline.

Source: OECD 2011, “Doing Better for Families”

• The trend for social networking and mobile communications will increase as more people live alone

• Online sharing across different locations is

likely to rise – consumers will look for newer, more convenient ways to share photos, videos and messages

• Smaller family units will result in lower

disposable income per household – manufacturers and retailers will need to adapt pricing and store portfolios to reflect this ‘younger’ emerging market

• Turkey and Russia have the biggest proportion of young internet users (aged 15-24) in Europe

Source: Wall Street Journal (2013): http://blogs.wsj.com/tech-europe/2013/05/29/europe-tops-global-smartphone-penetration/

• Tablet ownership in Western Europe will quadruple by 2017 – from 14% today to 55% in 2017.

• Over 23 million people in the EU5 countries had a smartphone as well as a tablet as of December 2012 (7% of the population)

Source: Forrester (2013) http://thenextweb.com/eu/2013/04/10/forrester-adults-in-the-uk-spend-more-online-and-own-the-most-devices-out-of-any-eu5-country//

Smartphones and Tablets

Source: TechCrunch / Forrester http://techcrunch.com/2013/02/20/forrester-tablet-ownership-in-europe-to-rise-4x-in-5-years-55-of-regions-online-adults-will-own-one-by-2017-up-from-14-in-2012/screen-shot-2013-02-20-at-15-38-58/

Smartphones vs. Tablets

To what extent do you agree or disagree with the following statements? Average score out of 7, where 7=agree completely, 1=disagree completely

Sample size = 4,000+. Differences are statistically significant at 95% confidence interval

Attitudes to Technology

• Mobile devices will become the main platform for internet browsing – so web-enabled devices will become the norm, as will using them to research products

at home and in stores

• Product advice and recommendations will be driven by virtual correspondents (Facebook ‘friends’, virtual communities,

trusted bloggers etc.)

• QR codes and photo references will help shoppers keep track of their research

and become more savvy

• Mobile internet driving social media growth: Facebook and Twitter more likely to be accessed on mobile devices than on PCs or laptops

• Search and social becoming more intertwined: conversations will drive SEO, not just search terms

• More customers will get access to special deals by interacting with brands on Facebook – and potentially shopping via the site

Sources: We are Social,Forbes: http://www.slideshare.net/wearesocialsg/the-future-of-social-media-12-provocations

http://www.forbes.com/sites/jondube/2012/05/08/why-smartphones-are-the-future-of-social-networking/

Social Media and Shopping

Boom in technology ownership

The changing consumer

Why shopping isn’t simple

Shopping in the future

What this means for researchers

Did you initially have a budget in mind? Was the price more or less than initially expected?

Budget

Base = 11,000 consumers across Europe, 2013

Days and weeks of research can go out of the window once the customer visits the store…

Store experience often trumps

research

• Web, TV, Radio, Printed Media is no substitute for touching and trying out the product

Key points

• Around 50% of customers buying cameras and printers say they would have liked to spend (more) time touching and trying out the product

• Most customers make a decision within the first few seconds of trying out their device

The changing consumer

Why shopping isn’t simple

Shopping in the future

What this means for researchers

“The mobile phone – the digital wallet – will replace the physical wallet because it’s safer

and more convenient. Our vision for payments is you put everything in your physical wallet in the Cloud - your credit cards, cash, debit cards, loyalty cards…and access it safely and securely

from any internet-connected device.” John Donahoe, CEO of eBay

Digital Wallets

“Wherever the customer is, as soon as they say something about the Burberry brand… if you tweet something positive or negative, our

teams around the world can pick up on that and start having dialogue with you in real time.”

Angela Ahrends, CEO of Burberry

Merging the on-line experience with the in-store experience:

“Omni-channel” shopping

“The ability to customise everything from price, service, to the product itself will be fundamental … many brands will be concierge brands, catering to the individual based on an in depth knowledge of the exact preferences gathered from personal data. Technological advancements mean

that we are entering an age of mass customisation” Marketing Store report 2013

Me-tail: Greater personalisation

“Bricks-and-mortar stores will still have a presence, but mainly just to

let customers have a sensory experience -- touching and feeling items they can purchase remotely

and having them shipped.” Retail magnate Blake Nordstrom

reported in USA Today, April 2013

Stores will become showrooms: High Street to Try Street

Greater use of mobile apps for shopping

“Shoppers are increasingly using their devices and apps to shop online for lower prices and to manage the entire shopping experience on their mobile phones…The only

thing you can be really sure of is that your mobile phone, together with apps like RoboShopper or Amazon mobile,

will probably play a more and more important role” John Ford, Tech guru and futurologist, Dec 2012

Further into the future…

OCR (Optical Character Recognition)

T-Commerce

A.I. driving voice recognition on smart phones and tablets

3-D printing

iWatches, smart glasses… and contact lenses?

Physical interaction, instead of point-and-

click, Kinect-style

The changing consumer

Why shopping isn’t simple

Shopping in the future

What this means for researchers

• Unexpected moments in the customer journey can’t be accurately measured by surveys alone • Most realistic approach: observational qual with customers in the

process of buying a product

• Complexity of the customer journey means shoppers won’t reliably recall their activity…or the things that influenced them • Only accurate research will involve monitoring and measuring in real

time, or simulating parts of the journey virtually

• Fewer shopper surveys and more mining of big data

• Behavioural Economics will influence research more and more

• Research must slow down or sacrifice opportunities for real insight

• Embrace smartphones and tablets…carefully

• Trade-off methodologies must evolve or die

• High-grade video and audio capture is now essential

Any questions?