As a retailer, deciding where to put your money isn’t always easy. What do you prioritize, and why? Bricks or clicks? Experience or convenience? Customization or personalization? New clients or existing ones? Artificial intelligence or virtual reality? The dilemmas are endless, and we’ve noticed that a lot of companies struggle with this decision-making process. So we developed a new framework with four “customer attitudes” to help retailers create the best shopping experience for every type of consumer.
Step into my shoes and let me take you on a familiar shopping journey (although I have to admit that this isn’t often my responsibility).
It’s 6 pm, I’m walking out of my last meeting, and my next assignment is to get food on the table ASAP. Do you recognize this? I head directly to my favorite supermarket, so I definitely don't waste time on that. Once I'm there, I have to face the daily struggle of choosing what to eat this evening. In case I don’t have any inspiration, I grab one of the supermarket’s magazines and choose a dish that’s proposed there. I find all the ingredients and finally push my full shopping cart towards the cashier, with my ‘fingers crossed’ in the hope of standing in the fastest queue.
In short, my shopping attitude is characterized by #needforspeed. I seek convenience and a shopping journey that addresses my intent to buy in the most frictionless way. Although my thinking or needs haven’t really changed, I recently started using Colruyt Collect & Go. I came into contact with this service via friends. Now I order groceries online and pick up one day later. Somebody at Colruyt prepares my order and when I arrive, I just have to pay and put the groceries in the trunk of my car. It takes me 5 minutes on average and is virtually queueless. So because of digitization and a different operational process at Colruyt, I have found a way to be served more conveniently when I’m chasing.
Later in this article, I’ll explain this ‘chasing attitude’ within a framework. But I don’t chase every time I go groceries shopping. For example, imagine me at the Sunday market buying fresh vegetables. I wouldn’t be chasing, but wandering. This means that the same action (groceries shopping) can originate from different attitudes. I’ll also get back to this later on.
In 2017, worldwide e-commerce sales amounted to $2.3 trillion and e-retail revenues are projected to grow to $4,1 trillion by 2020 (Statista). Compared to 2014, e-sales tripled globally. The US is taking the lead in online shopping penetration with 96% of citizens doing at least part of their purchasing through the web (omni-channel retail study, BigCommerce, 2017).
It’s safe to assume that there is a major shift going on from physical stores to online sales. But physical stores are fighting back. According to Fjord, 72% of shoppers say they like to touch and feel products before they buy (TimeTrade 2017). 50% of consumers say that the overall enjoyment of their experience is important in their decision to buy a product or service (Deloitte). More financial research shows 4-8% extra revenue growth for companies that excel at customer experience (Bain & Company). So the physical store is definitely not dead, as it can play a major role in boosting the experience of shopping.
If you take a look at the past, you'll see that the chasing attitude that I mentioned before has existed for a very long time. Our grandparents saw the evolution from growing their own vegetables to buying them in local shops. Eventually, we started buying groceries along with other miscellaneous items in supermarkets. This kind of transformation continues and has sped up because of the fast emergence of new technologies and digitization. Nowadays we see innovators like Amazon and HelloFresh reshaping the shopping experience by capitalizing this attitude. Amazon recently launched AmazonGO, a supermarket full of smart technology that tracks you while shopping and even enables cashierless check-outs. HelloFresh takes this process one step further: they bring a meal-kit with healthy food to your front door.
As mentioned before, customer habits are radically changing. Simultaneously, the arsenal of tools available to retailers is also evolving and growing. But based on our own research and numerous workshops with Belgian retail companies, we realized that the 'shopping attitudes’ underlying these habits seem to be timeless.
The customer’s will to make any effort during basic shopping is crumbling. A study has proven that 53% of customers will abandon an online purchase if they can’t find a quick answer to their questions (How AI Will Transform Customer Service Forrester, 2017). On the bright side, these frustrations are being eased by technology, as shown in another report: 70% of American millennials appreciate the use of artificial intelligence to show more interesting products/services (Frontierless Retail, JWT Intelligence, 2016).
Deliveroo spotted this customer ‘laziness’ and reacted with an upgraded delivery service for hungry millennials. This involves a simple ordering process, frictionless payment and checkout and fast delivery. In summary, Deliveroo’s strength lies in minimizing and smoothening all ‘boring’ tasks related to a purchase. No single customer likes these mandatory tasks, so if you make them as fast and easy as possible, you’ll win his/her heart (and wallet). Not only food-related companies focus on chasing customers: also think about Gucci, Primark, Action and Netflix. Fortunately, the future is bright: according to predictions made by the American retail prophet Doug Stephens, 40% of all future purchases won’t demand any human interaction at all. This means that in a few years, your coffee machine will order your favorite capsules and your fridge will replace the yogurt bottle you just consumed before you even realize you're out.
A customer with this attitude already has a defined image of what he wants to buy. In some cases these needs are translated into really specific solutions or products (e.g. a type of shoe). In other cases the customer trusts the retailer to choose for him, based on his preferences (e.g. HelloFresh). To make your company fit with this current chasing attitude, make sure you integrate end-to-end customer convenience in every stage of your product/service lifecycle.
Let’s jump immediately to an example. IKEA makes sure that customers apply a wandering attitude while visiting their shops (both online and offline). Their realistic showrooms help customers imagine their dream home. Even the kids are entertained while parents take all the time they need to shop for a new living room. Next to the offline experience, customers can find numerous interior ideas and tips from experts online. To ease the decision-making process and compel the wandering customers to buy, IKEA practices cheap prices, easily transportable packages and modular products. As a result, wandering customers can't find any reason to leave the shop without a new coffee table or trendy curtains.
Wandering is the attitude that results in consumers browsing through or examining a store's merchandise. It’s a form of leisure or external searching behavior that lacks a specific intent to buy or a defined buying criteria. Although there was no initial intent, this sort of recreational shopping often leads to a purchase. With an average of 5 hours per week spent shopping online, the effect companies can have during that time shouldn’t be underestimated either (Hosting facts: Internet Stats & Facts for 2017).
The way customers are treated at Suit Supply is a good example of the perfect retailer’s response within the considering customer framework. In-store, the Suit Supply assistant personally supports the customer to end up with a custom suit. Additionally, Suit Supply offers the possibility of personalizing your suit online, fast delivery and a free 30 days return policy. In brief, the customer is influenced by convenient interactions and services.
Considering customers don’t go home without a purchase. But their buying need isn’t (entirely) defined before they enter a shop either. So during the shopping process, they count on companies’ support and service. The results of an in-store shopping questionnaire strengthen this assumption: 43% of shoppers take advantage of in-store promotions and 29% like the experience of having a personal assistant (TimeTrade 2017). This isn’t any different for online shopping.
Customers shopping within the belonging attitude identify are loyal to their favorite brands. Even without an intent to buy, they visit your physical stores frequently and scroll through your online assortment, in an effort to stay up to date with your products. They seek belonging and want to be associated with your brand. Belongers like to share and endorse, both on- and offline.
To leverage the belonging attitude, companies should turn customers into fans or ambassadors (towards friends and/or networks).
An interesting example of addressing this attitude is Minimums. This curation platform influences customers based on the powerful trend of user-generated content. According to TINT (the 2018 User Generated Content Marketing Report), 92% of consumers are more likely to trust recommendations from friends than branded content. Minimums displays branded content which is curated in a personal way: influencers create a list of their “most interesting possessions” which visitors can buy directly through webshops. In other words, ‘authentic’ content connects webshops with the customers’ love for the people he/she identifies with. It’s a way to boost revenue with user-generated content by using them as a retail channel.
Hopefully the sky in retail land has become less foggy by now. Use it to create an overview of your competitor’s initiatives and the shopping attitudes they focus on. Find the best target for your business and discover how to create the shopping experience your customer has been waiting for.
Step 1 - Your competitors
Plot competitors' initiatives, new players and/or hero brands that you could learn from.
Step 2 - Your company
List current challenges your company is facing and reformulate them into opportunities.
Step 3 - How Might We (HMW)
Reframe previous insight statements into HMW questions to trigger innovative thinking.
Step 4 - Ideation
Use your set of HMW questions to trigger ideas about a better shopping experience.
Step 5 - Next steps
Use dot-voting to create a heatmap & prioritize your next steps.