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2012 Shopper Experience Study Presentation for Post

2012 Shopper Experience Study Presentation for Post

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2012 Shopper Study Overview Retail Without Boundaries

©2012, Cognizant

Study Summary

| ©2012, Cognizant

Our third annual, 2012 Shopper Experience Study respondents reflect the typical mix of retail shoppers
4,000 Shoppers Around the World
Respondent Geography Respondent Income Group
US Canada UK Australia Hong Kong China

Low Income Middle Income High Income

Respondent Age Group
18-33 34-45 46-64 65 and over

Respondent Gender

Male Female

| ©2012, Cognizant

On-line survey conducted April 12 – April 22, 2012

Cognizant .Retailers must devise their shopper experience strategies based on the shoppers they serve ONE size does NOT fit all 3 | ©2012.

Cognizant . | ©2012.Retail without Boundaries is about knocking down the walls.

anywhere and through any channel.Shoppers love to shop anytime. Cognizant Price Product “Showrooming” (browsing in a store and then purchasing online through a smart phone. but especially at stores occur in stores and the most influential factors are: 4 out of 5puchases 1 #2 # 5 | ©2012. tablet or PC) is the number one risk facing retailers today. The key to winning with shoppers today is to enable “Retail without Boundaries”. .

Cognizant .Shoppers have high expectations for in-store execution “How much do you dislike each of the following when shopping in a store for products?” Some of the highest scores across the study are related to how much customers dislike when stores fall short on execution. | ©2012.

retailers must create digital experiences that both support in-store purchases as well as digital commerce. | ©2012. “What percentage of your annual purchases for each of the following types of goods do you make through the following channels?” Although the lion share of sales still take place in stores.Sales in digital channels are growing— varied by category—and influencing in-store sales. Cognizant .

Cognizant .Higher income shoppers are most inclined to use digital channels % of Purchases by Channel 100% 80% 60% 40% 20% 0% Lower Income Middle Income Higher Income In-Store Online Mobile Other In-Store Online Mobile Other 70% 60% 50% 40% 30% 20% 10% 0% % of Purchases by Channel Split by Type of Product for High Income Shoppers The highest income shoppers are more likely to use digital channels They are most likely to use digital channels for the purchase of specialty products 8 | ©2012.

6 3. Cognizant .The basics for creating digital experiences that shoppers want are similar to stores “How much do you dislike each of the following experiences when shopping online?” Cannont return the product to a store Payment method you like is not available Too many steps or too much information is required to check out 3.8 3.8 4.4 4.9 1 2 3 4 5 The shipping options you prefer are not available No order online and pick-up in store Online price or promotions/discounts are different from what's available in-store Purchase price not communicated clearly or early enough Ability to compare different products is not available The product information you need is not available You can't find the product you want using the website's search engine navigation Shoppers increasingly expect online and in-store experiences to be consistent.1 3.7 3.0 3.3 3.0 3. | ©2012.

Cognizant .Key Shopper Study Themes 10 | ©2012.

There are four themes essential to becoming a retailer without boundaries Showrooming can be a retailer’s “frenemy” Are you keeping up with the Jones' or investing in the future? Retail Without Boundaries How personal can you get without being creepy? Store associates are a retailer’s brand ambassador… for better or worse 11 | ©2012. Cognizant .

With the right shopper strategy showrooming can become your “frenemy” Differentiated Experiences Showrooming Jones’? Retail without Boundari es Associat es Personal ization Customer Service Product. Cognizant . Promotion Location 12 | ©2012. Price.

they rank return processing higher (#3) and compelling loyalty programs lower (#8). Right product selection Customer Service (quality/access) Fast. etc.Factors that influence purchase decisions are consistent across segments and channels The top five influencers of in-store purchase decisions are unanimously agreed upon by all shopper segments: Rank Order 1 2 3 4 5 Competitive price. Cognizant . promos. However. easy check-out Compelling loyalty program Online shoppers value the same retail fundamentals. 13 | ©2012.

How purchase decisions are being influenced is changing and varies based on product type “In a typical month. how often do you use the following resources to help you make informed purchase decisions of products in the following category(s)?” TV is continuing to lose ground Significant differences between specialty and consumables for traditional resources Mobile and tablet are still nascent Specialty product purchases are more influenced by digital experiences | ©2012. Cognizant .

inventory and ordering 10% . The two essential elements to combat the risk of showrooming is to match prices and provide exceptional customer service.The best way to stop showrooming is to give shoppers what they want. Of shoppers want store associates to be more available in the aisles 15 | ©2012. Of shoppers want store associates to match prices 29% 35% Of shoppers want store associates to have better customer service skills Equipping store associates with mobile technologies is the second line of defense. Cognizant 14% Of shoppers want store associates to have real-time access to product information.

Shoppers are most interested in member discounts (e. men are more interested in some of the newer mobile and social retail experiences. how important it is for you that your favorite stores work with the following types of partners to provide you with better experiences. These trends are consistent with 2011. Beyond the Rack and Ideeli) closely followed by group buying sites (e. Groupon and Living Social). 16 | ©2012. more products.3 1 2 3 4 5 Female Male Geo Location Member Discount Group Buying / Deals Social Networking/Media Surprisingly.0 2.g. or more specials/promotions?” Product Comparison Smartphone App 2. Cognizant .g.5 2.5 2.Experimenting with new shopper experiences will endear shoppers and differentiate retailers “For the product category(s) shown below.2 2.3 2.7 2.8 2.7 2.1 2.

Cognizant .Store associates are a retailer’s brand ambassador… for better or worse Showrooming Jones’? Retail without Boundari es Associat es Personal ization Help with purchase decisions Help find product “Go to” person for issues 17 | ©2012.

Shoppers rely predominantly on traditional resources to help with purchase decisions. Age 18-33 13 % 16 % 18 % 18 25 % % 10 % Age 34-45 9% 9% 12 % 19 % Age 46-64 7% 22 % 9% Age 65 and over 5% 20% 27% 33% 8% 7% 23 28 % % 9% 23 30 % % 18 | ©2012. excluding store associates Resources Used to Help with Purchase Decisions Digital Resources Product Packaging Store Associates Word-of-Mouth Store Signs Traditional Advertising 19% 11% 10% 13% 22% 25% Store associates is the only traditional resource that ranks very low across all segments as a preferred resource to help with purchase decisions. Cognizant .

Cognizant .When shoppers can’t find what they want. Ask an associate to help you locate the right item 65 and over 20% 6% 5% 46-64 34-45 18-33 0% 20% 40% 60% 80% 19 | ©2012. most likely they’ll look elsewhere What do you do when you can't find what you want? Leave the store and look for the same product elsewhere 9% Leave the store and look for the same product during a future visit 49% Ask an associate to help you locate the right item Purchase an alternative item available in that store 11% Use your mobile phone to identify the product elsewhere At first glance. it’s affirming that nearly 50% of shoppers ask for help when they can’t find what they’re looking for…on the other hand more than 25% buy the product elsewhere--13% of 1833 year olds use their mobile phones to do so.

“When you have a problem while shopping in a store (e. out of stocks.g. Cognizant . poor customer service. product availability.) indicate whether you are unlikely to report it. retailers might never know about it.” 65 and over 11% 46-64 10% Younger shoppers are unlikely to report store issues 34-45 13% 18-33 21% 0% 5% 10% 15% 20% 25% 20 | ©2012.When shoppers have a problem. etc.

g. Younger shoppers especially are increasingly gravitating toward digital channels (e. Cognizant .50 In-store associates are the most likely resource for shoppers to seek when they need help.00 0. “When you need assistance while shopping.00 2.When shoppers do seek help. social media. mobile text and chat) for help Social media page Go to in-store customer service desk 18-33 34-45 46-64 Online chat Mobile text message 65 and over Mobile chat Video chat 21 | ©2012.50 1.50 3. nothing beats a live person.00 1.50 2. how likely are you to use the following customer service options?” Call customer service # 4.00 3.

Cognizant Personalized in-store experiences .Showrooming How personal can you get without being creepy? Jones’? Retail without Boundari es Associat es Personal ization #1 22 | ©2012.Versus - Resistant to sharing personal information .

preferences customized based on past purchases or status etc. promotions.g. #1 23 | ©2012.Personalization is a proven tactic to increase shopper engagement. Personalized in-store experiences (e. Cognizant offers.) was ranked the most desired feature by shoppers in North America .

76 2. how much would each of the following techniques to personalize your shopping experience influence your shopping choices.00 2.00 3.00 Special treatment in the store based on loyalty Offers delivered in a store that are personalized Acknowledgement of status as a highly valued customer while in the store Website recommendations based on other products you searched for E-mails with personalized messages Website recommendations based on products others have searched for Personal greeting in the store Offers delivered via a mobile phone that are personalized 2.Above all. Cognizant .26 2.88 2.17 3.00 5. 24 | ©2012.91 2. “When shopping for specialty products.72 The top three personalization techniques that will influence shoppers’ choices are about enhancing the in-store experience.00 3. shoppers want to be recognized and uniquely appreciated while in stores.44 3. if available?” 1.15 4.

25 | ©2012.00 0. e-mail for website account E-mail collected at point of sale Phone number collected at point of sale Have cookies placed on your computer to allow tracking Locations you are at tracked using geo location service on your phone Information tracked by credit card number 1. address.69 2.26 Shoppers are especially resistant to sharing information when it is tied to their personal property Although shoppers want personal experiences.83 1.50 4.50 3.50 5.89 “How willing are you to share the following information with stores in order to have a more personalized shopping experience?” 0.00 2.50 2.50 1. they have boundaries around how much information they’re willing to share in exchange for those experiences.82 2.00 3. Highest income shoppers are most willing to share information where as older shoppers are least likely.60 2.86 1.Shoppers are skeptical about sharing information Information tracked by loyalty number Name. Cognizant .00 4.00 2.00 1.

Are you keeping up with the Jones' or investing in the future? Retailer mobile and tablet apps are the least favored resources Showrooming Jones’? Retail without Boundari es Associat es In APAC social media is a leading influencer of purchase decisions Personal ization Digital assets as an enterprise resource is the next frontier 26 Everyone LOVES Facebook | ©2012. Cognizant .

Cognizant Retailer mobile and tablet apps are the least favored resources .5 2.0 0.5 - 1st 2nd 3rd 4th 5th 6th 7th 8th 9th 10th 11th Store’s mobile smartphone app Consumables Specialty Store’s tablet 27 | ©2012.Shoppers go to digital resources first when shopping for specialty products. Rank order of resources used to make purchase decisions for specialty products Other Internet searches and websites Store’s website Print materials Information provided on product packaging Television Shelf signs or interactive product displays Friends and family Store associates Social media Store’s mobile smartphone app Store’s tablet Other Internet searches and websites Store’s website 3.0 2.0 1.5 1. Retailers’ investments in mobile phone and tablet apps aren’t paying off…yet.

5 1 0.5 0 China Hong Kong North America Australia U. there’s every evidence that the influence of social will only grow in North America.5 2 1.5 0 China Hong Kong North America Comments aboutOther customers’ online ratings the product on social media and reviews sites (e.5 1 0.g. Facebook) Australia U.5 4 3. Although North American Shopper’s social influence lags APAC.5 3 2.5 4 3. yet shoppers in APAC are ready. 28 | ©2012. Pay Pal and Bill Digital Wallet Me Later via a Personal Mobile Device Mobile payment ranks dead last by a large margin for shoppers in North America. Cognizant . 5 4.5 2 1.K.K.5 3 2.Many digital trends are moving east to west--APAC has become an indicator of where to invest 5 4.

6 3.9 2. 3. If retailers can cleanse their online data and extend it for use in stores. on mobile devices and in the store All Shoppers Shoppers Age 18-34 Poor quality information is the leading dissatisfier for online shoppers.4 3.3 3.2 3.1 3 2.Leveraging digital assets in stores is the next frontier Although cross channel integration and interactive experiences are not yet demanded by shoppers.7 Interactive experiences (e.g. customers will respond to them—especially those who are ages 18-45.8 2. Cognizant Unclear Information Cannot Find Product Undesirabel Policies Difficult to Purchase Lack Cross Channel Integration Lack advanced Web Features 1 2 3 4 5 6 29 . digital kiosks or signs.5 3. they’ll be two steps ahead | ©2012. interactive product displays) Consistent experiences and information on websites.

8 2. more products.1 3.4 3.9 3. especially Facebook It is important for shoppers’ favorite stores to have a presence on social networking sites to provide better experiences. and specials/promotions Other MySpace Blogs Pinterest Twitter Facebook 1 2 3 4 2. not shop on social site. Cognizant Rank Order 1 2 3 4 5 6 7 .2 3.8 3.Shoppers expect retailers to extend their brands through social media.2 Specialty Consumables Facebook is the only technology driven retail experience where shoppers age 65 and over expressed a strong interest 4. Exclusive promotions/sales New products sneak peak Feedback on products Customer Service Fun. interactive experiences Social responsibility Make a purchase 30 | ©2012.4 3.0 2.1 3.1 4.2 5 Shoppers want to engage with their favorite brands via social media.

com to request a customized briefing of the Shopper Study results or a copy of the detailed global shopper research results. 31 | ©2012.cosby@cognizant.Thank You Please contact Rachel Cosby at rachel. Cognizant .

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