alan treadgold. the multi-channel shopper and the new engagement landscape for retailers and brands
TRANSCRIPT
The Multi-Channel Shopper and the new engagement landscape for retailers and brands
Dr Alan TreadgoldGlobal Head of Retail StrategyLeo Burnett Group
16th International Food Business Russia SummitMoscow, February 2011
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Multi-channel shopping: The defining theme for retailers and brands
Understanding the Multichannelshopper: Our key questions• Who is the multichannel shopper?
• Is there a “psyche” to multichannel shopping?
• What are the motivations (or barriers) to multichannel shopping?
• Are there different kinds of multichannel shoppers?
• What purpose do different channels serve?
• How do multichannel shoppers shop different product categories?
Our Research in Russia13markets
12 •Skin Care•Laundry detergent•OTC Medicine•Tobacco•Hard Liquor•Beer
categories
685respondents
10channels
•Carbonated soft drink•Chocolate bars•Electronics•Mobile phone hardware•Automobiles•Designer clothes
• Moscow• St. Petersburg• Novosibirsk• Nizhny
Novgorod• Ekaterinburg• Samara• Omsk
• Kazan• Chelyabinsk• Rostov-na-Donu• Ufa• Volgograd• Perm
•Store•Web•Mail order catalogue•TV (infomercials, home shopping channels) •Land line telephone
•Mobile phone•In-home parties and door-to-door sales•Magazines•Direct mail•Store produced newspapers, flyers, circulars
The Headlines
A highly engaged shopper…
86% of respondents use more than one shopping channel when shopping a category
Across the 12 product categories, the average shopper uses 5.2 channels to shop
Multichannel shoppers spend a lot of time shopping
30
52
0102030405060
Light
Heavy22
200
0
50
100
150
200
250
Light
Heavy
Minutes Hours
*Note: Heavy multi channels shoppers defined as the heaviest 25% of shoppers within a category, Light MCS defined as the bottom 25% in a category
Time Spent Shopping for:Packaged Goods Durables
They use all channels –but online dominates
0
10
20
30
40
50
60
Light Multichannel Shoppers Heavy Multichannel Shoppers
CIRCULAR
MAGAZINE
IN‐HOME PARTY
MOBILE PHONE
LANDLINE TELEPHONE
INFOMERCIAL
MAIL/CATALOG
ONLINE
IN‐STORE
0
50
100
150
200
250
Light Multichannel Shoppers Heavy Multichannel Shoppers
Channels used when shopping for:
CPGs (in mins) Durables (in hrs)MINUTES HOURS
30 HOURS
52 HOURS200 MINUTES
22 MINUTES
*Note: Heavy multi channels shoppers defined as the heaviest 25% of shoppers within a category, Light MCS defined as the bottom 25% in a category
While multichannel shoppers share some common traits,there are different types of
multichannel shoppers
The 6 Key drivers of multichannelshopping
Bargain Hunting
Habitual
PremiumLow Price
List Driven
Exploratory
Profiling the Multi-channel shopper in Russia
Bargain Hunting
Habitual
PremiumLow Price
List Driven
Exploratory
OpportunisticAdventurer11% / 95
EfficientSprinter8% / 121
StrategicSaver12% / 130
SavvyPassionista37% / 107
DollarDefaulter5% / 117
QualityDevotee27% / 80
Percent: Heavy Multichannel ShoppersIndex: Heavy Russian Multichannel Shoppers / Total Shoppers in Russia* Overall shopper archetypes are based on overall attitudes towards shopping
The multichannel shopper in Russia compared with ‘the West’ –more about style; less about saving money
Segment Name Western Russia Gap
Strategic Savers 29% 12% -17Opportunistic Adventurer 15% 11% -4Saavy Passionista 14% 37% +23Quality Devotee 16% 27% +11Efficient Sprinter 13% 8% -5Dollar Defaulter 13% 5% -8
Source: Leo Burnett / Arc multichannel shopper research 2009 & 2011
Why…are people multichannelshopping?
HIGH RISK
LOW RISK
LOW REWARD
HIGH REWARD
Perceptions of Risk and Reward explain levels of multichannel shopping
EG: Banking EG: Designer Clothing
EG: Household Basics EG: Books
*Note: Numeric % represents the percent of category shoppers shopping 3 or more channels
High Risk
Low Risk
Low Reward
High Reward
Electronics
89%
Designer Clothes
85%
Over The Counter Medications
63%
Carbonated Soft Drinks
51%
Candy
52%
Hard Liquor
57% Beer
63%Laundry
Detergent
70%
Smart Phones
92%
Automobiles
86%
Skin Care Products
94%
Entertainment
PassionBurden
Routine
Risk / Reward perceptions and the Russian Shopper
Quality Devotee
In Russia the presence of the different Shopper archetypes varies widely when viewed through the lens of the type of product being purchased
37
39
123
123
91
162
Consumer Package Goods Durables
Savvy Passionisita
Efficient Sprinter
Dollar Defaulter
Strategic Saver
Opportunistic Adventurer
Consumer Package GoodsSkin Care
Laundry detergentOTC Medicine
TobaccoHard Liquor
BeerCarbonated soft drink
Chocolate bars
DurablesElectronics
Mobile phone hardwareAutomobiles
Designer clothes
When are the different engagement channels being used in the shopping journey?
The experience in Russia – less focus on one or 2 engagement channels only
INDEX: Likelihood of using a channel in a phase
115
106
112
133
105
Trigger To Start Shopping
113
114
106
123LATE
Select. Buy
MIDDLEDefine criteria
Compare optionsSeek adviceExperience
EARLYAssess needs. Gather ideas.
Learn. Consider options
THROUGHOUTPROCESS
113
105
Example: The electronics ‘path to purchase’ in Russia
0.0
5.0
10.0
15.0
20.0
25.0
30.0
35.0
StoreWeb
Search Purchase
% o
f ele
ctro
nic
sho
pper
s
Beginning Early Middle Late End
20
Implications forRetailers and Brands
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Effectively engaging the multi-channel shopper requires 3 lenses of insight
CategoryThe most essential lens for understanding the
multichannel shopping is the category
ShopperWithin a category different shoppers
employ very different shopping strategies, or
“archetypes,” each with its distinct
motives
ChannelDepending on the category and the shopper, channels vary in their ability
to address different shopper needs
1 2
#1
A 360o approach is mandatory for effective shopper engagement
Mobile commerce will be the next key engagement platform for many
New SchoolConvenience:The whole world in yourhands
(50% of US shoppers will have a smartphone by Christmas 2011)
Retailers must re-imagine the role of their stores
“Multichannel defines the new landscape. Retailers are going to have to adapt and make sure they’re not disintermediated.”
Ian Cheshire – CEO, Kingfisher Group UKNRF Convention, NYC, 01/11
Re-imagining the role of the retail store - dial up experience, stimulation and ideation
Apple, NYC
Sainsbury’s: Inspirational food ideas instore
And finally...Strong brand ideas must be at the heart of winning in the multichannel landscape
What kind of retail experience do I want to offer?
What does the physical store experience need to be?
What is the compelling brand idea to bring the desired experience to life?
How should the brand idea be delivered across multiple channels?
The key questions
The kind of retail experience you want to offer
Optimise the physical stores to deliver the desired experience
Define the experience with a compelling brand idea
Use the brand idea to help determine how to deliver your brand across multiple channels
The store that makes shopping easy
Tesco: The brand idea is at the heart of their multichannel strategy
Thank YouAnd if you’d like to know more:Alan TreadgoldGlobal Head of Retail Strategy
Tel: +44 (0)7958 [email protected]
