03.21.2007

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Pulse Report

SHOPPER CARDS FOR A CONSUMER PERSPECTIVE

This Pulse Report documents how well consumer attitudes and behaviors align with industry intent and practice. Shopper Cards from a Consumer Perspective looks beyond transaction size and shopping frequency patterns to begin to unravel the mystery surrounding who holds the key to loyalty: the consumer or the retailer.

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For more Hartman Group articles on RETAIL EXPERIENCE, click here...

02.07.2007 Shopper Cards: Popular, Yes...But Special?"

11.15.2006 Simplicity at Retail"

07.19.2006 The Role of the Exit Experience"

10.27.2005 Retail Experience on the Front Lines"

08.25.2005 Costco vs. Wal-Mart: Getting Beyond Utility"

05.19.2005 The Myth of One-Stop Shopping"

05.12.2005 Building Community: the Lost Art of Hanging Out"

04.07.2005 Trader Joe's: Cracking the Code of Lifestyle Brands"

05.06.2004 Beware of Self-Checkout and RFIDs"

11.01.2002 Mom & Pop: What's in a Memory?"

08.02.2002 The ABCs of Experience"

07.26.2002 The Retailer as Brand"

06.28.2002 Experience, Expectation and the Shopping Trip"

04.26.2002 Sometimes an Experience is Just an Experience"

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Near Miss Retail Opportunities

Retailers have a picture in their minds of troubled consumers desperately in need of their help. Consumers, on the other hand, have a different perception of this relationship. They are not waiting for retailers to come to their aid and do not look to retailers for answers to their everyday problems. The disconnect between the two members of this relationship is not uncommon, and like any relationship it isn't something a big dose of communication and a little understanding can't fix.

The scenario according to retailers might look like this: a mother racing up and down the aisles of a grocery store, dragging along two screaming children as she frantically throws items into her cart, sweat beading off her forehead, her surroundings becoming a blur in her shopping frenzy...

While retailers may not be able to slow down time, provide a shoulder to lean on or a shelter in the storm, they can provide solutions to smaller scale problems as they relate to everyday shopping trips. Many are already attempting to offer consumers creative solutions within their retail spaces by combining services and providing opportunities for customers to multi-task while they shop. Others are trying to appeal to consumers' values and attempting to align their retail environments in a way that reflects this. Many of these retail attempts are not quite winners, and many are not exactly losers. While they fall short of consumer expectations, they are on the right track to providing consumers with appropriate solutions.

We've chosen a few retail examples to illustrate how some "near misses" can be converted into opportunities in the marketplace.

[Near Miss]: Retailers assembling or supporting communities.

In order to fulfill consumers' legitimate need to connect with others, retailers promote their services as an opportunity to accomplish a task and commune with others. Based on shopping behavior research, it is unlikely that the "socialize while you shop" retail strategy has legs. Retailers cannot dictate a sense of community. In fact, this strategy does not work as evidenced by the multitude of "paint your own pottery" shops that open...and close, shortly thereafter. Consumers don't seem to have a need for the services and opportunities that these stores offer. In this case, if a consumer has a need for pottery there are multiple channels to obtain ready-for-use items (e.g., department stores, home furnishing stores, etc.). More importantly, if a consumer wants to spend time with friends, there are multiple venues they are more likely to visit for the sake of socializing.

From our Shopper Insights study, we found that consumers have distinct motives when shopping. Shopping tends to be either "other-directed" or "self-directed" (for more go In-Depth). Other-directed occasions are those in which the shopper is focused on fulfilling others' needs - son, daughter, husband, wife. On these occasions they are tending to the family and feeling duty-oriented, responsible and nurturing. During self-directed shopping occasions the self is the focus and shopping is leisure-oriented, recreational and often social. Ethnographic research unearthed that it is unusual for both shopping orientations to occur on the same shopping trip.

[Potential Hit]: Allow consumers to create community
when and where they want it.

The key to successfully supporting consumer communities is to pair a stand-alone retail experience with opportunities for socializing and allow community building to naturally evolve. Bike shops serve as wonderful examples. They offer a stand-alone retail experience; providing bikes, bike parts, and bike repair services. Bike shops further support communities, and incidentally create store loyalty, by sponsoring bike teams or bike riding events, which then lead to successful social outlets. These social situations are successful because the retailer isn't in control, the consumer is, and the shop's primary purpose is always clear: fixing and selling bikes, through this experience they extend your role to becoming a lifestyle advocate.

When trying to meet consumer demands to do more with less time, we caution retailers to ensure several things:

• The retail experience can stand alone (e.g., in-store dining formats in specialty grocery stores such as Wegmans and Central Market that offer compelling, attractive prepared foods in comfortable settings).

• Acknowledge that social opportunities organically emerge through consumer efforts that are supported, not required or artificially constructed, by the retailer (e.g., think Pinkberry, the Los Angeles-based yogurt shop with lines literally around the block, evoking the kind of response in customers saying that they can't live without this brand).

• The "extra" experience must add the right kind of value. If it can't, then add value by providing another task solution rather than a diluted and unsatisfying social solution (e.g, every time you visit Costco there is some new cool thing that is just within your budget).

• The retail proposition must match the potential shopping occasion not the potential social occasion (e.g., here Apple stores rock - enough said).

[Near Miss]: Grocery store checkout lanes labeled "Family Friendly."

Consumers are looking for ways to align their purchasing dollars with their personal values and modern lifestyles. With this trend in mind, a recent visit to a major grocery store prompted some reflection with the addition of checkout lanes labeled family friendly." These lanes distinguish themselves from other checkout lanes by omitting gossip magazine displays that often exhibit cover imagery that is not suitable for "G-rated" audiences. A vast display of candy, however, was presented at children's eye level and within their reach. It appears that this retailer is attempting to support consumer values, in this case protecting children's innocence, but neglecting another, protecting children's health and wellness.

We asked several mothers what "family friendly" meant to them in the context of a grocery store checkout lane:

"The checkers like children and will be nice to them."
"The lane is dedicated only to families with children so we can checkout quicker."
"There would be no junk food or trash magazines."
"The checkout clerk might have toys for the kids to play with to keep them entertained."

[Potential Hit]: Talk to consumers and find out what "family friendly" means to them and implement it according to the consumer.

While we applaud retailers for supporting consumers and their values we caution them in their implementation. When attempting to be relevant to consumers and their values, it is important to know what their values are - not what you assume they could be or should be. In all likelihood they will be different from what you might think. It is also important to clearly communicate solutions and the customer they are aimed at. "Family friendly" is an ambiguous term that conjures up multiple meanings. By understanding your consumers, solutions can be developed that are both relevant and meaningful.

Shopping trips with kids in tow is often essential but always difficult. Shopping with children often decreases time for experimentation or gathering knowledge, and increases the distaste for unhealthy foods that entice children and frustrate parents. As one mother explained the meaning of "family friendly" to us:

"I love those little carts that some stores have for the kids...it keeps them so focused on driving that they don't pay any attention to what I'm putting in the cart. I wish all stores had them!"

Right on Target: Keep Consumers at the Center

Regardless of what types of solutions retailers are considering to maintain or enhance their relevance to consumers, retailers will see the most benefit in taking their direction for retail adjustments from consumers.

Whatever the retail proposition, we encourage retailers to consider consumers' needs and shopping behavior before presenting time saving solutions. It is important to ask consumers about what to improve in the shopping experience - make it easier, faster, make it meaningful, and interactive - and then provide solutions grounded in their answers. Attract customers by providing opportunity for more shopping occasions, rather than making your retail space occasion(s) specific. Shoppers are not likely to change their shopping behaviors, retail environments must change to suit consumer behavior. "If you build it, they will come...." does not always work in retail, but "If you support it, they will stay..." does.