Consumer shopping habits
Key future trends
"Euphoric shopping" is the key to reinventing marketing and branding targeted strategies to engage the consumer in today's increasingly complex retail environment, according to James Murphy, CEO Rainey Kelly Campbell Roalfe/Y&R.
The buzzword in today's social climate is "mobility", with consumers responding to a rise in retail formats and a rise of internet retailers online, which in turn are driving the sea change, pointing determinedly to changes in the retail experience.
Experiential shopping is still driving consumer behaviour according to Rodney Fitch, chairman of retail design agency Fitch, who said: "There is a common theme, the business of shopping needs to provide an experience."
He also highlighted how the tectonic plates of world retailing are shifting: mature v emerging markets are driving factors of the future for retailers.
Consumers want experiential shopping, it makes it more exciting. Shopping is a hobby now that we have the internet, which is "as dull as it gets" according to UK retail research agency Echochamber, who says "there's no magic online" and the future of shopping needs to be: How are retailers going to bring back the magic to shopping?
Keep it real
Customers need to be engaged in retail but they crave reality, so a store environment needs to be real.
Look at the Samsung brand experience in New York. The space in the Time Warner Center sold nothing and was just a "commune" where there was "no shopping, only loitering", according to the New York Times. But according to Samsung, it hugely increased consumers' propensity to buy Samsung product. Other examples of this are Maytag where the store is theatre or Wholefoods - more retail theatre for its rich offer of colour and texture.
Shopping is social
Ultimately people like shopping because it's a place to interact, it's a social pursuit.
Examples such as Apple - an "immersive club" - or American Girl Place - a "club for tweens to connect with their history and one another" - both show how service is a key battleground.
Further service success stories can be seen from UK supermarket delivery service Ocado. Introducing one-hour slots for deliveries shows it really understands its customers' needs. The Geek Squad from Best Buy in the US is a great example of how far the company will go to please and help its customers, the promise of service is outstanding. Because of this, Best Buy's growth is 40% per annum.
Shopping is the purpose of life
The UK high street is getting its mojo back. People want to shop because they actually enjoy it and want to go out and shop, says Rainey Kelly Campbell Roalfe/Y&R's Murphy.
Plus, according to Echochamber, ultimately shopping is just a pastime. "People go into stores for something to do, to watch the world go by - simple really."
There is a common theme, according to Rodney Fitch, who declared: "The business of shopping needs to provide an experience". For example, at UK department store Selfridges the product takes second place to the experience in-store. Selfridges is arguably the earliest and best adopter of the trend for experience in-store and is constantly changing its events for this very purpose.
Fitch gave some further great examples of experience destination stores, such as Apple, Central Food Hall in Bangkok, Hypercity in India, Thanks Shop in Mumbai, Harvey Nichols and BP's new, Frank Gehry-designed, "Beyond Petroleum" filling station in LA for its outstanding design and approach to selling fuel.
Shopping is the purpose of life according to Fitch, who said: "Global shopping means size matters. The top five largest retailers in the world have a combined turnover that is the equivalent of $600bn more than entire economies of Sweden, Thailand and Kuwait."
Shopping is emotional and reflective of the big wellbeing trend, both in mature and emerging markets. People want to know "how to shop well", they enjoy it more than most things.
Tectonic plates of world retailing are shifting: mature v emerging markets
To compare mature and emerging markets is to consider shifting trends. Fitch headlined the following:
Mature v Emerging
Consolidation v Choice
Choice is key: in the future the largest retailer will be eBay instead of Wal-Mart. 50% of people expect to do all their shopping online now.
New formats will be increasingly important in the mature market, retail marketers should be tracking new concepts to drive innovation. While in emerging markets trained staff will be more important for known "globalised" retail concepts.
The proactive consumer is key for the mature market. Dramatically changing attitudes to brand engagement have transformed consumers' generosity, proven for participation. Look to the example of when the the iPod Nano launched and when, within the first few days of sales, faults emerged - reported widely on blogs and websites and in the media - it took Apple 19 days to respond, the company quickly learnt its lesson to respond more promptly. Participation by consumers is driving how companies operate and they can learn from their own consumers how to provide generosity.
In emerging markets such as India and China the youth market is a huge growth area for aspirational consumers. 50% of the population are under 21 in these countries, so the future focus has to be youth driven.
In mature markets brand equity is easily transferable, from the brand proprietor to retailer. But as retailers gain the trust of consumers through regular shopping, the balance of equity strength is shifting from branded products to retailers' own brands. In the US 40% of groceries sales are own label. Brands need to be more like retailers in order to gain trust.
Retailers talk about value, consumers talk about cheap product. For the consumer it's no longer smart to pay more than absolutely necessary. Blame this on the strength of own-label products.
In emerging markets local players are becoming more important than global brands - local retailers already have the trust of their consumers.