By Anastasia Lloyd-Wallis
Head of Insights, Retail Doctor Group
Let’s take a journey back in time to January 2020…
Tartan trousers and micro bags were the fashion choices, whilst sipping pink gin or Frose, streaming “Leaving Neverland” and the final series of “Game of Thrones”, TikTok and Twitch were the secrets of Gen Z unknown to the mainstream masses.
Fast forward a mere 12 months and the world has changed dramatically…
Leisure wear is now everyday wear, and a facemask is a necessity. Virtual wardrobes and makeup are now common occurrences. Zoom is a word in my 86–year–old grandma’s vocabulary, and everyone has a pet dog!
So much has changed in the world and in how we live our lives. Thus, we must assume that our retail customers have also changed dramatically. Retails must listen to their consumers and understand how their behaviours have changed. What do customers want from you?
From listening to our consumers, we can see there are 4 key areas that we expect to see to be of continued importance to them:
Time is the new currency. Consumers value time much more greatly, especially how they spend it and how they save it. Time that was once used on the commute to work is now enjoyed as family breakfast. Transactional purchases can now be automated or ordered online for next day delivery. We have seen this growth with the rise in Amazon Prime subscriptions (approximately 17% of the population are now Prime members, a 7% increase from the prior year). RDG’s consumer sentiment study showed that 1 in 3 consumers have now used Click and Collect to save time, with 67% of consumers (75% of millennials) looking for their retailers to help them save time whilst shopping.
Staying in is the new going out. Avoiding crowds and keeping a distance is key. Hence, it is unsurprising that consumers are more educated on their purchases before they even leave their houses to reduce the time spent in-store. Over 80% of purchases are pre-researched online. This has been seen in the physical stores where consumers are visiting less frequently but average basket size has increased as consumers know what they want and have planned their retail visits.
Of every part of the consumer journey, consumers are emotional beings, not just numbers in a data file. They want a personal and human experience from the minute they connect with a retailer to purchasing the desired products. We have seen the rise of personalised products (exact shades of lipstick, monogrammed handbags right through to named Nutella), but customers are now looking for a curated experience. The loneliness of lockdown has led to a craving for human connections.
Building on Personalisation and Time saving, consumers are now looking for retail as an escape, an experience and a way to spend their time. During COVID, we have witnessed the rise of “Shoptimism” – small purchases to make oneself feel happy, and Experiential retail, in which the store is used as a means to engage customers in a branded journey and experience – think KitKat Chocolatery, Rebel Consumer Experience Store (RCX), giving consumers a reason to leave the house for something they cannot experience in the online world.
On the other end of the spectrum, Augmented reality retail is equally thriving. Retailers attempt to bring the retail experience into their customers’ homes, allowing them to try the products in a virtual world, test makeup on their skin in the comfort of their own home, try a sofa in their living room before purchasing, and even drive a new car without having to leave the house.
But one thing that has not changed is consumers’ personalities.
95% of consumer decision making is driven by their personalities:
- WHY they choose certain brands over others
- WHY they are influenced by certain marketing cues
- WHY they will enter a retail store
- WHY they will be driven to purchase a particular product or service
These decisions all happen in the subconscious mind, below the radar of our rational brain.
By understanding our consumers on a subconscious level, we can begin to predict their future behaviours; their “WHY” layers this knowledge with frequent insights into current consumer trends, allowing us to create a fuller picture of WHO our consumers are, WHY they shop with us, and WHAT we can expect from them in the future.