For as long as I care to remember the adage that 70% of purchase decisions are made in-store has floated around in conversations and articles in the retail community and been used as a justification for investment in in-store shopper marketing activity.
In recent years there has been much conjecture over the 70% figure. So where does it come from?
Grocery shopping is a task based activity.
Often times we will walk into an aisle and play out a heuristic script which leads us to select the same product that we always have.
Searching for that product is a process of elimination guided by familiar signals such as the shape and colour of packaging.
In these circumstances, for a product attempting to build market share, disrupting this process and gaining a shopper’s attention is no mean feat.
When you ask people how much of a supermarket (how many aisles) they visit when they go shopping, a large proportion will tell you that they visit nearly all of it. In fact this is far from the truth. We know this from studying shopper behavior in supermarkets using CCTV video footage to monitor shopper traffic.
Although the growth in on-line sales is unquestionable, that’s not a reason for retailers or manufacturers to take their eye off the ball with Bricks & Mortar.
In the UK a mere 4.4% of grocery sales are on-line and the IGD predicts that this will rise to 8.9% by 2019. OK that’s strong growth but it still leaves over 90% of sales to be accounted for by physical stores. (more…)
Grocery retailing is undoubtedly a volume business where marginal changes in shopper behaviour can have a massive impact on the balance sheet.
To use an example, some five and a half billion litres of milk are sold in the UK each year with the top 5 grocery multiples accounting for nearly three quarters of this volume.
At a price of £0.75 a litre, Tesco as the UK’s largest retailer sells over £1bn worth of milk a year to the British people. As such increasing sales by just 1% would result in a revenue uplift of around £10m. (more…)
How do we look for things?
Chances are that if you are like me at some point you will have lost something such as your keys and have had to try and find them. You will have gone first to the most logical places such as the key hooks by the door or the counter top in the kitchen; but if your keys don’t show up there you’ll try elsewhere, working through a mental list of all the possible places that your keys might be. As the search goes on you’ll probably feel yourself getting more and more frustrated and possibly start thinking about how much time you are wasting and how you need to be moving on to do something else. But you don’t stop, you need your keys!
Looking for products in a supermarket is no different. (more…)
In his book Inside the Mind of the Shopper, US shopper insights pioneer Herb Sorensen states that “Shoppers only spend 20% of their time selecting purchases and 80% in transit” with the implication that retailers need to put products in the path of shoppers so they can spend less time walking and more time buying. This would certainly seem to be a valuable insight in as much as it makes a distinction between useful and wasted shopper time; however is this generalisation about time utilisation always true? (more…)
This great lecture by Beau Lotto on light and colour got me thinking…
Colour is important in telling us about our environment and the things in it.
Colour is a function of the wave length of the illumination, the transmittance of the space between our eye and the object and the reflectance of the object. Changing any one of these dimensions changes the colour we perceive.
Our brains adapt to changes in these dimensions so that we can continue to perceive objects as the quality of light changes, but this adaptation is not instantaneous.
This being the case let’s consider a retail environment. (more…)
As traditional media fragments then the retail coal face becomes ever more important in the battle of brands to capture the attention of consumers en-mass.
Little wonder then that shopper marketing and the research and insight which fuels it are becoming an increasingly significant element in many organisations marketing and communications mix.
But marketing to shoppers at this first moment of truth presents a unique set of challenges. (more…)