The development and evolution of digital shopping has already affected the way consumers are shopping for goods and services, and there is no sign of this letting up in 2014. A Capgemini report into digital shopping behaviour has made a comprehensive study of the way shoppers are behaving in both mature, and developing markets, with fascinating results.
The simplest, most effective way and to find out the way consumers are interacting, experiencing, and buying from brands in the purchase funnel is to ask them. Outsourcing technology consultancy Capgemini did exactly that, surveying a massive 18,000 consumers across 18 countries in both mature and developing markets in their Digital Shopper Relevancy Research Report 2014.
The report covers a wide range of topics, with key findings revealing: a decline in the influence of social media as a driver for purchase in developed markets; the growing number of digitally savvy consumers in high-growth developing markets; and how digital marketing initiatives can best incentivize in-store purchases.
Here are five key findings from the report.
1. Social Media In Decline As A Driver For Consumer Purchases
Social media shows a comparative decline since 2012. With retail stores experience a resurgence as mobiles and app incentives are integrated with offline and in-store experiences, fewer shoppers now expect the use of social media will change their shopping in the future.
2. Physical Stores Still Favored For Global Shoppers
Around the world, 72 percent of consumers still favor physical stores for point-of-sale purchase, for all categories except electronics, considering stores to be important or very important. This is slightly greater than the 67 percent of consumers who regard the Internet to be important or very important.
3. High-Growth Markets Extremely Digitally Savvy
Consumers in high-growth markets showed a considerably higher preference for digital technology and marketing. Consumers were much more receptive to marketing messages in many aspects of mobile, social media, and in-store technology, than any of the 13 developed markets included in the study.
4. Fashion Takes The Digital Initiative
The fashion industry has taken the digital marketing initiative, experiencing the highest level of online momentum with 9 percent growth. 61 percent of the 18,000 respondents indicated that they had shopped online for fashion items in the last six months.
5. The Future Use of Digital Channels
Increasingly, as mobile and app usage grows, and in-store retail becomes more integrated with digital marketing incentives, shoppers will expect more flexibility in their shopping experiences.
Digital technologies are going to play a major role in the future of consumer shopping. Consumers will expect rewards for their loyalty and recommendations, just as they expect and wait for incentives before pulling the trigger on purchasing decisions. A challenge for retailers will be to integrate online and offline marketing funnels, and streamline in-store retail with wider digital marketing efforts.
7 Digital Shopping Personas — Rise Of The ‘True Digital Shopper’
An important aspect of the report is in how it distinguishes shoppers in different territories. The study identified seven shopping personas in total, segmented by mature and developing markets:
In mature markets, the largest majority of consumers (41 percent) are “socially-engaged digital shoppers,” or those who engage with brands on social media and are happy to provide personal data to retailers. However there is a suggestion in the study that shoppers in this group progress to being “true digital shoppers” (which now numbers as high as 19 percent in mature markets), those who readily use mobiles, and apps to get the best deals on digital or in-store shopping purchases, and are able to compare products, track delivery, and form long-term relationships with the brands they like.
High-growth markets such as Brazil, China, India, Mexico, and Russia, have an even greater levels of digital engagement, with a massive 77 percent of shoppers falling into either “interactive digital shopper,” “or technophile digital shopper” personas, both of whom have embraced digital technology, messaging, and incentives as part of their overall shopping experiences.
6 Takeaways for Brands from Capgemini’s Report
Capgemeni’s report highlights some key takeaways for consumer facing brands, in order to inform and develop strategies that can adapt to the evolution of digital shopping behavior:
- Change from a product- or feature-focused approach, to a consumer- and shopper-focused approach across all channels.
- Global companies need to take note of the differences between high-growth and mature markets, and retailers in general needs to reassess the countries where they are present and exercise caution in any market entry strategy.
- Establish processes for integrated merchandising, order fulfillment, and inventory management across all channels rather than individual channel.
- Incrementally and iteratively grow via a “test and learn” approach to customer-centric initiatives.
- Build organizational structures and goals around value propositions that cut across all channels, with incentive and commission programs to promote cross-channel selling.
- Develop and implement cross-channel benchmarks and metrics.
Inventiveness, Personalization, Future Thinking
Perhaps the best example of an industry that has thrown itself into consumer-centric digital marketing is the fashion industry.
By adopting a heavily customer-centric focus, online fashion retail has effectively turned the home into a fitting room, allowing customers to try, evaluate, and easily return goods should they wish to do so. With 71 percent of consumers indicating that post-sale, the option to return goods easily was extremely important, making returns an easy and integral part of the purchase promise provides an level of reassurance for online consumer purchases that can make the difference.
Kees Jacobs, Global Digital Proposition Lead at Capgemini Digital Customer Experience, gave the following comment in an interview with big4.com:
“Notably, fashion has seen more growth in digital shopping than any other category. Leading the way in terms of inventiveness and segmentation, fashion could be the channel to essentially drive the digital shopping experience even to apprehensive consumers.”
As both technology and consumers continue to evolve, inventiveness and segmentation will be two areas that will separate the best performing digital brands from the average performers. The ability to offer new, personalized shopping experiences and opportunities for consumers to engage, will be a defining characteristic of successful digital marketing for years to come.
You can read Capgemini’s full Digital Shopper Relevancy Research Report 2014 here.
Do you agree with Capgemini’s findings? Is social media really in decline or is it just a momentary blip?