4 sight em_loyalty study_april2015

4 S I G H T T O P L I N E

the journey to loyalty goes through

their hearts

Emotional Shoppers

© 2015 Foresight Momentum

= { E X P E R I E N C E + B E H A V I O U R + C U L T U R E + S Y S T E M S }

April 2015

TABLE OF CONTENTS

• EMOTIONAL LOYALTY OF CANADIANS …3

• WHAT IS EMOTIONAL LOYALTY? …4

• PROJECT BACKGROUND …5

• WOMEN’S FAVOURITE STORES …6

• MEN’S FAVOURITE STORES …7

• WHAT INFLUENCES SHOPPER EMOTIONS? …8

• WOMEN’S SHOPPING EMOTIONS …9

• MEN’S SHOPPING EMOTIONS …10

• EMOTIONAL CONNECTION METER …11

• SCORES BY SUPER-LOYAL SHOPPERS

…12

• P12M GROCERY STORE VISITS …13

• EMOTIONAL CONNECTION METER: GROCERY …14

• STORE LOYALTY CARDS & APPS …15

• APPENDICES …16

• ABOUT FORESIGHT MOMENTUM …19

EMOTIONAL LOYALTY OF CANADIANS

What do people expect when they shop? Good prices &

selection, wide aisles, fresh product, super service, free

delivery? What do people want, deep inside their

hearts, when they come to the store? Why they love

some stores and care less about others?

This 4SIGHT topline report summarizes the findings of

our recent Canadian Shopper survey about emotional

loyalty & connection. Here are a few ideas for retail

brands that want to build stronger emotional loyalty:

Excel at the basics, deliver excellent 360 customer

experience, differentiate your brand.

Offer something beyond commodity: surprising,

unexpected, enabling, empowering, cool, etc.

Build one-on-one relationships and social dialogue.

Appeal to deep value-expressive and ego-defensive

human motives.

Build marketing content inspired by shopper

emotional territories.

Elevate the Loyalty game: expand beyond loyalty

points, test targeted content, offer solutions – not

deals, appeal to heart and higher values.

Elevate the Digital game: go beyond a digital flyer,

test micro-targeting, content marketing, geo-

targeting, beacons, etc.

If you find these insights useful or intriguing, and want to learn more,please contact Lana Novikova at [email protected] or416.702.7837.

We offer complimentary lunch-n-learns, affordable custom research,custom analytics, strategic consulting, and ½ day training workshops.

© 2015 Foresight Momentum PAGE 3


Markets run on an enormous amount of unspoken and often unnamed consumer motive.

(by Future Foundation, 2014)

mailto:[email protected]

WHAT IS EMOTIONAL LOYALTY?4 S I G H T T O P L I N E

*Source: Russell-Bennett, Rebekah, Ha ̈rtel, Charmine E.J., & Worthington, Steve (2013) Exploring

a functional approach to attitudinal brand loyalty. See Functions description in the Appendix.

Brand Loyalty

Behavioural

Dimensions

“I do”

Attitudinal Loyalty

Cognitive

Dimensions

“I think”

Utilitarian Function

Knowledge Function

Emotional

Dimensions

“I feel”

Value-expressive Function

Ego-defensive Function

“I always buy the same

brand of milk on

autopilot. I never think

about it twice.”

“This grocery store

has good prices,

decent selection

and convenient

location.”

“I have done extensive research on car brands when

I bought my first Ford. It served me well. I buy same

brand ever since.”

“I care about my family’s health and

the planet. I choose to buy organics and know where our

meats comes from.”

“I want to look and feel great. Some brands help me

feel that way. I am worth it.”


PROJECT BACKGROUND

We reached out to 300 urban shoppers from Toronto and Vancouver – both men and women of a wide age range, with kids or without, most with $40K+ income*.

We asked them to name three of their favourite stores and three words that describe what they feel while shopping there.

Then we applied a new “emotional connection” meter – two very simple questions designed to measure the quality and the depth of connection between an individual and a brand.

© 2015 Foresight MomentumPAGE 5


* Please see Household Composition and Income Charts in the Appendix.

WOMEN’S FAVOURITE STORES



Women’s

Favourite

Stores in

P12M (475 stores

mentioned

UNAIDED;

n=172)

TJX stores (11% of all

mentioned incl.

Winners,

HomeSense,

Marshals)

On-line

Retail (7% - Amazon,

1% Ebay)

Branded

Apparel(27% inc. Gap,

Forever21, H&M,

Old Navy, Banana

Republic, etc.)

Costco(5% of all

mentioned)

Walmart(9% of all

mentioned)

Target(2%)

Sephora(2% of all

mentions)

Grocery

stores (13% of all

mentioned)

Top 5

Banners

Mentioned:

1) RCSS

2) No Frills

3) Loblaw's

4) Safeway

5) Longos &

Metro

Depart.

Stores(4% incl. Bay

& Sears)

Book

Stores(2%)

Shopper’s

Drug Mart(3%)Home

Improvement(3%)

Women love to shop

- They enjoy brandedclothes and shoestores.

- Women love the“discovery” ofbrowsing for ideas andgreat deals at Winnersand Home Sense.

- Wal-Mart, Amazonand Costco are theirtop bargain choices.

- 13% of all the“favourite stores”mentioned by womenare Grocery stores.

13

%

MEN’S FAVOURITE STORES



Men’s

Favourite

Stores in

P12M (384 stores

mentioned

UNAIDED;

n=133)

TJX

stores (2%)

On-line

Retail (10% - Amazon,

5% Ebay of all

mentioned)

Branded

Apparel(11% of all

mentioned)

Costco(6% of all

mentioned)

Walmart(12% of all

mentioned)

Target(2%)

Grocery

stores (16% of all

mentioned)

Top 5

Banners

Mentioned:

1) No Frills

2) RCSS

3) Loblaw's

4) Safeway

5) Metro &

Food Basics

Depart.

Stores(9% incl. Bay

& Sears)

Electro-

nics(8%)

Shopper’s

Drug Mart(1%)

Home

Improve-ment(7%)

Men love shopping just as

much

- They love e-shopping onAmazon and Ebay.

- Electronics and HomeImprovement stores comeup high on the list, yethardly get mentioned bywomen.

- Clothes are important tomen, but not as much asthey are to women.

- 16% of all the “favouritestores” mentioned by menare Grocery Stores.

16

%

I. Objective factors

Such as store category, channel, banner/brand,

floor layout, shelf layout, aisle width, fixture

design, store environment (light, smell,

temperature, sound, parking lot, bathrooms, etc.),

in-store communication, product, pricing,

assortment, package design, promotions, etc.

II. “Human” factors

Such as her/his personality type and demographics, state of

mind or mood, needs, desires, habits, her perceptions of the

Objective or Situational factors (ex.: “unaware,” “indifferent,”

“negative,” “positive”), hormone-based sensory type, shopping

style, price sensitivity, biological factors (vision, physique,

height, etc.) & more.

III. Situational factors

Such as time of day, weather, how busy or not she/he is at

the moment, commute, in-store service, shopping occasion,

shopping mission, budget, store atmosphere, exposure to

pre-trip communication/social media messages, etc.

WHAT INFLUENCES SHOPPER EMOTIONS?4 S I G H T T O P L I N E


Shopping experience is the

sum total of every interaction a

consumer has with your store

before, during and after the

transaction, the sum total of an

individual’s perceptions &

feelings of your organization.

It's based on all the direct and

indirect interactions she has

with you.

Pine and Gilmore, The Experience Economy

WOMEN EMOTIONS



Interesting emotional territories to explore:

1. Positive affect & excitement

2. Relaxation & ease

3. Inspiration & engagement

4. Satisfaction

5. “Clever bargain hunter”

6. Look & style

7. Convenience & comfort

8. Surprise & curiosity

9. Being in control

10.Accomplishment

11.Visual appeal & design

12.Relief

13.Reward

14. A hero / winner

15. Special & pampered

16. Creativity

17. Anticipation

18. Freedom to explore

19. “Like a kid in a candy shop”

20. Creative

0 10 20 30 40 50 60 70 80 90

Happy/delighted/good/enjoyment/fun

Relaxed/nice/calm/easy/content/peaceful

Excited/over-joyed/thrilled/amaizing/dazzled/exhilarated

Sa sfied/pleased/fulfilled/impressed/empowered

Inspired/Interested/engaged/s mulated/enthusias c/

"Cleverbargainhunter"(price-conscious/frugal/thri y)

A rac ve(classy/trendy/instyle/cool/fashionable)

Comfortable/convenient

Surprised/curious&intrigued

Incontrol/organized/prac cal

Finequality/highclass/sophis cated

Confident

Overwhelmed

Valuable/valued/appreciated/important

Accomplished/Pleasurefromthingsdone/produc ve

Efficient/smart/intelligent

Clean

Energe c/energized

Goodchoice/selec on/variety

Moneysavvy/wellspent

Visuallyappealling/Art/visual/style/nicepictures/info

Likeakidinthecandystore

Relieved

Sexy

Rewarded(loveloyaltypoints)

Family me

FinallyIfoundit!

Feeldesire

Pampered/special

Compe ve

Crea ve

Eco-friendly

An cipa on/expectant

Fast

Flexible

Focused

Freetoexplore

Fresh

Friendly

Healthy

Jealous

Learnalot

"LikeIwasn'tge ngrippedoff"

"Likeawinner"

Likemyneedswerebeinga endedto

Lucky

Madeforme

Norush

Pre y

Safe

Sporty

Trust

Welcomed

Withinbudget

Young

MEN EMOTIONS



Interesting emotional territories to explore:

1. Positive affect

2. Inspiration & intrigue

3. Relaxation & peace

4. Just fun

5. Thrifty fun

6. Appreciated & valuable

7. Respect

8. Stylish & cool

9. Freedom

10. Accomplishment

11. Beauty & design

12. Creativity

13. Prestige

14. Success

15. Challenge

16. Liberation

0 10 20 30 40 50 60 70 80 90

Happy/good/great/enjoyable/nice/pleasure

Interested/Inspired/Intrigued/Surprised/Engaged/

Excited/Amazed/ecsta c/elated/fantas c/awed/facinated

Easy/relaxed/calm/peaceful

Fun

Savingmoney/Value/frugal/ge ngagooddeal/Economical

Convenient

Sa sfied/Fulfilled

Thri y/cheapestprices

Comfortable

Fast/Quick

Experienced/smart

Appreciated/welcomed/valuable/respected/Lookeda er

Stylishandcool

Energe c/refreshed

Free

Friendly

Safe

Proud/Accomplished

Beau ful/Colourful

Canadian

Clean

Crea ve

Incontrol"Ihadop ons"

Knowledgeable

Pres ge/Privileged

Powerful/mighty

Successful/Rich

Worthy

Athome

"Big"

Casual

Challenged

Chores

Determined

Equipped

Helpful

Libera ng

Op mis c

Organized

Produc ve

Relief

Rewarded

Unique

Informed

EMOTIONAL CONNECTION METER4 S I G H T T O P L I N E


Net Promoter Score (NPS) is a well-accepted single

measure of customer loyalty. With all its pros and cons, it is

useful for businesses, and easy for responders to answer,

even on mobile.

Emotional Loyalty goes deeper than other Loyalty types,

and is a complex concept to understand, let alone to

measure – whether with a traditional survey or new neuro-

and implicit research tools.

We set up to find a simple way to measure and track

Emotional Loyalty. First question is a simple 5-point-scale

rating of connection between the responder and the

brand/product.

Then, using Neuroscience and Cognitive Psychology, we

identified 12 key types of emotional connection.

We validated each type of connection and a corresponding

image with an in-house research using text and quantitative

analysis.

The new measure – Type of Connection - adds depth,

substance and “colour” to the Emotional Connection Score.

SCORES BY SUPER-LOYAL SHOPPERS*4 S I G H T T O P L I N E

PAGE 12

Emotional

Connection score:

4.1 out of 5

Type of connection:“SATISFIED

BUSINESS

CONNECTION”

Emotional

Connection score:

3.7 out of 5

Type of connection:“SATISFIED BUSINESS

CONNECTION” &

“JOYFUL AFFECTION”

Emotional

Connection score:

3.7 out of 5

Type of connection: “FRIENDSHIP &

ADVENTURE” and

“SATISFIED BUSINESS

CONNECTION”

© 2015 Foresight Momentum

Emotional Connection

score:

4.1 out of 5

Type of connection:

“SATISFIED BUSINESS

CONNECTION” &

“COMFORTING HUMAN

CONNECTION”* “Super-loyal”

shoppers are

responders who

named the store as

one of their

favourites (unaided)

P12M GROCERY STORE VISITS4 S I G H T T O P L I N E


We picked 12 grocery banners popular in Toronto and Vancouver, and asked if

our responders shopped in each banner in the past 12 months.

Then we asked responders to rate each banner using the Emotional Connection

Meter.

EMOTIONAL CONNECTION METER: GROCERY4 S I G H T T O P L I N E


Costco Fortino

s

IGA Loblaw

s

Longo’s Metro Overw. RCSS Safewa

y

Sobeys W-Mart Whole

Foods

3.6 3.3 2.9 3.5 3.4 3.2 3.7 3.6 3.3 3.1 3.5 3.3

1.8 1.3 1.4 1.7 1.2 1.4 1.2 1.8 1.6 1.5 2.1 1.4

P12M

Visitors

Non-

Visitors

* Connections scores are based on ratings from 5 (“Very connected/Close”) to 0 (“Very disconnected/Far”);

sample size 70+.

As expected, shoppers who visited a banner in the

past 12 months, rated their connection with the banner

much higher than those who did not visit it.

The higher the score, the closer is “reported” emotional

connection to the store.

On page 12, we showed the scored of 4 stores given

by the super-loyal shoppers, that range between 3.6

and 4.1. We can use it as a “high bar” measure.

We intend to release more studies in different

categories utilizing this simple tool that measures the

“heart” of emotional loyalty between your brand and

your shopper/consumer. Stay tuned!

STORE LOYALTY CARDS & APPS

According to a 2015 Yahoo study, 22 million Canadians

(90%) have on average 4 loyalty cards.

93% of our urban responders use “store” cards regularly;

most of them use 1 to 4 cards.

Though almost half urban shoppers regularly use store

apps, there is an untapped opportunity to get on smart

phones of 40% who currently don’t have or don’t use

apps.



APPENDIX: HH COMPOSITION & INCOME



APPENDIX: FUNCTIONS OF BRAND LOYALTY4 S I G H T T O P L I N E

*Source: Russell-Bennett, Rebekah, Ha ̈rtel, Charmine E.J., & Worthington, Steve (2013)

Exploring a functional approach to attitudinal brand loyalty.

COGNITIVE:Utilitarian Function

•The utilitarian function is based on evaluating alternatives on performance criteria and then selecting a brand that meets those requirements.

•The utilitarian function is roused through experience rather than verbal information (WOM); thus, consumers that repurchase brands are likely to be satisfied with their experiences using the brand, rather than hearing about the performance of the brand.

•The utilitarian function leads to attitudinal brand loyalty when a brand is proven to be value for money, or the best ‘deal’, owing to the consumer comparison of its attributes with competitive brands.

•Consumers who are loyal for utilitarian reasons are responsive to brand performance messages, but are also opportunistic –always looking for a better deal and comparing utilities.

COGNITIVE:

Knowledge Function

•This function involves the mental organization of complex information in a meaningful way to assist people to make decisions easily and without having to refer to the detailed attribute information that was originally used.

•This function is the driving force behind the rational side of loyalty for high ticket purchases like cars, computers and real estate.

•The knowledge function is an explanation for why highly experienced consumers tend to stay loyal to a brand.

•It allows consumers to have a readily established base of heuristics and schemes, and results in maintenance of existing brand choices.

•Consumers perceive the knowledge function as reducing cognitive effort by buying a brand that was mentally categorized as top of mind, considered trustworthy and reliable, and was as a result of a long history of using the brand.

EMOTIONAL:

Value-expressive Function

•The underlying motivation represented by this function is the need to buy brands that are consistent with, or express, one’s values.

•The brand is used as a symbol for self-expression.

•Consumers perceived the value-expressive function as allowing them to make buying behaviour congruent with lifestyle, aspirations, values, ethics and loyalty to region or country-of-origin.

•Powerful consumer trends of Health & Wellness, organics, local food, Fair Trade, Green consumption, and others are fueled by the value-expressive function.

•Food retailers and food service businesses that stand out on the basis of their values have a big marketing advantage to create deep and passionate loyalty and evangelism, command premium prices, and establish long-lasting relationships with the community (ex.: Whole Foods, Trader Joe’s, Wegmans, Chipotle, etc.)

EMOTIONAL:

Ego-defensive Function

•This function is predicated on Freudian defense mechanisms that help people deal with emotional conflict and feel better about themselves, and thus, relates to personal identity.

•The ego-defensive function is being served when the consumer perceives buying the brand as contributing to their esteem or boosting their ego.

•Consumers perceive the ego-defensive function as a way to show others how far they have come in their lives, bolster self-esteem, and improve self image.

•This function does not involve much planning, is quite spontaneous and reactive.

•Many luxury brand purchases are driven by this function.

•The value-expressive and ego-defensive functions often overlap, especially on sub-conscious level, for example, choosing to drive a Toyota Prius in a “green” neighborhood could be both about your “green” value and an ego-defense.


FOOD FOR THOUGHT4 S I G H T T O P L I N E


It is no longer about the physical connection of products with consumers.

This is simply a point of entry. Far more important is the “mind”connection… In order to fulfill consumer demands, we must first determine

how to make our value offering so powerfully satisfying that it actually

changes the consumer’s brain chemistry… it must be so mentally and

emotionally compelling that at the mere mention of the brand or retailer or

service, the consumer’s brain releases a shot of dopamine, which triggers

an instant desire to get or go to that brand.

It is achieved when a retailer/brand/service creates a strong psychological

and physical response that operates on a subconscious level… and that is

typically not readily understood or necessarily recognized by the consumer.

Simply stated, a brand or store has a neurological connection with

customers if they approach the store visit as they would a visit to a home of

a good friend. The trip requires almost no effort because they know it is

going to be a fun and enjoyable experience.

Robin Lewis & Michael Dart

It’s one thing to satisfy people’s interests, give them what they want.

But people’s lists of what they want are endless. That builds

situational satisfaction, but not enduring emotionally-based

satisfaction. To get people to really buy into you as an idea,

something has to be part of the mix which in beyond commodity. You

have to give people something surprising and let them take it as a

provocation to explore something about themselves and about

experience that was beyond expected. It’s a SELF-EXPENSION

ISSUE – not satisfaction issue.

Dr. Bob Deutsch on the Buzz Council, 2014, Youtube

ABOUT FORESIGHT MOMENTUM

We focus on answering four fundamental

questions: WHO, WHY, WHEN and WHERE

behind consumer desires and shopper decisions,

so you can focus on HOW to optimize your

marketing and innovation strategies and build your

brands. We partner with you to connect the dots

and help you optimize your marketing

effectiveness.

Foresight Momentum is a new Integrated

Consumer Insight Consultancy in Toronto.

Passionate experts in the fields of human insight,

predictive analytics, psychology, neuroscience,

technology and business, we offer full-service,

integrated market research and analytics

solutions.

© 2015 Foresight Momentum www.foresightmomentum.com [email protected]

4 sight em_loyalty study_april2015

Marketing

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mentionsgrocery stores

shoe stores

foresight momentumpage

attitudinal brand loyalty

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depth of connection