omnichannel has moved from opportunity to … has moved from opportunity to necessity 5 ......

Omnichannel has mOved frOm OppOrtunity tO necessityHow people blend clicks with bricks – and what the future might hold

3Omnichannel has moved from opportunity to necessity

What next for the shopping mall? The blended shopping experience 4

Learning from Leading Edge Consumers 9

About GfK FutureBuy 14

cOntent


What next fOr the shOpping mall? the blended shOpping experience

The advent of digital has changed – and continues to change – the way we shop for everything, from clothes to cars. The latest research from GfK shows that rather than seeing digital as a one stop shop, consumers are enjoying an omnichannel shopping experience that blends digital with traditional bricks and mortar retailers to create a new kind of purchase journey.

With omnichannel shopping, the norm amongst consumers across the

spectrum and new innovations, like L’Oreal’s virtual kiosk for make up on-the go, it’s entirely reasonable to wonder what’s next for the shopping mall or high street. Digital is undoubtedly having a huge impact on where, when and how we shop but there are significant differences by category and by demographic making this a complex area to understand. For example, omnichannel shopping now stands at 67% across all categories. Consumers have been favoring an

Online shopping evokes functional associations, bricks and mortar more social attributes

BRICKS & MORTAR ONLINE

Top descriptors of shopping experiences (global)

44%42%

38%40%

Easy

55%Easy

Friendly

40%Satisfying

Personal

47%E� ortless

47%Safe

54%Safe

33%Fast

33%Informative

Satisfying

35%Satisfying

76 Omnichannel has moved from opportunity to necessity Omnichannel has moved from opportunity to necessity

omnichannel shopping experience for large ticket items and durables for a while already, now even day-to-day household needs such as cleaning products and food and beverages scored 17% and 19% respectively.

Research from FutureBuy, GfK’s study into the behavior and preferences of 17,000 shoppers, shows that while popular, online shopping is typically associated with functional attributes whereas traditional bricks and mortar retail environments are associated with softer, more sociable benefits. More than half (55%) of respondents describe online shopping as being “easy” compared to 44% of offline shoppers. While “fast” (54%), “effortless” (47%) and “organized” (35%) were attributes most often used to describe the online

shopping experience, more sociable associations were typically made of the bricks and mortar experience: “safe” (47%), “personal” (42%) and “friendly” (38%). Clearly there is a role for both, and consumers are becoming adept at blending them.

While there was significant positivity amongst respondents towards bricks and mortar retail establishments in the shopping mall, GfK FutureBuy revealed a continuing trend towards web shopping. Of particular note is a significant increase in the number of respondents searching the web for the best price. While in last year’s survey 47% said they compared prices between stores online, searching for the best price is now the top activity with 72%. Making a purchase also

grew from 47% to 66% .This difference between internet usage for price comparison and actual purchases suggests that there is a continuing role for the shopping mall alongside the virtual store.

An increase in the incidence of webrooming, where consumers browse online before going in store to purchase, further underlines the important balance that exists between the online and offline retail environments. 24% of respondents reported webrooming in the last 12 months, which suggests that there is a need for retailers to achieve synergies across their online and offline channels in order to satisfy consumers’ expectations of the purchase journey.

With webrooming being relatively universal across the generations, there is substantial evidence which supports the idea that this type of behavior, whereby shoppers move seamlessly between the online and offline environment, is likely to grow.

With consumers increasingly dictating their own purchase journey and expressing a preference for omnichannel shopping as well as services such as click and collect, the challenge for retailers is to provide a connected experience that blends the best of the online and offline shopping experience and allows both to exist side-by-side to meet consumers’ different needs.

% Engaging in online shopping activities (global)

All web shopping activities trending up

Searching for best price72%

Finding products & services67%

Check for general information about products67%

Make purchase66%

Read reviews57%

Use social media to exchange/post info about product/service27%


learning frOm leading edge cOnsumers

The constant changes in today’s digital world are revolutionizing the retail experience, for both consumers and retailers. Consumers can now shop virtually any time, anywhere and for anything. But with new possibilities and new technologies comes a thirst for even greater change and innovation. In this piece, we concentrate on Leading Edge Consumers and what they can tell us about the future of shopping.

Leading Edge Consumers (LECs) are made up of three different types of shoppers:

1. Early adopters2. Influentials3. Passionate shoppers

Within GfK’s FutureBuy study, 15% of respondents globally were identified as being LECs. Drawing on this data,

15% of sample identified via proprietary questions and analytics

Early adoptersinnovators who value and want

products and services ahead of the

mainstream market

Influentialstypically people who have historically been years ahead of the mainstream and have pioneered new trends

Passionate shopperspeople with a high

degree of involvement in the sector and a significant level of

motional investment

LEC

Leading Edge Consumers are


we are able to offer significant insight into the future of shopping for both retailers and their consumers.

1. LECs are significantly more wired than their peers80% own a smartphone compared to 69% of non-LEC and a further 55% own a tablet compared 38% of non-LECs. This connectivity means that LECs are more likely to shop online: 41% of LECs shop exclusively online compared to 33% of non-LECs. There is a similar rise in the number of LECs that report omnichannel behavior – 75% compared to 65% of non-LECs.

This increase in online shopping activity amongst the more wired LEC segment suggests that as uptake of mobile devices increases amongst the general population, there is likely to be a corresponding increase in online shopping behavior. But retailers shouldn’t abandon bricks and mortar: there is strong support for omnichannel shopping.

2. LECs are less loyal than the mainstreamWhile the trend towards online shopping, as suggested by the behavior of LECs, potentially offers significant cost savings to retailers, data from GfK FutureBuy suggests that the transition from store to online comes with great risk in the form of reduced customer loyalty. LECs are typically less loyal:

three quarters (76%) are less loyal to any one retailer compared to 58% of respondents in general and 76% are less loyal to any one brand compared to 57% on average. These figures suggest that there is likely to be considerable pressure on loyalty as shoppers become increasingly connected and transfer more of their activity online.

3. LECs enjoy assistance with their purchasesAlongside this move away from retail loyalty comes the notion that LECs

are more likely to respond positively towards a brand or retailer that assists them with their purchase: 78% say they would be more loyal to a brand or retailer who gave them input on a purchase, compared to nearly half (47%) of respondents overall. This suggests the potential to foster positive relationships within the online

environment, but brands will have to work hard to connect with consumers online and earn their loyalty.

4. LECs love a bargainLike many consumers, LECs are attracted to making savings and will most likely opt to use the internet to compare prices and find money off

Less loyal than the mainstream% Shoppers agreeing completly/somewhat

“Feel more in control than ever before when shopping.”

“Now less loyal to any one brand.”

“Now less loyal to any one retailer.”

88%62%

76%57%

76%58%

LECNon-LEC

LECNon-LEC

LECNon-LEC

% Own Device

Significantly more wired than their peers

80%LEC

Non-LEC

38 %

69 %

55 %

% Reported shopping behavior

Exclusively online

Omni-channel

Heavier web shoppers

41%

33%

75%

69%

Comparing prices across stores (non-LEC = 38%)

Using coupons on manufacturers websites (non-LEC = 20%)

% of LEC reporting doing more of...

55%43% SAVE

$ $ $

12 Omnichannel has moved from opportunity to necessity

of sharing means that there is huge potential for LECs to become “power consumers”, whose experiences are shared immediately with an online audience and will influence the purchasing behavior of other similarly connected consumers.

While LECs typically fail to see the relevance of bricks and mortar retail environments – 72% say that they can see a future where traditional stores are not a big factor in their shopping compared to 41% of non-LECs – it is important not to overstate the

coupons. 55% compared prices across stores and 43% use coupons from manufacturers’ websites compared to just 20% of non-LECs.

5. LECs share on social mediaLECs are nearly twice as likely to share information about products and services via social media (44% vs 24% for non-LECs). This high incidence

importance of this trend. Our survey shows that while the future of shopping is changing, and the LECs give many important clues as to its direction of travel, we believe that for the large majority of consumers, an omnichannel shopping experience will remain key. Consumers will be able to customize their unique shopping experience depending on what they are buying and when, fusing the best of the online and offline environments to meet their specific needs.

“My social network have become as important to me as other shopping information sources.”

“Using social media to exchange/post info about product/services.”

Big on sharing

24% Non-LEC

34% Non-LEC

44% LEC

69% LEC


abOut gfK futurebuy

FutureBuy® is GfK’s proprietary, annual survey of shopper attitudes and behaviors.

2014 it was carried out online across 15 categories:

FMCG » Beauty and personal care » Packaged food/beverages » Household washing and cleaning

products » OTC healthcare

Consumer Durables » Consumer electronics » Mobile phones » Home appliances

Services » Financial services » Healthcare services » Meals at restaurant

Other » Automotive » Toys » Apparel » Home improvement » Home and garden

In 17 countries (N = 1000 per country, age 18+): Canada, US, Mexico, Columbia, Brazil, Argentina, Poland, Germany, France, Spain, Romania, Bulgaria, Russia, China, Korea, Japan, Australia

GfK is the trusted source of relevant market and consumer information that enables its clients to make smarter decisions. More than 13,000 market research experts combine their passion with GfK’s long-standing data science experience. This allows GfK to deliver vital global insights matched with local market intelligence from more than 100 countries. By using innovative technologies and data sciences, GfK turns big data into smart data, enabling its clients to improve their competitive edge and enrich consumers’ experiences and choices.

About GfK

For more shopper insights please contact:

Adrian SangerGlobal Head, Shopper and Retail Strategy, [email protected] +44 20 7890 9175

GfK. Growth from Knowledge

omnichannel has moved from opportunity to … has moved from opportunity to necessity 5 ......

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