Retail Tap

RETAIL

TAP

FOUR KEY

RETAIL TRENDS

FOR

2013

Powered by Shopper Sciences

RETAIL

TAP

TRENDS ACROSS THE

PLANET

Retail TAP has been curated to showcase innovation and design in Retail. We’ll aim to bring you the most inspiring articles from around the globe and focus on implementations which are unique enough to make a big impact.

This edition focuses on four key retail trends for 2013: TEC-TONIC SHIFT Forget consumers. Forget customers. Today it’s about the shopper.

C2C Consumers aren’t just talking to each other, they are selling, trading, advising one another.

INCONSPICUOUS CONSUMPTION Increasingly retailers and shoppers are finding ways to lighten the load.

MAN-SUMERISM The rise of male shopping behaviour.

Retail TAP //

Contents

Contents 01

TEC-TONIC SHIFT

02

TWo sTATes: usInG & deCIdInG

10

ConsuMeR CuRATed CATAloGue

18

PoP uP ReTAIl 2.0

ReCYClInG AT ReTAIl

05

Re-AlIGnInG ARound dIGITAl shoPPeR ReAlITIes

The ReAl PuRChAse Funnel

13

14

dIsInTeRMedIATInG BRAnds

20

InVIsIBle BuT PoWeRFul

27

Men don’T jusT shoP. TheY BuY.

04

12

19

26

Men shoP dIFFeRenTlY

RIse oF shoPPeR MARkeTInG

11

nexT Gen MARkeTPlACe

sToRe BRAnd equITY

03

Men ReseARCh, WoMen shARe

29

MARkeTInG To Men

15

23

ReCessIonARY ResIduAls

30

Getting in touch

09

sMART shoPPeR PlATFoRMs

16 loYAlTY, BRAnd equITY “keePInG uP WITh The joneses”

INCONSPICUOUS CONSUMPTION

MAn-suMeRIsM

08

the ecology of shopper dialogue

C2C

22

21

loYAlTY Is noT A FRee T-shIRT

28

C2C: The neW sAles FoRCe

07

17

eCo PACkAGInG

24

“RenAIssAnCe MAn” ReVIsITed

25

BeYond The 9–5 GRInd

RETAIL TAP //

Tec-tonic shifT.

Tec-tonic shift Forget consumers.

Forget customers.

Today it’s about the shopper.

01

two states: using & deciding

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two states: using & deciding What drives shoppers to say “yes�?

using

Deciding

02

rise of shopper marketing

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rise of shopper marketing Source: GMA/Booz

Annual Shopper marketing spend:

$50b And growing

03

%

re-aligning around digital shopper realities

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re-aligning around digital shopper realities Percentage of brand marketers who think:

67% 54% 67% 54% need a more formalised process to measure digital shopper effects

54%

54% 80% 54% 80%

need to establish better planning processes for DSM campaigns

80% excited at the new opportunities to measure DSM

80% 45% 80% 45%

45%

getting more data with DSM than with traditional marketing efforts

45% 42% 45% 42% better linkage between media results and sales results

04

4

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the real purchase funnel

The Real purchase funnel The real purchase funnel is chaos. But increasingly, we can reveal where shoppers go at each stage of the purchase journey- and identify where the greatest patterns are to engage them along their decision path.

• Each green line represents one individual shopper • C learly, shoppers do not behave in programmed, linear modes • Shopper path is NOT a funnel

05

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the real purchase funnel

The Real purchase funnel • Brands must understand the most common purchase paths.

• Entry points reveal where shopping begins.

• Circles indicate most used information sources.

• Color indicates degree of influence of information sources

06

RETAIL TAP //

C2C.

C2C Consumers aren’t just talking to each other, they are selling, trading, advising one another.

07

the ecology of shopper dialogue

Retail TAP //

the ecology of shopper dialogue Social media has re-written the rules of trade, opening up a world where shoppers can buy, sell, and trade...to each other.

B2b & B2C meet C2C 08

smart shopper platforms

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smart shopper platforms Access to information is making shoppers smart – really smart. Knowledge sharing sites are increasing in sophistication and number. Forget Google or Wikipedia – these sites are the future of decision making, accessible by shoppers at every step of the purchase journey.

Decide.com tells shoppers if they should purchase or wait for prices to drop.

Fooducate rates food products based on nutritional and expert information.

09

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consumer curated catalogue

consumer curated catalogue Burgeoning photo sharing site Pinterest has been called a place to “shop without money.” But it’s also a self created consumer catalogue and showroom.

10

next gen marketplace

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next gen marketplace Online craft site, Etsy has provided artists and craftmakers with a thriving marketplace to sell their goods. Smart retailers like WestElm are inking deals to bring online shoppers to their stores by featuring and selling Etsy artist goods.

Etsy is the 58th most popular website in the USA.

11

pop up retail 2.0

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pop up retail 2.0 A confluence of trends has produced a thriving “pop up” economy. Whereas previously pop up stores and kiosks were the domain of big brands seeking to expand their foot print, today they are led by entrepreneurial mini-preneurs.

“The maker economy allows amateurs to seamlessly become professionals and test their concepts before investing in brick-and-mortar.”

Nicholas Russel CEO, Ephemeral Labs

12

disintermediating brands

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disintermediating brands Shoppers aren’t just talking to each other about brands, they are creating their own products and services - and disintermediating brands in the process.

On any given night in NYC, social travel site, AirBnb has more rooms booked than the largest hotel in NYC.

• Over 10 million nights booked • 192 countries • 168 million Social Connections

13

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C2C: the new sales force

C2C: the new sales force San Francisco start up, Quri enables brands to tap a nationwide, shopperpowered mobile field force that intends to be a scaleable solution for brands to measure and optimise in-store.

Needle is a promising Fan-sourcing Sales Platform that recruits and trains passionate brand fans to provide realtime sales support via the cloud.

mobile computing + geo location + shopper field force = real time intelligence 14

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INCONSPICUOUS CONSUMPTION.

INCONSPICUOUS CONSUMPTION Increasingly retailers and shoppers are finding ways to lighten the load.

15

loyalty, brand equity “keeping up with the joneses”...

Retail TAP //

loyalty, brand equity “keeping up with the joneses”...

What do they all have in common? They are all casualties of the recession and the need for people to re-evaluate what matters most. Inconspicuous consumption, where maximising resources is a primary driver of purchase decisions, is the reality.

$27 $27 $27 $27 average monthly spend on groceries up $27 from 2007 to 2011.

two in five shoppers purchasing more store brand or generic items

three in 10 respondents cut back on bakery items, candy, desserts and magazines/books/DVDs

one in four have cut back on prime cuts of meat/seafood

16

eco packaging

Retail TAP //

eco packaging Reinforce differentiators. In unexpected places. Ketchup is ketchup… and a way to conserve resources.

Puma’s sustainable shoe box and reusable bag looks cool and saves: • 8,500 tons less paper • 20 million Megajoules of electricity • 1 million litres less of fuel oil used and 1 million litres of water • 275 tons of plastic

17

store brand equity

Retail TAP //

store brand equity More than half of grocery shoppers now regularly buy store brands across all categories of groceries.

2008

2009

2011

good alternative to name brands

71 74 74

quality as good as name brands

63 65 65

usually extremely good value for the money

67

70 69

some are higher quality than name brand

33

for people on tight budgets and can’t afford the best don’t feel comfortable serving to guests

20 18 17

37 38

The one exception: Pet Food

11 11 11

18

recycling at retail

Retail TAP //

recycling at retail Thrifty IS mainstream.

Goodwill Industries and Savers are aggressively expanding nationwide, causing reluctant retailers to take notice.

• Number of resale shops has increased by 7% in past year • G oodwill hit $4 billion in revenue in 2011 (10% growth since 2007) • 2 0% of people shop in thrift stores regularly, compared with 14% in 2008

19

invisible but powerful

Retail TAP //

invisible but powerful Retailers are using lightweight and invisible technologies like Euclid Elements to better able their sales associates to engage with their best customers.

Saks Fifth Avenue teamed up with start up Euclid Elements to create a smartphone app that would be loaded on associates’ phones and would identify when loyal shoppers (who had opted in) entered the store, and would tell the associate where in the store they were located using the customer’s mobile wifi signal.

20

loyalty is not a free t-shirt

Retail TAP //

loyalty is not a free t-shirt Shoppers want more than just free ‘stuff.’ Savvy retailers and brands are shifting from extrinsic to intrinsic rewards - rewarding all shopper interaction, instead of just purchase.

average number of loyalty programs per US household:

less than half are active:

18 8

Most loyalty members are unsatisfied with the value

of loyalty programs (grocery/drug most satisfied at only 42%)

SOCIAL CURRENCY

VIRTUAL GOODS PROGRAM OPT-IN

EXCLUSIVE ACCESS

A VOICE IN BRAND DECISIONS

RECOGNITION/FAME

21

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MAN-SUMERISM.

MAN-SUMERISM The rise of male shopping behaviour.

22

recessionary residuals

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recessionary residuals While the job market for men has recently improved, the lasting effects of the recession, have altered the traditional “provider� paradigm.

3

At the height of the recession, unemployment was more than 2% higher for men men

women 10.4

10.5

9.4 8.1

39% 39% of women out-earn their male spouses

80% 80% of men are OK with it

6.1 4.6 4.6

2006

4.7

8.6

8.4

8.3 8.1

5.4

4.5

2007

2008

2009

2010

2011

2012

23

“renaissance man” revisited

Retail TAP //

“renaissance man” revisited Whether by choice or need, being exposed to new roles such as child care, shopping and household activities has created a new generation of men who embrace their new roles and the impact they can make.

40%

40%

40%

of men are the primary grocery shopper in the household

44%

44%

44%

of men say they equally share in house cleaning

86%

86%

86%

of men agree being a man = doing what is necessary to keep the household running

24

beyond the 9–5 grind

Retail TAP //

beyond the 9–5 grind Men increasingly evaluate their successes in life in areas beyond career and finance.

67%67% feel their LIFE is the same or better than it was prior to the recession

42%42% feel their FINANCIAL situation is the same or better than it was prior to the recession

25

men shop differently

Retail TAP //

men shop differently “Subscription Commerce” sites such as Trunk Club, Mr. Porter and Manpacks address men’s expanded interest in style and grooming, while P & G is setting up “Man Aisles” within physical stores.

All focus on conveniently solving a need.

SHOPPING ACTIVITY: functional PURPOSE: solve a problem/need PRIORITIES: convenient, informative

26

men don’t just shop. They Buy.

Retail TAP //

men don’t just shop. they buy.

Whether by choice or obligation, men are doing more shopping than they have in the past. Disenfranchised no longer, they are empowered by technology and a growing recognition of the contributions they make. average spent “yesterday” in stores, gas stations, restaurants, or online

$59 WOMEN

$81 MEN

increase in men’s clothing sales last year

2%

8%

WOMEN’S

MEN’S

increase in men’s facial care sales last year…yes, facial care

11%

27

men research, women share

Retail TAP //

men research, women share Males use more sources on average than females, but tend to share less than females after purchase.

MALES (n=2004)

average source node usage:

FEMALES (n=2999)

17%

average number used:

15% 10.2

11.6

SMOT participation i.e. sharing information about purchase with F&F or via Facebook, Twitter, etc:

56%

61%

28

marketing to men

Retail TAP //

marketing to men At home and in store... men are increasingly shopping for themselves and their families. Empowered by technology, men have 72% 72% 72% embraced mobile and social media to conveniently inform their decisions.

MAKE IT EASY: Shopping is need based for most men.

The process should be simple and direct.

research price online before making a purchase

26% 26% 26%

more likely than women to scan a barcode in store

76% 76% 76%

men are favoring digital sources—and not their televisions—when looking to be entertained

BE INFORMATIVE: Product info, reviews, comparisons, availability and store information.

HAVE FUN, BUT DON’T INSULT: A recent Huggies campaign backfired for implying Dads were unfit parents.

29

Retail TAP //

Getting In Touch

Getting in touch

email us your news & views

tap@momentumww.com http://blog.momentumww.com/blogs/wwtap/

Sources: GMA/Booz, SHS, appapeal.com, Ephemeral Labs, airbnb.com, MaxPoint Interactive, 3IGInsight, Nielsen, USA Today, Colloquy, Bureau of Labor Statistics, Men’s Health, GfK Roper Reports, KSDK, Spike Network, Shopper Sciences, Scanbuy, AskMen.com Contributing Momentum Offices: US, UK