design:retail - July 2016 - (Page 32)

shopper insights 032 DIGITAL NATIVES SHAKING UP THE SHOPPING LANDSCAPE REBECCA BROOKS COFOUNDER ALTER AGENTS @alter_agents N OT ONLY ARE Digital Natives quickly becoming the largest consumer group in the marketplace, but they also are driving changes in shopping behaviors that are creating a sea change for brand marketing. This group-made up of Millennials (18- to 34-year-olds) and Generation Z (those under age 17) have an approach to shopping that is a complete break from any experience we've known to date. At Alter Agents, we examine this change through the lens of the CPG grocery space using data based on continuous sampling of shoppers who bought groceries in the last 24 hours. What we've found, based on six years worth of shopper journey studies in dozens of categories in multiple countries, is a fundamental shift in how Digital Native shoppers are reframing the entire shopping experience. Four trends have emerged that brands can examine in order to understand how this powerful group of shoppers is thinking and what matters to them. 1 ANXIETY - INFORMATION OVERLOAD We have unlimited access to information, and Digital Natives aren't scared to access it. Online inputs, word of mouth, social media, retail and traditional media-the list goes on. Whereas the older generation of shoppers might dismiss a user-generated video about a product, a Digital Native would give it equal weight, if not more, to a multimillion-dollar ad campaign. What's the end result of all this input? Anxiety. Shoppers of these generations feel compelled to gather validation and confirmation before making a purchase-even in low-engagement categories like CPG grocery. 2 CONSUMER-CENTERED - VIEW EVERYTHING THROUGH THE LENS OF THE CONSUMER DESIGNRETAILONLINE.COM 3 BIG SPENDERS - SOMETIMES Digital Natives complicate things when it comes to cost and spending. Even though this generation is absolutely squeezed financially, they are willing to spend more on certain things. "Quality" that demands a premium is more about unique products and experiences, organic, sustainable, "for a cause" and social acceptance, rather than brand name or exclusivity. The interplay of price and the added value of a quality or interesting product is fluid. Digital Native shoppers can change priorities often. This makes it much more challenging for marketers. 4 PROMISCUOUS - LOYALTY SHIFTS For Digital Natives, the quality of a product or JULY 2016 brand is directly related to the ease and convenience of their shopping experience. Expectations for brand interactions are extremely high and do not fit within the traditional siloed framework of the consumer experience. Brands need to create a consistent endto-end consumer experience that makes shopping enjoyable and convenient (think Uber, Amazon, Apple). Consumers who don't feel important to a brand will look elsewhere for that experience. A key element of our research is identifying shoppers by labeling them as Defectors, Impulsives, Ambivalent or Loyalists. GLOBALSHOP.ORG Defectors planned on buying a brand, but bought another brand at shelf. Impulsives were not planning to buy in the category, but decided to purchase at shelf. The Ambivalent knew they wanted to buy in the category, but did not have a brand in mind. Loyalists bought the brand they planned on buying. Our data reveals a trend in CPG grocery toward promiscuity that we believe will increase rapidly in the next decade. Even still, the data shows us that younger shoppers are less "secure" than older shoppers. As technologies continue to improve, as Generation Z ages into their buying power, and as the Boomer population continues to decline, a trend toward low brand loyalty and shopping promiscuity will snowball. WHAT NOW? The digital generation gap means huge changes for end-to-end marketing. How do brands change communication to get in front of the digitally connected, technology-ingrained consumer? They need to move away from the concept of building a loyal consumer base. Marketers need to stop thinking about how to "win" customers from competitors and think about how to bring customers back. The model needs to be reframed not with loyalty as a conclusion, but with the goal of giving the consumer a reason to return. Editor's note: Further explore this concept, specific data and additional conclusions examined in a new e-book, "Dawn of the Promiscuous Shopper," available at alteragents.com/promiscuous-shopper. A BELIEVER THAT EXCELLENT WORK CAN ONLY BE ACHIEVED IN AN ENVIRONMENT THAT FOSTERS PASSION, CREATIVITY AND REVERENCE, REBECCA BROOKS IS A PROUD PARTNER AND COFOUNDER OF ALTER AGENTS (ALTERAGENTS.COM), A LOS ANGELESBASED MARKET RESEARCH FIRM. http://www.alteragents.com/promiscuous-shopper http://www.ALTERAGENTS.COM http://www.DESIGNRETAILONLINE.COM http://www.GLOBALSHOP.ORG

Table of Contents for the Digital Edition of design:retail - July 2016

design:retail - July 2016
Contents
Editor’s Note
On Trend
We Love This!
Designer Picks
Clicks & Mortar
Postcard
Mingle
How'd They Do That?
Have You Heard?
Shopper Insights
Shopping with Paco
Bolon
Kum & Go
Intersport Klöpping
Nino Álvarez
Fixture Leaders
Products
Backstory

design:retail - July 2016