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The Digital Consumer Journey: The Six Types of Digital Consumers

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“The purchase funnel is dead!” It’s a digital declaration made for the past few years to make known that a brand cannot simply expect a would-be consumer to move seamlessly from awareness to …

“The purchase funnel is dead!” It’s a digital declaration made for the past few years to make known that a brand cannot simply expect a would-be consumer to move seamlessly from awareness to consideration to purchase. This seemingly accurate statement is based on the new reality that decisions of what to buy and where to buy it are happening at scale online, using social and mobile tools that did not even exist 10 years ago.
In new research, GroupM Next, along with Compete, a Kantar company, examined more than 168,000 purchases of consumer electronics, where the consumer used digital media in at least one step, with the goal of finding where consumers go online to make their purchase decisions—and why. Nearly half (48%) of all purchases studied were heavily influenced by digital media and advertising. It’s an obvious signal to brands that the shift among consumers of time spent on and giving attention to digital continues, and investments, both in media and content, will continue to be strategic imperatives.
The research outcome suggests that a new series of consumer behaviors is forming the
next-generation version of the purchase funnel. Six clear pathways emerged, defining the most common types of modern digital shoppers. Each of the six segments represents like-minded
consumers who follow a given path of varying depth and duration to reach a marketer’s optimal
outcome—a sale.

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  • 1. May 2013Authors:Jesse WolfersbergerJ. Patrick Monteleone, Ph.D.The Digital Consumer JourneyThe Six Types of Digital Consumers;Amazon’s Increasing Influence in the Purchase Pathway
  • 2. “The purchase funnel is dead!” It’s a digital declaration made for the past few yearsto make known that a brand cannot simply expect a would-be consumer to moveseamlessly from awareness to consideration to purchase. This seemingly accuratestatement is based on the new reality that decisions of what to buy and where tobuy it are happening at scale online, using social and mobile tools that did not evenexist 10 years ago.In new research, GroupM Next, along with Compete, a Kantar company,examined more than 168,000 purchases of consumer electronics, where theconsumer used digital media in at least one step, with the goal of finding whereconsumers go online to make their purchase decisions—and why. Nearly half(48%) of all purchases studied were heavily influenced by digital media andadvertising. It’s an obvious signal to brands that the shift among consumers oftime spent on and giving attention to digital continues, and investments, bothin media and content, will continue to be strategic imperatives.The research outcome suggests that a new series of consumer behaviors is forming thenext-generation version of the purchase funnel. Six clear pathways emerged, defining the mostcommon types of modern digital shoppers. Each of the six segments represents like-mindedconsumers who follow a given path of varying depth and duration to reach a marketer’s optimaloutcome—a sale.1A new seriesof consumerbehaviors isforming thenext-generationversion of thepurchase funnel.The Digital Consumer Journey:The Six Types of Digital Consumers; Amazon’sIncreasing Influence in the Purchase PathwayMay 2013
  • 3. The Six Types of Digital Consumer JourneysIn examining purchases made in the consumer electronics space where the consumer used digitalmedia in at least one step, it is the journey—not the individual or ticket price of the item bought—that is the defining variable. Of the consumers who make up each segment, the average age, gender,income, education and ethnicity are remarkably similar. This suggests that, with a few exceptions,the difference in purchase pathways has more to do with behavioral factors than demographics.Average purchase price is also very similar among segments, suggesting that the type of productis not a differentiator.No segment has a majority of the market; the most prominent segment makes up 29% of allpurchase paths. Because of this, marketers have to be nimble. They cannot simply play to themajority, because no majority exists. Brands and marketers need specific strategies for where tofind consumers and what to say to them.2Basic DigitalConsumersRetailScoutsBrandScoutsDigitallyDrivenSegmentCalculatedShoppersEternalShoppers6345143529%22%20%16%11%2%The Six Segments and Their PathsSearchSegment Name RetailSitesBrandSitesPathLengthStepsMobile Social Local Portal% ofDigitallyEngagedShoppersTOOLSThe Digital Consumer Journey:The Six Types of Digital Consumers; Amazon’sIncreasing Influence in the Purchase PathwayMay 2013
  • 4. 3The Digitally Driven SegmentUsing every digital tool at their disposal, these modern consumers exist ingood numbers already, but within five years, this will be the dominant segmentof consumers. These people embrace digital from beginning to end. They usesocial and mobile more than any other segment in the study, they value convenience above all else andthey do just about everything in their power to avoid physically going to a store.Of any segment, the Digitally Driven Segment is the most engaged with social media, with 29% of pathscontaining a branded social site. These consumers are also the most mobile, using mobile more thanany other segment and for the primary purpose of doing research, as opposed to looking for storelocations. This segment has the highest ratio of online to offline purchases. When asked about thebenefits of buying online, the response of these consumers was that prices are better and it is fasterto shop online. This segment enjoys being left alone; these consumers said they make their purchaseonline to avoid salespeople and crowds.This new, digital-savvy segment has another interesting trait—these shoppers like advertising. TheDigitally Driven Segment is 30% more likely to find ads valuable than someone in another segment.Reaching the Digitally Driven Segment:» Brands can reach this segment of people online.» Have a mobile and local strategy for this segment.» Surprisingly, these consumers do not watch many video ads, nor do they find video advertisingvaluable.» This segment is the most likely to become a brand advocate on social media, with ~ 14% goingto a branded social media site after purchase. Give them a “share” button on the product pageand after checkout.» Of all segments, these shoppers had the highest affinity for search ads.» Buying trigger: Keep the conversation going between these buyers and your brand by reachingthem at multiple touch points.Basic DigitalConsumersRetailScoutsBrandScoutsCalculatedShoppersEternalShoppers634143529%22%20%11%2%DigitallyDrivenSegment516%The Digital Consumer Journey:The Six Types of Digital Consumers; Amazon’sIncreasing Influence in the Purchase PathwayMay 2013
  • 5. 4The Retail Scout SegmentThese consumers have short journeys and prefer retail sites to brand sites.The Retail Scout Segment uses mobile, but these consumers are twice aslikely to use it in the home as out. They use tablets and are responsive to ads on tablets. They arecomfortable buying online but did not express a preference between online and offline. This segmenthas the least amount of consumers who had multiple purchases (two or more) in the same categorywithin the previous six months.Reaching the Retail Scouts:» Brands can find this segment on tablets and mobile devices.» This segment is highly likely to use search. Brands should consider using retail sites as landingpages.» These shoppers will be most responsive to coupons that can be used online or offline.» Buying trigger: Right product, right price.The Brand Scout SegmentThese consumers have short journeys and prefer brand sites to retail sites.Brand Scouts are the spiritual partner to the Retail Scouts, except instead ofhaving a favorite retailer, they have a favorite brand. When asked, 72% said they start their journey witha brand in mind.Those in this segment seem to already know the brand they want to buy—now they are asking, “Should Ibuy it?” When they go to the brand sites, they say they are trying to understand features. Of all segments,they are the least likely to try and find a lower price elsewhere. While they are not price-sensitive, they areresponsive to value-added perks. They place a high value on free shipping and free returns.Of all the segments, these consumers watch the most video and place the highest value on videoadvertisements. They also find display ads valuable. Additionally, when compared to other segments,they have the highest preference for offline purchases.Basic DigitalConsumersRetailScoutsBrandScoutsCalculatedShoppersEternalShoppers634143529%22%20%11%2%DigitallyDrivenSegment516%Basic DigitalConsumersRetailScoutsBrandScoutsCalculatedShoppersEternalShoppers634143529%22%20%11%2%DigitallyDrivenSegment516%The Digital Consumer Journey:The Six Types of Digital Consumers; Amazon’sIncreasing Influence in the Purchase PathwayMay 2013
  • 6. 5Reaching the Brand Scouts:» These shoppers are already going to the brand site, so they do not need much convincing. Theyare responsive to non-monetary incentives.» They are responsive to video and display ads. This could be a great opportunity for retargeting.» They use search, so brands should make sure the non-monetary incentives are apparent in thecopy of their search ads.» Buying trigger: Free shipping, free returns, minimize buying friction.The Basic Digital Consumer SegmentThis segment takes several steps to research online, but they are nothighly digital users. Basic Digital Consumers are comfortable withInternet shopping and research, but they are not mobile nor social andhave the second-highest likelihood of buying offline. They are not the early adopters; they arethe secondary adopters. In the next few years, this segment will likely shrink as people become moremobile-centric.The right offer can make the difference—73% of those surveyed said they are looking for promotions.In terms of digital media exposure, this segment has the highest percentage of remembering a displayad, and 10% said a display ad prompted them to look up more information about the advertiser, thehighest of any segment.Reaching the Basic Digital Consumers:» The biggest opportunity for brands is in display advertising. The research path of theseshoppers takes them all over the Internet, and the right display ad with the right message canbe a powerful combination.» They buy both online and offline, so give them a coupon that will work for either.» Decision is made using a desktop or laptop computer.» Buying trigger: The right offer.Basic DigitalConsumersRetailScoutsBrandScoutsCalculatedShoppersEternalShoppers634143529%22%20%11%2%DigitallyDrivenSegment516%The Digital Consumer Journey:The Six Types of Digital Consumers; Amazon’sIncreasing Influence in the Purchase PathwayMay 2013
  • 7. 6The Calculated Shopper SegmentThe Calculated Shoppers seem to know they are going to make a purchase,but they are deciding which brand to choose. They are similar to theDigitally Driven Segment, but they have no urgency to their purchase, andthey’re willing to take the time to get the best deal.About 24% watch product videos on a manufacturer’s website, the highest of any segment. Whileon mobile, they look for pricing and features as well as compare brands, but they are not lookingfor where to buy, which is why these purchases lack urgency.Consumers in this segment are likely to be showroomers; they say they use their mobile device to price-compare when they are close to a purchase.Like the Digitally Driven Segment, these consumers find value in advertising. They are also higher-volume customers, with 65% making more than one consumer electronics purchase in the pastsix months.The Calculated Shoppers are the second most likely to use social. It is important to give these customerseasy ways to share with their network the deals and products found on brand websites.Reaching the Calculated Shoppers:» These shoppers are responsive to advertising. They are highly likely to use search and arelooking for promotions and specials.» They go to multiple brand sites to compare price and features, so make that information easyto find and compelling.» Of all the segments, these consumers are most ideal for loyalty programs. They make multiplepurchases and are responsive to email.» They tend to use mobile when close to the purchase decision to price-compare—make yourmobile site showroom-friendly.» Buying trigger: Promotions and special deals they can be proud of—and feel compelled to share.Basic DigitalConsumersRetailScoutsBrandScoutsCalculatedShoppersEternalShoppers634143529%22%20%11%2%DigitallyDrivenSegment516%The Digital Consumer Journey:The Six Types of Digital Consumers; Amazon’sIncreasing Influence in the Purchase PathwayMay 2013
  • 8. 7The Eternal Shopper SegmentThe consumers in this segment are trying to find answers to, “Should I buy?”,“What do I buy?” and “What brand do I buy?”—all at the same time. Theseshoppers have no urgency to make a purchase, and they do their research ondesktop and laptop computers, not mobile.This segment’s consumers do not place a high value on price or promotions, and they are not concernedabout convenience. More interested in researching the product, they are not necessarily doingin-category comparison shopping.Reaching the Eternal Shoppers:» This segment’s consumers are all over the map, but they use search to navigate from stepto step. Search is the best way to reach this customer, but bid carefully—they could cost amultitude of non-converting clicks while they research.» Like the Calculated Shoppers, they are responsive to email ads, so they are good candidates forloyalty programs once you acquire them as customers.» Buying trigger: Excitement about the product.The Essential Roleof the Brand WebsiteBetween Amazon, Facebook brand pages and locallistings, almost anything a consumer wants to knowabout a brand can be found somewhere other thanthe company site. For some brands the role of thesealternative properties has raised questions as to thelasting value of a brand website. The results of thisresearch show that a brand site is an incredibly importanttouch point for consumers.The most common destinations of consumers who use online in their purchase pathway are brandsites (69%) and online retailers (50%). Portal sites (common homepages such as AOL.com, Yahoo.com and MSN.com) and social media sites are found in conversion paths five times less than brandand retailer sites.Basic DigitalConsumersRetailScoutsBrandScoutsCalculatedShoppersEternalShoppers634143529%22%20%11%2%DigitallyDrivenSegment516%Median Times Consumers Spendat Four Major Digital DestinationsSource: The Modern Digital Path To Purchase; GroupM Next, 2013BrandSite543210Portal OnlineRetailerSocialMinutesThe Digital Consumer Journey:The Six Types of Digital Consumers; Amazon’sIncreasing Influence in the Purchase PathwayMay 2013
  • 9. 8When consumers go to a brand site, they spend a median time of 4.2 minutes at that touch point, morethan twice as long as at a retailer site. In a Compete study in 2012, it was discovered that consumers whoshopped online for CPG products and eventually purchased those products were more likely to havevisited the brand.com sites prior to their purchase. Collectively, this means that despite more optionsfor both consumers and brand to connect, the core destination of a brand website remains relevant—and valuable.In addition to the paths that ended in conversion, a number of “look-alike” pathways were examined, inwhich a consumer hit at least two product research pages but ultimately did not make a purchase. Thesewere consumers who were on the path to purchase but dropped off somewhere along the way. Of all ofthe possible destinations, the brand site was the only touch point more likely to be found in a convertingpathway than in a non-converting pathway.In the survey, consumers said they look to brand sites for features, product specifications, promotionsand purchase locations.Additionally, brand sites are often found in purchase pathways after conversion,often paired with social media. This is unexpected and valuable information for brands because itsuggests that people return to the brand site to verify their purchase, remember what they bought and tocopy the URL to paste to social media sites.Why Amazon is More Than Just an Online RetailerIn digital retail, it is becoming Amazon and everyone else. Amazon has joined Google as the two mostimportant digital properties in consumer purchase behavior. In digital pathways leading to a purchase,Amazon.com appears 17% of the time. In comparison, every other retail site combined showed up in34%, meaning that when consumers go to retailers, one out of every three goes to Amazon.On its way to becoming the largest online retail site, aninteresting thing happened: Amazon became a trustedsource of research at all stages of the conversion pathway.Of purchase pathways which contain Amazon.com:» 37% of the time Amazon starts a path that endssomewhere else.» 35% of the time the purchase path ends at Amazon.» 22% of the time the path starts and ends somewhereelse, but Amazon is used in the middle.» 6% of the time Amazon is the only destination inthe path.37%35%6%22%PURCHASEPATHWAYSCONTAININGSTARTSPATHENDSPATHONLYPATHMIDDLEOF PATHAmazon represents one-third of allretail site visits in purchase pathways.The Digital Consumer Journey:The Six Types of Digital Consumers; Amazon’sIncreasing Influence in the Purchase PathwayMay 2013
  • 10. 9The Digital Consumer Journey:The Six Types of Digital Consumers; Amazon’sIncreasing Influence in the Purchase PathwayMay 2013Our research reveals consumers are just as likely to use Amazon as a research site as they are to use itas a retailer. Amazon is seen as having trusted reviews and as a good source for price comparison. Thisrole creates an incredible advantage. Modern consumers put a premium on convenience, and if Amazoncan continue to function as a trusted research destination, many of those people will stay and purchaseat Amazon.The consumers in this study repeatedly said they go to brand sites to find promotional offers. As theKindle distribution and ad model evolves, the influence of Amazon will only increase.The Connection Between Social and BrandOne anticipated but non-material influencer is social media. Social sites, defined as brand-specific pageson Facebook and Twitter, showed up only in 4% of all purchase pathways evaluated. Those who diduse social were just as likely to use it after making a purchase as they were before. In post-conversionactivity, social media is often paired with brand site visits, meaning these customers would return to thebrand site in order to share the product, coupon or sale with their network.This study measures the impact of branded social media, noting that click-stream data analyzed doesnot include personal Facebook and Twitter interactions, where there are certainly influential activities.Therefore, the overall effect of social media is unambiguously higher than the results in this study.Three of the six segments in this study regularly use social in the purchase process: the Digitally DrivenSegment, the Calculated Shoppers and the Eternal Shoppers. The connection of brand visitors to socialsharers is a critical link in bridging brand to earned media. These brand-social consumers are the carriersof the brand DNA to others who might not be reachable by paid media alone. Identification of theseconsumers as a growth target will be a good media bet for continued presence in earned media.To encourage the sharers, the next step will be to understand what and why they share. What promotionsdo they value? What information would others find compelling enough to generate interest in the brandwhen shared? Perhaps brand websites should provide something brand advocates can share to furtherincent both sharer and those being shared with?
  • 11. 10The Law of the Instrument: Why Brands Need a Bigger ToolboxThe Law of the Instrument states, “If the only tool you have is a hammer, everything looks like a nail.”Modern digital consumers are fragmented and nuanced. They cannot all be treated the same, andtherefore modern marketers have to be nimble and pragmatic, using the proper tool to reach the rightconsumer with the right message at the right time.This study reveals the most common pathways today’s digital consumers take to find information,answer questions and make purchases. Over time, the proportions of each type of path will change andnew pathways will emerge, likely with mobile playing an increasingly larger role. An exciting finding ofthis research is that the most digital savvy customers are also the most advertising-friendly. Give thecustomers something useful, and they will be responsive.The purchase funnel as we knew it is dead, but in its place are countless street corners, each anopportunity to reach a customer at a crossroad in the purchase pathway.The Digital Consumer Journey:The Six Types of Digital Consumers; Amazon’sIncreasing Influence in the Purchase PathwayMay 2013
  • 12. GroupM Next is the forward-looking, innovation unit of GroupM, the world’s largest global media investment management groupthat is the parent company to WPP media service agencies Maxus, MEC, MediaCom and Mindshare, as well as Catalyst Onlineand Xaxis. Together with GroupM agencies, GroupM Next focuses on the curation and application of insight-focused solutionsacross online, social, mobile and addressable channels. Through thought leadership, technology, research and education,GroupM Next delivers data-driven, actionable insights and a clear path to action to help GroupM agencies and their clientsharness the right opportunities made possible in the digital technology and new media industry environments with speed andrelevance. Access our work and discover our perspective at www.groupmnext.com.Contact us with questions or comments: cindy.spellman@groupm.comGroupM Next111 Westport PlazaSuite 350Saint Louis, MO 63146www.groupmnext.comA WPP Company