Some things don’t changeShoppers want quality products at a great price,great customer service, convenient locations
Some things do change• An overwhelming number of shopping decisions + less free time to make those decisions.• New consumer pain points.• The way people shop.• The balance of power between manufacturers, retailers and shoppers.
How people shop The days of uninformed shopping are over • 70% of Americans now say they look at product reviews before making a purchase • 79% of smartphone owners now say they use their smartphone to help with shopping • 83% of moms say they do online research after seeing TV commercials for products that interest themSource: ZMOT: Winning the Zero Moment Of Truth, by Jim Lecinski, Google
How people shop The average shopper used 10.4 sources of information to make a decision in 2011, up from 5.3 sources in 2010. Traditional 3-Step mental model New mental modelSource: ZMOT: Winning the Zero Moment Of Truth, by Jim Lecinski, Google
Balance Of PowerTechnology is empowering shoppers by makinginformation more transparent.
Balance Of Power: Retailers’ POV • 55% of retailers say it’s getting too easy for consumers to find competitive prices • 55% of retailers say shoppers are better connected to information than store associates • 87% of retailers believe that shoppers can easily find a better deal using their mobile devicesSources: 1) Retail Systems Research, “Optimizing Price In A Transparent World” Benchmark Report, Nikki Baird andPaula Rosenblum, April 2011. 2) Motorola Solutions Annual Holiday Study, January 2011
Information Transparency (my definition) The information consumers need simply delivered when and where they need it
Product Information, now“this toaster is junk and dangerous … our daughter burned herfingers on it. Its going in the garbage where it belongs.”“Weve had 3 fires in ours … stay away from this product unlessyou dont mind burning down your house/apartment.“One of the scariest things I have ever experienced.”
Product Information, now • “My 6 year old was hurt within 5 min.” • “My 8 year old cousin broke his neck walking (not even bouncing) on these shoes ... the little boys life has been pretty dramatically changed.” • “My 7 1/2 year old daughter tried these on at a friends house yesterday. She had them on for about 2 minutes before she fell and got hurt. After a trip to the ER and the Orthopedic Surgeon, she has a fracture in her growth plate.“ • Dont be as stupid as me, and DO NOT buy this item. IM SERIOUS!!!!”
Concealment “Our results indicate … retailers pursue strategies to lower the quality of the data and thus the utility of product search … it is more than questionable whether ShopBots will ever create market transparency”Source: “SHOPBOTS AND INFORMATION QUALITY – RETAILERS’ STRATEGIES FOR PRICE CONCEALMENT” , Oliver Hinzand Tanja Frischmann, 2008,
For the first time, the advantage has tipped in consumers’ favor
Consumers and a wave of startups areinnovating to push the boundaries of information transparency
So What? Retailers• Your best customer is the one currently in your store – will you keep them?• Empower your sales associates (don’t tie their hands). – Provide access to product info and pricing via mobile devices – Have a policy around price comparison
What’s Your Policy?Source: RSR Research, Optimizing Price in a Transparent World
So What? Retailers• Your best customer is the one currently in your store – will you keep them?• Empower your sales associates (don’t tie their hands). – Provide access to product info and pricing via mobile devices – Have a policy around price comparison – Create a feedback loop• Standardize pricing online and in-store• Never refuse to tell your customers a price
So What? Manufacturers• What resources have you deployed toward ZMOT? Are you one of the 10.4 research sources?• Think of customer product reviewers as your extended marketing team.• Don’t force your retailers to conceal prices.
So What? All Brands• What resources have you allocated toward driving transparency vs. concealment?• Consider partnerships to help drive transparency in ways that will benefit your brand• Monitor your brand online, incl. mobile• Don’t fight your customers or the trend of transparency