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It’s certainly commonplace for shoppers to be inundated with promotional materials from retailers and suppliers as they walk the aisles during their regular shopping trips. For retailers, there seems to be no end to the planning and execution of new creative content, featured products, sale prices and promotional messaging at the store, category and product levels.
But for those retailers who question how those efforts pay off in a tangible sense, Chicago, Ill.-based Market Track’s Shopper Insight Series, designed to provide clarity and insight into promotional and pricing execution, enables retailers to wade through the clutter and refocus their promotional strategies for maximum benefit.
According to Market Track, promotions are an important motivator in shoppers’ mindsets as they choose where to shop and what to buy, and effective promotions can be the difference between shoppers choosing a certain retailer or product over its competitor.
Here’s an interesting statistic. According to Market Track’s Shopper Insight Series survey, 78 percent of respondents said that during the past 12 months, they have purchased a brand other than the one they normally purchase based on a promotion they received.
Here’s another. Of the shoppers surveyed, almost 80 percent had changed where they normally shop at least once in the last 12 months based on a promotion; 30 percent visited that store to pick up the item on promotion; and nearly 50 percent indicated their purchase at a competitor’s store translated to repeat business.
Put more simply, nearly half of a retailer’s shopper base is at risk of jumping ship to a competitor that offers a more appealing promotional value.
During the last few years, we’ve seen a monumental shift in the way consumers absorb information, particularly promotional material. To that end, it’s imperative that retailers understand their target consumer base and its particular set of preferences – digital versus print, the use of social media, smart phone apps, etc.
A strategy that incorporates both print and digital is likely the most effective, finds Market Track, as 69 percent of survey respondents said they regularly use print media to find deals, tied with retailer websites; about half of respondents use emails from retailers, weekly circulars posted online and TV ads, further confirming that an “either/or” approach may not be the best way to leverage promotions.
In the same vein, this multi-channel approach also affects planned versus unplanned purchase decisions. Indeed, across all consumer bases, 83 percent have made an unplanned purchase after receiving a promotion for a product in the past 12 months; of those 83 percent, 82 percent claim to use two or more media types to find such deals; 68 percent three or more; and 50 percent four or more. This reveals that consumers who use multiple forms of media are more likely to make a promotion-based purchase they did not intend when entering the store.
As most retailers assume – or maybe they don’t – younger consumers gravitate toward digital media types when investigating promotions, while older consumers rely more heavily on traditional print media (over 70 percent). And while this argument does hold water, Market Track’s research is finding surprising evidence that media usage is not so cut and dry.
In fact, over 60 percent of respondents in the younger age brackets of 18-20, 21-29 and 30-39 said they do use print promotions to find deals -- a significant departure from common assumptions. And, on the other side of the spectrum, older consumers do seek out digital formats, most commonly email, with 50 percent of shoppers ages 40-49 saying they receive and use promotional emails from retailers; as well as 43 percent of shoppers ages 50-59; and 56 percent of shoppers ages 60 and over.
What does align with commonly held generation-based assumptions is the use of social media and mobile – two fairly new platforms – with 30 percent of respondents ages 18-39 using retailer social media sites; only 20 percent ages 50-59; and under 15 percent ages 60 and over. Likewise, only 30 percent of those 18-39 use mobile platforms, and less than 10 percent of those 50 and over.
So what’s the take-away?
We know that promotions dramatically influence shopper behavior, and to leverage promotions successfully, retailers must understand their shoppers' mindsets – their habits, tendencies and how they absorb information.
To that end, as these trends continue to evolve, how has your company adapted its promotional strategies to accommodate consumer needs?