Precision, Passion & Prudence

A study of multichannel shoppers yields valuable insights.

By Masha Sajdeh and Nick Jones, Arc Worldwide

Let’s dispel the misnomer that shopper marketing is just in-store marketing. A growing number of shoppers “shop” in more places than just the store. So, contrary to popular belief, shopper marketing must be viewed as more than just marketing in-store.

People used to walk into a store and buy a television, but times have changed. Today, a shopper may research TVs in magazines and online, browse a store circular delivered in the mail, go to the store, and while there check for online prices on a smartphone, maybe even order the set online, and pick it up in the store.

Forrester Research predicts that by 2012, nearly 50 percent of transactions will be executed with the consumer crossing channels. This trend represents a fundamental change in the way people shop, but there has been a dearth of insights for marketers to leverage.

Arc Worldwide recently completed a research study that uncovers new insights into the multichannel shopper. This study provides a look at cross-channel shopping across a broad scope of categories studied, including durables, services and consumer packaged-goods.

The study was conducted online, and included 60-minute interviews with more than 5,600 respondents in the United States, United Kingdom and France. Their shopping behaviors, attitudes, motivations and barriers were studied across 10 channels such as stores, online, phone, catalog and flyers.

The research illuminates who multichannel shoppers are, why they shop across channels, what role the different channels play in the shopping process, and how these shoppers behave in 20 specific categories and industries.

An Engaged Shopper

Multichannel shoppers are driven by a need to make an informed purchase decision and put in due diligence to ensure they are getting exactly what they want. They are driven to get the best price possible and will shop around to find it.

For them, it’s worth spending the time and they enjoy the hunt. Shopping is not a chore for multichannel shoppers; it’s, in fact, quite a delight. They enjoy immersing themselves in the experience and are on a constant lookout for great deals and new trends.

Whether they are shopping everyday consumables or the occasional big-ticket item, heavy multichannel shoppers spend more time shopping, and shop in many more places than light shoppers. While the store is a common place for both heavy and light multichannel shoppers to shop, differences emerge depending on the category. Light shoppers stick to the store for packaged goods, while heavy shoppers also shop alternative channels such as online, circulars and infomercials, tripling the time spent shopping for packaged goods. When shopping for high-ticket durable goods, both heavy and light shoppers spend more time online than in the store. But heavy shoppers go the extra mile, shopping around in different channels.

Categories Drive Behavior

There is no one-size-fits-all approach to multichannel marketing. To truly grasp the complexities of multichannel shopping you must examine it from three dimensions: the category, the shopper and the channel.

Different categories experience varying degrees of multichannel shopping. Depending on the category being shopped, different patterns of shopper archetypes emerge. Once you determine which type of shopper dominates your category, understanding the channel mix they use proves to be uniquely relevant for your category.

While multichannel shopping is a rapidly growing occurrence, it is not equally established across all types of categories. There are varying degrees of multichannel shopping and buying behaviors.

Shoppers are prone to multichannel shop durable categories such as computers, automobiles and appliances more than they are for packaged goods. But not all packaged goods are alike; certain categories like skin care and pet supplies have emerging multichannel shopping behaviors. As people shop in more places, they generally are more open to buying in more alternative and emerging channels.

The behavior in categories that are likely to see a prevalence of multichannel shopping tends to be quite different from those that don’t. To a large extent, this behavior is explained by a risk/reward model developed by Leo Burnett that illuminates the involvement, approach and mindset that people have towards a category.

Multichannel shopping is more heavily affected by risk than reward. When risk is eliminated from the process, multichannel shopping diminishes because people no longer feel the need to shop around.

Risk helps explain why durables are heavily multichannel shopped while packaged goods are not. Because durables cost more, the risk of failing to find the “perfect” product is higher and shoppers are motivated to save big dollars. Durables are also purchased less frequently and are more complicated to shop, so shoppers need to research them more. In contrast, consumables are purchased routinely and require little effort to shop.

Just as risk is a factor in multichannel shopping, reward also draws people to shop in certain categories more than others. Certain non-durables such as books, CDs and designer jeans are multichannel shopped because people treat these as a leisure activity and hence enjoy shopping for them. This is in contrast to other categories that may be viewed as burdensome or routine.

Similar shopping patterns don’t necessarily translate into similar purchase patterns. Although durables are shopped one way and consumables another, purchase patterns don’t necessarily align. Computers and accessories are purchased online or in an alternative channel, but autos are not. Books and music are purchased online, but designer jeans are not.

To a large extent this phenomenon is also explained by the risk dimension. Products that shoppers need to touch and feel before purchasing won’t be purchased in an alternative channel unless the uncertainty is mitigated. Music and books have both successfully enabled people to sample the product, and overcome the barrier to purchase. However, shoppers don’t yet feel comfortable buying designer jeans without trying them on.

The Packaged-Goods Question

The inevitable question for packaged-goods marketers is, how will the multichannel shopping phenomenon affect their categories? We see that certain packaged goods — like skin care, pet supplies and packaged organic foods, are experiencing higher levels of multichannel shopping and buying than others.

This is because categories like skin care are becoming more complex as new products emerge, making it difficult to navigate selection at the shelf. Skin care has relied on more informative channels like direct sales and infomercials to address the complexity and intimacy of the decision.

Similarly, unfamiliar categories, such as packaged organic foods, have a need for research. In the case of pet food, shoppers rely on more information sources because they’re often unable to make a choice themselves.

Marketers have enabled people to indulge their passions for their pets and now shoppers embrace social media networks to celebrate their passion. In each of these instances, shoppers are willing to put in an extended effort to make an informed selection.

What are the barriers holding back other packaged goods? Why is cereal any different than pet food? Why are shoppers willing to shop more channels for their pet’s food than their own? Several reasons prevail.

Well-established, low involvement, routine and unplanned purchases primarily take place in-store. Limited channels to purchase also restrict multichannel shopping. If packaged-goods marketers want to engage multichannel shoppers, they must create more opportunities for shopper involvement through more engaging experiences in alternative channels.

Multichannel Shopper Archetypes

To engage multichannel shoppers in your category, you need to understand them. In examining multichannel shopping behavior across the 20 categories, we also uncovered six shopper archetypes based on their overall attitudes and motivations to multichannel shopping.

Among these general shopper archetypes, two dominate among heavy multichannel shoppers — the Strategic Savers, Opportunistic Adventurers and Savvy Passionistas are about average — representing motivations driving multichannel shopping — precision, prudence and passion.

 Strategic Savers are committed to doing due diligence to find exactly what they are looking for at the best possible price. Opportunistic Adventurers get a thrill from treasure hunting and discovering unbeatable deals, and Savvy Passionistas enjoy shopping around to find the latest and greatest.

Among the other archetypes that emerged: Quality Devotees are highly discerning and need to experience products firsthand; Efficient Sprinters readily pay more for convenience; Dollar Defaulters use price as their primary decision criteria, sacrificing both brand and experience.

 When we apply the category lens, different archetypes dominate in different categories. For example, within packaged-goods categories like laundry detergent, Dollar Defaulters and Efficient Sprinters skew highest, and represent the prevalent price-driven, low involvement behavior.

 Within emerging packaged goods, such as skin care and pet supplies, Dollar Defaulters and Efficient Sprinters still over-index, but Opportunistic Adventurers and Savvy Passionistas also emerge as these categories have become more engaging to shop. Finally, within durables, Strategic Savers and Quality Devotees are both over-represented as these are high-ticket items that require research and involvement to find the right product at the right price.

The type of multichannel shoppers that dominate in your category determine the mix of channels that should be used to meet their unique shopping needs. The store is used equally by all types of shoppers. Online is also a popular channel among many archetypes, but the heaviest multichannel shoppers — Strategic Savers — tend to use online more to research and price compare.

 Magazines are preferred among Savvy Passionistas and Opportunistic Adventurers because they offer a fun way to browse for new trends. Catalogs are a favorite among Savvy Passionistas for gathering inspiration, but Strategic Savers also use them for comparison shopping. In contrast, the Efficient Sprinter and Dollar Defaulter are relatively less engaged across channels.

Different channels serve different needs. Different archeypes use different channels because each channel does something different for them. Television, magazines and catalogs are used for inspiration. Online, flyers and circulars are employed to save money and find the best deal. Stores, customer service and sales reps help with experiencing a product first-hand. Circulars are part of a routine and so are stores. Shoppers haven’t defined a clear role yet for mobile phones; this is an emerging channel.

Decoding the category, shopper and channel tri-factor is at the core of uncovering the multichannel story for marketers. What should you do? Ask yourself these key questions:

• How prevalent is multichannel shopping in my category?
• Which multichannel shopper archetypes dominate in my category?
• What channel mix do shoppers use in my category?

The answers may well lead you to harnessing the power of the multichannel shopper and fueling their passion for shopping.

MASHA SAJDEH is chief shopper strategist and leads the insight group at Arc Worldwide, the marketing services arm of Leo Burnett Group. She may be reached at masha.sajdeh-at-arcww.com.

NICK JONES is executive vice president, retail practice lead and account director at Arc Worldwide, specialists in shopper, digital, promotion and direct marketing. He may be reached at nick.jones-at-arcww.com.