By Rodney Mason, CMO, parago
Today, consumers have more information sources to help them make purchasing decisions. Smartphones, tablets, social media and the Internet — combined with traditional shopping channels like magazines and direct mail — means that deal-finding and comparison-shopping methods are almost always at consumers’ fingertips. As a result, shoppers are making their purchases faster.
While the shopping pace increases, many retailers are struggling to keep up with the demand for new marketing, promotional and pricing strategies. But the message is clear: omni-channel shopping means retailers must dynamically disrupt the path to purchase — or risk getting left behind.
At parago, we conducted shopper research during the 2013 peak holiday shopping season and identified a number of emerging omni-channel, path-to-purchase shopping trends for the year ahead. These results are important for all retailers as they plan for back to school and beyond.
Our research shows that consumers no longer spend weeks or months planning purchasing decisions, even with higher-priced items like home appliances. Instead, the average time to purchase is just three days. That’s less than a week to convince a customer that your store is the best place to buy.
Interestingly, even with this shorter path to purchase, deal-finding activities are increasing. Some 65% of shoppers report being more sensitive to price now than they were a year ago. Plus, 88% of consumers look for deals, rebates and best prices before they even walk out the door. Consumers appreciate the savvy feeling of knowing they’ve found the best price simply by doing what they consider to be basic Internet research.
In addition to deal seeking online, showrooming continues to be a threat. Four out of five 18- to 49-year-olds own smartphones, and nearly 50% of all shoppers compare price in-store using smartphones. Even if a retailer uses smart marketing and promotional techniques to get a consumer to walk through the door, this potential customer may walk out empty-handed and choose to purchase elsewhere for a lower price.
Today’s consumer is dynamic and moves quickly, so retailers must also use sophisticated pricing techniques. Best-in-market prices can disrupt the path to purchase for consumers in the middle of the research process.
The majority of shoppers would stop their searches and purchase immediately if offered a dynamic-price rebate. These rebates respond to consumers’ demands for lowest prices while protecting retailers’ margins for retailers.
In an era of omni-channel shopping, retailers have a smaller window to capture consumers and convert sales with a compelling value proposition. Retailers must think like their consumers — busy, demanding deals, always connected, savvy — to develop compelling strategies for engaging this evolving shopper behavior.
Rodney Mason is CMO of parago, a global thought leader and incentives and engagement provider that delivers billions in rewards to millions of people for leading brands around the world. Follow him on Twitter or send him an email. For a free copy of the report, “Need for Speed, Disrupting The Omni-channel,” go to bit.ly/1jvOngU.