New research has revealed the customer segments - and their motivations - that marketers should be targeting to save their high street brands from ruin.
Against the backdrop of high-profile high street brands going to the wall, and the appointment of retail guru Mary Portas to carry out a government-backed review, Experian conducted a study of 2,000 people about their shopping behaviour.
And despite the collapse of companies such as Thorntons and Habitat the findings challenge the view that Britain’s high streets are in terminal decline.
In particularly, the emergence of a new group of consumers – ‘multichannel shoppers’ – is providing retailers with reason to be optimistic.
The multichannel shopper is urban, affluent and young; and they fall into four distinct groups, differentiated by their unique behaviours and motivations.
The wealthiest of the multi-channel shoppers, they tend to live with their children in family houses. Most of their income tied up in property, they will conduct their own research and are less likely to be influenced by social media.
These young families are often over-stretched on their credit, resulting in functionality, reliability and value being the key drivers of their purchasing decisions. These consumers find reassurance in knowing the finest details of products but lack time to wait in for products to be delivered. Therefore convenient schemes such as click and collect resonate well with this group.
New home makers tend to be young, single professionals. They tend to rely on the internet to search for information and advice about products and services: However, they prefer to receive information via their mobile rather than direct mail.
These young professionals have yet to commit to partners, children or purchased property. They are experienced users of the internet and therefore use this as a key channel to purchase products and manage their finances. Again their lack of time means waiting in for online deliveries may prove to be a barrier to making final purchases online.
Overall, the Experian research reveals that almost a third (31%) of the UK population now falls into the multichannel category.
Nigel Wilson, Experian’s managing director of marketing information services in the UK and Ireland, said: “Although multi-channel shoppers tend to share some characteristics, our research shows that they are clearly defined groups. This has a real impact for marketers to understand the best channels to reach each section and if high street retailers want to thrive, they need to increase their flexibility and reach across all channels.”
Experian’s research also revealed that there is another distinct group of individuals for whom social media dictates their purchasing decisions. With limited disposable income, these ‘social shoppers’ use social networking as a way of life and their reliance on this form of media is greater than others. Most likely to be seen with the latest mobile phone, this group has a high take up of new technologies.
Nigel Wilson explained: “For marketers, understanding the distinction between not only the sub-sets of multi-channel shoppers but also appreciating there is a unique group of social shoppers who need to have products promoted to them in a different fashion is crucial.”
In light of the significant changes in how consumers shop as highlighted by the study, Experian shares five tips for any retailers keen grow their high-street presence.
1. Knowledge is power. Never underestimate how much consumers know about the performance and price of your products.
2. Join the channels up. Make sure on and offline marketing is a consistent experience, multi-channel users will purchase across both channels.
3. Incentivise consumers in the right places. Know where and what consumers respond to best.
4. Embrace the power of social media, use friends networks such as Facebook to drive consumers to on and offline locations
5. Make it mobile. Create an app to help them find you on the go.