3. the future of shopping | vol 5
2 Introduction: 21st-Centur y Retail
3 Four Imperatives for the Retail Brand of the Future
23 The Internet and the Rise of the Smart Shopper
4.
5. 2
“I am the world’s worst salesman; therefore, I must make it easy for people to buy.”
–F.W. Woolworth (1852–1919)
→ INTRODUCTION: 21st-Century Retail
Frank Winf ield Woolworth revolutionized retail in the 20th century, bringing goods out
from behind the counter and into the open, where customers were free to inspect and
touch the merchandise prior to purchase. His f ive-and-dime stores were the precursor
to today’s big-box discounters, and, like Wal-Mart today, he was accused of driving local
merchants out of business by undercutting prices.
By its 100th anniversary in 1979, Woolworth’s had And there’s precious little room for missteps,
become the largest department store chain in the especially in difficult economic times. It’s little
world. Fewer than 20 years later, in 1997, Woolworth’s wonder, then, that the International Council of
department stores were no more (though chains Shopping Centers estimates there will be 5,770
using the name continue to operate outside the store closings in the U.S. alone in 2008, up 25
U.S.). Unable to compete with the new generation of percent from 2007.
discount retailers, F.W. Woolworth’s company changed
This issue of Prosumer Report explores the future
its name to Venator Group and now survives as
of the retail category, with an emphasis on how
sporting-goods retailer Foot Locker, Inc. Woolworth’s
evolving customer demands and behaviors are
fall stands as a reminder of just how competitive the
changing the shopping experience. The report
retail category has become. There are many more
draws on findings from Euro RSCG Worldwide’s 2008
formats, more goods (about 180,000 new products a
The Future of Shopping study. The online survey
year), and more players. At the same time, retailers
was conducted by Market Probe International in
are facing increasingly demanding stakeholder
four markets: the United States (n=700), France
groups, ranging from everyday customers to NGOs
(n=700), the United Kingdom (n=700), and
and influential bloggers. They’re under constant
China1 (n=700). Prosumer breakouts are included
pressure to deliver innovative new products, services,
throughout the report as indicators of where the
environments, and experiences.
sector will be heading next.
1
Prosumers in the China sample were identified using an algorithm refined for that market. In addition, the Chinese sample in general should be
considered as representing the upper tiers of Chinese society rather than the mainstream, given that all respondents completed the survey online.
At present, China has an Internet penetration rate of approximately 16 percent, according to the China Internet Network Information Center;
that compares with rates of 69.7 percent in the United States, 55 percent in France, and 61 percent in the United Kingdom.
6. 3 Four Imperatives for theRetail
Brand of the Future
Retail is a constantly evolving category, mutating in response to new ideas, pressures,
technologies, and opportunities. Looking back over the centuries, one can see a
progression that begins with basic survival and eventually morphs into something
far more complex. The most primitive retail customers (and they still exist in every
market) are concerned only about survival. Their focus: price and accessibility. Simply
put, they look for the cheapest food they can buy at the nearest location. At the next
stage, consumers focus on pleasure. In an environment of mass consumption, they
want more than just low prices, and they’re making more purchases unrelated to basic
needs (e.g., home furnishings, entertainment). These consumers value access to a
variety of products and brands, and are looking for great deals with lots of extras.
SURVIVAL PLEASURE MISTRUST MINDFULNESS
E V O LV I N G A P P R O A C H E S TO C O N S U M P T I O N
The next progression is marked by varying levels of on economic circumstance:
mistrust–typically coinciding with a period of soft As finances become tighter, an individual
growth and collective pessimism. Consumers are may decide considerations other than price
more informed and marketing savvy, and they begin are less important. It’s essential, therefore,
to question everything from brand promises and to be cognizant of where individual consumers are
corporate practices to excess consumption. They along the spectrum at any given time, because that
seek a sense of direction and control–to know that will determine how to target –and serve – them most
their purchases aren’t made blindly and without effectively.
real benefit. And, finally, many consumers are now
Taking into account these differing consumer
reaching a stage of mindfulness, a point at which
attitudes and need states, The Future of Shopping
they make the choice to become more responsible
has uncovered four actions retailers must take
consumers. These more mindful shoppers prefer
to stand out and thrive in tomorrow’s ever more
simplicity to excess and search for brand partners
competitive environment: They must engage
that offer a sense of humanism, moral values, and
consumers, they must help consumers, they must
authenticity. For them, shopping isn’t just about the
motivate consumers by creating stronger incentives
goods; it’s also about the people who produce and
to purchase, and they must target consumers based
sell the goods, and the impact one’s purchases have
on their individual priorities and preferences. Each
on the broader world.
of these imperatives would seem to be common
While it’s possible to identify large populations of sense, but precious few retailers have managed to
“survivors” in undeveloped markets and “mindfuls” address one on a consistent basis, much less all four.
in more mature markets, each type of consumer This section of the report showcases retailers– and
actually exists in every country. Moreover, any one retail initiatives– that offer a glimpse of the best
person may act according to any of these pillars practices of the future.
when making different consumption decisions. In
one product category, an individual might be focused
solely on price, while in another, he or she is looking
for something more. This can also change depending
7. 4 What’s a Prosumer?
Prosumers are the most inf luential men and women within any
market. Empowered by new technologies and improved access
to information, they have tipped the scales of power away from
manufacturers and retailers, and toward themselves. They are
highly knowledgeable and demanding consumers who expect
their brand partners to acknowledge their value and treat them
accordingly. Prosumers typically make up 15 to 25 percent of any
market. Euro RSCG Worldwide has made them an ongoing focus,
because, beyond their own economic impact, prosumers influence
the brand choices of others. Simply put, what prosumers are
doing today, mainstream consumers are likely to be doing six
to 18 months from now.
KEY PROSUMER TRAITS
» Embrace innovation–curious » Are marketing savvy and plugged
to try new things, challenges, in to multiple media sources
and experiences
» Demand top-notch customer service
» Keen on new technology and gadgets and access to information
» Transport new attitudes, ideas, » Proactively seek to maximize control
and behavior–they are “human media” over their lives through information,
communication, and technology
» Pursue timeless value
» Constantly seek information and
» Recognize their value as consumers and opinions; eager to share their views
expect brand partners to do likewise and experiences with others
RETAIL CATEGORIES IN WHICH
PROSUMERS YIELD MOST INFLUENCE*
» Food and Beverage
» Computers and Peripheral Equipment
» Home Electronics
» Health and Wellness
» Travel Services
» Beauty and Grooming
* Based on responses of “among the first to try” and “my friends come to me for advice.”
8. 5 Imperative 1: Engage
In the past few years, engagement has emerged as one of the advertising
industry’s favorite buzzwords. The idea, of course, is to get consumers who
are beyond the “survival” stage more involved with brands – and even brand
creation – rather than simply bombard them with brand messaging.
In the retail sector, we’ve identified three primary means of engagement:
1. Create experiences that engage consumers in the brand
2. Provide opportunities for communication and connection
3. Offer endless innovation
The Retail Brand of the Future Ian Schrager’s Gramercy Park Hotel in
New York City provides conversational currency
(RBoF) Of fers More Engaging by giving guests a key to the city’s only private
Experiences park, offering a unique experience, a sense of
elitism, and something to talk about upon their
With so many choices available, mature return home. London’s Selfridges provides plenty
consumers are gravitating toward retailers that of cocktail-party fodder with its Wonder Room–a
offer a fundamentally different experience or place where shoppers can find such high-end
little extras that elevate a mundane activity purchases as a sip of Pétrus Bordeaux ($66), a
into something more. Consider the difference first edition of Sylvia Plath’s The Bell Jar, or a
between picking up a bar of packaged soap at handcrafted winged saddle from Hermès.
a discount store and purchasing a freshly made
and cut Figs and Leaves handmade soap at Lush. Indulging the senses is another way to create
Everything about the experience is different, engaging experiences. In London, Tiffinbites
from the sights and scents to the level of pleasure uses aromas to turn lunchtime into a cultural
derived. The former is an errand, while the latter adventure. New York City’s Chop’t uses the sounds
is an indulgence. of simple kitchen tasks to draw diners in to the
beauty of making something fresh. Consumers
There are all sorts of ways to create retail also are being enticed with varying levels of visual
experiences that engage and indulge. Single- hypnotism, both inside and outside the store.
focus retailers such as Apple Store and Ethel’s Think: the displays at Dylan’s Candy Bar in New
Chocolate Lounge offer plenty of scope to York, the edible art created by Pierre Hermé in
support and encourage connoisseurship and Paris, and the architectural art that can be seen
a deeper brand experience. On Paris’s Champs in Apple’s flagship New York store and Selfridges’s
Elysées, Heineken has created an immersive Birmingham location.
experience centered on beer in hopes of reaching
a more sophisticated crowd than is generally As prosumers gravitate toward more experiential
found in sporting arenas and pubs. Culture Bière shopping, a growing number of retailers are
combines a sophisticated restaurant, three turning their venues into living, breathing
bars, a terrace, a boutique, and a gallery. In lifestyle statements, reflecting the values of
China, Beijing’s Lenovo Brand Experience Center both brand and consumer. London’s Microzine
provides an interactive experience that immerses store features a constantly changing array of
consumers in the brand, offering insights into upscale fashion, art, furniture, and technology,
the company and its technological achievements, all geared toward the tastes (and aspirations)
while also letting visitors get a taste of the of the readership of such magazines as GQ and
digital life in home and business settings. Arena. And in France, SFR’s new store doesn’t just
sell mobile phones; it also contains a concert
Starbucks was quick to recognize the value of hall, a design-focused restaurant and lounge
conversational currency. By providing a glimpse with free Internet access, and the Fashion Room,
of the people and processes behind its products, containing trendy phone accessories.
the retailer was able to turn coffee into a cultural
adventure.
9. 6 Retailer Websites Offer a Reliable Channel to Prosumers
In each market surveyed, the vast majority of prosumers –
and large percentages of mainstream consumers –already
are engaged in communication with retailers online. They
visit corporate websites to download coupons, sign up for
newsletters and special offers, and enter sweepstakes. Every
visit is an opportunity for the retailer to learn more about its
customers and discover more compelling ways to keep them
involved with the brand.
How often do you do each Indicate your involvement
of the following? with each online activity
FREQUENTLY/SOMET IMES DO IT NOW
sign up to receive coupons or request or download coupon
other store promos via e-mail or coupon code
p: 88% 77% 82% 87% p: 96% 78% 88% 80%
0: 78% 66% 68% 71% 0: 86% 61% 74% 72%
FREQUENTLY/SOMET IMES DO IT NOW
sign up to receive info/news subscribe to a retailer’s
from a retailer or manufacturer e-newsletter
p: 77% 71% 82% 81% p: 90% 89% 93% 91%
0: 64% 56% 66% 67% 0: 77% 80% 75% 76%
FREQUENTLY/SOMET IMES DO IT NOW
go to a company’s website to arrange enter an online sweepstakes
for service on a product i own
p: 52% 66% 43% 87% p: 75% 93% 38% 68%
0: 36% 45% 33% 67% 0: 70% 89% 33% 52%
p: prosumers o: others
10. 7 The RBoF Brings People The RBoF Keeps It Fresh
Together Innovation is arguably this century’s most
important driver of business and brand growth–in
Smart retailers understand brand engagement is
every category. In the retail sector, innovation
all the more potent if it brings people together,
allows companies to develop entirely new
creating dialogue and encouraging collaboration
business models (e.g., eBay, Netflix), to regain
and communal action. It can be as simple as
or grow market share (e.g., Apple), and to get
providing communal dining spaces, as the
noticed. It’s also an increasingly important
Wagamama noodle-bar chain does in more than a
component of financial performance: According to
dozen countries, or as involved as creating cause-
Boston Consulting Group, the top 20 percent of
focused events, such as Avon’s annual Walk for
innovative companies deliver up to four times the
Breast Cancer.
shareholder return of the bottom 20 percent.
Taking a cue from Starbucks, more retailers are
Keeping it fresh at retail is what flash goods
creating hangouts where customers can get
and pop-up stores are all about. By limiting the
together around shared interests. Club Libby Lu
time most items stay in stores, apparel retailer
(U.S.) provides a space for girls ages five to 12 to
Zara averages 17 store visits per customer a year,
shop, socialize, and even hold birthday parties.
compared with an industry average of three to four.
In New York, Nike and Foot Locker have teamed
Rather than follow the standard pop-up route of
up to create a retail/socialization venue called
renting empty storefronts, Japan’s UNIQLO drove
House of Hoops. The concept store features a
two shipping containers around New York City,
hardwood basketball half-court with backboard,
opening daylong stores in various locations to give
Nike Basketball merchandise, and exclusive limited-
shoppers a taste of their logo-free apparel. Bonne
edition products.
Maman, a company that makes jams and preserves,
Claseo is billing itself as the world’s first invitation- targeted its next generation of customers during
based fashion label. Members receive a limited a two-week appearance in a trendy Parisian
number of invitations to share with friends, who neighborhood by offering cartoons introducing
must enter a code and make a purchase to become young children to “jam culture.”
members themselves. Every item is emblazoned
Limited-edition merchandise also drives interest
with a unique ID code that allows members to
and demand. Carlsberg 900 launched in just a few
recognize one another and learn more about people
select bars in Stockholm. Nike opened a pop-up
of interest by entering the wearer’s code on the
store in SoHo for just four days with the sole
website.
purpose of selling 250 pairs of $250 Zoom LeBron
IV NYC basketball shoes. Chinese convenience-
store chain KEDI had great success with a
promotion that allowed customers to preorder a
limited-edition Hello Kitty MP3 player.
In the U.K., restaurant chains Itsu and Leon are
experimenting with flexible spaces, changing
their environments and offerings according to the
time of day. In the mornings and afternoons, they
cater to a crowd looking for fast, fresh, healthy
fare, while in the evenings they behave more like
traditional restaurants.
Innovative ideas that shake up a category can
prove a substantial boon to a retail business.
Recent examples include Wal-Mart’s decision to
sell hundreds of generic prescription drugs for just
$4 apiece, and Bank of America’s Keep the Change®
program, which rounds up purchases to the nearest
dollar and transfers the difference from the user’s
checking account to his or her savings account. The
company matches 5 percent of savings, up to $250
a year.
11.
12. Prosumers Can Make or Break New Stores
Online and off-, prosumers are both early adopters of retailers
and influential in drawing others to (or away from) new retail
options. Prosumers’ more varied retail experience and overall
enjoyment of shopping make them the go-to source for
mainstream consumers.
New online store
among the first to try my friends come to me for advice
p: 71% 67% 80% 64% p: 55% 63% 62% 60%
0: 44% 43% 41% 49% 0: 30% 34% 24% 57%
New brick-and-mortar store
among the first to try my friends come to me for advice
p: 61% 72% 54% 84% p: 44% 51% 32% 53%
0: 33% 54% 26% 67% 0: 22% 31% 12% 50%
p: prosumers o: others
13. 10
The RBoF Is a Consumer Advocate
Today’s more proactive consumers are demanding
more from their corporate partners, a reaction to
both unprecedented levels of distrust in business
and heightened expectations regarding the
social role corporations should play. Retailers are
responding by providing information and services
that position them as consumer advocates and
IMPER AT I VE 2: HELP helpmates.
In the U.K., Pret A Manger has taken transparency
As everyone knows, consumers to new levels: The trendy deli chain is sharing its
are more demanding today. With trade secrets by offering its sandwich and soup
recipes online, in a cookbook (Food On The Move),
so many choices available to them, and printed on packaging and postcards.
they’re in a position to choose to Retailers are also taking steps to help their
do the bulk of their business with customers make smarter choices. In the U.S., the
Hannaford supermarket chain has created the
retailers that respect their time, Guiding Stars system, which uses between one and
offer value-added conveniences, three stars to let customers see which items in the
store have “good,” “better,” and “best” nutritional
and conduct business in a way that value. The Meijer supermarket chain has created
is both ethical and supportive a Gas Alert program, letting customers sign up for
text messages alerting them to upcoming gasoline
of customers. price hikes. And France’s Leclerc has launched a
website that lets consumers compare prices on
more than 2,000 goods in 246 stores (Leclerc
stores and those of eight national competitors).
As part of their customer-engagement efforts,
more retailers are also offering learning
opportunities. Apple Stores offer workshops
ranging from product instruction to podcast
creation and the basics of Web design. Tesco’s
website includes expert advice and forums on
going “green” at home. Done right, such efforts
don’t just push product and strengthen the bond
between company and consumer; they also bring
customers together in an organic community that
adds life to the brand.
14. 11
The RBoF Offers Convenient A growing number of retailers are serving
as“editors,” creating collections that carry the
Solutions cachet of the retailer’s approval. In the U.K.,
There are two things most modern-day Topshop prides itself on being an arbiter of “mass
consumers feel are in short supply: time and cool,” partnering with some of today’s leading
money. Smart retailers are finding ways to save designers to offer fashion and accessories that
customers one or both. meet its criteria for cutting-edge style. At the
premium end, Priscilla Carluccio (sister of design
For many retailers, self-service has become an icon Terence Conran) has opened Few and Far, a
economical way to cut down on lines and wait shop of vintage and new merchandise that reflects
time. In the U.S. and Canada, consumers spent the owner’s style and taste. She has been quoted in
an estimated $525 billion at self-checkout lanes, Vogue as saying nothing is sold at the shop “unless
ticketing kiosks, and other self-service machines I think it’s really lovely and would have
in 2007, up from $438 billion in 2006, according it myself–that’s my only benchmark.”
to IHL Consulting Group. Tesco’s Fresh & Easy
stores in the U.S. are 100 percent self-checkout. We’re also seeing more efforts to let shoppers try
And VinoVenue automated wine bars let customers before they buy –an option that can work to the
select and serve their own wine using prepaid advantage of both parties. Appliance maker Maytag
cards. No more time wasted trying to flag down has “tryout” stores in which potential buyers
a waiter. can run a load of laundry, bake cookies, etc. To
connect with potential customers, Senseo Coffee
Efforts to simplify shopping can be seen installed machines at European bus and tram stops,
across the category. In the grocery sector, offering waiting passengers a cup of fresh-brewed
the U.S.’s Piggly-Wiggly chain is revamping its coffee. And Sleep Number has installed its beds in
stores to make shopping more convenient for every guest room at Radisson hotels and resorts
customers. Rather than have all dry goods in one throughout the U.S., Canada, and the Caribbean.
section and frozen in another, for instance, the
stores arrange items based on food types and meal Taking “try before you buy” to an entirely new
solutions. So, for example, all fresh, frozen, and level, France’s Celio, a men’s apparel retailer, keeps
canned vegetables and fruit are in one location, 17 “fit models” on staff. Ranging in age from 19 to
and one-stop stations offer such items as ground 63, these male staff members come in all shapes
beef, hamburger buns, marshmallows, potato and sizes, and are available to try on individual
chips, and beer for backyard barbecues. garments or entire outfits. That way, female
shoppers can be sure they’re buying the right sizes
Other retailers are simplifying the shopping for the men in their lives.
process through the use of new technologies.
Bloomingdale’s department stores have installed
interactive mirrors that let shoppers try on virtual
outfits and e-mail the images to friends for an
instant thumbs-up or thumbs-down. Through its
ScanExpress program, France’s Géant Casino lets
shoppers scan their groceries as they add them to
the cart. The system helps customers keep track of
their tabs as they go, removes the need to empty
and refill carts at checkout, and offers privacy from
cashiers when buying personal items.
15.
16. 13
The RBoF Is Moving Toward
Sustainability
Results of The Future of Shopping show the extent
to which both prosumers and mainstream consumers
have become more eco-conscious at retail. Large
majorities in each country already purchase
environmentally friendly products, and most intend
to do so more often in the future.
Responding to pressures from environmentalists
and everyday consumers – as well as to the
financial incentives that come from cutting
energy consumption and reducing waste– more
retailers, big and small, are taking steps to become
environmentally responsible. There’s also a growing
understanding that when consumers can choose
from among comparable products and retail venues,
an eco-friendly come-on may provide the incentive
to choose one product – or store – over another.
To reduce packaging costs and waste, Wal-Mart
now scores its 60,000 worldwide suppliers on their
ability to develop eco-packaging and conserve
natural resources; the practice has resulted in an
estimated corporate savings of $3.4 billion. Beyond
that is the enhanced reputation that comes from
IMPER AT I VE 3: MOT I VATE associating the much-maligned retailer with a
popular cause.
For some consumers, motivation
Ice-cream maker Ben & Jerry’s brand identity
at retail begins and ends with price: has always been tied to social action, including
They want to get as much as they environmentalism. Now, with its “Lick Global
Warming” campaign, it’s moving beyond monitoring
can for the least amount of money. its own carbon footprint to getting consumers
But that’s no longer the case for a involved. Among other initiatives, the retailer
partnered with the Dave Matthews Band and Save
growing number of consumers. Our Environment to launch its One Sweet Whirled
As was confirmed by Euro RSCG’s flavor; purchases support the band’s global
warming– focused Bama Works Fund. The GE Money
The Future of the Corporate Brand Earth Rewards credit card allows customers to
study (2008), shoppers around do good effortlessly: GE matches up to 1 percent
of credit card purchases with greenhouse gas
the world are increasingly taking emissions offsets. Britain’s Marks & Spencer stores
into consideration more than how have given consumers an extra push toward eco-
responsibility by charging five pence for each bag
they personally benefit from the distributed at checkout. Since the initiative began,
things they buy. They have come to bag use at M&S has decreased 80 percent.
understand the broader impact of Retailers are also putting more effort into
communicating sustainability to customers
their consumption choices, and they through the use of natural materials, skylights,
muted colors, and other nature-based cues.
are intent on limiting the damage This is particularly evident in the grocery sector,
their purchases inflict on other as more mainstream stores use visual distinctions
to carve out niches and stores-within-stores
people and on the environment. for organic and natural foods. Retailers are also
Though noble intentions don’t taking cues from farmers’ markets, using bushel
baskets, handwritten signs, and other “home-style”
always translate into noble actions, measures to make their spaces seem less corporate
the trend toward more mindful and more local.
consumption is clear.
17. 14 Buy environmentally friendly products
do it now do it now and likely to do it
more in the future
p: 85% 92% 82% 89% p: 64% 73% 45% 72%
0: 79% 76% 78% 77% 0: 45% 54% 42% 55%
Buy energy-efficient lightbulbs
do it now do it now and likely to do it
more in the future
p: 82% 90% 85% 96% p: 70% 82% 55% 81%
0: 76% 82% 83% 85% 0: 53% 63% 51% 64%
Bring reusable bags to the grocery store
do it now do it now and likely to do it
more in the future
p: 50% 98% 76% 75% p: 42% 79% 55% 51%
0: 44% 93% 78% 62% 0: 29% 78% 59% 44%
p: prosumers o: others
18. 15 Buy/refuse to buy a product based on the company’s expressed
values or political/social activities
do it now do it now and likely to do
it more in the future
p: 71% 68% 47% 79% p: 45% 50% 24% 45%
0: 52% 44% 39% 57% 0: 27% 26% 18% 31%
Make purchase decisions based on country of origin
do it now do it now and likely to do
it more in the future
p: 59% 85% 49% 84% p: 40% 59% 16% 49%
0: 50% 52% 41% 78% 0: 25% 30% 18% 45%
Avoid buying products from a particular country/region
do it now do it now and likely to do
it more in the future
p: 54% 73% 54% 59% p: 37% 45% 24% 35%
0: 45% 47% 38% 45% 0: 23% 26% 17% 22%
I avoid shopping at stores that don’t treat their employees fairly
p: 70% 73% 32% 85%
0: 56% 56% 38% 77%
I am willing to pay a bit more for a product if a portion of the
proceeds goes to a good cause
p: 60% 74% 28% 87%
0: 52% 46% 28% 68%
p: prosumers o: others
19. 16 The RBoF Has a Purpose
Beyond Profit
Being more conscientious about consumption Rather than create one-off promotions,
choices isn’t just about concern for the environment. more leading retailers are creating long-term
Consumers are also looking to vote with their partnerships in support of a particular cause.
pocketbooks, supporting those companies (and/or In the U.S., Target stores have supported the
countries) that share their values while refusing to Red Cross for more than a decade through donations
do business with those that don’t. to relief efforts, employee volunteerism, and sales
of a first-aid and emergency-preparedness kit, all of
The survey results show significant majorities of which benefit the organization. Nike is a founding
prosumers in the U.S., France, and China avoiding partner of ninemillion.org, a U.N. Refugee Agency–
retailers that don’t treat their employees fairly and led campaign committed to raising awareness and
making purchase decisions based on a company’s funds for education and sports programs for refugee
values or socio-political activities. A majority of youth around the world. In Northern Ireland,
prosumers in each market avoid buying products from Musgrave Retail Partners (SuperValu and Centra
a particular country or region, and many expect to do stores) has partnered with Action Cancer since 2001
so more in the future. to operate a mobile unit offering onboard digital
In looking at the country breakdowns, Americans breast screening, and cancer prevention and health
are significantly more likely to boycott a particular promotion education and services.
company rather than an entire country or region, Getting consumers involved is key to furthering
while respondents in the U.K. appear least inclined the cause and further engaging the consumer in
to make purchase decisions based on socio-political the brand. Some retailers make it easy for consumers
stances or even the treatment of store employees. to participate by creating product lines benefiting
French respondents stand out as the most likely to specific causes. The Body Shop’s Daisy line, for
factor provenance into purchase decisions. instance, benefits organizations working against
A majority of prosumers in each market but domestic violence. In Japan, retailers host charity
the U.K. are willing to pay extra for a product if vending machines, which enable users to specify
a portion of the proceeds goes to a good cause. which of a number of causes they’d like their
A willingness to pay more is particularly evident in purchases to benefit.
France and China.
From Apple and Toyota to Starbucks and Whole Foods,
many of today’s leading retail brands have one thing
in common: a strong set of beliefs that are clearly
articulated. Such beliefs are all the more compelling
at a time when consumers are reconsidering the
social role corporations should play – and raising their
expectations of corporate conduct and contributions.
At retail, brands are expressing shared values through
messaging, promotions, and cause-linked activities.
Lush stores post a list of brand beliefs, ranging from
no testing on animals and making products fresh
by hand to “making our mums proud.”As part of an
antipoverty initiative, China’s Intime department
stores provide financial aid to help needy children
complete their compulsory education.
20. 17
IMPER AT I VE 4: TARGET
The ability to segment shoppers to uncover new opportunities is crucial to
staying competitive in the retail environment now and next. It’s no longer
enough to know when and where people are shopping; leading retailers are
also tracking how and why people make purchase decisions in order to find
new ways to reach and engage them. Messaging that would appeal to a person
in “survival” retail mode would be unlikely to capture the attention of someone
currently taking a “pleasure” or “mindful” approach to shopping. It’s important
to be clear on the motivations behind any behavior.
Euro RSCG’s The Future of Shopping study has uncovered a new market
segmentation that will help retailers better understand and communicate with
their customers and targets. These segmentations, ranging in size from 10 to 35
percent of the population of each market, offer fresh insights into how and why
certain individuals shop, the benefits they seek, and the extent to which they
are adopting new channels. Savvy retailers will use these segmentations for
precision targeting of communications and sales tactics.
EXPERIENCERS: The golden grail of the retail sector. Rhapsody, and Nordstrom in the U.S.;
Making up between 10 and 15 percent Starbucks, Monoprix, Sephora, and The Body
of the population, this group loves the shopping Shop in France; H&M, New Look, and Next in
experience and has the knowledge and resources the U.K.; and Sohu, Tesco, Best Buy, IKEA, and
to participate fully. Not surprisingly, the group Lenovo in China.
skews somewhat young (18–34), upscale, and
decidedly female (60 percent). They are the first to
try most new products and services, and frequently
are called upon for their advice and expertise.
Experiencers shop online and off-, wherever they
can maximize their enjoyment.
Experiencers are a prime target for e-retail;
already, 40 percent of them make 20 or more online
purchases a year.
Favorite retailers2 include Apple Store, Sephora,
2
Sample of favorite stores based on Euro RSCG Brand Momentum data and
insights from local Euro RSCG category experts.
21.
22.
23. 20 PLANNERS: Constituting 10 percent to
15 percent of the population, these people
possible. Generalist e-retailers such as Amazon.
com are a boon to this segment, giving them
don’t love to shop, but they’re good at it. a broad array of merchandise and a quick-and-
They approach shopping pragmatically, easy shopping experience, including “one click”
fully researching purchases online and offering purchases.
personal information to marketers
Favorite retailers include Lowe’s, CVS, and
in exchange for clear benefits. Many influence
Walgreens in the U.S.; Lidl, Amazon, and MUJI
other shoppers by being early adopters of products
in France; MUJI, Amazon, and Tesco in the U.K.;
and services, and posting their own reviews. The
and Dangdang, Taobao, OCJ.com.cn, and KEDI in
group is better educated than average and skews
China.
somewhat male.
MODERN MIDDLERS: The largest group
To effectively target Planners in a tough economic
(roughly 30–40 percent of the population),
climate, retailers must offer something extra–
Modern Middlers represent the core values
added value that gives these men and women more
in each country we studied. Their scores on most
reason to buy than abstain. One way to do this
demographics and attitudes were average, and
is by offering products that are environmentally
they neither love shopping nor seek to avoid it. In
responsible or by adding a socially conscious
a testament to how mainstream online shopping
element to the purchase. More than any of the
has become, these people have made the Internet
other identified groups, Planners aspire to
an important part of their shopping process (even
conscientious consumption.
when they plan to make the purchase at a brick-
Favorite retailers include Whole Foods, and-mortar retailer). They seek out customer
Trader Joe’s, and Barnes & Noble in the U.S.; eBay, reviews online when making purchase decisions
Franprix, and Cdiscount in France; ASDA, Marks and consider shopping a game in which whoever
& Spencer, John Lewis, and Waitrose in the U.K.; gets the best price for the least amount of effort
and eBay, H&M, Li-Ning, IKEA, and China Mobile wins.
in China.
Like Planners, Modern Middlers are open to
ESCAPE ARTISTS: Like Experiencers, this group environmentally focused come-ons and are even
loves to shop, but they’re more focused on fashion willing to spend a bit extra (1–5 percent) for
and grooming–categories in which they are often products that are eco-friendly. While always happy
innovators. Somewhat less well educated and less to score a great deal, this group now expects more
upscale than the overall respondent base, this than just discount pricing.
group views shopping as a bit of an escape from
Favorite retailers include Target and Wal-Mart in
boredom and the ordinary. Representing roughly
the U.S.; Decathlon, IKEA, Leclerc, and Celio in
15 percent of the population, Escape Artists skew
France; B&Q and M&S in the U.K.; and HaoYouDuo,
younger and female (75 percent).
Gome, Suning, and Yole in China.
Escape Artists are rejecting more expensive
STRAGGLERS: Older and with fewer economic
department stores in favor of discount-oriented
resources, Stragglers do not like to shop and have
general merchandisers. Above-average Internet
resisted the Internet. This is a group that’s best
shoppers, they look to online retailers to create
targeted by such traditional price-focused tactics
engaging experiences. They enjoy being part
as discount coupons, two-for-ones, and sales.
of online communities of customers who share
opinions and information about companies and Favorite retailers include Dollar Tree,
brands – a clear opportunity for fashion brands to Wal-Mart, Kroger, and Home Shopping Network in
get on their radar. the U.S.; C&A, Conforama, Intermarché, and La
Halle in France; Ocado, Superdrug, and Netto in
Favorite retailers include Whole Foods,
the U.K.; and Dangdang, Taobao, KEDI, and
Trader Joe’s, IKEA, Sephora, Old Navy,
China Mobile in China.
H&M, and American Eagle in the U.S.; Fnac,
Nature et Decouverte, L’Occitane, and Carrefour
in France; Boots and B&Q in the U.K.; and KFC,
M-zone, and Taobao in China.
AVOIDERS: This group hates to shop, regarding
it as a major hassle. They are frequent users of
the Internet, as it lets them bypass much of the
retail shopping experience. Making up roughly 15
percent of the population, Avoiders skew male (60
percent) and are more highly educated than most.
Getting Avoiders to part with their cash, especially
in difficult economic times, requires making the
entire transaction as simple and hassle-free as
24. 21 Prosumers Inhabit Two
Segments
Where do prosumers fit into this shopper
segmentation? They make up the bulk of two
important groups: Experiencers and Planners. This
is in keeping with our understanding of prosumers
as people who both enjoy shopping and are good at
it. They approach significant purchases carefully,
conducting research and soliciting the opinions of
others online. And they serve as a source of advice
and recommendations for those less willing to put
in the time to fully vet a product or brand prior to
purchase.
The segmentation also shows two important
groupings based on shopping motivations:
Experiencers and Escape Artists are both emotional
shoppers. They derive more pleasure than average
from the act of shopping and scoring a good deal.
These are the people who will be most receptive to
creative retail experiences and environments, and
most open to innovative promotions. At the other Targeting today’s most proactive consumers–the
end of the spectrum are the Planners and Avoiders, Experiencers and Planners who make up the
both of whom fall into the category of pragmatic prosumer segment–makes sense in any category
shoppers. Though Planners approach shopping and economic climate. That’s why they’ve been an
with far more interest and gusto than do Avoiders, ongoing focus of study for Euro RSCG since 2002.
both groups welcome opportunities to gather This newest study also spotlights the value to be
information easily and quickly. When shopping gained by accurately targeting two other groups:
online, they’ll favor sites that offer customer the Escape Artists and Avoiders. Together, these
reviews, detailed product descriptions, and hassle- two groups make up a quarter of the population
free purchases (e.g., free shipping, easy returns, in each market, and they’re more likely than
stored customer information). Experiencers and Planners to change their
shopping behaviors during economic downturns.
These are the customers who could most easily
be lost to retailers who don’t take the time to
understand their motivations and meet their
unique needs.
s
er
pp
ho
a ls escape artists
n
io
ot
em
modern middlers
experiencers co
ns
um
um ers ers
pros
avoiders
planners stragglers
pragmatic shoppers
25. More than 80% of our food products
in France are made in France*.
When in France, buy French, and when in Brazil, buy Brazilian. It’s the logical way to shop,
especially when it comes to groceries. At Carrefour, most of the foods for our locations around the world
are produced locally. And most of our products come from small or midsize businesses.
At Carrefour, to be useful every day is to commit to local producers
and small and midsize businesses.
www.groupecarrefour.com
*Percentage of French Carrefour food products produced locally in France.
26. 23 The Internet
and the Rise
of the Smart
Shopper
It would be difficult to overstate
the impact of the Internet on
shopping behaviors and attitudes.
Virtually all prosumers and the vast
majority of mainstream consumers
in each market said the Internet
has become an important part of
their shopping and their first step In and of itself, online retail has become a key
competitor in the category over the past decade.
in major purchase decisions. This When asked how often they shop at 15 types
response rate is up significantly in of retailers, respondents ranked the Internet
among the top five overall, behind only grocery
every market compared with data stores, discount chains, super centers, and
drugstore chains. In most markets, respondents
from Euro RSCG’s 2004 Prosumer are more likely to shop online than in department
Pulse® study. The increase in people stores (traditional or discount), warehouse
stores, convenience stores, or independently
using the Internet to research owned stores and boutiques. Prosumers in the
major purchase decisions is up most U.K. actually cited the Internet as their most
frequented type of retailer; 74 percent shop online
dramatically in France, rising 42 somewhat often/often, up 20 percent since
percent among prosumers and 36 the 2004 Prosumer Pulse survey.
percent among others in the four Perhaps more important than the migration to
online shopping is the impact the Internet is
years since the previous study. having on shopping in general. Large majorities
in each market indicate they conduct a lot of
consumer research online–much of which arguably
would not have occurred prior to the Internet.
Virtually all consumers and approximately eight
in 10 mainstream consumers search for customer
reviews while making purchase decisions,
and most indicate they will do so even more
in the future.
Actually writing and posting product/retailer
reviews online is an activity in which a majority
of prosumers are already involved–testament
to their proactive natures. It’s interesting to
note that even mainstream consumers are inclined
to join an online community of customers who
share opinions about companies and brands,
suggesting further scope for consumers to band
together online as a means of increasing their
clout at retail.
27. 24 Even if I don’t make purchases I do lots of [consumer]
online, the Internet is a very research online
important part of my “shopping” strongly/somewhat agree
strongly/somewhat agree
p: 88% 70% 84% 88%
p: 99% 88% 92% 92% 0: 67% 42% 65% 66%
0: 81% 76% 78% 81%
For major purchase decisions, The Internet has had little
my first step is usually the Internet to no impact on my shopping
strongly/somewhat agree strongly/somewhat agree
p: 92% 94% 92% 88% p: 6% 17% 5% 25%
0: 75% 71% 75% 71% 0: 10% 22% 11% 21%
I read consumer feedback/reviews I would like to be part of an online
before making a purchase community of customers who
frequently/sometimes share opinions and information
about companies and brands
strongly/somewhat agree
p: 91% 90% 87% 95%
0: 79% 67% 72% 90%
p: 74% 68% 78% 93%
0: 46% 48% 53% 83%
I search for customer reviews while making purchase decisions
do it now do it now and likely to do it
more in the future
p: 96% 98% 96% 97% p: 74% 65% 69% 79%
0: 86% 85% 79% 87% 0: 57% 38% 41% 65%
I write online product or retailer reviews
do it now do it now and likely to do it
more in the future
p: 71% 72% 55% 80% p: 38% 34% 31% 47%
0: 46% 53% 32% 61% 0: 21% 15% 13% 36%
p: prosumers o: others
28. Search for airline/car rental/hotel information and/or make
25 reservations
do it now do it now and likely to do
it more in the future
p: 96% 98% 93% 95% p: 85% 77% 64% 79%
0: 91% 92% 81% 80% 0: 67% 52% 44% 57%
Search online for financial information and/or purchase
financial products
do it now do it now and likely to do
it more in the future
p: 65% 71% 87% 89% p: 41% 29% 53% 65%
0: 58% 56% 75% 77% 0: 28% 17% 35% 52%
How often do you do each of the following?
Visit company website Use online coupon in
to locate store near me brick-and-mortar store
frequently/sometimes frequently/sometimes
p: 96% 84% 87% 85% p: 82% 71% 77% 77%
0: 89% 75% 82% 88% 0: 76% 61% 57% 64%
Research purchase online Visit retailer with info
before visiting store to buy it printed from website
frequently/sometimes frequently/sometimes
p: 95% 88% 97% 97% p: 79% 92% 69% 72%
0: 89% 82% 82% 88% 0: 70% 76% 56% 61%
See product in store and then Return online purchase to
wait to order online brick-and-mortar store
frequently/sometimes frequently/sometimes
p: 62% 73% 72% 87% p: 42% 26% 31% 45%
0: 50% 58% 58% 71% 0: 35% 19% 25% 34%
p: prosumers o: others
29. 26
ADVAN TAGE: SHOPPER The Interplay of Online and Off-
There are all sorts of ways consumers are using Successful retailers of the future will
the Internet to their advantage when shopping. understand – and make full use of – the interplay
Price and product/service comparisons are an between online and brick-and-mortar stores. As
obvious choice, and nearly all respondents are mainstream consumers become more proactive
making use of this capability in at least one retail shoppers, the line is blurring between the virtual
sector. Researching purchases in areas that offer and “real” worlds. Even people who intend to
a sometimes confusing array of choices and that make purchases at a local store will visit the
have potentially serious consequences for wrong company website to research a product prior to
choices is particularly prevalent. Two of these purchase, download a discount coupon, and/or
categories are Travel/Hospitality and Finance. get directions to the store. It’s also common
Nearly all prosumers – and almost as many for people to see a product in a store and then
mainstream consumers – turn to the Internet wait to order it online, whether for reasons of
when making travel plans. Most indicate they convenience or based on the assumption that a
will do so even more in the future. In looking at lower price can be found on the Internet. Retailers
the percentages of respondents who search for will want to take steps to ensure the offline-online
financial information online, it’s telling that the transition is seamless and that each medium fully
gap between U.S. prosumers and mainstream supports the other.
consumers has narrowed dramatically since the
2004 study. Four years ago in the U.S., 68 percent
of prosumers and 43 percent of others searched for
financial information online – a gap of 25 points. In
the current study, the gap is just seven percentage
points, illustrating the extent to which what
used to be leading edge is now mainstream. It’s
also worth noting the tremendous jump in online
financial research in France and China. In both
markets, the prosumer scores rose 33 percent from
2004, while mainstream consumer scores rose 27
percent and 29 percent, respectively.
30. 27
Conclusion: Reaching the Retail
Target of the Future
The Future of Shopping study makes clear that, in the future, shopping
will be more proactive and considered. Consumers will continue to
seek new and better ways to research products and services prior
to purchase–and smart companies will help them do so. We can expect
increased consumer-to-consumer communication via online reviews,
recommendations, and consumer blogs, as well as new mechanisms
through which individuals can work together to elicit better deals. This
study also confirms the shift to more mindful consumption– a trend that
will influence how retailers package, present, and promote their goods.
In the background of each of these shifts is the Internet, a tool that has
forever changed how people shop. Virtual shopping baskets will grow
heavier, as e-retailers continue to compete on cost, convenience, and
selection. And retailers will continue to find new ways to engage their
customers so as to add value to the brand and to the shopping experience,
both online and off.
With change taking place at such a rapid clip, retailers are well advised
to keep an eye on the prosumers in their markets. These men and women
continue to offer a glimpse of the future in terms of both how people will
shop and what they’ll be buying.
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32. Prosumer Reports is a series of thought leadership publications by Euro RSCG Worldwide – part of a
global initiative to share information and insights, including our own proprietary research, across the
Euro RSCG network of agencies and client companies.
Euro RSCG Worldwide is a leading integrated marketing communications agency and was the first
agency to be named Global Agency of the Year by both Advertising Age and Campaign in the same year.
Euro RSCG is made up of 233 offices in 75 countries and provides advertising,marketing, corporate
communications, and digital and social media solutions to clients, including, Air France, BNP Paribas,
Charles Schwab, Citigroup, Danone Group, Heineken USA, IBM, Kraft Foods, Lacoste, L’Oréal, Merck,
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