Coming back from this week’s IBM Smarter Consumer Study 2013 Media & Influencer Launch, where I was invited to speak on the expert panel alongside Ian Wong of IBM and Margy Osmond of ANRA, we discussed the topic of the state of the nation in terms of consumer behavior across different channels and their implications for retailers.
One theme that particularly stood out for me was that whilst there is a lot of talk about how consumers interact within channels, the future is to understand how consumers interact across channels.
We know that today a customer that shops across multiple retail channels is up to four times more valuable than a single channel customer (JC Penney is a case in point). But as our last global cross-channel study showed, Australian retailers have been slower to catch up on consumer-driven multichannel strategies (Click here to download the report).
For the year 2012, we estimate that at least $6 billion of retail marketing expenditure nationally was wasted in targeting the wrong consumer (or not targeting at all).
A case in point: There are 8.5 billion catalogues distributed in Australia each year, often a significant spend for retailers. Now we know that only 20% of these are ever read and, moreover, only by a certain consumer type.
At the same time, we see the rise of online and mobile. Online currently makes up about 9-11% of Australian retail sales, but more importantly it is involved almost always at some point on the consumers path to purchase by as much as 75% of consumers in certain categories.
Mobile is also growing at a rapid rate, with our last study in consumer electronics showing 20% of online pre-research is now done on a mobile device. In other categories, like hotels, events and tickets, this is even higher. But here again, certain consumer types are currently up to 100% more likely to engage in such behaviours than others.
Ownership of tablet, PC and smartphone devices across different consumer types (Source: RDG Insights Research)
And finally, many consumers often still want to see, feel and touch a product before buying, want to engage in a multisensory, social and interactive experience, typically somewhere between 50-90% depending on the category and consumer type, but then, particularly in fashion, they also want to receive live feedback from their friends on social media at the same time, which some clever retailers like e.g. Lorna Jane already picked up on.
So, from a consumer’s point of view, the real world now consists of all these channels (including online, physical stores, social media, catalogues, etc) and they are using them simultaneously in whatever way suits them that moment. It is a real mash-up, and for retailers who intimately understand who the customer is, they are all contributing to one rich, timely and relevant branded experience.