We all love a bargain, but we also love telling everyone about it – whether it’s the cheap designer shirt you found at the charity shop at the weekend, the discount you found online or the yellow sticker sandwich you picked up for lunch. John Gillan, Managing Director, Northern Europe at Criteo examines a new type of bragging we love to do – ethical bragging – where we tell our friends about how the making of it was kind to nature or what extra the brand did to help the world beyond retail.
Shopping has traditionally fallen in to two broad categories: that of “want” and “need” with little room in-between for anything representing higher value, virtue or enjoyment.
All too-often considered a vice, ‘retail therapy’ is regularly seen as a form of escapism that should be immediately followed by pangs of guilt associated with overindulgence. While the opposite side of shopping, that associated with utility and requirement, is often seen as a mundane chore that’s to be completed efficiently as opposed to enjoyed.
But all of that is changing. A major shift in the consumer mindset is transforming shopping in to something that can be enjoyed and revelled in.
Some of the changes, like the joy of finding a bargain, have evolved with technology developments, while totally new behaviours, such as the ethics of modern consumerism, are putting a completely new spin on the retail world.
These behaviours will define shopping in the coming years and retailers will need to ensure that they’re catering to shoppers’ every desire. It is only through using data and artificial intelligence that retailers can truly understand and interpret consumer behaviour and ultimately succeed in today’s competitive modern market.
The first major trend identified by the report points to a shift in mindset towards more conscientious consumerism. Ethical shopping is one of the fastest growing sectors in retail today. Spend last year on sustainable food and drink grew 9.7% with the market now worth £81.3bn in the UK.
The result is a shopper-base actively looking for an ethical ingredient from the brands they’re buying from. Ethical shopping is increasing and trends like Fairtrade and organic are continuing to grow as people want to know more about the provenance of their food, fashion and jewellery and the people who produce it.
Almost half of UK shoppers today (40%) feel more positive about brands that publish their ethical standards as the internet makes it easier for people to discover the credentials of manufacturers and retailers alike.
In a retail environment where choice is everywhere and brands are seemingly scrambling to offer ever-lower price points, there is a distinct subsection of shoppers out there actively seeking higher ethical standards. For brands looking to capitalise on the virtuous cyclers, promotion of supply chain information, usage of local suppliers and sustainable resources is key to success.
The rise of ethical brands is a clear demonstration of how with shopping the compass is moving from guilt to virtue. It’s no longer enough to use ethical ingredients, ethical is the first and foremost ingredient.
Yes, the ‘death of the high street’, and the department store in particular, has been a popular tabloid headline in recent years, yet the enjoyment Social Capitalists get from the physical shopping experience suggests a brighter future. Indeed, a quarter of people (24%) prefer to shop with friends with that figuring rising to 46% for millennials (18-24 year olds), despite the common perception that they are the ones driving the ever increasing online spend. Retailers take note: millennials and Gen Z are not the killers of the high street as has been proclaimed. In the case of social capitalists, they are actually giving it a whole new meaning.
Department stores for example, with their wide product ranges, and distinct locations that offer sandbox-like experiences complete with ‘stop spots’ where discoveries can be made, are the most popular destination for these retail revellers.
This means examining the stores already reaping the rewards of social capitalism. When shopping with friends, department stores are ranked the highest as social retail destinations (M&S, Debenhams and IKEA come out on top) because of their ability to meet these needs.
However, to nurture and encourage this behaviour, brand marketers need to ensure that the physical shopping experience is up to the standards of a largely youthful subset of shoppers deriving enjoyment from the overall social experience associated with retail. Another micro behaviour of the social capitalist underpins this point; One in four consumers (26%) haven’t bought something in the last 12 months due to a long queue. If retailers can’t iron out the kinks in the physical experience, they risk missing out on the custom of the social capitalists.
But while the opportunity for physical retail is still very much alive thanks to behaviours exhibited by social capitalists, there is an equal section of consumers turning their back on the physical shopping experience almost altogether, rejecting the retail stores as the best place to make purchase decisions. One third of people don’t like using fitting rooms for example, opting instead to buy items to try on at home. Such is the convenience of delivery and return methods that this behaviour can be effectively catered for.
Self-care shoppers don’t experience the same pleasures from using shopping as a social exploit. Instead they get their enjoyment from a feeling of having earned a great deal. This is perhaps the subtlest of behavioural changes set to impact mainstream retail because couponing, bargain hunting and price comparison has long been a part and parcel of the shopping experience. While that continues to be the case, only now are we starting to see the impact of this behaviour on the psyche of the shopper. Driven by the thrill of the chase and the hunt for bespoke experiences, self-care shoppers get their enjoyment from the careful consideration of a purchase earned. The guilt of senseless splurging simply doesn’t come in to the equation for these savvy shoppers.
Online and new retail sales rituals (like Black Friday) have transformed shopper expectations and behaviours. Consumers now expect to find just the right deal or shopping experience for them, at any time. Finding bargains is also the means of transforming shopping into a productive activity that makes people feel better about their purchasing decisions.
The psychology behind shopping is changing. Key trends are driving people everywhere to start thinking about the activity as more than just a utilitarian necessity or something which represents
self-indulgent hedonism. As a result, the retail industry must embrace both seismic and subtle shifts in the way that it engages with its buying public.
These behaviours are set to define shopping in the coming years and retailers will need to ensure that they’re effectively making use of data and artificial intelligence that retailers can truly understand and interpret consumer behaviour and ultimately succeed in today’s competitive modern market.
By John Gillan