Research trends in the behavior of retail customers

Usually, when looking for the right product, consumers rely on past experience and assessment of the current situation. We are considering which store to visit and how much time to spend there, and interest in a particular place often depends on how good offers are waiting for us. In the process of such a search, we form our own individual purchasing patterns and habits. In this material, the author analyzes the studies on such habits, and draws conclusions about current trends in consumer behavior in the field of retail sales on the example of American retail.

The most extensive research was carried out as part of a major scientific study, conducted under the guidance of the director of MIT Media Lab, Sandy Pentland. He and his colleagues studied about 16 million credit and debit card transactions made by 10 million retail customers over a period of three months.

The analysis of these data allowed us to draw a number of conclusions not only about the patterns that consumers adhere to during shopping, but also about their solvency. For this, scientists introduced 3 criteria: how many stores consumers visited for shopping and how far were stores from each other (variety of costs), how much money was spent on each of the retailers (loyalty) and the constancy of this behavior over time (regularity of purchasing patterns) ).

Diversity, loyalty and regularity are manifested in the actions of all studied cardholders. However, as it turned out, consumers, for the most part, are people of habit: as a rule, they make all their purchases only in their favorite places, without sticking to any regular schedule or schedule.
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According to the observations of scientists, 90% of purchases were made in 3 favorite places. At the same time, 65% of buyers did not follow any regular schedule when they were committed. Twenty-five percent of cardholders showed a very low level of regularity, which suggests low solvency.

A similar study based on analyzing the behavior of cell phone owners was conducted by researchers at the University of New York at Buffalo. It was conducted primarily for the purposes of urban planning and environmental protection, but the results obtained are very valuable in the context of the findings of Pentland and colleagues, and add some interesting details to them.

According to the study, mobile phone users spend 85% of their time in 3-5 main places - at home, at work, and in those same 3 favorite stores. To this is added another interesting conclusion: they spend 15% of the remaining time visiting a large number of very different places, devoting each of them less than 1% of the time.

This information may be valuable to retailers. She, in particular, allows us to understand why physical retail has turned into such an agonizing occupation, and points to a possible way out of the situation.

Consumers always return to the same places that they visited before, unless, of course, nothing interferes with their well-established habit. Moreover, the habit remains in force, even if the favorite store is at a decent distance, but under one condition: if the consumer gets the goods he needs steadily, without breaking the usual pattern. The buyer may, for example, come to the store not after lunch on Saturday, as usual, but the next day, on Sunday, but such changes in regularity do not affect his loyalty.

According to the study, this is true in 90% of cases.

Therefore, if you are a retailer, then you should be well aware of your most loyal customers, and make sure that you are doing exactly what they like so that they keep coming to you. That is, it is possible that you do not even need to invest a lot of money and time to try to lure loyal customers from other stores with the help of large discounts and other incentives. If the Groupon experiment taught us something, the useful lesson is that loyalty to discounts is a passing thing and as soon as the incentive disappears, consumers immediately return to their favorite brand.

From these studies, it can also be concluded that maintaining customer loyalty, and at the same time their spending habits in the same place as before, does not always require the retailer to offer discounts and large appetizing special offers that destroy any margin.

The price and the continued availability of the full range remain two key reasons that determine where consumers decide to make purchases and spend a substantial portion of their funds. That is, the availability of the "right" products at the "right" (not always the lowest) prices remains the main element of retail, along with the speed of delivery of these goods to the consumer. Online orders with subsequent checkout in the store have become popular because they give consumers confidence in the availability of the product, as well as the ability to pick it up without overpaying for delivery. Mobile pre-order is not good because of its price, because in fact the average price of such orders is higher. It's all about convenience and a higher level of service.

Therefore, the preservation of its 90% loyal purchases is a task of paramount importance. It is in the preservation of such loyalty brands should invest. This is probably why Kohl's and Target have recently launched mobile payment applications designed specifically for the most loyal customers with branded cards.

For the same reason, retail giants like Walmart offline and Amazon in the network are not just major players in the market, but also the strongest competitors in all its space. A distinctive feature of their brands is the ability to find and get the desired product at any time of day and day of the week. The data shows that consumers with a great desire will buy from a brand that they trust, but who seek to save their time, rather than think about finding new, albeit more profitable, retailers.

And what can we say about 10–15% of the time that consumers devote to various places and purchases in the intervals between visiting the 3 most favorite stores?

They fully confirm what is happening in retail and reflect its problems, since they actually talk about how little time and money consumers spend in most stores, preferring instead to visit some of the most attractive options.

Be that as it may, sellers offering some kind of special service or goods have a good opportunity to climb in the personal charts of the consumer up to 4, 5 or 6 places. Such retailers, of course, should use new tools and data analysis to catch the attention of the consumer who is looking for a particular product and turn this purchase into a habit.

Because, in the final analysis, the skill of retail sales is nothing more than the simple elimination of obstacles and risks that prevent the buyer from receiving what he needs at the moment when he finally got out in search of the necessary goods.