The shopper/buyer

The increased power of the customer

The shopper/buyer has become more powerful because of near-universal communication
(and the technology that has enabled it) and the access a shopper/buyer has to an amazing
amount of information. The supplier, retailer and brand managers have to live with this, but
if they use big data and social media research and the insight they provide, they can discover
a lot about shoppers/buyers, who they are, who buys what, what triggers the purchase and
how to communicate with them. The shoppers/buyers' expectations have changed as well:
quality, value, relationships, competent service and delivery with consistency rank high in
their evaluation of the brand, supplier and retailer. This matters as the shopper/buyer builds
a 'mind file' that stores all the information, even over many years, which is brought forward
from their subconscious as their version of a brandgram, when a proposition to buy arises.

Segmenting
Customers display many different shopping personalities according to the time, place or
context of the purchase. The business executive may be buying top travel packages one
moment and the next organizing an economy family break. Within a few hours an office
manager may be purchasing office materials, spending on entertainment at lunchtime with
colleagues and then, after leaving work, go food and retail shopping with the children before
returning home to shop online. The shopper is gill one individual with a singular and distinct
social, educational and cultural background, but represents multiple customer personalities.
The supplier or retailer that fails to recognize this chameleon-like aspect is likely to fail the
customer relationship test. The customer applies a different buying process to different
purchases. Obviously acquiring a pair of socks may require no thought and allow an instant
purchase where the product subsequently can be rejected if the purchase is mistaken.
There are not many parameters when considering sock for commodity) purchase. When
buying a car, a rigorous examination of alternatives, consultations and research is
undertaken: the cost of insurance, tax, fuel consumption, in addition to performance,
reliability and resale value. In fact car sales staff report that some shoppers know more about
the car than they do all the shopper is then looking for from the salesperson is a better deal
than a competitor car showroom. Factors affecting the shopper perception may be the cost
of purchase in relation to shopper income or available cash or credit, but here the salesperson
can invoke feelings that the shopper is worth it and overcome price resistance.

The shoppers emotional state at the time of purchase can encourage impulsiveness.
Heightened emotion associated with a promotion, work, professional recognition, being on
holiday, being in love, can encourage us to bypass our normal caution and restraint. The status
of products and services may also influence a purchase: some customers are heavily
influenced by the impression a branded item portrays and their own perception of how
people view others who own such branded goods. A customer attitude to purchase can be
altered by the perception of an economic recession, the influence of green issues, medical
disclosures, press speculation and whether they can be seen to shop in certain premises. The
recent extended recession made economy brand shopping quite chic for otherwise high net
worth individuals, shopping at Lidl or Aldi with an Audi, BMW or Range Rover is no longer
socially unacceptable, nor is shopping at pound shops.
To target by gender, demographic or socioeconomic station is no longer adequate: brand
marketers must reach, engage, convert and amplify the offer (see below) to the specific
shopper the one who will buy, share, post, tweet and participate in branded programmes
and events. The shortest path to this shopper is through a well-targeted, measured and well-
messaged existing user base. The importance of well-planned and holistic CR/v1 practices has
never been greater.

Myer (Australia) advised by Sarah Richardson of Global Loyalty Pty Ltd (set Chapter 15),
segment its customers into five categories, according to the way they shop as much as on the
basis of what they buy. These are:
1. Busy Belinda: always in a hurry and often with kids.
2. Premium Polly: loves designer and high-end trends.
3. Trendy TJ: a wannabe Premium Polly.
4. Low Involvement Lou: would rather not shop if she can help it.
5. Discount Dora: loves to grab a bargain. This has helped its marketers and staff in assessing
how to treat shoppers.

Target shoppers and insights

Research from eBay published in 2014 shows some 75 per cent of UK shopping spend is by
'super shoppers' who make up 18 per cent of the population (see Brief 23). me top-end
products and services these wealthy people must be sought out; the same principle applies
to other types of shopper who have an interest in any specific duct range. For many years it
has been possible to construct a profile of a preferred customer and then find potential
customers with similar profiles and the channels to reach them. Those with a sport, hobby or
specific need will generally search out their niche suppliers and retailers. A retail outlet such
as a supermarket which is tied to a location and offers a standard range of brands, or a niche
product supplier, nee to establish what the local shoppers' profiles are (or the niche segment
shoppers characteristics are) and what they buy and then stock that range and similar brand
lines. Centralized purchasing does not work for such retail outlets and the local manager must
have the power to acquire shopper insight and then decide what to stock, the promotions to
run and the messages to communicate (Lidl seems to be good at this).

Those who lead the pack, the `future shapers', most also be identified from among customers
and be engaged with. Future shapers are identified as:
valuing authenticity and originality in all they buy and experience;
being well informed and hugely involved in the products, services and thus brands they buy;
individualistic, doing things their way and trying to persuade suppliers to convert to that
way;
time-poor and valuing anything that saves them time;
socially responsible, exercising ethical awareness via product and brand choices;
curious, open-minded and receptive to new ideas;
advocates of new ideas and they spread the word.

Before you go any further, for every customer segment that you decide to select as a target
(you do not need to target every one), you should apply the following method. Erase from
your mind your own thinking and prejudices. Learn to listen, observe and grasp how your
target thinks, communicates and comes to conclusions. You need to understand them and
how they react. This method has been described as 'self-recognition criteria' accepting that
the way you think and react is wrong for any target you are analysing. You should not make
any assumptions about the target customer (research into marketers finds their assumptions
about customers are grossly out of kilter with reality). Find out from analysis of big data and
the insight from research. Now you have an open mind about the customer, let's examine
how to respond to the customer, how customers express their needs and what makes them
tick.

Reacting to the shopper

1. Anchor your proposition as the supplier, brand manager or retailer for each product or
service, using the customer view of the Six Cs component parts of the offer (see below) to
produce the customer value proposition (CVP).
2. Ensure that you locate and understand who your target shoppers are and from insight know
that the offer you propose matches the Six Cs components for your target shoppers. You may
have to change the offer to achieve alignment or find a way to realign your shoppers to your
offer.
3. Take account of the recent research finding on the part shoppers subconscious plays when
they are choosing what to buy, which requires a sequence of messages delivered by different
media to achieve an excess share of voice and to build the mind file' of the shopper; you
need to reach the shoppers tipping point that that persuades them to buy (adding a
promotion!). The insight should also be used to confirm that the shoppers' engram and mind
file' for your product or service is near what you would wish for your brand - compare their
version with your brandgram. If is not as you would wish you will need to act to remedy this
by additional messaging.
4. Make sure you have the logistics in place to deliver your product or service and any
promotion customers are really put off if a brand they seek isnt in stock.

These four steps provide a clear way ahead for the marketer to define marketing objectives
and so make a plan for message communication through each medium. From that analysis
readily arises the promotional objectives - Who do you medium. to do what? - along the route
to purchase that converts the shopper's arrival at the tipping point point into a sale, which is
what this book is about.

The Six Cs - the offer

The six components are:

1. Cost (of lifetime purchase) within a value perception. That value perception is personal and
includes a quality-of-life assessment, social, cultural, or status reasons and the cost of time
and travel to make a purchase, in addition to longer-term servicing and maintenance costs.

2. Concept: the product and service, incorporated with brand values, benefits and advantages
over competitors; a warranty, fitness for purpose and a returns policy are assumed and of
course there is the distinctive shopper marker - its engram (and the subconscious `mind file'
built on it).
3. Convenience: of payment method, location, availability of item and ideally 24/7 purchase
and delivery.

4. Communication: the seamless arrival of appropriate and timely messages through

preferred media and channels. The communication must not be complex or dull and put the
concept across in terms the consumer commonly uses. The mobile Internet is the consumer
technology of the future; shoppers communicate with each other (social media) and expect
the brand to operate two-way communication too.

5. Customer relationship: the customer expects to have a relationship, be treated with

respect and he recognized at any interface (the involvement criterion) with the supplier or
retailer with all reasonable questions answered and problems arising resolved speedily and
fairly.

6. Consistency: the same values of the brand and messages at all customer interfaces brand
surety if you like; research shows that inconsistency can lead to a loss of 30 per cent of sales.

Matching the offer to the shopper/buyer

Once the offer is determined, it needs to be matched to what the shopper/buyer expects.
This is an iterative process. See if the shopper buys from the offer the CVP you have
created. If it is right, you will make sales!

The shopper's engram and 'mind file'

The shopper's subconscious plays a key part in buying. Something in the brain, which
shoppers do not articulate when questioned, is prompting their behaviour. The shopper
appears to build a 'mind file' about brands, products and services around a core 'hook',
identified as the engram, and only when a tipping point of sufficient marketing
communications is reached with messages that build the 'mind file' will the shopper buy that
brand, product or service. This 'mind file' may be subconscious but it can be built on and
encouraged by the discerning marketer on the shopper's journey to purchase. An expansion
of the reasoning for the engram concept is given in Shoppernomics, by Roddy Mullin and Colin
Harper, which also describes the 'communication canvas' of a shopper and how to match
marketing messages to it.

In essence the shopper's subconscious takes a logo, a smell, a jingle but usually a visual
indicator called a core visual mnemonic or CVM that triggers a brand or product as an
engram, and all experiences and messages, good or bad, as interpreted by the shopper, are
added to that to build a 'mind file'. Each individual will store different experiences and take
on the marketing messages in their 'mind file' and may build up, as a consequence, something
quite different from the image intended by the brand manager, retailer or supplier. Insight
from social media analysis will reveal what the shopper thinks, which can be accommodated
or corrected to the preferred profile of the brand, known as a brandgram. Early research
shows a brand manager's brandgram frequently differs from that held by shopper/buyers.

The shopper is unlikely to buy anything without having absorbed marketing communications
and messages from many other sources (relatives, colleagues, friends and social media,
advertising) into the adaptive subconscious, before entering the store or website. The
shopper may be smart, sophisticated, cynical of marketing and advertising, time-poor and
highly selective, but his or her subconscious will be working the whole time. The in-store
environment is immensely complex, with many, sometimes thousands of products on display
and lots of promotions, other shoppers and staff; how does the shopper set about the task of
making purchases? Shoppers are pack-focused and interacting with packs is the primary task.

For a product, the packaging needs to stand out and do so in a very brief glance by the
shopper, seeing a CVM which then triggers the engram with its mind file. Shoppers look for
unique visual clues in prioritizing shape and color over any words. The packaging is the most
important form of communication for the shopper in store. The shopper subconsciously pays
attention only to packs that are relevant to their store visit. Packaging design minimizes the
effort and time involved in decision making. The CVM often has high recall; where it does not,
conscious processing is required to make the decision to select a product.

Unfortunately, market researchers are often unaware that the research they undertake
exposes conscious attitudes and opinions to research stimulus material but rarely identifies
the subconscious. Eye-tracking studies, for example, reveal where people look on a pack but,
with honorable exceptions, studies do not reveal whether a dwell in one area is a result of
trying to understand, or high levels of interests.

Twitter research can indicate how shoppers are rate supermarkets and predicts need to
change the customer relationship. Categorizing tweets in eight ways from Happiness to
Disgust and examining each is revealing much about the herd view of a brand their
depiction of the brandgram. It allows analysts to predict early on the eventual outcome of the
common view of shoppers on brands, on retailers, on individual stores service and on
anything else on which there are comments.

To build the engram 'mind file' some six communications are needed to deli, your messages.
Initial messages provide information and come from the brand man-ager, retailer or supplier.
They describe the product and associated services and the benefits and features. They must
match the communication canvas in their delivery. The shopper/buyer will also search other
sources, online forums, social media, etc for comments clever marketers can encourage
this. Some brands have used social media as the starting point only then do they introduce
the commerce element. Contacts with colleagues, friends and relatives need to be stimulated
as they provide an important input to the mind file sharing their views. The way into and
in the shopping environment (online or in store) itself needs to send messages to the shopper.
Excess share of voice plays an important part and can be achieved locally quite easily (excess
share of voice is when the marketing communications exceed the market share). Point of sale
material plays a further part. A on the cake, adding fun, exciting the shopper/buyer and
reaching the tipping point that persuades the shopper to buy.

Stock availability, logistics

Shoppers expect to see their preferred brands on the shelf. Shops and retail outlets are often
centrally limited in the inventory they may stock even though outlets may do so: M&S will
supply only 10 stores with some fashion items, and Homebase limits boards for cutting at
some of its stores meaning customers have to go e h where. Meanwhile other chains are
prepared to more stock around (TopShop spends millions doing so); they rate customer
satisfaction highly. Next also seems to have cracked the problem. One fashion chain went out
of business some years ago through failing to research its customers jackets with sleeves
were stocked in the North of the UK and sleeveless jackets were sent South. Customers in
each case preferred the opposite and a fortune, more than their profit, was spent correcting
the error.

Technology's effect on shoppers

In the United States and Britain, around 50 per cent of the population own smartphones. In
Britain the growth trend is also for mobile TV interaction and social interaction. The shopper
is using web pages, on mobile, tablet and PC, both as a showroom and for actual purchase.
The shopper seeks engagement with the brand, supplier and retailer. Personal recommend
commentary and participation offer a great signal to those in one's sphere of influence: if
delighted, shoppers are given the opportunity to share their passions. Shoppers are
accustomed to moving from one technology to another they expect the brand or retailer
to do the same.

Games are another may to support brand advertising principally through in-app purchases
or free-to-play. Cross-channel campaigns should exploit the differences between mobile and
tablet, making the message a holistic experience, ie one message complements the other.
Strategies that could be used include augmented reality, for example where a shopper clicks
on a view and computer-generated pop-ups add information or descriptions to the scene;
geo-location, where the mobile or tablet using GPS produces messages related to the
shopper's location (usually near the retail store or a brand outlet); or a second screen when
something seen on TV can be accessed by the shopper on mobile or tablet or through an app
(even downloading the app while watching the ad on TV). 'Attract', 'engage' and 'delight' will
be the marketers' watchwords. Make sure that any platforms you use work successfully in all
of the regions and countries from which you draw your customers.

Measuring the effectiveness of all the above is a challenge and is covered in Part Three. Real-
time intelligence where the brand and retailer pick up shopper reaction almost as it happens
is needed to turn the quantities of data into relevant, actionable insight, transforming the
end-user experience positively into purchases. The Kellogg's delivery overnight of on-pack
gold medal winner naming, is an ex-ample of near real-time action. (Yes, Kellogg's had the
packs printed with winners' names, filled and delivered overnight to the shops!)

How shoppers shop

What catches their eye? What messages persuade? How do shoppers gather and use
information? The fact is that most decisions in-score are not purely rational: you have to
accept there is a degree of randomness about the way a person shops. The shopping
experience is basically a creative process. It is complicated by the 20 per cent of shoppers
who are also un-persuaded and not concerned about price.

At the point of sale there is an involvement in purchase, dialogue, developing the customer
relationship and 'nudging' the customer to purchase. MARI research has discovered that what
actually can and does make the difference to the purchase decision is the use of key words
(Tree', 'New' or a 1 flash) or a promotion. Research indicates that 70 per cent of brand
purchase decisions are made in store/on the web page. A number of models describe how
people buy, one of which is the involvement model. The involvement model for buying is
increasingly seen as a realistic description of the way in which consumers buy products and
services. This ties in with the need for six messages that build the 'mind file' while instilling
involvement. The model extends well beyond marketing: for example, religious bodies used
to think that people started belonging to a church because they believed, often after a
conversion experience. However, it is now under-stood that people belong before they
believe. Studies in the United States have shown that people become involved in a church
because of friends or family. It is often quite casual at first: only after a period of years do
they come to realize that they believe. The process of 'belonging before believing' is about
'behavior before attitude'. The involvement model suggests that if you involve shoppers in
your product or service sufficiently they will believe in it and buy. The Ehrenburg model is
based on the same 'early experience convinces, approach in the commercial world. This
suggests that marketing campaigns that directly impact on the behavior of customers succeed
and the desired to the product or service will follow. A creative promotion can do this;
following the London 2012 Olympics, the distinctive symbol of success used by Mo Farah and
Usain Bolt have been adopted by some brands. Advertising campaigns aimed primarily at
creating awareness and attempting to change attitudes are less likely to succeed.

A promotion, offering a sample, or the deployment of experimental marketing can assist in a

change in behavior. Persuading someone to try offers the chance to experience a product
and the brand values that come with it. Once you have seen that the product or service match
or could match your preferred behavior then, if the process continues, it is only a matter of
time before behavior and the shopper buys the product or purchases the service. It follows
that one should make use of this insight that behaviour precedes attitude; for example, the
importance of bounce-backs in mobile marketing, which stimulates further involvement. A
bounce-back is a second promotional offer when a shopper accepts a first promotional offer
or responds to a requested action. It is a kind of thank you. Encouraging someone to try a
product or service is often the best way to begin the process by which they become a long-
term customer. Never give just one sample - always more - so that they can try one on the
spot and the second when they will have more time to absorb the engram and get another
opinion. Giving away more also looks generous and that is a plus to build into the 'mind file'.

Loyalty, attitude and behaviour

Loyalty is supposed to be based on attitude; it is not necessarily a predictor of behavior.
Compromises do occur: behaviour beats attitude and loyalty when a customer is lured into
buying a competitor on price drop. Loyalty is also undermined by bulk-buy discounts, though
the Office of Fair Trading intervention in November 2012 requiring the price of bulk purchases
to be a genuine discount on the list price, suggests that customers are not all as they supposed
to be. The Grocer has pointed out that in Asda supermarkets 44 per cent of all goods are now
sold on promotion with 60 per cent of health and bleauty products on a price promotion at
any one time. There is a need to constantly promote products to maintain customer loyalty
(and of course re-invigorate the engram). Errors in measuring loyalty can occur
DunnHumby tracking volume purchasing a particular product as 'low loyalty' and it was de-
listed, whilst Mormons customers loved the same product. Brands are designed and built to
secure loyalty and encourage purchase, generally at a higher or even premium price.
Ehrenburg demonstrated that loyalty can be mapped as a statistical effect, resulting from the
higher penetration that brands achieve with their higher marketing spend.

The strong trend to discounting is developing two types of consumer: the ones that are not
driven by price alongside brand, and those that are. This suggests three different measures
of loyalty: customers who are loyal under all normal circumstances, those who are loyal under
discount (in particular when a shopper can 'larder fill') and those with no brand preference.
IPM research with Retail Bulletin indicates a broad trend that loyalty cards have moved the
two major users in the UK (Tesco and Boots; for the latter, 68 per cent of sales are from 70,000
Advantage card holders) above their expected market position. Loyalty cards also provide
valuable data on shoppers.

Coupons or vouchers have the greatest effect (55 per cent buy a product they would not have
otherwise), followed by in-store tasting, then a money-saving discount. Samples in any form
work well, whether given away in store with other products or through door drops even
cover-mounted on magazines. Moneysupermarket.com estimated some 2.4 million vouchers
are redeemed every day, representing 30 billion in a year. The positive impact of a coupon
on customer buying behaviour even works when the value of the coupon is small research
indicating that there is no difference in response between a 15p off or a 75p off coupon or
voucher.