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Consumer Products and Retail the way we see it Introduction How different is the use of digital The study focuses on five product channels during the shopping journey categories: food, health and personal in developing countries compared with care, fashion (clothing, footwear, more mature markets? accessories), do-it-yourself home improvement (DIY) and electronics. The Is there a clear segmentation of findings are based on 16,000 interviews shoppers based on their shopping with people who have used technology behavior and preferences across all 16,000 during the shopping process across channels (for example, taking into 16 countries, representing developing account different behavior for women, as well as mature markets: Australia, tech-shy or older people)? interviews Brazil, Canada, China, Finland, France, Germany, India, Italy, Mexico, Russia, When are retailers and manufacturers relevant to digital shoppers in their Spain, Sweden, Turkey, the United all-channel experience, such as with Kingdom and the United States. social media and smartphones – and The research helps uncover the how does this differ depending on the many faces of today’s technology- shopper segment? enabled shopper and demonstrates The answers to these questions and that shoppers are no longer loyal to more can be found in Capgemini’s new an individual channel but rather to an “Digital Shopper Relevancy” research experience across all channels. The 16 report. Studying shopping behavior has long majority of those surveyed said they expect the seamless integration of the online, physical and mobile shopping countries been a focus for Capgemini. Over the experience by 2014. past decade we have surveyed tens of thousands of consumers around The executive summary that follows the globe as part of our “Consumer provides an overview of key findings Relevancy” and “Future Consumer” from our “Digital Shopper Relevancy” research programs. In these earlier study. And the ensuing sections offer studies, the emphasis was largely on more in-depth data and analysis of shopping behavior patterns in physical today’s digital shopper, their behavior stores. and preferences across the All-Channel Shopping Journey – from Awareness With our new “Digital Shopper through Aftersales Care – and the Relevancy” research we have expanded changes they envision for shopping the focus to all channels, including channels in the future. those in the digital realm. Our objective: to understand how a range of channels We are confident that the findings and devices – from smartphones of Capgemini’s “Digital Shopper and mobile apps to websites and Relevancy” study will provide in-store kiosks – are used and valued organizations with insights into changing by shoppers during the All-Channel shopper dynamics. We believe that Shopping Journey, and to help retailers those insights can lead companies to and consumer products manufacturers gain a better understanding of how and understand how to profit from these where to invest in capabilities across all insights. channels. 3
Consumer Products and Retail the way we see itBeing a shopper today is more exciting The Journey of the Digital about setting up a commerce website,than ever. The consumer products and Shopper being active on Facebook or developingretail industry is undergoing significant a mobile app; this is about addressingtransformation largely because of Capgemini’s “Digital Shopper the specific needs of shoppers in thethe way that people choose to shop Relevancy” study provides insight into context of how they live their daily lives.and consume. They are enabled when, where and how shoppers want to interact with a retailer or consumer (Note: When we talk about “digitalwith technology that allows them to products company through various shoppers” we mean shoppers whoapproach the shopping process in a channels and locations across the use one or more digital technologies ordifferent way than they have in the past. phases of the All-Channel Shopping channels in one or more phases of theirShoppers expect to find information Journey: Awareness, Choosing, shopping journey.)in multiple sources and formats. Transaction, Delivery and AftersalesThey are looking for consistency Care (Figure 1).and convergence among differenttechnologies and channels. And they This insight is crucial for companies tohave no predefined views about what be able to serve these digital shoppers“belongs” in specific channels, but will in a relevant manner. This is not justuse whichever channel or device ismost relevant. Figure 1: The All-Channel Shopping Journey All-Channel Shopping Journey Awareness Choosing Transaction Delivery Aftersales Care Maria gets her Maria uses Maria doesnt really Using her phone, Maria gets personalized Mobile ideas from her her social network differentiate Maria requests information on phone and shops and phone between mobile delivery to her accessories and at special sales to let her friends and online as she house, her matching separates events at the mall help choose does everything boyfriends house for her recent through one or school, purchases device whichever is more convenient James’ goods arrive at James doesn’t get his home delivery box James will send James uses With one click feedback to the retailer e-mail James adds these involved in the at his pre-agreed transactional element regular time unless he on his mobile if there is suggestions to to his regular something in his order of his regular intervenes with a At Home supplement his online he is not happy with regular online replenishment purchases as they change of order happen automatically circumstances purchases Anna gets alerts on her phone about the Anna chooses Anna will order from a delivery status of the online or during kiosk in store or back order an experiential at home after she has Anna takes shopping trip, inspiration both chosen her goods Anna buys extended depending on the from online and category products and services from her mall that she sees in Store visits showroom-style stores. Any issues she deals with at home online Source: Capgemini Note: The “Digital Shopper Relevancy” study tracked shopper behavior and attitudes toward the following channels and devices: Internet sites, e-mail (such as newsletters and offers), in-store technology (such as kiosks), social media, smartphones (specific apps) and phone (via call center). 5
Key Findings The research uncovered a number of key findings. T here is no “one” digital using blogs and social networks to find consumer recommendations and shopper. reviews, although they are less likely We identified a variety of different than younger shoppers to follow types of digital shoppers, each using retailers on social media. In addition, channels and devices in different ways a surprising number want to receive during their shopping journeys. Their location-based messages and offers behavior is impacted by factors such as from retailers via digital channels. age, gender, product category, journey Overall, shoppers in the older age “ phase, market maturity, and attitudes groups are less interested in using and expectations about technology. mobile apps, although they do see We found some overall behavioral value in in-store technology such as differences, for example: kiosks and digital devices integrated Online stores • Female shoppers: Women are into shopping carts. need to provide all generally more engaged than men The differences were less pronounced when it came to demographic factors product information when using digital channels. They are more interested than men such as education and income levels. that is available.” in receiving personalized offers, recommendations and information However, demographics are only one factor impacting shopping behavior. Digital Shopper from Brazil about new products. In addition, A detailed segmentation analysis women are more interested than identified six distinct segments of digital men in using digital devices inside shoppers: Techno-Shy Shoppers, the physical store to order products Occasional Online Shoppers, Value that are not available in the store; Seekers, Rational Online Shoppers, they are also more interested in the Digital Shopaholics and Social Digital ability to easily compare different Shoppers. products before making the final Each segment uses digital channels purchasing decision, and in being and devices in different ways during offered visual aids (such as “how- their shopping journeys. For example, to” videos) to help them choose the Digital Shopaholics are early adopters most suitable product. and experimenters; they use digital • Older shoppers: Not surprisingly, channels and devices like smartphone older shoppers place less apps and in-store technology very importance than their younger actively throughout the shopping counterparts on digital channels in process. In contrast, Value Seekers general. But this doesn’t mean they are price-sensitive shoppers with low don’t see value in these channels. interest in digital shopping and new In particular, they are heavy users of technologies. They shop online primarily Internet sites, especially during the to find the best deals on products early phases of the shopping journey. they know they want and seldom use Older shoppers are interested in smartphone apps, social media or in- store technology when shopping.6 Digital Shopper Relevancy
Consumer Products and Retail the way we see itS ignificant differences media and blogs. By comparison, less than half of shoppers in the mature exist between digital markets of US, Canada, France, Australia, the UK, Germany, Finland andshoppers in developing Sweden are interested in this capability.markets and those In the middle are Italy, Russia and Spain, where a little over half are interested inin mature markets. using social media and blogs to learnThe research makes it very clear that about new products.digital shoppers rule in developing D “markets. Digital Shopaholics and SocialDigital Shoppers form the majority of igital shoppers aredigital shoppers in China, India, Brazil, focused on coreMexico and Turkey. By comparison,these segments account for a smaller functionality like price, I expectpercentage of the total digital shopper product specificationspopulation in the other markets. In most discounts and and delivery information.of the mature markets, the RationalOnline Shoppers are dominant. Digital shoppers, especially those in promotionsShoppers in developing regions mature markets, want retailers and consumer products companies to get specifically designedplace greater importance on all digitalchannels, regardless of the phase of these basics right before they will be for digital channels, open to engage. When researching,the shopping journey. This may be due comparing and choosing products clearly differentiatedin part to the lack of traditional retailinfrastructure in these markets as well through digital channels, half or more of respondents said that factors such from those availableas the tendency in developing marketsto “leapfrog” entrenched approaches as clearly marked product price, at the traditional availability and delivery charges, andin favor of the latest tools and formats. comprehensive product information store.”For example, 72% of respondents from were extremely important. Of lesser Digital Shopper from SpainIndia and 69% from China said they importance to respondents are optionspurchase more products in a single such as having content in digitaltransaction online than in a physical channels tailored to their profile andstore, compared with just 24% of those preferences.from Finland and 31% from the US. And73% of shoppers from India and 74% Shoppers also made it clear thatof those from China prefer to be offered they expect online prices to be loweradditional product suggestions online than those in physical stores; thisvs. 34% in France and 36% in Australia. was cited by 73% of all respondents. Digital Shopaholics and Social DigitalShoppers in developing markets are Shoppers are most likely to think onlinealso more engaged with retailers and prices should be lower. More than 80%consumer products companies through of these more digital-savvy shoppersdigital channels. Nearly three-quarters said online prices should be lowerof respondents from India and 68% of vs. about 60% of non-digital-savvythose from China said they would like respondents.to be able to follow retailers through T he Internet remains thesocial media, far more than those in themature markets. primary channel forInterestingly, we found that threecountries – Russia, Italy and Spain – most digital shoppers.often fell somewhere in between the Across the phases of the shoppingdeveloping and mature markets in journey, Internet sites remain theterms of their digital shopping behavior. dominant digital channel in all theFor instance, more than two-thirds of product categories studied, followed byshoppers in the developing markets of e-mail. For example, 79% of electronicsIndia, Mexico, Brazil, China and Turkey shoppers said the Internet is importantsaid they are interested in finding out during the Awareness phase; 74% ofabout new products through social DIY shoppers said the same; 73% of 7
Key Findings S eparating hype from fashion shoppers; 70% of health and personal care shoppers; and 59% of food shoppers. Similar results were reality is critical for recorded for the other journey phases. emerging digital channels However, channels such as social media, mobile apps and in-store kiosks like social media and are close behind, with their relevancy smartphone apps. varying depending on the journey phase Plenty of attention is being paid by and country. Phone (via call center) is retailers, consumer products companies the least important channel, except in and the media to these new digital the Aftersales Care phase. channels. And for good reason, given “ P the hype surrounding them. However, roximity matters it’s important to understand who is really using these channels. Overall, only when it comes to about half of shoppers expect that the To improve personalization. use of social media and mobile apps Customers appear to be of two for shopping will increase in the coming the usage of digital mindsets regarding personalization three years. But the number jumps channels in the during the All-Channel Shopping Journey. They express an interest considerably in the developing markets, and among younger shoppers, Digital purchasing process, in certain types of personalization Shopaholics, Social Digital Shoppers when shopping online, but are less and those shopping for high-end retailers and comfortable being recognized in the products such as electronics.manufacturers should physical store. Consider that 61% said they want online stores to remember Understanding these differences isprovide an integrated their personal information and payment essential in determining where to make digital investments, particularly in new methods to speed up the shopping experience between process. But only 41% want to be channels like social media and mobile apps. For example, in mature markets, physical and digital identified through digital devices (such as their mobile phones) when entering a companies would do better making touchpoints.” physical store. careful, selective investments in mobile apps and social media at the moment, Digital Shopper from Italy This seemed somewhat counterintuitive but in developing markets those given concerns surrounding privacy channels are more relevant and should in digital channels. But the shield of be the first priority for a digital strategy anonymity that exists in the digital world and investment. may make shoppers more comfortable sharing personal information online Loyalty – and Spending – than in the physical store. Respondents Across All Channels in Sweden and Finland are least likely Our study findings make it clear to share information in-store, while that shoppers are no longer loyal to shoppers in India are most likely to do an individual channel but rather to so. an experience across all channels. Also here we see a significant difference Consider that the majority of shoppers between shoppers in mature vs. said they are likely to spend more developing countries. For example, 80% money at a physical store if they use of shoppers in India and 73% in China digital channels to research the product said they want to receive personalized prior to purchase. In addition, they offers and recommendations through said they will spend more money with digital channels. This compares with a particular retailer if products are 35% in Sweden and 38% in Finland. available anytime via any channel. This point was reinforced in the qualitative comments from shoppers across the countries. “To improve the usage of digital channels in the purchasing process, retailers and8 Digital Shopper Relevancy
Consumer Products and Retail the way we see itmanufacturers should provide anintegrated experience between About the Studyphysical and digital touchpoints,” said a Capgemini worked with ORCrespondent from Italy. International, a London-based global research firm, to conduct the “DigitalBeing Relevant for Digital Shopper Relevancy” online study.Shoppers ORC International surveyed more than 16,000 consumers in 16 countries:Our research demonstrates that Australia, Brazil, Canada, China,shoppers expect an integrated Finland, France, Germany, India,experience across all channels but Italy, Mexico, Russia, Spain, Sweden,aren’t yet getting it. Nearly 60% of Turkey, the United Kingdom and therespondents said they expect channel United States. “integration to be the norm by 2014, butmore than half said that most retailers The composition of the consumercurrently are not consistent in the sample in each country was basedway they present themselves across on projectable national sampleschannels. representative of the population from the standpoint of age and gender. I use theUnderstanding how shoppers are usingchannels and devices in the context of Additional demographic factors examined included income, education, Internet mainly totheir daily lives is a critical starting point employment and marital status. All acquire productto serve them in a relevant manner.But to realize a relevant all-channel respondents had used digital channels and/or devices for shopping in the three information, butexperience is no easy task. Providing aseamless interaction across channels is months prior to taking the survey, and they were asked about their degree of decide on purchaseschallenging for retailers and consumer online shopping, use of mobile apps only after seeingproducts companies and requires and their technology adoption rate.considerations that impact the entire Respondents were asked about their and trying on theenterprise. These include shiftingfrom a product- or feature-focused purchase behavior in five product product.” categories: food, health and personalapproach to a consumer- and shopper- care, fashion (clothing, footwear, Digital Shopper from Finlandfocused approach across all channels, accessories), do-it-yourself homeand integrating processes such as improvement (DIY) and electronics. Andmerchandising, order fulfillment and they were surveyed about their useinventory management by category of numerous channels and devices atrather than by individual channel. each phase of the shopping journey:We believe the insights contained in this Awareness, Choosing, Transaction,report can help retailers and consumer Delivery and Aftersales Care.products manufacturers determine how In addition, respondents were askedthey can profit from customers’ desired for their predictions about the roleall-channel experience. The data we of various digital shopping channelshave collected goes far beyond what over the coming years and to identifywe have published in this report – the developments they would like to seeresearch also includes information on to improve their shopping experiencehow digital shoppers view the relevance across channels. Finally, they wereand performance of key retailers and asked to rate how important five keybrands in the respective countries. shopping attributes will be to themThese insights can translate into direct over the next five years in decidingbusiness benefits. how and where to buy products and services. These attributes are access,Capgemini has further developed experience, price, product and service.our original “Consumer Relevancy” Consumers were also asked to ratethought leadership into a “Digital their top three retailers and brands inShopper Relevancy” framework and the different categories and on thesemethodology. With these tools, we can five attributes.help retailers and consumer productscompanies make the right decisions The study’s quantitative data was supported by additionalto become more relevant for digital qualitative comments from theshoppers across the phases of their All- respondents.Channel Shopping Journey. 9
The Many Faces of the Digital Shopper10 Digital Shopper Relevancy
Consumer Products and Retail the way we see it 55% 62% OF WOMEN ELECTRONICS OF DIY SHOPPERS 65 ORSHOPPERS WANT TO RECEIVE OLDER USE INTERNET SITES TOINSPIRATIONAL CONTENT LIKE LEARN ABOUT PRODUCTS “HOW-TO” VIDEOS Who is today’s digital shopper? and promotions. Similarly, 78% of electronics shoppers in the 55 to 64 age Our research demonstrates that group and 69% in the 65-plus group there is no “one” digital shopper. The use Internet sites during the Awareness requirements and needs of digital phase. shoppers are difficult to untangle but distinct segments are emerging, each Older shoppers are somewhat less “ using digital channels in different ways inclined to use digital channels in the during their shopping journeys. Key later phases of the shopping journey. factors influencing the experience and Noted a respondent from Canada: “I’m requirements of digital shoppers include age, gender, product category, journey 65 years of age and retired. I do shop and compare online, but when it comes As a senior phase, market maturity, and attitudes and expectations about technology. to purchasing, I still prefer to see the goods, purchase them and tote them citizen having home.” watched how this Demographics Matter Gender plays a role in shopping While they are less likely than younger electronic age has shoppers to follow retailers on social behavior, with women generally media, older shoppers are interested developed over more engaged than men when using digital channels. For example, they in using blogs and social networks to find consumer recommendations the years what I are more interested than men in receiving personalized offers and and reviews. In addition, a surprising thought would not be number want to receive location-based recommendations; this is the case messages and offers from retailers via possible a few years across all countries but particularly in India, Russia and Finland. And women digital channels: 49% of respondents in the 55 to 64 age group and 38% ago now is. All I can are also more likely than men to be interested in receiving inspirational of those 65 and older expressed an say is ‘surprise me.’” interest in location-based offers when content from retailers through digital learning about products. Overall, Digital Shopper from Australia channels (such as “how-to” videos). In shoppers in the older age groups are the electronics category 55% of women less interested in using mobile apps but shoppers would like to receive this they do see value in in-store technology kind of content when learning about such as kiosks and digital devices products, compared with 44% of men. integrated into shopping carts. Women are also more interested than men in finding out about new products How Digitally Savvy are through blogs; receiving messages Shoppers? and offers from retailers based on We found varying levels of digital location; and in participating in online sophistication among shoppers: 55% communities provided by retailers. In of all respondents agree that they are addition, women are more interested frequent and confident shoppers online; than men in using digital devices inside 34% regularly use apps and services on the physical store to order products their mobile phones to research and/ that are not available in the store; they or purchase products; and 35% said are also more interested in the ability to they are early adopters of the latest easily compare different products before electronic and technology equipment. making the final purchasing decision In all cases, respondents in China and being offered visual aids to help and India were the most likely to see them choose the most suitable product. themselves as digital-savvy shoppers. Not surprisingly, older shoppers place Digital-savvy shoppers demonstrate less importance than their younger certain behavior patterns that counterparts on digital channels in distinguish them from other shoppers. general. But this doesn’t mean they For example: don’t see value in these channels. In particular, they are heavy users of • They are most likely to use Internet sites, especially during the technology to learn about products early phases of the shopping journey: and promotions and to search for Awareness and Choosing. For example, information to compare and choose 72% of DIY shoppers aged 55 to 64 a product. and 62% of those over 65 use the • Internet sites are particularly Internet to learn about products important for digital-savvy shoppers 11
to purchase and pay for products. Segmenting the Digital • Frequent and consistent online Shopper shoppers are most likely to agree Demographics and technological that the use of digital channels will sophistication are only two factors increase over the next three years. impacting shopping behavior. A “ • Early adopters of technology prefer detailed segmentation analysis led us to be offered additional product to uncover six distinct digital shopper suggestions online (cited by 85% of segments1: Techno-Shy Shoppers, early adopters). Occasional Online Shoppers, Value I’m 65 years • Digital-savvy shoppers are most likely Seekers, Rational Online Shoppers, of age and retired. to think online prices should be lower Digital Shopaholics and Social Digital Shoppers. Each segment uses digital (cited by more than 80% of digital- I do shop and savvy shoppers vs. about 60% of channels and devices in different ways during their shopping journeys. compare online, but non-digital-savvy respondents). when it comes to purchasing, 10 Years + 34,000 Consumers + 18 Countries = Countless I still prefer Insights Into Shopping Behavior to see the goods, Our “Digital Shopper Relevancy” study is the latest in Capgemini’s series of consumer research programs focused on addressing changing dynamics in the consumer products purchase them and and retail industry. tote them home.” A decade ago we launched our “Consumer Relevancy” research to help businesses understand the new language of consumers. We surveyed 16,000 consumers in the Digital Shopper from Canada United States and nine European countries about their shopping experiences and their relationships with business. The research demonstrated that companies needn’t – and, in fact, shouldn’t – try to be great at everything. Rather than striving for universal excellence, companies should consider the five basic shopping attributes present in any commercial transaction – access, experience, price, product and service – and select one on which to dominate and one on which to differentiate themselves, while ensuring they are at par or meeting the market on the remaining three. This research was followed by our “Future Consumer” program, which involved more than 2,000 consumer interviews in four countries: France, the Netherlands, the United Kingdom and the United States. The research explored the importance of topics such as health and wellness, product traceability, environmental issues and the use of new/emerging technologies, and how these issues may impact the way consumers buy, receive and use products and services in the future. Our new “Digital Shopper Relevancy” research, involving 16,000 consumers in 16 countries, picks up where the earlier studies left off: by focusing on how, when and where shoppers use a wide range of channels and devices – from smartphones and mobile apps to websites and in-store kiosks. The sum total of these consumer research programs: 10 years, 34,000 consumer interviews, 18 countries studied – and countless insights into shopping behavior. 1 Capgemini segmented the respondent base using more than 60 behavioral variables. Methods included12 Digital Shopper Relevancy factor analysis and k-means clustering.
Consumer Products and Retail the way we see itTechno-Shy ShoppersTechno-Shy Shoppers (13.3% of therespondents) are not interested in newtechnologies and do not consider digitalchannels or devices important duringany phase of the shopping journey.They are not frequent or confidentonline shoppers and rarely usesmartphone apps. They demonstratethe lowest rate of online shopping of all thesegments across all product categories.Techno-Shy Shoppers show someslight interest in social media but preferpersonal contact via phone/call centers.And they have very little interest in futuredigital developments.These shoppers include both youngstudents and older consumers and manyof them come from Continental Europe. Occasional Online significantly less online compared with all segments except the Techno-Shy. Shoppers When they do use digital channels, Occasional Online Shoppers (16.1% they prefer the Internet, e-mail and of the respondents) shop online in-store technology, but they rarely infrequently, with low usage across use smartphone apps or social media all product categories. They buy during the shopping process. These shoppers use digital channels primarily for choosing and comparing products and tracking deliveries. They expect digital channels to be in their native language. Occasional Online Shoppers value flexible return options, availability of product information and customer service. These shoppers are slightly more likely to be women than men and also are likely to be high school and college graduates; 56% of Occasional Online Shoppers are older than 45. 13
Value Seekers Their typical online purchases include fashion and personal healthcare items. Value Seekers (accounting for 13.5% of Value Seekers want an easy shopping the total respondent base) are price- process with clearly marked product sensitive shoppers with relatively little information and prices, and convenient interest in digital shopping and new return policies. technologies. They shop online primarily to find the best deals on products they They are more likely to be women (63%) know they want. Smartphone apps, than men, and are also somewhat social media and in-store technology more likely to be retired than their play almost no role in their shopping counterparts in the other segments. process. Sixty percent of Value Seekers are over the age of 45. the shopping journey but they have little interest in using social media and mobile apps for shopping. They know what they want and they use the Internet to find the most optimal solution. Rational Online Shoppers value well-functioning online stores with clearly marked product information, pricing and delivery charges, as well as reliable delivery processes. They do not trust Rational Online Shoppers reviews in retailer-hosted consumer communities and do not regard as Rational Online Shoppers (14.7% of the important giving feedback and receiving respondents) are relatively confident help through digital channels. online shoppers buying mostly fashion products and electronics. Overall, Rational Online Shoppers are equally they are the second most active divided between men and women online shopper segment (after the and 25% of them are retired. They are Digital Shopaholics). The Internet is particularly prevalent in Finland and the their preferred channel throughout UK.14 Digital Shopper Relevancy
Consumer Products and Retail the way we see itDigital ShopaholicsDigital Shopaholics (17.6% of therespondents) are early adopters andexperimenters and are prevalentamong the digital-savvy shoppers;they use digital channels and deviceslike smartphone apps and in-storetechnology very actively throughout theshopping journey. These consumers aretrue digital shoppers and have a higher-than-average rate of online purchasesacross all product categories. Theyplace considerable emphasis on theshopping experience.They prefer to communicate withretailers online and are active usersof social media and other peer-to- retail stores will ultimately becomepeer networks to share their opinions mainly showrooms.about products and services. DigitalShopaholics expect the full integration Digital Shopaholics are more likely toof the physical, online and mobile be men than women and they workshopping experience by 2014, and a full time; 60% have a college degree orvast majority anticipate that physical higher. Social Digital Shoppers themselves as frequent and confident online shoppers; however, they Social Digital Shoppers (24.8% of the purchase less online than the average respondents) are very optimistic about in all retail segments except electronics, the use of all digital technology and the likely due to the fact that they tend to vast majority consider digital channels be younger shoppers and have not yet and devices to be important in all reached their peak buying power. phases of the shopping journey. They tend to be digitally savvy and describe They are heavy users of social media and want to share opinions and experiences through digital channels and are active users of mobile applications and services. Social Digital Shoppers trust mobile devices for paying for products, locating items and identifying themselves. These shoppers are more likely to be under the age of 35 (45%) and 11% are students. Social Digital Shoppers are especially prevalent in developing markets such as India, China and Mexico. 15
Segments Display Similarities fairly often online but tend not to be and Differences up to date on the latest technology. In contrast, Digital Shopaholics and Social We found both similarities and Digital Shoppers are heavy users of the “ differences among the six segments. latest technology. Techno-Shy Shoppers For example, all segments value and Occasional Online Shoppers are the Internet as the key channel at cautious online shoppers and their use each phase of the shopping journey. Keep it simple However, Digital Shopaholics and Social of the latest technology is limited. For these shoppers, simplicity and visibility and easy to buy Digital Shoppers use a wider range of channels than do the other segments. of information through digital channels is key. Said a shopper from Germany: for non-tech-savvy, In addition, among all segments price “Keep it simple and easy to buy for non- non-Facebook, is the primary attribute impacting purchase decisions, followed tech-savvy, non-Facebook, non-social- media consumers.” non-social-media by product. Value Seekers and The buying behavior of Digital Occasional Online Shoppers put the consumers.” greatest emphasis on price, while Shopaholics and Social Digital Shoppers is especially affected by the Digital Shopper from Germany Digital Shopaholics and Social Digital presence of multiple channels. These Shoppers demand high standards from two segments will spend more money digital channels across all five attributes: with a retailer if products are available access, experience, price, product and at any time via any channel. They will service. Rational Online Shoppers will spend more money at a physical store settle for lower experience levels if they if they have used digital channels to get the right product at the right price. research products before going to Different patterns of online shopping the store, and are also more likely to and technology adoption were apparent purchase more products in a single among the segments. Value Seekers transaction online than in a physical and Rational Online Shoppers shop store.16 Digital Shopper Relevancy
Consumer Products and Retail the way we see itDigital Shoppers Dominate in Shoppers in developing regions social media, far more than those in theDeveloping Markets place greater importance on all digital mature markets. channels, regardless of the phase ofThe research makes it very clear that Now that we have a view of who the shopping journey. This may be duedigital-savvy shoppers rule in developing the digital shoppers are, let’s look at in part to the lack of traditional retailmarkets. Digital Shopaholics and Social how, where and when they use digital infrastructure in these markets as wellDigital Shoppers form the majority of channels and devices during their as the tendency in developing marketsdigital shoppers in China, India, Brazil, shopping journeys. to “leapfrog” existing approaches inMexico and Turkey. By comparison, favor of the latest tools and formats.these segments account for a smaller Shoppers in developing markets arepercentage of the total digital shopper also more engaged with retailers andpopulation in the other markets consumer products companies through(Figure 2). In most of the mature digital channels. Nearly three-quartersmarkets, the Rational Online Shoppers of respondents from India and 68% ofare dominant. Around the world, the those from China said they would likepercentage of Techno-Shy Shoppers to be able to follow retailers throughis similar, except in France and Spain,where it is higher. Figure 2: A View of Digital Shopper Segments by Country (Ranked by Social Digital Shoppers/Digital Shopaholics) 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% China 44 33 1 6 2 14 India 50 26 2 5 6 11 Brazil 36 23 8 5 19 10 Mexico 36 22 3 9 21 8 Turkey 35 19 5 9 19 14 Russia 29 17 9 9 25 11 Italy 22 22 10 14 17 15 Spain 25 13 8 16 15 23 US 19 16 19 19 17 10 UK 14 20 30 18 6 12 Australia 17 16 21 16 18 12 France 16 15 24 10 16 19 Canada 19 11 16 21 21 11 Germany 14 14 22 17 16 16 Sweden 12 7 25 20 21 14 Finland 11 7 32 20 17 13 Social Digital Shoppers Rational Online Shoppers Occasional Online Shoppers Digital Shopaholics Value Seekers Techno-Shy Shoppers Source: Capgemini Note: Results are rounded and hence not all bars equal 100%. 17
The Growing Role of Digital Channels: Spanning the All-Channel Shopping Journey18 Digital Shopper Relevancy
Consumer Products and Retail the way we see it 56% 58%OF SHOPPERS SAID THEY WERE OF DIY SHOPPERS SAID LIKELY TO SPEND MORE IN-STORE TECHNOLOGY IS MONEY AT A PHYSICAL STORE PARTICULARLY IMPORTANT IN IF THEY HAD USED DIGITAL THE TRANSACTION PHASE CHANNELS TO RESEARCH PRIOR TO PURCHASE Meet two of today’s digital shoppers. Engaging with these technology- The Internet Still Rules enabled customers begins with Across all these phases, Internet sites Marc, a Digital Shopaholic, uses his understanding the All-Channel remain the dominant digital channel local supermarket’s shopping app Shopping Journey across five phases: in all the product categories studied, to browse recipe suggestions, read special offers and compile his weekly • Awareness: learning about products followed by e-mail. For example, 79% shopping list. Once in store, the app and promotions of electronics shoppers said the Internet guides him to each item. He scans is important during the Awareness • Choosing: searching for specific barcodes for important product phase; 74% of DIY shoppers said the information, comparing and choosing information beyond what’s on the same; 73% of fashion shoppers; 70% of a product label. At the checkout Marc pays health and personal care shoppers; and • Transaction: purchasing and paying 59% of food shoppers. Similar results with his smartphone and the total for the product were recorded for the other journey is automatically deducted from his account, the receipt appearing in his • Delivery: tracking product delivery phases. However, channels such as store app. and related information in-store technology, social media and • Aftersales Care: providing feedback smartphone apps are not far behind Sandra, a Social Digital Shopper, (Figure 3). and receiving help after purchasing a is shopping online for shoes. She product, including returns identifies a pair she’s considering so that her friends in her social network can give her advice. As well as various comments, they also send her links to alternative options from the same Figure 3: Importance of Digital Channels Across the Customer Shopping Journey retailer. The nearest store to Sandra is alerted to the online conversation and Awareness Choice Transaction Delivery Aftersales Care a representative offers to help her find the right shoe at the right size. Sandra Internet site 3.94 3.92 3.80 3.92 3.94 visits the store the next day, where her personal shopping assistant has picked E-mail 3.56 3.47 3.34 3.71 3.79 out several pairs for her to try. (such as newsletters, offers) Like Marc and Sandra, people today In-store technology 3.31 3.33 3.41 3.25 3.28 seamlessly integrate the use of all types (such as kiosks) of technologies in their lives, including the way they shop – at any time, at Social media 3.09 2.99 * * 2.99 any location. As a result, they are more informed and selective about the Smartphones 2.88 2.82 2.81 2.93 2.91 products and services they want and (speciﬁc apps) use, and are more empowered toward Phone the industries that serve them. (via call center) 2.67 2.63 2.70 2.87 3.08 “ Source: Capgemini Ranked on a scale of 1 to 5 where 1 = not at all important and 5 = extremely important * While the study shows a low acceptance of social media in the Transaction and Delivery phases of the shopping journey, the study did reveal that shoppers increasingly prefer to journey through these phases via Internet sites, and many of the sites that I would like consumers use include a “social” component. The lines blur when consumers think about social media and transacting online. Social commerce is the blending of social media to see a comparison sites with e-commerce and is growing rapidly. Social commerce is expanding to include a range of social media tools and content used in the context of e-commerce. Examples of social commerce include customer ratings and reviews, user recommendations of prices and quality and referrals, social shopping tools, forums and communities. Shoppers are increasingly willing to transact via sites such as Facebook (F-commerce) and conversely socialize their thoughts on traditional commerce sites. among the same types of products.” Digital Shopper from Mexico 19
The research uncovered some Figure 4: Importance of the Internet Ranks Especially High in Developing Marketsdifferences depending on the journeyphase. For example, e-mail was Internet Sitesdeemed more important during theAftersales phase than in the earlier Awareness Choosing Transaction Delivery Aftersales Carephases. In-store technology was ranked Australia 3.81 3.80 3.59 3.78 3.80higher during Transaction, and social Canada 3.82 3.79 3.42 3.72 3.77media was somewhat more important Finland 3.68 3.70 3.45 3.60 3.73 Franceduring the Awareness phase. 3.76 3.69 3.63 3.80 3.77 Germany 3.48 3.44 3.35 3.42 3.35While the study shows a low Italy 3.93 3.94 3.79 3.94 3.92acceptance of social media in the Spain 3.72 3.68 3.60 3.71 3.73Transaction and Delivery phases of Sweden 3.61 3.52 3.34 3.41 3.51the shopping journey, the study did UK 3.93 3.89 3.86 3.96 3.85reveal that shoppers increasingly prefer US 3.92 3.93 3.81 3.93 3.98to journey through these phases via Brazil 4.30 4.32 4.32 4.43 4.41Internet sites, and many of the sites China 4.22 4.19 4.13 4.16 4.17that consumers use include a “social” India 4.38 4.35 4.30 4.31 4.33component. The lines blur when Mexico 4.22 4.23 4.17 4.31 4.37shoppers think about social media and Russia 3.96 3.94 3.84 3.97 4.01 Turkeytransacting online. Social commerce 4.27 4.26 4.25 4.30 4.36is the blending of social media sites Mean score: <2.0= 2.0-4.0= >4=with e-commerce and is growingrapidly. Social commerce is expanding Source: Capgemini Ranked on a scale of 1 to 5 where 1 = not at all important and 5 = extremely importantto include a range of social media Note: The data above demonstrates that the Internet is typically less important in the Transaction phase, suggesting that it is antools and content used in the context important tool for supporting buying in physical stores, not just for buying online.of e-commerce. Examples of socialcommerce include customer ratingsand reviews, user recommendationsand referrals, social shopping tools, Influence of Digital Channels surprisingly, lower prices was identifiedforums and communities. Shoppers on Spending Patterns as the incentive of choice, but a feware increasingly willing to transact via respondents offered alternative ideas. A key question is how the use ofsites such as Facebook (F-commerce) Said a shopper from the UK: “I’d like to digital channels may impact consumerand conversely socialize their thoughts see a wider range of loyalty points given spending. Our research found someon traditional commerce sites. for shopping in different channels.” interesting correlations. For example,Phone (via call center) was considered 56% of respondents said they were These highlights provide an overview ofthe least important channel overall, likely to spend more money at a how digital channels are being used byexcept for Aftersales Care, where physical store if they had used digital consumers. In the sections that followits ranking went up considerably. In channels to research the product prior we take a closer look at the use ofaddition, call centers were considered to purchase. And 55% said they were digital channels in each of the phases ofmore important in the developing more likely to spend more money with the shopping journey.markets than in mature countries. a particular retailer if products were available anytime via any channel.The importance of the Internetwas particularly pronounced in the Some respondents suggested incentingdeveloping markets, with respondents shoppers to use multiple channels. Notin most of these countries awarding itan importance ranking above 4 acrossall journey phases (Figure 4).2 2 Ranked on a scale of 1 to 5 where 1 = not at all important and 5 = extremely important.20 Digital Shopper Relevancy
Consumer Products and Retail the way we see it“ I’d like to see a wider range ofloyalty points given for shoppingin different channels.”Digital Shopper from UK 21