In a recent Wall Street Journal article titled The End of the Impulse Shopper, Shelly Banjo and Sara Germanolay out a new “intentionality,” born in part from online shopping, where consumers buy what they came for – and then leave the store.
Those habits threaten more than just gum sales at checkout. Impulse is why stores offer deep discounts on loss leaders, why they put the milk in the back corner and why marketers spend heavily to pile up products in displays at the ends of the aisles. If shoppers just target the deals and don’t let their eyes wander, long cherished models for boosting sales fall apart.
The Journal story is right. The days of driving to five stores to compare prices, then circling back to the best one, are long gone. People are taking fewer trips to stores and there is more information than ever, so of course consumers are going to look at everything – prices, reviews, friends’ opinions, and blogs – and do more cross-shopping because they have the information in advance to inform the trip.
However, that’s not the whole story.
The Journal article primarily focuses on the relatively small shopper segment of List Makers, who can pose a challenge for supermarkets, which rely on POS displays and in-store features to increase average order value (AOV). But there are several new, conflicting influences – by-products of today’s omni-channel world – which may actually be having precisely the opposite effect on impulse buying behavior, across all shopper segments:
- Fear of Missing Out (FOMO) – More social awareness of items can lead to more impulsive buying on things than perhaps was previously the case when friends weren’t sharing online and aspirational images weren’t clouding your promotions inbox.
- Marketing Touchpoints – With the recent omni-channel trends in retail, there are more touch points than ever before, driving more opportunities for impulsive decisions (and, necessarily, a declining effectiveness of any one channel as a result)
- Couch Couponers – Easier browsing from the comfort of home, coupled with better web and mobile retailer applications means more deal-prone shoppers; data proves this factor leads to more deal–prone behavior, with more than half the goods purchased in America bought on sale.
This proliferation of “digital-age” impulse drivers makes it more important than ever for retailers and consumer goods companies to digitally “pre-test” offers and identify promotions that break through the noise.
The good news is that shoppers are using digital channels more each day – not just for “homework,” but also to BUY products across segments (41% of 2014 Cyber Monday sales were conducted via mobile devices!). This reality, coupled with social media use, makes digital channels fertile ground for real-world A/B testing of thousands of offer configurations. Such experimentation enables companies to identify and execute on the promotions that perform best – driving in-store purchase behavior from BOTH impulse shoppers and List Makers.
To learn more about behavioral drivers and how to transforms promotions, check out our eBook on Offer Innovation