Almost 70% of consumers in the US shop in both the online and brick-and-mortar retail world. This makes them what we would call Omnichannel Shoppers, and they are especially valuable because on average they spend more in all channels than consumers who shop in one channel alone.
Of these Omnichannel Shoppers, roughly 81% rely on digital research when they are discovering, shopping for, and purchasing your products. Even if their ultimate purchase is transacted in brick-and-mortar retail, on average 35% (and even more in certain categories) are likely to validate their choice on their mobile devices, even when they are poised to purchase the product in a physical store!
In an Omnichannel retail world, the digital Path-to-Purchase dramatically impacts how consumers interact with brands and ultimately how they shop. How can brands map and leverage it to optimize behavior and consumer choice to their advantage?
Influencing Choice Throughout the Path-to-Purchase
As brands have moved their marketing online, many have embraced e-commerce (through pioneers like Amazon and Walmart, or even Direct-to-Consumer, most notably in beauty and personal care brands like Harry’s Shaves).
Few CPG and FMCG brands are ignoring e-commerce, but they may struggle to understand and harness the digital Path-to-Purchase, even if brick-and-mortar continues to be their dominant selling channel. And the largest e-commerce platforms like Amazon and Walmart offer very few options for brands to differentiate themselves and stand out on the e-commerce grid.
Adoption of online grocery by consumers hasn’t eliminated brick-and-mortar as a shopping channel; if anything, shoppers may look for products online that fulfill a “job to be done,” shop for it in a physical store, and ultimately purchase the product in another retail outlet offering a better price.
Early adopters experiment with either “click and deliver” or “click and collect” e-commerce alternatives offered by most major grocery retailers, introducing yet another variable in Omnichannel choice. And the number of consumers who move comfortably across the range of channels, continues to grow.
Now, grocery represents the fastest growing online purchase category.
Digital grocery has emerged not just as an alternative for consumers, but as an integrated component of the total Omnichannel shopping experience. In a pre-Omnichannel retail world, Path-to-Purchase was divided neatly into categories:
- Discovery (“I need a Product”),
- Shopping (“Where can I find that Product”), and
- Purchase (“I am buying that Product”).
Omnichannel Shoppers now move seamlessly between digital and physical retail, blurring the lines between actions that used to be discrete and sequential.
It is imperative for marketers to understand the optimal opportunities to intercept the consumer in each of these activities, understand how and why they make choices, and how to affect consumers’ ultimate buying behavior on the Omnichannel Path-to-Purchase, regardless of where the purchase finally occurs.
Recent research by PRS IN VIVO has taken a hard look at Omnichannel inflection points with some surprising implications for how brands can look beyond e-commerce alone as a way to win in an Omnichannel Shopper experience.
Mapping the Omnichannel Path-to-Purchase through a Behavioral Design Lens
Our research revealed five key behavioral insights that can help brands navigate the new Omnichannel shopper journey in order to drive sales growth:
- Discovery Is Now a Digitally Enabled Function. In the Omnichannel Path-to-Purchase, almost 50% of shoppers use Digital Devices to research online before going to the store. One-third, on average, are consulting their mobile phones while in the physical store to enhance Discovery and Shopping (there are some grocery categories where these numbers are even higher). A brand’s online presence can profoundly affect not only consumer awareness but also their choices at the moment of truth at the till or the virtual shopping cart. Where and how a consumer behaves online can impact how they get to your brand presence, and once there how they can be converted.
- Shoppers Navigate Discovery with an Eye for “Jobs to Be Done.” Design Thinking, a principle made famous by Clay Christensen, popularized the hypothesis that consumers have “jobs to be done” and they metaphorically look for products to “hire” to fulfill that job. This has a profound implication on how they approach the Discovery function of the Omnichannel Path-to-Purchase. We saw this in our research where consumers searched for a “Job to Be Done” (JTBD), a Brand or Product name and a JTBD, or just a brand name.
Brands who anticipate this behavior and create content to fit “jobs to be done,” fare better than those who rely on brand awareness alone to drive more consumers to a choice inflection point. Using passive tracking, we identified search terms used by consumers like “How to make meatloaf” which led them to recipes incorporating Hellman’s Mayonnaise, a somewhat unconventional ingredient in meatloaf preparation.
Conversion to purchase is often influenced by engagement that anticipates “jobs to be done” in the most oblique ways. “How to clean mussels” was a search which led consumers to a page on a Knorr website, walking would-be chefs through the secrets to de-bearding these shellfish favorites and appending a recipe including Knorr bouillon cubes as a key ingredient.
- Shoppers are Using Their Digital Devices In-Store for Variable Reasons. It is the moment of truth at the shelf: reaching out and putting the product into the cart. Even at this Purchase phase when looking for additional information about a product, most shoppers will be searching for a “Job to Be Done,” i.e., “Will this sunscreen truly be safe for my child with sensitive skin?” But besides enabling searches for more information, the consumer’s mobile phone allows them to compare prices between retailers, look for coupons, and even just access their shopping lists. Knowing the behavior at this inflection point enables marketers to make effective interventions informed by behavioral design.
- Brands Should Not Depend on Retailers to Do Their Heavy Lifting. Some searches may start with a retailer. Surprisingly, however, in the Discovery Phase there tends to be low interaction with retailer websites, particularly when the search is limited to a “Job to Be Done” or even JTBD and a Brand Name. Rather, the areas ripe for influence are those relative to a category (e.g. a food and recipes or beauty tips). When consumers are at the Shopping phase, their use of digital devices might be comparing prices or looking for coupons. But often consumers are validating the original Discovery research, even as a purchase is about to be made, confirming that the product will address the “Job to Be Done.” In-store or on-pack cues to give consumers the final behavioral prompts (what PRS IN VIVO calls the “Drivers of Influence”) that can make the difference between a sale and an abandoned cart.
When the online retailer is Walmart or Amazon, brands should not rely on these retailers to help them stand out distinctively. Further, their unique and rigid grid requirements disadvantage brands in specific, and actually different ways, relative to how consumers perceive products almost unconsciously. Savvy marketers need to understand these differences in order to optimize product presentation in either channel.
- Relevant Content on a Brand’s Website Leads to Sales as well as Deeper Engagement. Searching for a “job to be done” leads consumers to interact with many websites that are relevant to the category/brand (e.g. recipes for food products, etc.) as well as with the brand’s website (if the brand is strategic about this). A JTBD search that lands on a brand’s website have a 10% chance of converting immediately to an online e-commerce site that enables a purchase. Knowing this propensity to conversion allows a brand to construct prompts to further drive consumer choice and increase chances of a sale.
But more than that, brands in categories like pet food, haircare, and household products saw deeper engagement with the brand’s site when the brand satisfied a perceived need.
Consumer Choice Understood Through Behavioral Science and Design Thinking.
We have written a lot about behavioral science and the Drivers of Influence that can be applied to decode consumer choice. In the coming months, we will share more with you about Behavioral Design, the combination of BeSci and Design Thinking to create winning interventions in the Omnichannel Path-to-Purchase.
By combining Behavioral Science and Design Thinking, brands now have a chance to drive their own destiny even in the more conscripted e-commerce environments like Walmart and Amazon, the complex online platforms of other large grocery retailers, and in physical brick-and-mortar stores. By understanding how consumer choice is impacted by the new inflection points in the Omnichannel Path-to-Purchase, brands can learn how to harness BeSci and Design Thinking to their best advantage.