THE TRUTH ABOUT CONSUMERS. Paul Martin, UK Head of Retail 23 rd March 2017
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1 THE TRUTH ABOUT CONSUMERS Paul Martin, UK Head of Retail 23 rd March 2017
2 Our global online consumer report About the survey KPMG International commissioned Intuit Research to conduct a survey of global online shoppers regarding their purchase behaviours, purchase drivers, and perceptions and attitudes towards online shopping. The sample consisted of consumers aged 15 to 70 years old who had made at least one online purchase in the past 12 months, and who were within the top 65 percent of income-earners in their country. The survey was conducted using an online questionnaire. A total of 18,430 qualified responses were received from 51 different countries. Within each country, the sample was weighted to the same age distribution to ensure that country comparisons showed behavioural differences rather than those caused by difference in demographic makeup of the population surveyed in each country. The full report can be downloaded online at 2
3 $ 10+1 key trends shaping the retail landscape Declining margins Internationalisation Fulfilment Discounters Innovation Business model Platform Play Convenience Omni-channel Consumer power Artificial intelligence 3
4 The customer is changing.. Who holds the power? Retailer Manufacturer Retailer Consumer + Manufacturer Data aggregator 1950s 1970s 1990s Limited choice Only route to market Power of brand Distribution Scale Private label Consolidation Consumer data Global sourcing M & E commerce Social media Technology Consumer data Holistic view of consumer data Internationalisation Direct to consumer 4
5 Physical or digital? Both! Consumers expect retailers to integrate their physical and digital environments to provide a much broader, deeper experience. Today s state-of-the-art store is no longer a simple retail outlet but an inviting, highly designed urban space that functions as a store, showroom, activity area and warehouse. The result is a new spirit of collaboration over competition among developers and retailers. These players are sharing data and market intelligence as never before to develop and apply new technologies that converge digital and physical shopping, ultimately creating a highly unified, intuitive, personalized customer experience. 5
6 Stages of the purchase journey 1 Awareness: Triggers and influencers Evaluation: Experience and 4feedback Consideration: Product and 2company research 3 Conversion: Where and when to buy 6
7 Awareness: channels where consumer saw product first before purchasing Any online channel: 59% Any offline channel: 52% 30% 22% 15% 15% 15% 13% 12% 10% 10% 9% 8% 7% Source: Global Online Consumer Report, KPMG International, 2017 Online shop Online advertisement Online review Social media post or blog promotion Online article or magazine Physical shop Talking to friends Talking to family Saw a friend with it Print magazine or newspaper On TV or in a movie 7
8 Consideration: factors driving purchase decisions Decision factors by region Consumers in Australia, New Zealand, Canada, France, Belgium and South Africa were most likely to be influenced by price or promotions. In these countries, more than 38 percent of consumers said price and promotions were the factors that drove their most Factors driving purchase decisions Factors driving purchase decisions by region 22% 12% 24% 19% 23% 9% 12% 22% 19% 38% 17% 15% 26% 27% 15% 19% 13% 17% 22% 29% 27% Price/promotions 23% Product features 22% Brand 17% Online reviews 5% Newest trends or arrivals 4% Peer influences/recommendations 2% complementary products Asia Australia or New Zealand North America Eastern Europe or Russia 11% 9% 9% 16% 30% 13% 29% 16% Price/promotions 34% Product features Brand 18% 24% 24% Online reviews 25% 25% 17% Other Source: Global Online Consumer Report, KPMG International, 2017 WesternEurope Latin America Africa and Middle East Source: Global Online Consumer Report, KPMG International,
9 Conversion: deciding where and when to buy Most important attributes when deciding where to buy Best price Preferred website Best delivery options/price Stock availability Peer advice Returns policy 1% 2% Source: Global Online Consumer Report, KPMG International, % 17% 30% 36% Purchase duration by product category and price (%) Cosmetics Electronics Fashion Food Luxury Below US$100 US$100-$500 Over US$ The same day Less than 1week 1-2 weeks 2-4 weeks 1-3 months More than 3months Source: Global Online Consumer Report, KPMG International,
10 Evaluation: experience & feedback Type of feedback most recently shared online Sites where consumers shared feedback (%) Seller s website 47 Facebook 31 92% Positive Manufacturer or brand website WhatsApp % Negative 6% Neutral Instagram Online forum WeChat Blogs Twitter Source: Global Online Consumer Report, KPMG International, 2017 YouTube Snapchat Pinterest Other 21 Source: Global Online Consumer Report, KPMG International,
11 What s driving the shift to online Reasons consumers shop online instead of instores Reasons consumers shop in stores instead of online Ability to shop 24/7 58% I want to see/touch item first 56% Ability to compare prices 54% I want to try the item on 55% Online sale/better prices 46% Concerned products look different 41% To save time Convenience of not going to shops Greater variety/selection 29% 40% 39% Delivery takes too long Shipping costs are too high Product is too valuable to buyonline 25% 24% 34% 29% Enjoy the experience of going to the shops 23% 27% I have to go to the shop anyway 16% To avoid crowds Products are not sold in my city/country To avoid checkout lines 20% 15% 15% 11% I want to verify the authenticity Return process is too complicated Do nottrust onlinesecurity I want to talk to asalesperson 15% 14% 13% 11% Convenience Price-related Push fromoffline Ease ofselection Freeshipping Only option tobuy Source: Global Online Consumer Report, KPMG International 2017 Source: Global Online Consumer Report, KPMG International, 2017 Touch/try product Shipping Enjoy experience Other 11
12 Transforming from omni-channel to an omni business Omni-channel: Seamless integration across channels Omni- business model: Seamless integration of all functions enabled by digital technology and with the customer at the center 12
13 Serving today s consumer Put the customer first Moving to OMNI business Win hearts to win minds Take a different view Make it easy Welcome to the machine Dream big. Start small KPMG, a Hong Kong partnership and member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative ( KPMG International ), a Swiss entity. All rights reserved. Printed in 2017 KPMG, a Hong Kong partnership and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative ( KPMG 13 International ), a Swiss entity. All rights reserved. Printed in 13
14 Remember A desk is a very dangerous place from which to view the world! John Le Carre
15 Paul Martin UK Head of Retail, KPMG UK LLP KPMG UK LLP 15 Canada Square London E14 5GL United Kingdom The information contained herein is of a general nature and is not intended to address the circumstances of any particular individual or entity. Although we endeavour to provide accurate and timely information, there can be no guarantee that such information is accurate as of the date it is received or that it will continue to be accurate in the future. No one should act on such information without appropriate professional advice after a thorough examination of the particular situation.
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