consumer electronics

Transcription

1 MaxMedia Retail Labs Industry Report: consumer electronics October 2015

2 95% and of shopping and purchase decisions are made non-consciously where emotions, memory, instincts rule the day. About Our Industry Reports: MaxMedia Retail Labs redefines shopper research. Consider the fact that 95% of shopping and purchase decisions are made non-consciously where emotions, memory, and instincts rule the day. We use a psychological approach to research with studies focused on accessing this hidden layer of data. Our studies are carefully crafted to access non-conscious motivators of shoppers in different retail categories. We apply our proprietary Emotional Experience CENTER Model and the same cognitive analytics engine used by P&G and other leading retail companies. 2

3 With statistical significance, our team determined which of the identified six experiential levers are most important to shoppers: Comfortable Shoppers need to feel mentally and physically safe and secure from the moment they enter the store until the time they leave. Easy Shoppers brains want to expend as little energy as possible. Intuitive, easy to navigate shopping environments are paramount. Novel Only the new, interesting, intriguing or surprising gets shoppers attention in a crowded, cluttered, and highly-distracting world. Tactile Shopping physical stores should be a visceral, emotional, sensorydriven experience, delivering immersive shopping moments. Engaging Shoppers want to be more than just a spectator; they want to be a player in the shopping game and look for opportunities to engage and become part of the story. R ewarding Today s shoppers crave the personal satisfaction of making the right choices and being recognized for it. They seek a sense of accomplishment, confidence, or pride. Methodology: Our Retail Labs team uses the CENTER Model levers to unearth quantitative data expressing shoppers expectation of an industry. Each factor is scored 0-5: 0 as least important, 5 as most important. We compare these results to the qualitative data (also represented 0-5) gleaned from the reality of how companies deliver on each of the six levers. This gap is the sweet spot for industry improvement and opportunity. 3

4 MaxMedia Retail Labs Industry Report: consumer electronics Study conducted by MaxMedia Retail Labs in August 2015 Participants: 100 Americans, years of age, who have shopped for consumer electronics in the past 6 months what we know Consumer electronics carries the highest in-store digital influence factor (58%) among any other retail category 1 90% of retailers use or have plans to use in-store applied game theory (gamification principles and the effect of reward) 2 90% of shoppers surveyed would prefer to buy in a brick-and-mortar store versus online 3 Over half of those surveyed are millennials Shoppers prefer their personal device or in-store digital displays over a sales associate to 1 : Locate items Get product information Checkout 4

5 what we found comfortable rewarding engaging easy novel The participants typical expectation of the consumer electronics industry leaned most toward factors of Engagement and Novelty. However, the actual experiences these participants encountered skewed heavily to Comfort and missed the opportunity for Ease and Novelty. tactile Reality Expectation Image 1.0 Shopper expectation of the consumer electronics industry vs. shopper in-store experience. Insights In considering how these participants reacted to the reality they encountered in three top consumer electronics retailers, we found many important insights. Biggest drivers of churn: Engagement void Lack of ease Biggest drivers of happiness and brand advocacy: Reward Tactile interaction Biggest contributor to comfort and ease: Employee interaction 5

6 what we found Shopper Expectations Walmart GameStop Best Buy All Comfortable Easy Novel Tactile Engaging Rewarding Image 2.0 CENTER Model levers against shopper expectations of specific consumer electronics retailers. Shopper Expectations by Retailer An exploration of specific retailers points toward the conclusion that shoppers don t expect the shopping experience for consumer electronics to be Easy or Comfortable. Walmart shoppers expect to sacrifice Ease for Novel products and an Engaging experience. GameStop shoppers have relatively high expectations on all fronts, but are especially interested in their experience at the retailer being Engaging, Novel, and Tactile. Best Buy shoppers mostly expect the retailer to provide an Engaging environment with much Novelty to explore. 6

7 what we learned Based on statistical analysis of the qualitative data we gathered, the most important factor in the success of consumer electronics retailers is not the physical environment but the employees within it. The behavior of employees can make or break an experience in store. We found that employees of consumer electronics retailers are the biggest cause of failure on the Ease lever while also being the biggest catalyst for success on the Engagement lever. Poorly trained employees make the experience more difficult for shoppers. Yet employees that take pride in their job create a lasting, positive impression. I was trying to find the best external hard drive for my laptop, and the store employee spent 30 minutes with me. He answered all my questions and asked me a series of questions that I had not even thought about. There was one time when I was being helped by an employee who seemed to be far less educated on video games than I was. We discovered that shoppers most reported feelings of anger when there was also a reported failure on the Ease and Engagement levers. Customers were frustrated and upset when they found the shopping process difficult or when they were ignored. And these two levers are the highest indicators of churn. I had to wait 30 minutes for an employee to find their keys to open up the case to get my game. Not surprisingly, a high rating on the Reward lever was correlated to reports of happiness in shoppers. With any retailer, it is important to make consumers feel valued and important. Employees are no doubt a critical component when pursuing a retail strategy. The cashier gave me a special promo coupon, which allowed me to get $10 off. It was so nice and unexpected. 7

8 what we think Retailers of consumer electronics would benefit by creating an engaging and new shopping experience inside the store. Use applied game theory to impart a sense of reward and accomplishment for shoppers as they navigate different product options. Create plenty of opportunities for shoppers to tactily engage with products inside the store without a heavy sales push. Encourage shoppers to share their findings socially. Ensure sales associates are well-versed on different product lines and features for those shoppers looking to validate their impending purchase. For shoppers in the research phase, provide self-guided, unbiased, peer-reviewed, interactive screens to help narrow down the product set. Keep in mind these interactive screens should be supplemental to the opportunity to physically explore products. Digital should support, instead of replace, the tactile shopping experience. And lastly, ensure the employees hired are as irrationally loyal to your brand as you want your shoppers to become. 1 Deloitte: The New Digital Divide, June Boston Retail Partners 2015 CRM/Unified Commerce Survey 3 A.T. Kearney Omnichannel Shopping Preferences Study