Rethinking Retail for a New Shopper
New York — Retailers seeking to survive in an evolving landscape must better understand and cater to a new breed of shoppers. “The American shopper … has changed so dramatically in even just the past six months,” Wendy Liebmann, chief executive officer and chief shopper of WSL Strategic Retail, said in March during a general session at the Shopper Marketing Summit. “We really need to rethink the way we do our business today.”
Pointing to the dire state of once-prosperous retailers such as Macy’s and Kohl’s and lagging sales at even successful merchants like Target, Liebmann stressed the urgency of understanding and responding to these changes in shopper behavior.
Although there are now more places to buy than ever before, brands have fewer places to sell, with the average number of channels that shoppers utilize in a three-month period dropping for the first time since 2010. “[The shopper] is starting to pull back because she’s choosing different ways to shop,” Liebmann said.
Drawing on the latest “How America Shops” report and other WSL research, Liebmann described how the modern shopper, or “shopping goddess,” is now more knowledgeable, demanding and self-centered. She makes more frequent trips outside traditional channels, opting instead for smaller, local and discount places, as well as digital offerings such as click-and-collect and subscription services like Blue Apron or Stitch Fix. “She’s shopping in places that most of us aren’t looking at or tracking,” Liebmann said.
She also makes faster trips when she is in stores, thanks to rising pre-shopping habits such as online research that allow her to make decisions before entering a store and spend less time browsing. According to WSL, one in three Americans and one in two Millennials pre-shop. “The notion of the time spent in the store – the time she can connect at the aisle or checkout – has changed,” Liebmann said. “Either she’s not there or she’s got all her information before she gets there. It’s not just tying into the digital proposition; it’s asking, ‘Do I even understand what the trip model looks like?’”
Furthermore, although research shows that women are more financially secure today than two years ago, retail growth remains slow because retailers have not responded to new expectations from shoppers.
Fewer than half of shoppers are loyal to brands today and are disillusioned by the lack of perceived differentiation in categories, feeling that most retailers and brands are mediocre at best. But basic price promotions won’t win over the shopping goddess, who can easily find her own deals. Nor will touting “new and improved” products, as she cares increasingly less about material “stuff” and more about achieving happiness.
“If we’re in the stuff business, we need to build that proposition around the value she’s looking for in her life,” Liebmann said.
The “How America Shops” report found that shoppers are more willing to pay for services and solutions that reduce stress in their lives and health-focused products that improve their physical wellbeing. Shoppers also want the opportunity to make discoveries in stores and receive a customized selection.
However, what truly unites shoppers is the concept of “easier, kinder” shopping; they prefer to visit places that provide them with a positive experience and contribute to their sense of happiness. Although convenience and pricing factor into this experience, the retailers who scored the highest with shoppers were those that helped them use their time well, feel smarter and showed them that they care.
According to Liebmann, to drive growth and bring the “shopping goddess” back to their stores, retailers ultimately need to develop dynamic strategies and programs that aim to give her exactly what she wants, exactly where she wants it.
“It’s not about Amazon – not really,” Liebmann said. “That’s her default position when we don’t do a good job engaging her in a physical place.”