Transcript:
Peter Crosby:
Welcome to Unpacking the Digital Shelf where we explore brand manufacturing in the digital age.
Peter Crosby:
Hey everyone, Peter Crosby here from the Digital Shelf Institute. Those pesky consumers, they keep wandering around anywhere they like, discovering there, researching here, buying wherever, picking up or getting it delivered. And now they're doing it in a time where inflation anxiety is expanding their choice towards value. That makes shopper marketing research even more useful to plan how a brand should respond. Shopper marketing expert Anne Stephenson, partner at Explorer Research, has spent her career deeply studying shopper behaviors and turning that into actions across both the physical and digital shelf. She joined Lauren Livak and me to share the latest trends from the squiggly consumer journey.
So Anne, thank you so much for joining us. Shopper research has always been so critical, but particularly in the economic and sort of global environment that we find ourselves in right now. And never more so than a time like this. And you've spent more than 30 years, I think, laser focused on it, working at Brands and at Explore Research for over 17 of those. I believe you started when you were 10.
Anne Stephenson:
I'll take that as a compliment. I'll take wherever I can get it. Thank you.
Peter Crosby:
Thank you so much for being here. I mean, what is the state of the art and science of shopper research these days?
Anne Stephenson:
Well, as you mentioned, we've never seen such seismic change in terms of shifts in shopper behavior, and a lot of that was fueled by the pandemic. But the fun continues in terms of just such a shifting and changing world with inflation. So it's extremely dynamic. And I think one of the lenses that we really like to bring to anything we do shopper is to really understand that real behavior. And a lot of that you can only get through testing and context, whether that's in a bricks and mortar environment or online. So we use a lot of different behavioral tools to really get beneath the surface in terms of what someone might say they do versus what they actually do. So we use eye tracking. We'll use passive tracking in terms of what behavior people are doing online, in terms of their search behavior. Anything to really get that level deeper, to really understand what are those actual behaviors. And then, once we understand those, okay, well how do we put solutions in place to help our clients really drive growth for their brands from a shopper perspective?
Lauren Livak:
And I love, you had said when we were talking previously, that if you're just looking at the clicks, you're missing the why. And I really loved that, especially these dates. Because you're looking at content and someone might be clicking, but why did they not click? Why did they click? It's just so important for brands to really understand.
Anne Stephenson:
A hundred percent. And that's why tools like eye tracking, you can understand well what someone didn't click on this because they never even saw it. So really understanding the whys behind that behavior. And the same thing would be true with bricks and mortar. If you think about, you could look at past history of your category sales and say, "Well we're going to continue doing it this way because this is what sells." So we want to prioritize these particular products versus other products in terms of the actual physical retail environment. However, if you really understood, well maybe there's real consumer demand for certain products but they're not being seen because they're not given priority shelving. Maybe a retailer could really drive sales as well, from the bricks and mortar standpoint, by really understanding that behavioral aspect. So we incorporate that for both online, as well as actual physical retail stores.
Peter Crosby:
And sort of a question a little bit out of left field. We've been thinking a lot about the idea that over the next five years and probably a decade, we're kind of guessing that it will be in the interests of every retailer and every brand and distributor to think about how do they monetize every pixel of the digital shelf. Similar to the way that they've done with every square foot in a store. And if you think about that and what that might require, it would seem that we'll want to get as, and this is such a dangerous word, but as sort of personalized or targeted in that product page experience as possible. Do you agree with that future? And does that mean that over time you'd want to be able to connect up kind of visitor information of this type of shoppers coming to this page? And then there's another type of shopper that's coming to this page and their behaviors are different? Or do you think it will ever get to that sort of level of complexity or are you already doing that kind of view?
Anne Stephenson:
Well right now we do work with a range of different retailers as well as manufacturers in terms of their online experience. So yes, things are edging towards that. And I agree a hundred percent it will become more customized because we will have the data and information to do that. And we know, just behaviorally, it's so different in terms of online versus a physical store. So we know online typically you're viewing sort of eight to 12 products. It's really just what comes up in terms of that primary page that you're viewing and that's all driven by your search filters. So absolutely there's a role for customization. One of the things that we'll look at is some of the comparisons whenever we're doing customer journey work between the online and bricks and mortar experience.
And recently we did a sort of our own research on research in terms of the pet category. Because we really wanted to understand well behaviorally what's different in bricks and mortar versus online. And it was super fascinating in terms of what we found out. So not surprisingly, pet is a pretty high involvement category. I know when I'm shopping it, I look at the packages or if there's things on sale. It's like, oh she would love this. So I'm actually pretty involved in the category. So behaviorally, in terms of the actual time to shop, it was about 80% higher in bricks and mortar versus online. Because again, it becomes something that's maybe more of a routine purchase that either it's showing up in your favorites, in terms of buying the pet category or just search filters get you down to a very narrow assortment.
And then it's interesting in terms of, well from an eye tracking standpoint, how is this different in a physical store versus online. So what we saw was when you're shopping this big section in store with lots of colors and engaging things, we know behaviorally, actually, faces draw people in or images such as a pet. It really draws you into the packaging. So we saw that the actual number of fixations, and that's from an eye tracking standpoint, where you're actually looking. So when we do any kind of study, we can kind of look at the number of fixations, 97% of them were on the packages in a physical store. But within an online store it was only around 55% of fixations were actually looking at a pack. Because there was so much more to look at in terms of that primary search, once you got down to the brand or the category products you were looking at. Shoppers would look at titles. They'd look at reviews. All kinds of different information.
So this has huge implications in terms of not only is the assortment in terms of what you're actually evaluating that much smaller, but you're actually really not spending as much time looking at the package. So how you communicate online has to be different and you really have to understand what's that most salient thing that's going to drive your purchase. So one of the things we tell our clients in terms of packaging design is we have the Explorer rule of three. Which is despite wanting to throw tons of stuff on a package, you need to actually just focus on those top three things because visually you're only going to fixate on three key elements when you're looking at a package. So you need to prioritize what those three elements are. However, when we look online in terms of fixations, there's only one fixation on a pack. Because the shopper looks at the pack and then they move to other information, whether that's price, whether that's reviews, whether it's titles. So they're moving all over. So you have that one fixation to really communicate what you want from a packaging standpoint.
So super interesting in terms of these differences. And really it's a bit of a different decision making approach overall. When you think about bricks and mortar, you're navigating, so if I use the pet category, you might be looking for cat versus dog in terms of the aisle, and then you narrow into the type of pet food you're looking for. Online, all those, you've already filtered for that. You're presented with the most relevant options for you. And then it becomes, okay, well what's the most important thing you want to say from a pack standpoint? How do you want to optimize your product description? So getting really precise on what you're doing is super important and you almost have to be more laser focused in terms of your online communications.
Lauren Livak:
I think that's super interesting, especially around the mobile hero images that are changing online now. Where you have not just the package but you actually blow up a piece of it. If it's about laundry detergent, you blow up the number of pods in the box. Or the age group for the toy that you're playing with. And that speaks so much to what you're saying, right? Because people are just glancing at that image and they need to see the one thing that's most important to them that might be slightly different from an in-store perspective. Do you see a lot with the mobile hero images coming up?
Anne Stephenson:
A lot. Yes. So really sort of understanding what's most important. So it's got to be recognizable as your brand and your pack, but you can edit some of the information that you're putting in terms of those mobile images. And again, we've all done this where you order the wrong size of something. It's like, oh okay, I thought I was ordering this and I got the jumbo size or something. So really understanding that context of how you then dimensionalize the product description and specifications. So the shopper cannot get frustrated and they actually know what they're buying.
Peter Crosby:
I love that the term is fixation. Just when I think about the meaning of that word and then also the actual science of fixing on something. I think it's a wonderful blend of the actual what the eye is doing. Then also being, what are you fixated on? I don't know, just strikes my English major's heart.
Anne Stephenson:
And actually it is really interesting when you look at it from that perspectives. But one thing is your eye moves very quickly. Think about a hummingbird is sort of two to three fixations per second. So your eye's moving super quickly and that's the beauty of eye tracking is it actually picks up all those fixations. We can be extremely accurate in terms of what we're looking at. And then you can also look at engagement. So am I re-fixating? That shows I'm interested. So there's a lot of really fascinating ways you can analyze eye tracking data to really understand is someone noticing but then are they engaging? So there might be things that break through. You think about maybe bright packaging on shelf, maybe it's breaking through, I'm actually noticing it but I'm not really engaging with it. There might be other things that are better driving engagement in terms of refixations.
Lauren Livak:
So from a brand perspective, overall, in terms of trends, what are you seeing or what should brands be thinking about? I know we talked about the packaging piece, thinking about the omnichannel experience. What else from your insights have you seen that brand should really be thinking about that has shifted?
Anne Stephenson:
One of the things that we're seeing shift, and this has been going on for a while now, and some of this is driven generationally, but I think we're releasing this increase because of inflation right now, which is really understanding your loyalty. So especially younger generations, we see decreases in how loyal they are to particular brands. We see differences between males and females in terms of differences in terms of loyalty.
So what it means in terms of today's environment is, with inflation, the pressures are very real to maximize your spending power. So if your brand has high substitution, the shopper can now do that. And we love to say that substitution is a new shopper power, in terms of this superpower where instantly they can make comparisons. They can really understand, do I want to make a trade off? And this, in combination with just overwhelming choice, has really kind of set the stage for what are we going to see from a loyalty standpoint? And really, from a brand standpoint, understanding how loyal are your customers? What are those sort of price gaps where they'll make a trade off based on more competitive offerings in the marketplace.
So really understanding those dynamics is really important. I think back in my career, during of previous periods of either economic instability or higher inflation, we had kind of two plays in the manufacturer playbook, which was price up or downsize. But that doesn't work anymore because there's a lot of information out there to make those automatic comparisons. So it's very important, I think, for manufacturers not to be looking back at historical research or data, but to really understand very much sort just in time using really sort quick agile techniques to understand what's going on with their customer base. And also understanding who is loyal. And how do I get almost very precise with promotions and tactics to ensure that I'm sort of targeting the more loyal consumer differently versus a brand switcher and understanding those dynamics.
Peter Crosby:
Yeah, we were speaking with Jeriad Zogby, who's at Accenture, the other day. And they had done some more broad based consumer research. And had found that, I think, like you were just saying, it's super important to think about your assortment these days, and think about what your consumer's going to substitute, how do you make sure they substitute with you rather than going to a private label or to somewhere else to get their potentially lower price product? And it sounds like your shopper research side of that is definitely reinforcing that.
Anne Stephenson:
Yes. No it is, it's really important. So that's one of the strategies, especially with supply chain shortages. Let's say you're your leading products aren't there, so potentially a shopper is going to make a substitution. How do you make sure that you have something pretty close in terms of filling that gap? So just managing this is a lot in terms of from a manufacturer standpoint with supply chain shortages, inflation, lower loyalty from a shopper and consumer standpoint. There's a lot of factors coming together to just ensure that you do have those appropriate offerings, and you really understand it and monitor it pretty closely.
Peter Crosby:
And so when you think, you were talking earlier about the pet care example. If we could dig in on that a little bit for how your clients consume the information that you bring them when you're comparing brick and mortar to online, and how they turn that into decisions of how they approach each. A little bit more of the, "Okay, you told me this, now what do I do about it?" And how do you see the silos that can often exist between brick and mortar teams and online teams? Do you see that it kind of needs to break down a bit for them to meet in the middle somewhere? Or are they really still able to process this kind of data on their own? What are you seeing there?
Anne Stephenson:
Yeah, they do need to meet in the middle because it's not really a shopper friendly perspective to have two distinct areas. So we know behaviorally that shoppers are moving between. The journey is not linear. You're back and forth in terms of online. Sometimes you'll go to bricks and mortar to maybe comparison shop. So there's all kinds of back and forth. So they really do need to come together. And I think that's somewhere where we can sometimes help. So typically if we're looking at... And we've done a ton of work over the last few years of this area because so many people, their shopper journey was changing so much. So they really wanted to understand what was going on. So typically we'll do sort a very, sort a broader study where we understand that journey and we understand online versus bricks and mortar. And we use, typically, a range of different approaches to really get at that.
So it could be a broader sort of online survey where we really size the opportunities and what's going on within this journey. We go deep on touch points to really understand how are shoppers using different touch points for different categories. We typically also combine that with qualitative and other deep dives in terms of eye tracking, et cetera. So once we kind of understand the lay of the land, then we help our clients with how do I then take this information and activate on it? So how do I do better in bricks and mortar? What are the things that are going to really stop that shopper? What should I do in terms of mobile or apps or other communication? For online, where are they actually making that decision in terms of that purchase journey and how can I really influence and activate that online piece together? So we don't just kind of give our clients, oh here's happening in terms of where people are actually buying.
We try to provide them solutions, which is of much more of a consultative approach that we tend to take. So in terms of an example, we recently worked on a major, and it was kind of from a total category standpoint, study in terms of that path to purchase for a major manufacturer. So what was really interesting was we found that for this particular category, within bricks and mortar, it was shopped at the end of the shop. So you can probably figure out which category this might be. So it's a very large category that just based on typical trip patterns throughout a bricks and mortar. It was a grocery store. Typically bought at the end of the actual shopper journey. However online it was actually bought at the beginning. And why it was purchased at the beginning was it became a stock sort of item, more of a replenishment that shoppers would typically have as something that they had saved in terms of a routine purchase.
So one of the things we know. From a behavioral standpoint, and this is pretty much universal. Think about your own behavior even when you're going into a bank or when you are shopping for any type of product. Typically when you enter into your actual kind of purchase journey, you tend to be a little bit more task oriented in terms of, and I think about my sort grocery shopping, I'm like, okay, I want to kind of get through my list. And then halfway through the trip or later on, you open up to more discovery to more exploration. That's where impulse happens, which is why there's always been an impulse zone by cash. And then typically you're more open to impulse type products later on in your journey. So think about this category that's typically shopped at the end of the trip. When now, online, people are just okay. They're not even really exploring it's shopped at the beginning.
So their whole kind of opportunity for impulse within online dramatically decreased versus what they would typically see within bricks and mortar. Because that mindset has sort of shifted towards, okay, I've got through my major list of what are the key things I need to buy. I'm kind of open up to more impulse or more discovery later on in this trip. So huge implications. So within that type of scenario, we can then help our clients. Well then if you're not on that online list, how do you then get your brand on there? What are some of the interventions that you can actually look at to make sure that you are top of mind at the beginning of the purchase? How do you then do things maybe closer to the end of the purchase to drive impulse? In store, how do you influence that journey in terms of where they're actually going to make that decision? How do you drive impulse? How do you encourage some exploration?
So really different tactics, but really interesting to understand where are people actually then making that purchase decision on your category? Is it different bricks and mortar versus online? And then you really need very different approaches to then drive your business once you have that fundamental understanding.
Lauren Livak:
From an online perspective, do you see a lot of those tactics coming in from a retail media perspective? Where it's like I'm placing an ad at this certain point to try and grab that impulse?
Anne Stephenson:
Yes. Yeah. So that's the kind of thing on the manufacturer side. Our clients would need to work with retailers in terms of sorting out sort what's going to be best for them, where are they going to get the real set of payback or ROI in terms of some of those different tactics.
Lauren Livak:
And from a strategy perspective, I feel like we've come, manufacturers have come from a place of, I have one shopper journey to now you have an in-store shopper journey, you have an e-commerce shopper journey, you have an omnichannel shopper journey. How do you advise brands to think about that? Right? Because to Peter's point, sometimes you'll have an in-store team that's only focusing on in-store. You'll have an e-commerce team only focusing on e-commerce. How do you give advice to brands to think about it holistically and map out all the different buyer journeys that their consumers might be going through.
Anne Stephenson:
And I think, from a client standpoint, they're starting to get there pretty quickly. Because I think there's pretty universal understanding that it's almost like, and I think maybe we do our ourselves a disservice by talking omni. Maybe it's just kind of the new shopper journey in terms of this is how people are buying. And I think when we get too siloed, that's where we start getting into really not looking at that shopper as a person, not really understanding this fluid nature in terms of between different channels. So I think maybe almost a mindset shift needs to desperately happen in terms of looking at that, the buyer journey, as sort of one journey and it's just going to happen. Where in store you're going to be looking at mobile apps. So it's so back and forth that you need to really ensure that we're looking at it from a purely shopper standpoint, not a this is executing against different channels.
Peter Crosby:
I don't know what the shape of the shopper journey is, but it ain't a straight line, that's for sure, anymore.
Lauren Livak:
A squiggle.
Peter Crosby:
Yeah, yeah, it is.
Anne Stephenson:
A squiggle. Yeah, yeah.
Peter Crosby:
Yeah. That air hockey, it's like air hockey where it's bouncing from side to side, back and forth. So I'm, I think of the way in which the breadth of the funnel that online now represents. It really was, used to be very much, I'm arriving with intent, I know what I want. I put in the search term, I pick, I decide, I go. And now so much of it, particularly I think, as search out in the world becomes more complicated in terms of am I reaching the right audiences? Are they safe? Is it a safe place for my brand to be? And now it almost feels like retailer media to a certain degree, and retailer sites, have become kind of a little bit more of a safe audience. And so therefore more of the brand story is being told there because consumers are using it more that way for discovery. Have you seen that shift happen? And do you feel like it's reflected in the shopper behavior on the sites itself? Where they spend their time and is that reflected by what you're seeing?
Anne Stephenson:
Yeah, yeah it is. So we do see it quite a bit. And one of the things we do in our shopper journey or path to purchase work too, is we'll often look for browser history. So we'll be able to pair the stated of customer journey work with actually where they're searching. So that's where a lot of time we'll get some super interesting insights in terms of your shoppers are actually spending a lot of time on this site. Could be yours, could be the competitors from a brand standpoint, we can look at what retailers they're actually spending time with. So we're seeing shifts in terms of spending time at different retailer sites to really sort get more of that branded information. And it does vary by category, but absolutely I think of credible sources is really important in terms of shoppers and ensuring that the information is accurate and that they can really use that to help inform their decision.
Lauren Livak:
Along the same lines of discoverability, I mean not every brand can be in the first page of Amazon search. Especially when we're looking at analytics from a digital shelf perspective and you're trying to say, I want to be in the top 10. It's just not feasible for every brand. So from your perspective, what do you see that they're doing to be shoppable online? Whether it's through the online website or maybe focusing more on brick and mortar to help with discovery? What can they do because of the endlessness of the digital show?
Anne Stephenson:
Yeah, so I mean that's like the million dollar question.
Peter Crosby:
Well...
Lauren Livak:
You have answers right now.
Peter Crosby:
Let me get my checkbook.
Anne Stephenson:
So on the one hand it sort of creates more of an equal playing field. In terms of if you're a smaller brand you can now have opportunities that you wouldn't have had before within bricks and mortar. But then for larger established brands that it's not necessarily playing as much to your advantage. So I think one of the things that we'll sometimes look at to you is what are even the search functions, how are you actually making sure that you do come up? Talk from a search standpoint, understanding what are those key words in terms of what shoppers are putting in. And then to your point, just working with whether it is retailer media, anything to do to try and really increase your visibility is critical. Because, back to the pet example, I think there were 1300 cat food brands, 5,600 dog fit, it's just overwhelming. So of course naturally it's got to get narrowed down to that sort of top 15 products that someone's even going to use. So it's really those search filters and trying to get in front of that in terms of any type of visibility from a search standpoint.
Lauren Livak:
And do you use social in any of your insight or research? I'm just curious, with the boom of TikTok and Instagram shopping, is that incorporated in what you're looking at and do you see any big improvements there?
Anne Stephenson:
Yeah, so I mean social continues to grow. I mean just look at the popularity of TikTok made me buy it. And we're all guilty of that, in terms of how does this even show up in my feed? I mean, I'm convinced my phone actually knows what I'm talking about.
Peter Crosby:
I know.
Anne Stephenson:
I'll have a conversation, and then an ad shows up. And it's like, "Oh okay, yeah, I do need that." So we're all, and that will continue to be very big in terms of growth, in terms of social commerce and people actually buying online. So in terms of social media, we will continue to see that. And it's something that we absolutely track in terms of when we're looking at customer journeys, where they're buying, we will always ask about social and how important that is.
Peter Crosby:
The touch points just continue to proliferate.
Anne Stephenson:
Don't they? Yeah.
Peter Crosby:
It's one of the things that I just respect so much, are the leaders in our audience that are really thinking about this day in day out. And the complexity of data and behaviors, and all these things that need to, and competition, the complexity of it all to be able to make some choices to move the needle, is I just think it's a tremendous challenge. And the of amount of energy that they throw in to be able to figure this out at the pace at which it needs to be figured out is just, it's really impressive to me. I'm sure you find that with your clients as well.
Anne Stephenson:
I do. And I think it's just the pace, it's the amount of information. It's a lot in terms of really sort navigating your way throughout this. And we really love to dig into that with our clients and really understand how do they carve out a path that's really going to drive them ROI and get them results. And I think personally that's actually one of the reasons why I love shopper insights. Because it's not easy. You're really triangulating across a bunch of different data inputs. You really can't just look at one point in time piece of research and say, "Hey, this is the answer. This is the direction we need to go in." It's constantly evolving. So it's really kind of taking a lot of information, seeing the trends, seeing the patterns, and then trying to get ahead of that, a lot of time, in terms of where you're going to move next.
Peter Crosby:
So finally, and is a sort of an oxymoron, but future trends. It can only be a trend if it's happening. But as you think about 2023 and probably also into 2024, what are you thinking about that can create opportunities, or maybe some things to take pause about as we head into this next period, that if you were on the brand side in your customer's seat, you'd be thinking about?
Anne Stephenson:
Yeah, great question and I think probably the economy cooling is everyone's sort of top concern right now. So to what degree is that going to translate in terms of the next year? But it's huge in terms of what's going on economy wise. That coupled with inflation, supply chain issues, there's a lot in terms of moving pieces and we're at a very dynamic time right now. So I think one of the things we did touch on briefly was just I do think going forward there's going to be a need for more edited assortments in terms of the actual number of products that we're putting out to market. So I think that's going to be really important both in bricks and mortar and onlines. So I think from a shopper standpoint, it's actually a good thing in terms of a reduction in the amount of choice, I think it'll take a lot of pressure off of the supply chain.
And then I think just we're going to continue to see some of the trends that we've seen. I think of it the last few years and I just can't believe in terms of what retailers have done in terms of the pivot, in terms of the change in their operations. So I think both for bricks and mortar as well as online, we're going to continue to see the adoption of technology, we're going to see automation. And a lot of this is just necessitated in terms of even labor shortages, what we're seeing from a labor standpoint. So it's going to, I think, accelerate and fast forward technology adoption to really sort of manage in an environment where there are just fewer workers or just changing of sentiments among workers. Whether that's quiet quitting. Or the last one I read about was overemployed where people have two jobs.
Peter Crosby:
Oh my gosh, I'm more of a loud quitting person.
Anne Stephenson:
You're a loud quitting. You want to go out with a, in a blaze of glory.
Peter Crosby:
Oh yeah. Just let everybody know. So I'm interested in, you've been doing shopper marketing, as we mentioned, for a while, and you've been through recessions before. Are there sort of lessons that you take from that, that either should calm us or put us on alert? That you feel like still might be true even though the behaviors have changed since then?
Anne Stephenson:
I think it's any sort of very changing time, cooler heads are going to prevail. So I think it's just getting back to a lot of the basics in terms of understanding who your consumer and your shopper is, understanding their behaviors, really sort, understanding, especially as we're looking at inflation, what are those drivers of value? It's a lot of the basic stuff. How do you really answer their needs? What's really pressing for them? How can you help them through this time of inflation? How can you provide the appropriate assortment to them in terms of what's really relevant? So I think a lot of it is just stepping back and listening, and then just really answering that for your customers and for your shoppers.
Peter Crosby:
It's really not giving them a chance to go anywhere else, because you fulfilled their need. And trying to elicit, as early as possible, what those needs are in this period, it sounds like is really the work of shopper research. Anne, we really appreciate you sharing all this wisdom with us. It's been a real pleasure having you on. Thank you.
Anne Stephenson:
Yeah, thank you. It's been super fun.
Lauren Livak:
Thank you, Anne.
Peter Crosby:
Thanks again to Anne, for all the data and insights. Browse on over to digitalshelfinstitute.org to get more of all that by becoming a member. Thanks for being part of our community.
