No one can truly predict the future in this volatile economy. What really matters for marketers is consumer behavior today -- what and how people are spending, or not, in reaction to the economic crisis, reports Porter Novelli in a news release. Porter Novelli's oservations follow:
"Black Friday sales were better than expected, but no one should be fooled into believing that the spike is a harbinger of good things for the rest of the holiday shopping season," says Michael Ramah, Porter Novelli Partner and Global Director of Strategic Planning. "Marketers don't need tea leaves. They need a cool-headed strategy in order to face their individual communications challenges during this time of unbridled change."
Porter Novelli has identified 10 consumer behavior trends as the most impactful upon retailers, shoppers and marketers right now. The agency has also analyzed its 2008 ConsumerStyles data to segment consumers on dimensions that are most likely to drive shopping behaviors this holiday season (results below). Porter Novelli ConsumerStyles is a proprietary annual survey that explores attitudes, opinions and behaviors of consumers 18 years of age or older.
Here, the 10 key shopping trends Porter Novelli encourages retailers and marketers to consider right now:
1. Willing to Wait. Consumers want to buy, but in this economic climate they're willing to wait until the price is right. For marketers, it's imperative to identify specific areas of pent-up demand: Who is waiting to buy which products, and what will trigger them to spend?
2. Decidedly Undecided. For many consumers, it's not that they don't want to buy--they have the urge. It's that they don't know what they want. The implication for marketers: For some consumers, the emotional high that comes from acquiring the purchase is more enticing than the item itself.
3. Discount Dash. With millions of Americans deciding whether to spend a little or spend nothing at all this holiday season, the outlook seems bright for discounters. That means non-discounters need to compete on value, because they can't compete on price.
4. One for Me, One for Me. The International Council of Shopping Centers found that 81% of Americans who planned to shop on Black Friday weekend intended to buy something for themselves--up from 69% in 2007. With funds limited, consumers are asking themselves, "Should I be altruistic...or narcissistic?" Either answer adds up to sales.
5. All in for Next-Gen. Familiar technologies such as computers and music players are facing likely sales declines of 10%, but newer products such as Blu-ray players, smartphones and HDTVs are expected to do well. To build sales, marketers should consider bundling the old with the new.
6. Online on Top. More consumers than ever will be shopping online this year, looking to save time and money, avoid crowds and find a better selection of products. Companies who can make online and interactive marketing work even smarter and more efficiently will win.
7. Text to Shop. Scarborough Research data shows text messaging delivers a young, multicultural audience for marketers by providing a very locally targeted vehicle. Amazon.com is already tapping into texting over the holiday period to deliver its Deal of the Day, which recipients can purchase using their phone. The critical point for text marketing pioneers is to figure out how to use this tool without becoming a nuisance.
8. Future Tense. Black Friday retail performance was better than expected, but all signs point to tough times ahead for retailers. If sales contract and retailers scale back, marketing communicators will need to work a lot harder and a lot smarter to earn their keep.
9. Just Saying No. Not long ago, consumers blithely made impulse buys with cash or credit. But the less secure about cash flow shoppers become, the more they will have second thoughts. Retailers and product marketers must become adept at engaging with "second thought" consumers; they are likely to see a lot more of them.
10. The Cause Effect. As consumers shift from impulsive frenzy to second-thought hesitation, the notion of supporting a good cause may just provide a means to convert those second thoughts into buying mode. In a post-boom, post-greed retail climate, incorporating social and/or environmental responsibility into purchasescould be the acceptable new version of instant gratification.
Porter Novelli analyzed its 2008 ConsumerStyles data to segment consumers by: 1) price-sensitivity and 2) the extent to which they are active information-gatherers when it comes to making product purchases. The result is four consumer segments:
- The Impulsive & Fickle Deal Seekers (34% of consumers) are price-driven, yet they're not likely to spend much time researching their options. They want a good deal but don't want to work hard to find it.
- The Savvy Spenders (17% of consumers) are the opposite. They thoroughly research products but are less cost-conscious. Trendsetters and early adopters fall into this category.
- Tenacious Bargain Hunters (26% of consumers) are value-driven. They want the best price and will shop around to find it.
- The Want-It-Buy-Its (23% of consumers) do not see cost as a primary concern, nor do they thoroughly investigate their purchase options. If they see something they like, they buy it.