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Consumers may develop attachment to product objects based on things such as attributes, experiences, or values they share. The emotional attachment comes about due to a personal meaning the product has for the consumer that is unique and special in some way. The concept of product attachment is well known in marketing and consumer behaviour, but it has been a difficult challenge to plan for attachment and to implement during the product design process. The researchers Orth, Thurgood, and van den Hoven (2018) explored the prospects of creating products that are designed to connect with consumers based on their self-identities and life stories [1].

In thinking about self-identity, we can apply different means by which we perceive and define ourselves as persons (“who I am”). The process of construing one’s identity may start with his or her personality traits (i.e., self-image), but it can be expanded by adding beliefs, goals and values in life, an overall view of life and a look for the future (identity may also be expressed through salient group affiliations: social, professional etc.). When a good match of a product with any of those aspects is found, it may become the foundation for a consumer’s attachment with the product. However, there is another avenue for forming product attachment by means of connecting through episodes and elements in one’s life story or narrative — experiences and special moments (memories), people, places, and other objects (e.g., ties to existing possessions).  Orth, Thurgood and van den Hoven follow this avenue to look for opportunities to create product objects that designated individuals would meaningfully connect with. They state their objective as “purposefully create meaning by evoking meaningful associations” from one’s life narrative or sense of self.

In a marketing context, brands rather than products per se would be the appropriate targets for attachment. Brands identify products. Yet furthermore, a brand, as an intangible entity, may hold associations beyond attributes linked directly to the physical product that the brand name is assigned to; the associations can extend to brand personality traits, values, heritage, and more. The quality of an attachment may be assessed by (a) the brand-self connection that is built (i.e., how well the brand’s associations agree with and corroborate an individual’s self-identity to the extent that the brand becomes part of one’s definition of his or her identity); and (b) the prominence of brand associations in memory (e.g., how significant they are, that is, they come instantly and automatically to mind) [2]. Orth and his colleagues, who focus on product design, do not step-up from the product- to the brand-level, although they do refer to aspects underlying attachment that extend beyond the materiality of the product.

The researchers applied a three-stage methodology: 

Inspiration is derived from the life stories of consumers through in-depth semi-structured interviews (with three participants) —  participants told the researchers about their life stories, including people and places that were involved, memorable experiences they have had, possessions they cherish, as well as their views on physical product properties such as colour, texture and materials.

Creation of artefacts (products), designed to capture associations linked to valued and meaningful experiences, people, places, etc. in the memories (life narrative) and sense of self of the consumers-participants. Two artefacts were especially designed and made for each participant. The objects stayed with participants for two weeks.

Evaluation of the meaning, value and emotional tie each consumer-respondent ascribes to those two artefacts, designed-to-fit associations from each one’s life experiences and self-identity (note that the participants were not told that the objects were ‘designed-to-fit’ personally for them). As a reference, each respondent was also asked about his or her perceptions of and emotional ties to an artefact designed for another participant and to possessions they own which they regard as significant to them.

The results obtained by Orth, Thurgood, and van den Hoven were mixed. With at least one product-artefact they successfully captured the expected match in associations for forming an attachment; for other artefacts they partially captured the associations that would predicate an attachment (e.g., an attachment was formed but based on associations different from those expected); and in the case of at least one artefact, the design was evidently inadequate in forming an attachment (i.e., practically being a miss). The results testify to the difficulty of identifying and anticipating associations that will serve as the meaningful bridge for forming an attachment, even when quite detailed  information about the consumers to draw from is available.

Louise was offered a transparent candle cover (‘Diramu’) with silhouette of native Australian trees; the candle had a scent of smoky campfire.  It was intended to be reminiscent of her childhood in an area surrounded by bushland in Australia, where she had played frequently, but there was concern it would bring up less pleasant, disturbing memories of the struggle to keep bushfires away from her family’s home. Nevertheless, the designed Diramu managed to capture a ‘soft spot’ in the memories of Louise for bushfires (i.e., the bushfire was pleasant, not scary, and the candle’s scent had a feeling of home).

A partial success was obtained in cases as these: (a) Alex liked a porcelain decanter (‘Kiruna’) designed for him due to its fine aesthetics (attractive, elegant) and delicacy that he appreciates and favours.  But the decanter reminded him of the colours of Greece (white and blue) rather than his winter activities and skiing vacations with his children as intended. (b) Karen received a pendant necklace (‘Crater’) with a shiny anthracite coal that would resemble a gemstone. She found it ‘quite nice’ and she ‘quite liked it’. However, she grew no attachment to the object in spite of her affectionate memories of her father as a coal miner in England. The cue of coal failed to transfer the emotional significance regarding her father to the Crater artefact. The researchers admitted that they missed the completely functional attitude and emotional indifference of Karen towards objects, as they discovered it only in the evaluation stage.

The special world clock device (‘Globe’) prepared for Alex in conjunction with his many travels did not meet the expectations. Alex started developing a passion for travels during childhood in Australia and extended it to travels overseas in adulthood through his work; he likes connecting with people in different countries and collecting souvenirs (e.g.,  refined art objects, books and paintings). The Globe was made to show the names of places around the world (e.g., cities) at the time each location, according to its time zone, enjoys a Happy Hour for evening drinks. However, the name title of places turned out to be too weak as a cue to link to specific experiences. Alex commented that while many of the cities mentioned reminded him of some wonderful memories from his being there, “that thing doesn’t reflect those”. The clock design apparently also did not appeal to Alex (e.g., too simplistic, not to his aesthetic standards, and even stopped functioning after a while), leaving a negative impression on him.

The names as cues were probably too general and vague to trigger meaningful associations from the respective places; perhaps photographic images would have helped, but they too should prove personally relevant to Alex. Neither the informational cues (names) nor the design of the Globe artefact corresponded meaningfully with memories and associations of Alex from his travels, and thus according to Orth et al., it can be argued that the artefact was lacking authenticity for Alex.

  • Fournier (1998) studied the life narratives of consumers through in-depth interviews, though in her research the aim was to trace anchors for developing relationships between consumers and brands. That is, she learned from the products-in-use in the lives of three research participants about the roles that the brands of those products played in their lives and how bonds could be created with the brands based on the rich meanings they received [3]. The contribution of Orth and his colleagues is special in their attempt to leverage the information obtained about the life narratives of consumers into actual product objects designed specifically for those same consumers.

Realistically, companies cannot gather so detailed and personal information from too many consumers to enable them to design a product that will fit particular aspects from the life narrative or self-identity of each consumer. Orth, Thurgood and van den Hoven spoke to just three consumers and they had varied levels of success in anticipating the associations upon which attachment would be formed.

One direction they suggest, borrowing from previous research, is to create a set of optional product designs (versions) that would confer meaningfully to different target groups of consumers. In other words, each design could contain cues that any particular consumer may connect through to his or her idiosyncratic associations so as to develop an emotional attachment to the product object. This may suggest the importance that prevails in studying the lifestyles, values and psychographics of consumers (using surveys) in order to create the knowledge base necessary for designing personally meaningful product models. Nevertheless, this kind of information may never be as intricate and deep as the life stories studied by Orth and his colleagues. Finding personal meaning in products (and brands) could remain in the domain of the consumers based on what they know about themselves and their past experiences in life.

Another direction is to give consumers an active role in self-designing a product customised for each individual consumer who takes part in such a scheme. The consumer first has to choose what type of product is wanted; then he or she can choose features or properties (e.g., aesthetic-visual, functional) that may be perceived by each one as effective cues to trigger meaningful associations. The aim of self-designing a product in this context is self-expression and connecting to one’s experiences and self-identity, not strictly satisfying one’s utilitarian preferences. In typical schemes of mass customization consumers are constrained by the capabilities and willingness of companies to make the products of their designs. But in the age of 3D printing, consumers may gain greater authority, freedom and flexibility to design and create products to fit more closely the way they perceive and feel about themselves. Orth et al. put it this way: “Advancements in custom manufacturing technologies such as 3D printing provide growing opportunities for bespoke design practices such as those presented in this paper as an alternative to traditional mass production processes” (p. 101).

Orth, Thurgood and van den Hoven set two conditions for designing objects (products) with meaningful associations: (1) Cueing Meaning —  the product object has to cue an aspect of identity of the consumer that is personally significant or meaningful (e.g., the Kiruna made of porcelain related to an aspect of identity, ‘ceramics man’, not significant enough to Alex whereas the Diramu representing bushfires connected to an aspect of experience of ‘a pleasant bushfire’ uniquely meaningful to Louise); (2) Authentic Embodiment —  the consumer has to perceive the way a product object cues an association as authentic for it to elicit its personal meaningfulness (i.e., the consumers “must perceive the object to successfully embody the associated source”, hence establishing an authentic linkage between the object and source) (e.g., the Globe failed in relating authentically to the travels of Alex).

Product designers, with the help of design researchers, can go quite a long distance towards consumers in designing products that will be more meaningful to them, but they have to know and respect their limits in approaching consumers close enough. The difficulty is mainly in anticipating the associations that will be perceived by an individual consumer as relevant and significant to be the basis for forming an attachment, and then capture it in an authentic way. As Orth, Thurgood and van den Hoven phrase it, designers should acknowledge that they are “limited to creating possibilities instead of certainties in any attempt to design for product attachment” (p. 100). The task of finding a meaning in a product neither has to be relegated fully to the consumer. It should be a shared endeavour in which the designers recommend products and provide sufficient informed cues to meaningful associations, whereon consumers can detect and choose which ones in a product design truly matter to their self-identity and life experiences; and if technology allows, the consumers may be given even a more active role in creating such design cues meaningful to them.

Ron Ventura, Ph.D. (Marketing)

Notes:

[1] “Designing Objects with Meaningful Associations“; Daniel Orth, Clementine Thurgood, & Elise van den Hoven (2018); International Journal of Design, 12 (2), pp. 91-104. (Images of the artefacts can be seen in the article here).

[2] “Brand Attachment and Brand Attitude Strength: Conceptual and Empirical Differentiation of Two Critical Brand Equity Drivers”; C. Whan Park, Deborah J. MacInnis, Joseph Priester, Andreas B. Eisingerich, & Dawn Iacobucci (2010); Journal of Marketing, 74 (November), pp. 1-17

[3] “Consumers and Their Brands: Developing Relationship Theory in Consumer Research”; Susan Fournier (1998); Journal of Consumer Research, 24 (4), pp. 343-373

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Everything happens faster in the fashion world. Fashion houses and retailers have to deal with an increasingly turbulent market wherein trends and tastes fluctuate all the time and design styles replace each other in ever shorter cycles. This instability means greater uncertainty for firms, which makes it harder for them to plan and operate through the year. Attempting to curb the motion and introduce more stability can be a serious challenge for the fashion designers, marketers and retailers; the stream is strong, and more often it seems that everyone has to continue flowing to the next fashion style. Retailers with physical stores face an additional challenge from strengthening e-commerce — consumers prefer to buy more clothing items online, especially from whatever source and channel they can find them at lower prices.

Castro is a leading fashion house and retailer in Israel with over 130 stores carrying its name (i.e., Castro, Castro Men, and Castro Kids) across the country. The Castro company  was established by Aharon Castro in 1950. Its retail start was modest, and the business continued to be primarily a fashion house, designing and making garments (for women only), until the late 1980s. In 1985 the founder opened a flagship store on the modern Dizengof shopping street of Tel-Aviv; that may be considered a first brave move to lift-up the image of the Castro fashion brand and earn it more publicity.

In the early 1990s Aharon Castro passed the realm of the company to his son-in-law Gabriel (Gaby) Rotter, joined later by his daughter Esther (Etty) Rotter, and they have been serving as co-CEOs since then. The second period of Castro is marked by the great expansion of the retail arm of the business. More and more stores were opened in the 1990s and 2000s (Castro also made a venture abroad, mainly in Germany, but it was unsuccessful and largely cut-off). In this period the prevailing brand image of Castro was also invented, which gave it fame and appreciation. The last decade has seen more acquisitions of fashion enterprises (clothing and accessories) made by the company, but these do not carry the Castro name and therefore have less bearing on the Castro brand. In summer 2018 Castro merged with the fashion group Hoodies, and the repercussion of this move is yet to be seen, whether the brands mix or remain separated.

Listed below are selected actions that contributed more significantly to establish the prime attributes associated with Castro, exciting and daring, since the 1990s:

Castro aired a famed TV commercial in 1993 that was daring, playful and igniting the imagination — it is best simply to watch it.  Two more facts make this commercial special: (a) It was aired in the beginning of commercial TV in Israel, when the audience was highly curious and interested in advertising in this medium, which helped the commercial to become a “hit”; (b) The song featuring in the commercial was Creep by Radiohead, during the early stage of its musical career, so the commercial gave a unique exposure to Radiohead in Israel. Definitely in those days this Castro commercial was unusual and exciting (until today it is the most loved commercial in the country); it drove great attention and interest in the coats and other clothing products of Castro, and put it on a trail of growth.

In the early 1990s Castro moved into the pivotal shopping centre of Tel-Aviv (Dizengof Centre). Moreover, Castro situated its store near the entrance to the major department store of that time (HaMashbir), a sound call of challenge. A decade later, in 2003, Castro relocated within the shopping centre and opened its flagship store Castro Tel-Aviv, occupying three floors, with an external façade that turns to a strategic corner of streets with high exposure — a strong declaration of their presence. At least for several years it was an important anchor in the shopping centre.

Castro gradually started to enter clothes for men into its stores. Over time the fashion house expanded the scope of its target segments to become a marketer and retailer of clothing for men and women, youth and kids. On the retail side, Castro made two key moves: in 2000 it launched its sub-chain of Castro Men stores, and in 2013 the Castro Kids sub-chain of stores came to life. Perhaps already less exciting to consumers, but they are still daring moves (a demonstration of force).

However, the expansion of Castro’s activities, particularly adding stores to its retail chain, seems to have taken a toll from the company. It is hard to put a finger on a single factor as the cause of recent troubles at Castro. It appears, yet, that the toll has hit primarily Castro as a fashion house. From some point in the passing decade, consumers have been losing interest in the garments of Castro. In earlier decades, Castro led by its founder gained a reputation for creativity, for bringing new designs and quality fabrics (important especially in the 1960s and 1970s, credit going also to Aharon’s mother Nina). Consumers may have stopped believing that Castro’s clothing expresses creativity, novelty and ingenuity. Nonetheless, the needs and tastes of Israeli consumers apparently have changed, and they are looking for something different in fashion and clothing, which also happens to be less original and less expensive clothing.

Firstly, consumers buy more frequently from a variety of online retailers (‘e-tailers’), on top of them is Amazon.com, while getting easy access to broad selections of clothing from abroad at affordable prices. Consumers also are willing to pay less for garments, shoes and accessories of lower quality even if they would have to replace them more frequently. They further tend to inspect garments in physical stores and then buy the same or similar items from online stores. Yet another threatening competition to Castro comes from quick-movers, discount retailers like Zara and H&M that produce and sell garments of similar designs as those of known fashion houses (though they may have some original clothes). A more discomforting revelation of recent years is that a low cost retailer (Fox) is gaining in popularity while Castro is sliding down. The stores of Castro see less traffic of visitors (footfall), thus stores are too quiet for extended periods, and the sellers have too much ‘free time’ to arrange merchandise; a special report on public TV (Kan News, 4 May 2019, Hebrew) indicates that a growing pressure is put on sellers and other staff (e.g., visual merchandisers) to contribute to better results . Could it be that Israeli consumers find the design of stores less attractive; is the visual merchandising in-store less appealing to them; or is it the merchandise itself losing its appeal? We should not overlook the influence of background factors such as changes in the code of dressing (more casual, ‘dressing-down’, sportive) and economic constraints on consumers’ shopping behaviour in clothing and fashion.

  • In 2018 Castro saw overall a loss of 59 million shekels (~$16m), after a net gain of 48m shekels in 2017 and in 2016, and operating profit on clothing has dropped 66%. Additionally, sales of clothing in same stores of Castro+Hoodies fell 7.7% in 2018, above average rate in this sector (Globes, 5 May 2019, Hebrew — this article follows the report on Kan News).

A few ideas may be learned from the American department store chain Kohl’s that is taking dramatic measures in its effort for resurgence, led by CEO Michelle Gass [A]. Some of these measures may be relevant also to Castro, and could suggest directions for the transformation it may also be required of:

Kohl’s is reducing the amount of merchandise displayed in its stores, and is also decreasing the selling space of stores. On the other hand, the retailer installed an advanced inventory technology that allows it to track its merchandise on display at any time (by using RFID tags on product items), and follow purchase data (including online) and analyse it. Hence staff at Kohl’s can predict what products are in greater demand and what merchandise is in need of replenishing in real time, enabling to display less merchandise with no disadvantage.

Furthermore, Kohl’s  developed a capability to trace changes in market trends faster and cut the time needed to deliver new designs to stores (i.e., shorter time-to-market).

Kohl’s introduces new technologies in its stores to improve the service to shoppers and their in-store experience overall, including handheld checkout devices to cut waiting lines at cashiers, and digital price screens that can be updated with less hassle for staff; in addition, the RFID tags aforementioned enable staff to help customers quickly find products they seek (mirrors with holograms or augmented reality may come later).

  • Kohl’s has taken another intriguing step: orders from Amazon can be returned at desks in a hundred of its stores (out of 1,100+ stores). Critics and skeptics regarded this co-operation akin to “sleeping with the enemy” or “bringing a fox into the henhouse”. However, Gass sees in providing this service at Kohl’s stores an opportunity whereby Amazon’s customers already in a store may choose to buy some products they see around, similar to the case when Kohl’s customers who use its “click & collect” scheme at Kohls.com online store later come to pick-up the order at a physical store.

Castro announced recently that it plans to enlarge and redesign some of its stores. Castro Store TelAviv in GanHaIrPerhaps its management should re-consider enlarging stores. Does Castro really need to have stores as large as those of Zara and H&M (1000sqm+)? This may not be effective in terms of (lower) revenue per squared metre [B]. The stores can also be arranged to be more spacious between display exhibits and hold less merchandise, provided that information technology can be used to monitor it cleverly. Redesigning stores may indeed be welcome — current stores could feel too dark-toned with selective spot lights, which may be perceived more elegant but less convenient. Existing large stores may be reduced somewhat, or perhaps may better allocate space to other purposes like special projects (e.g., gallery of new art designs in fashion), a coffee bar or hosting events that may be more interesting than a space loaded with more products [cf. A].  Greater attention should be drawn to the experience that can be generated for visitors in-store.

Another issue concerns the image and experience delivered by the website and online store of Castro. Is the online store not advanced and rich enough? Will more exclusive online offers make the difference? [cf. B] What kind of experience should the website and online store present to visitors? Entering the e-commerce website overly feels like entering a catalogue. The e-store has some nice features like a model’s image changing position when hovering above with the mouse to show the garment from another angle, or being able to see the same garment in different colours. Yet the website appears nothing more than an e-commerce website; it misses something more important — it obscures Castro as a fashion house. The story of Castro and its creations is practically hidden, hard to find. When entering the website, it should communicate the image of the brand Castro — show original designs of the fashion house before start selling. The website should clearly show the “door” to the online store but right next to it should appear the “door” to Castro the fashion house and its story.

Eventually, the garments designed and created by Castro are the main issue to address. This should be an important point of differentiation for Castro from other retailers on which it should make its voice loud and clear. For example, prior to her role as CEO of Kohl’s, Gass identified the rise of the trend of activewear (sportive-energy) style in clothing; she gave it more emphasis in stores with the help of national brands like Nike and Adidas. Castro has a category (online) of Activewear. On the one hand, it can make its voice by introducing its own designs in this category. On the other hand, it should not go only after what seems popular at a time but suggest other modes or styles to the market.

Castro seems to lack sub-brands or endorsed brands up front that consumers can easily identify and associate certain styles or attributes with them (e.g., more daring or novel vs. more conservative, more artful vs. more functional). Castro is said to hire top-of-class young designers. Yet it does not elevate anyone as house designers by name, perhaps to encourage more collegiality and teamwork. An alternative approach would be to build a brand around a team of designers (like a “centre of excellence”) who share a certain vision and approach in fashion styles. Actually Castro already has three sub-brands: “Red” for casual dressing; “Blue” for more elegant, quasi-formal dressing; and “Black” for jeans wear. Castro can develop and enrich any of these sub-brands; create another brand with a specific style or tone of design as a secondary “specialisation” under any of those above; or build a new brand endorsed directly by the Castro name that will express new forms of art, novelty or elegance, etc. Whatever course taken, the leading idea is to give consumers a ‘name & face’ they can cling to, to follow how it evolves, and to identify with.

There are multiple avenues for Castro to reinvent and revive its brand and business as a whole. The expansion of its retailing activities may have led to the weakening of its fashion house and dilution of its brand. Some of the enterprises Castro acquired or merged with could hurt the brand to the extent that they are stopping Castro from developing answers in-house to gaps in the market. Therefore, it is perhaps the time now to return to increase the focus on Castro the fashion house as in earlier times, and let the retail arm serve it, not the other way round. Castro should be ready to enter its third period; the challenge will likely be assigned to the new Deputy CEO lately nominated, Ron Rotter (son of Etty and Gaby Rotter and former CFO), to reinvent Castro and put the brand on a new course.

Ron Ventura, Ph.D. (Marketing)

Additional Sources:

[A] “Michelle Gass Is Cracking the Code at Kohl’s”, Phil Wahba, Fortune (Europe Edition), December 2018, pp. 104-112.

[B] “Castro Once Was the Most Sexy Brand in Israel, But These Days Are Gone” (origin in Hebrew), TheMarker, 12 April 2019 (MarkerWeek edition), pp. 14-16

 

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Online shopping in digital stores and shopping in brick-and-mortar stores offer different forms of experiences. It starts from the environment or setting in which the shopper is situated — being present in a 3D physical retail space or viewing a 2D screen of a computer or mobile device. It is the difference between how much and what specifically a shopper can see and absorb when looking around in a physical store compared with looking at a screen. The difference in setting may have a further impact on behaviour, like how shoppers find products and how they inspect them.

Imagine a shopper, Dan, entering a large fashion store. Dan’s head immediately turns around as much as 180 degrees scanning the scene. Just a few steps in front of Dan there is a low desk with shirts, and another desk with sweaters to the left; to the right Dan observes shirts hanging on a rectangle-shaped stand, and he notices how their designs differ from those on the desk; along the walls are more shirts and trousers, etc. Dan decides to approach first the shirts to the left because they have multiple colours, lifting one or two to look more closely at them; later he also turns to the wall to see trousers and tries to match them with shirts. As Dan’s shopping trip advances he may enter deeper into the store to check on some accessories or another variety of shirts. Very early in the visit the shopper can figure out what may be found in main sections of the scene. Then starts a sort of discovery tour that may be guided by a master goal but progresses as the shopper identifies relevant and visually attractive items (stimuli). The scene is ‘updated’ as the shopper goes deeper into the store, or into adjacent halls, and details that were more distant and vague before become sharper and clearer.

A different kind of shopping process usually occurs in online website stores: first of all because much fewer products (stimuli) can be observed in a relatively short glimpse of the screen-scene. The way merchandise in the online store is located and explored is much more gradual.  An online store actually encourages a more goal-driven search process (e.g., choosing names of categories from a menu, selecting attribute options to narrow down the search to a relevant selection of products). Then starts a back-and-forth process of exploration of different items (e.g., by clicking on item titles or images and entering product pages), and visiting additional major categories of products. However, the experience of search and exploration is so different: whereas in the physical store the shopper can ‘wash the eyes’ with shapes, designs and colours of products, and follow the eyes through the shopping trip, it is much harder to do so in an online store where one has to go step-by-step or in a piecemeal manner. Nevertheless, online shoppers have more flexibility and a wider span of possibilities for viewing product options simultaneously on the screen of a desktop or laptop computer than on the screen of a smartphone.

Certainly there are more clever and creative e-commerce or store websites that are able to generate an improved experience of exploration and inspection of products. For example, there are online stores that show grids composed of tiles of images representing major categories and sub-categories of products. The images are more lively, and some of them exhibit motion as well. With some images, hovering with a mouse on the product photo (before clicking) changes the angle in which a garment or handbag, for instance, is shown. On product pages, some options may be selected that immediately affect the product image (e.g., colours, dimensions, designs); products may be rotated dynamically or by selecting from a line of static thumbnail images under the main frame.

A large majority of shoppers enquire about products online before visiting a physical store. According to a Google/Ipsos survey (‘Omnichannel Holiday Study’, Nov. 2017-Jan. 2018), 78% of US holiday shoppers searched products before going into a store; the online search helps shoppers in planning their shopping trip to the store, narrow down the options they should be seeking at the store, but it also ‘inspires the purchase’ (thinkwithgoogle.com, October 2018). In another research by Publicis (‘Shopper First Retailing’, 2018), an even higher proportion of shoppers, 87%, report that they begin searches in digital channels (online, mobile), up from 71% in 2017 (RetailDive.com, 15 August 2018). Searching the Internet is regarded as a productive method to look for directions and learning about product options, as preparation for making purchase decisions. Shoppers do not feel obliged also to make the purchase online, even if they browse the e-commerce website of an online-only retailer (‘e-tailers’) or of a mixed retailer that operates both a website store and physical stores. Consumers like especially to consult reviews of peer users who have already had experience with products they consider.

This learning process seems functional and goal-driven where shoppers need some guidance to put order into their shopping journey. Online sources, including e-commerce websites, seem to provide an efficient solution for this purpose. The process may indeed inspire shoppers with ideas, perhaps to the extent of helping the shopper to focus on viable and worthwhile purchase options and avoid wandering too long clueless in a store. In such a case in particular, visiting the online store of a mixed retailer can prove most useful before arriving to one of its physical store locations — and this makes the website an even more effective tool for the retailer.

However, retailers that operate physical stores would not want shoppers to come too prepared with their minds pre-determined what to buy. While shoppers usually have a general plan of what they are looking for, final purchase decisions are still made mostly in-store. Hence it is so important for physical stores to be designed and arranged in an appealing and stimulating manner — to allow consumers to complete successfully their shopping trip in-store, and furthermore encourage and induce them to purchase a few more ‘treasures’ they discover in the store.

It may be relevant to consider here two scenarios:

For retailers that operate physical stores in multiple, even numerous locations, there should be a stronger incentive to leave their customers with enough reasons to conclude their shopping in-store rather than on the website store. Thus, the online store has to be visually attractive, user-friendly and informative, but it does not have to be fully equipped with features that convince customers to complete their shopping and purchasing online. The website should not go all the way in effort to draw shoppers from physical stores. Whereas the online store may provide more functional, productive experiences (e.g., efficient, time-saving), the physical store would be more capable in creating pleasant emotional experiences (e.g., excitement, thrill, joy). The positive emotions invoked should not be taken lightly because they drive purchases.

For e-tailers with no physical stores there should be greater need to invest in the quality and feel of experiences they can provide in their e-commerce websites. The introduction of shoppers to the online store should be more delightful as well as informative and user-friendly. Visual elements and interactive features have to be inviting and helpful in guiding the visitor into different sections of the store — on the ‘main stage’ of the screen estate and not just through the menu and search engine.

The latter applies, nonetheless, also to mixed retailers that have stores in just a few locations (e.g., major cities) and wish to reach much greater numbers of customers that do not have a store near them. It may also be relevant when targeting customer segments who for any reason have little time free to travel to a store, and in regions where shoppers are reluctant to go out during harsh weather conditions (e.g., steaming hot and dusty or freezing cold and snowy). [Note: Location data might be used to channel a reduced or enhanced version of a store website according to whether the user is in vicinity of a physical store by the retailer, a form of ‘geo-fencing’].

Delicatessen in Gstaad

The brick-and-mortar stores remain very much in demand. According to a Google/Ipsos online survey (‘Shopping Tracker’, US, April-June 2018), 61% of American shoppers prefer shopping with brands that also have physical stores than ones that are online only. Key benefits suggested for shopping in physical stores are the immediacy in which shoppers are likely to obtain the products they require; getting hands-on — seeing and interacting with products before buying; and being more fun than shopping online (35% feel so) (thinkwithgoogle.com, John McAteer, November 2018). The Publicis study indicates more generally that 46% of shoppers prefer to buy in physical stores (vis-à-vis 35% who prefer shopping using their laptops and 18% on mobile phones) (RetailDive). Apparently, shoppers are not blind to benefits and advantages of shopping in physical stores over online stores, and many are not ready to leave them to fade out.

It is not suggested that online stores necessarily have to be made to appear like physical stores on the screen — mimicking the scene of a brick-and-mortar store may be perceived as just artificial, awkward and inconvenient (though retailers who also have physical locations can integrate actual store images into relevant sections of the online store). On the one hand, the retailer (or e-tailer) should take advantage of the strengths of the digital medium in organising, displaying and tracing information in the online store. On the other hand, online stores may have to breakaway in some degree from rigid structures of tables, lists and matrices. Grids of image tiles make a good start. Yet, more versatile visualisation possibilities have to be considered to provide visitors of store websites (or mobile apps) a more stimulating presentation of the variety of products the store has to offer. The interactive presentation should expose visitors to an array of products available (e.g., by type, use purpose, or brand), and lead their way from there into sub-categories and specific product models or brands.

  • Virtual Reality (VR) technology may be used to emulate a view of a store in 3D space, but the equipment needed to create a truly compelling experience is not in reach of most consumers, at least not yet. The more crucial question is: why should consumers prefer an imitation or illusion when almost everyone can visit real physical stores and shops. At least one aspect VR is unlikely to provide adequately is the social experience.

Instead of treating online shopping and shopping in physical stores as substitutes competing with each other, the more sensible approach for mixed retailers is to create ways in which they can combine and complement each other. The connection can be a two-way street, especially given that shoppers use mobile devices more frequently during store visits (71% of shoppers according to Publicis study cited by RetailDive). From online to store, for example, a mobile app of the retailer used in-store can help the shopper navigate and find the way to the places of products that he or she detected and learned about in a preliminary search and study online (e.g., Home Depot). From in-store to online, the shopper may use the app of the retailer in-store to find more information about products found in the store by scanning a barcode for the product of interest (e.g., Sephora [cosmetics] allows access to product reviews, order history of the shopper, and more) [examples adopted from McAteer in thinkwithgoogle]. More technologies that help in bridging between the virtual and physical domains of shopping include beacons and augmented reality (AR).

  • There are other areas not covered above in which online shopping is distinguished from in-store shopping and require more attention, such as customer service, specifically providing advice and assistance to shoppers, and the fulfillment of orders (a ‘click-and-collect’ programme is another way of linking the physical and online stores).

The physical and digital (virtual) domains have each their strengths in creating different forms of shopping experiences. Physical stores and shops have built-in advantages in evoking emotional experiences while shopping — they are tangible and more direct, can provide good personal care, and may attract and excite shoppers by means of interior design and visual merchandising in their physical spaces. Furthermore, beyond vision, physical stores allow shoppers to enact other senses (e.g., touch, smell) that cannot be experienced in the digital domain. It is unsure how much a store website (or app) can give rise to a similar emotional experience and attachment in shoppers, yet there are aspects that can be borrowed into the digital domain that would make it seem not just functional but also more appealing and immersive. Nonetheless, mixed retailers may have the best opportunity to combine the strengths from the physical and digital domains and link them to produce shopping experiences that are more productive and enjoyable altogether.

Ron Ventura, Ph.D. (Marketing)

 

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Many companies are well-known to consumers by their corporate names, including manufacturers, chain retailers and service providers. The corporate name may serve as the leading brand identifier (like an ‘umbrella’ name) for the company’s products or services. But furthermore the corporate-level brand name is the gate to access the organisation’s image as held in the public opinion of consumers. In the last decade companies are increasingly judged by their values, culture, and market and public conduct. Consumers are more strongly influenced in their choice of products or services of a company by what they think of and how they feel towards its corporate brand.

A Tel-Aviv-based strategic management consulting firm, TACK, constructed a two-dimension metric for assessing the image strength (or sturdiness) of companies in Israel. The metric comprises a rational-oriented ‘pillar’ named Logic and an affective-driven ‘pillar’ called Magic. Each dimension of the image strength metric is measured by two (rating-scale) items.

Logic represents how much a company is appreciated by consumers, and to what extent the company makes it worthwhile for consumers to be its customers.

Magic expresses how much a company is loved by consumers, and to what extent consumers believe that the company cares about its customers.

Magic pertains to the emotional ties between the company and its customers and is therefore particularly important to the relationships built by a company with the customers. We cannot underestimate the importance of the logical or cognitive-based evaluation of the company, by weighing its advantages and disadvantages, as the basis for the interest and preference consumers show in using the company’s products and services. However, reasoned appreciation of the company and its offerings will likely not hold-up a relationship without developing an attachment to the corporate-name brand.

TACK applied its Logic & Magic metric for the third continuous year in 2019 to 71 Israeli companies (e.g., food producers, retail chains, telecom service providers, banks). Measures were collected in a survey of 503 adult Israeli consumers (Hebrew-speaking). The companies are not necessarily managed purely as a ‘branded house’; however, this study is not concerned with additional brands owned by the company (e.g., brands that may be endorsed by the corporate brand name or products positioned as sub-brands). The demonstrated mappings of corporate brands (in Hebrew), along the dimensions of Logic and Magic, bring forward some sobering realizations shared below:

Firstly, it is noticeable that, from a consumer perspective, companies that are doing better on the logical-functional front are also more successful on the emotional front, and thus are doing better overall in connecting with consumers. We cannot conclude from this a cause-and-effect relation. But the findings do suggest that a wise strategy that is sensitive to consumers (i.e., it sees things through the eyes of consumers) can win on both fronts. In other words, a company as such that succeeds, through its strategy, in gaining the appreciation of consumers for its performance and advantages of its products and services, is also likely to win the affection, trust and approach of the consumers.

There are hardly any corporate brands that seem to get a high score on Logic but relatively lack in their score on Magic, and vice versa. This implies that a company cannot sustain a ‘cold-minded’ appraisal of its performance and offerings while failing to win the hearts of its customers; and just as well, a company cannot sustain an affectionate connection with its customers without establishing the foundation of approval of its functional benefits to customers (e.g., being relevant and attractive). Nevertheless. it should be noted that the spread among corporate brands with relatively higher Logic and Magic scores is greater than among brands with relatively lower scores on both dimensions (there are more of them and they are more condensed). There is still much variability among the best performing companies — they are not consistently doing better in the same way.

Secondly, the quality of products and services is just one of the factors consumers likely consider in their logical-functional evaluations, and is possibly not the more prominent one. There seem to be large differences in perceived quality of the products of at least some of the companies or in the weight assigned to quality. Moreover, companies whose products appeal in their high quality or expertise to only a relatively small segment of consumers (a niche) seem to fall behind and do not come out favourably in this type of all-market brand rankings. It is not so surprising to realise that the stronger and leading corporate brands are those of companies that aim to fulfill the needs and preferences of the wider common base of the mass market.

Let us look at a few examples:

  1. In the category of retail food chains, a heavy discount retailer, Rami Levy, is positioned close to the top-right corner of the map (both in its category and overall) with high Logic and Magic scores, while a delicacy retailer Tiv Ta’am is at the bottom-left corner of the map. The two major food retail chains are in-between, one in the top-right quadrant (Shufersal) and the other in the bottom-left quadrant (Bittan [Mega]). Tiv Ta’am may bring better-quality products (e.g., fresh produce, imports of delicacies) than other food retailers, but its stores are considered too expensive, lucrative, and they are not liked. Rami Levy and Shufersal are listed among the Superbrands of Israel for 2018 in the retail category.
  2. In the category of coffee houses, we find in relatively high positions the low-cost, basic-service chain of Cofix, and the espresso-bar, self-service chain Aroma. In the worst position we find Arcaffe, an Italian-style chain of coffee bars serving fine coffee, sandwiches and other products, but it fails to receive the appreciation of the greater public for their offerings and service. Aroma is much more popular although their products and its serving standard are moderate. Yet Arcaffe is considered more ‘top-notch’, made for European-connoisseurs, and is relatively more expensive. Eventually, Aroma and Coffix are also much more emotionally appealing to Israeli consumers than Arcaffe. Roladin, a bakery and coffee-house chain, can be argued to be much closer in quality and service standard to Arcaffe than to Aroma; yet, Roladin is appreciated and considered worthwhile (Logic) similar to Aroma and is even a little more loved and cherished (Magic) than Aroma —  the advantage of Roladin over Arcaffe seems to be that they understand better what the greater part of Israelis like to eat and expect to find in a coffee-house for a light meal. Aroma and Roladin are listed among Israel’s Superbrands of 2018 (dining out) whereas Arcaffe is absent.
  3. In the media category, among the news press publishers, HaAretz holds a much lower position on both Logic and Magic than Israel HaYom; Yediot Aharonot is located closer to HaAretz. Two marked differences between them: (a) HaAretz is left-leaning (affiliated with the Guardian and New-York Times) and Yediot is oriented to the centre-left, whereas Israel HaYom is right-wing; (b) HaAretz is superior, especially in some areas, in quality of commentary and analysis to the two other newspapers (tabloid-fashioned). But the political left, and the HaAretz newspaper associated with it, are out of favour in recent years, and perhaps as a result the tolerance to its reporting by large circles of society is low, no matter its apparent news quality. [It is noted that all three also have a news website, though in the case of Yediot the online channel is branded separately as ‘ynet’ — it is positioned close and just a bit better than the press edition]. Yediot (+ynet) and Israel HaYom are listed in the media category of Israel’s Superbrands for 2018 but HaAretz is absent (its economics and business branch TheMarker is included).
  4. Interestingly, the researchers of TACK report that preference for Arcaffe and for Tiv Ta’am, each in its category, is stronger among consumers who describe themselves as leaning to the political left. The relevance of political attitudes to dining-out and food shopping is a little obscure, but it gives an indication of the portrayal of their more likely customers. More importantly, this research evidence amplifies the argument that corporate brands more entrenched in niches — like HaAretz, Arcaffe and Tiv Ta’am — are much less likely to be considered strong leading brands.

Thirdly, response to price and value perceptions are not free of an emotional loading. An economic approach views the calculation of value as a rational procedure of weighing the benefits and cost of a product or service offer. However, when an offer is judged as unfair to the disadvantage of the buyer, this may stir anger and resentment of the consumer in response to the price offer. The resentment is more often directed to the retailer, but it may be pointed towards the manufacturer of a national brand as well, depending on whom the consumer believes to be more responsible for a price differential or increase.

The judgement of unfair price differentials is contingent on the reference price used (e.g., a price paid by a friend for the same product at another store this week). In the case of a price increase, the reaction is subject to whether consumers can see justification to a price increase by attributing the increase in retail price to a rise in cost that retailers or manufacturers could not control (e.g., price of raw materials). In the past decade much resentment developed because consumers failed to find such justifications. Instead, the perception more accepted was that retailers and manufacturers were rolling their cost rises mostly to consumers, and they raised prices merely to improve their profits. In Israel this problem was evident especially in the food category where consumers were witnesses to continued feuds between the food chain retailers and manufacturers. More broadly, many Israeli consumers appear to these days to have little tolerance to retailers, service providers or manufacturers that seem to raise prices unfairly or try to position themselves to be more up-scale and luxurious — disappointment and anger at them motivates consumers to punish them in some way. This kind of resentment and urge to act in revenge is apparent also in the results of the study by TACK.

Price is given priority by more Israeli consumers, and it seems to overweight possible advantages in quality of products, services or the environment of shopping. In some cases consumers may fail to appreciate any such advantages while in others they simply consider the price premium as unjustified or unaffordable (which may add frustration to their evoked emotions). This can be another aspect that explains the differences between companies described above: (a) for instance, the gaps on Logic and Magic between coffee-house chains like Cofix and Aroma compared with Arcaffe,  and vis-à-vis Roladin, or (b) Rami Levi which is probably perceived as making greater effort to charge affordable prices (although it declined a little from last year), far better than a delicacy chain such as Tiv Ta’am. In other categories, it is more difficult to make clear inferences. In telecom services (mobile, TV, Internet), for example, all major companies receive relatively low appreciation and are less loved. A specialised dairy producer (Tara) is positioned less favourably than the two major and larger dairies (Tnuva and Strauss) which happened to be more shaken by consumer protests of several years ago (Tara is more preferred though among ages 55+ according to TACK). Among fashion retailers, a low-cost retailer of casual wear (Fox) is positioned just slightly higher on Logic but lower on Magic than some major main-stream retailers (H&M, Castro, Zara); yet another retailer (Renuar) that is probably somewhat more exclusive appears to be considered less worthwhile and having moderately less of magic (as reference, Polgat [for men], which has visibly better quality clothing, is not included).

The study of image strength by TACK sheds light on the relative positions in which consumers hold corporate brands both in their minds (Logic) and in their hearts (Magic).  It is somewhat surprising to find such a strong association between the logical-functional dimension and the affective dimension — it suggests that a company cannot sustain a positive stance on one dimension without the other for a long time. There is some discomfort also in realising that price could be more dominant than quality, but it is important to acknowledge how perceptions of value, and especially unfairness, can influence the emotional reaction of consumers to the corporate-level brands. Effectively, being attentive and sensitive to what the wider circles of consumers in the country need and expect to have is a key to be regarded overall as a favourable, strong leading brand.

Ron Ventura, Ph.D. (Marketing)


Comment on Methodology:

The brand scores are given in percentages. More detailed values reported for 2017 help to understand the metric’s structure. The score on each dimension (Logic or Magic) seems to be calculated as the sum of the ‘top-box’ proportions for the two items it is composed of (e.g., % who give a rating of 6 or 7 on a 7-point Likert-type scale in agreement with each statement of Logic, where 25% on ‘appreciate’ + 20% on ‘worthwhile’ = 45% on Logic). However, summing up those percentages is not a proper procedure — this sum does not have a meaningful interpretation because the proportions cannot be accumulated. It would be correct to take their mean rather than the sum. Another valid option is to add-up the rating values of the pair of items for each respondent and then calculate the percentage who have given a total score on that dimension of above a threshold (e.g., a score on the index of Logic of above 12) in order to produce a score that may be more easily related to.

Reference on price fairness:

The Price is Unfair! A Conceptual Framework of Price Fairness Perceptions; Lan Xia, Kent B. Monroe, & Jennifer L. Cox (2004); Journal of Marketing, 68 (October), pp. 1-15.

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A classic view regarding decision-making holds that attention serves foremost to acquire the information most relevant and important for choosing between alternatives. Thereby the role of attention is largely a passive one. However, an alternative view that is gaining traction in recent years, especially due to the help of eye tracking research, argues that attention plays a more active role in decision processes, influencing the construction of decisions.

This is a key message delivered by Orquin and Mueller Loose (2013) in their review on the role of attention in decision-making, as can be learnt from tracking of eye movements and subsequent fixations [1]. The approach taken by the researchers, however, is less usual: They do not constrain themselves concretely to the domain of decision-making; instead, they start their review and analysis of evidence from theories or models of tasks similar or related to decision-making (e.g., perception, information processing, visual search, working memory, top-down and bottom-up processes, problem solving).  Then they try to project how the functions of attention in such tasks may project to or be expressed in decision processes.

Furthermore, Orquin and Mueller Loose examine the extent to which the evidence coincides with four alternative theories and associated models of decision-making (i.e., whether empirical evidence substantiates or refutes assumptions or conclusions in each theory). They review evidence from previous research on similar or related tasks that could also be traced specifically in decision tasks, based on eye tracking in decision-making research, and evaluate this evidence in the context of the alternative decision-making theories.

The theories and related models considered are: (1) rational models; (2) bounded rationality models; (3) evidence accumulation models (e.g., the attention drift diffusion model [aDDM] posits that a decision-maker accumulates evidence in favour of the alternative being fixated upon at a given time); and (4) parallel constraint satisfaction models (a type of dual process, neural network model based on the conception of System 1’s fast and intuitive thinking [first stage] and System 2’s slow and deliberate thinking [second stage]). Rational models as well as bounded rationality models more explicitly contend that the role of attention is simply to capture the information needed for making a decision. ‘Strong’ rational models hold that all relevant, available information about choice alternatives would be attended to and taken into account, whereas ‘relaxed’ rational models allow for the possibility of nonattendance to some of the information (e.g., attributes or object [product] features). Bounded rationality models suggest that information is acquired just as required by the decision rules applied. The two other categories of models are more flexible in regard to how information is acquired and used, and its effect on the decision process and outcome. However, the authors argue that all four theories are found to be in deficit to a smaller or larger degree in their consideration of the role and function of attention in decision processes, having at least some of their assumptions being rejected by the evidence evaluated.

Selected insights drawn from the review of Orquin and Mueller Loose are enlisted here only briefly to shed light on the significance of attention in consumer decision-making.

A crucial question in decision-making is how information enters the decision process and is being utilised in reaching a choice decision: information may be acquired through attention guided by a top-down (goal-driven) process, yet information may also be captured by a bottom-up (stimulus-based) attentional process. The entanglement of both types of processes when making a decision is a prime aspect in this domain and has multiple implications. A more efficient selection process may be driven by greater experience with a task (e.g., more important information cues have a higher probability of being fixated on) and increased expertise in comprehension of visualisations (e.g., more fixations to relevant areas, and inversely fewer fixations to irrelevant areas, requiring shorter fixation durations, and longer saccades [‘jumps’ between more distant elements of information in a scene]). The interaction between bottom-up and top-down processing can amplify attention capture and improve the visual acuity of objects perceived. Bottom-up attention in particular is likely to be influenced by the saliency of a visual stimulus; however, it may not take effect when the task demands on attention are high, wherein priority is given to top-down directives for attention. Decision-making research has shown that visually salient alternatives or attributes are more likely to capture attention and furthermore affect the decision in their favour.

An interplay occurs between working memory and ‘instant’ attention: As the load of information fixated becomes larger, more elements are passed to working memory, and information is accessed from there for processing; however, as the strain on working memory increases, consumers turn to re-fixating information elements and consider them instantly or just-in-time (i.e., fixations are thus used as external memory space). This type of interplay has been identified in tasks of problem solving. Toggling between working memory and fixations or re-fixations in decision tasks can be traced, for instance, in alternative comparisons. Greater demands imposed by information complexity and decision difficulty (due to greater similarity between alternatives) may require greater effort (operations) in acquiring and processing information, yet the process may be shortened on the other hand through learning.

  • Another area with interesting implication is processing of visual objects: Previous research has shown that visual objects are not encoded as complete representations (e.g., naturalistic product images) and the binding of features is highly selective. Thereof, encoding of particular features during an object-stimulus fixation may be goal-driven, and a re-fixation may be employed to refer just-in-time to specific object [product] features as needed in a decision task, thus saving on working memory capacity.

Consumers have a tendency to develop a bias during a decision task towards a favoured alternative. This alternative would get more fixations, and there is also a greater likelihood for the last alternative fixated to be the one chosen (put differently, consumers are likely to re-affirm the choice of their favourite alternative by re-fixating it just before making the decision). A desired or favoured attribute can also benefit from a similar effect by receiving more frequent attention (i.e., fixations). The authors point, however, to a difficulty in confirming evidence accumulation models: whether greater likelihood of a more fixated alternative to be chosen is due to its higher utility or greater exposure to it. They suggest a ‘soft’ model version in support for a greater effect of extended mere exposure leading to choice of an alternative. They add that a down-stream effect of attention from perception onto choice through a bottom-up process may play a role of gatekeeping the alternatives entering a consideration set. It is noted that a down-stream effect, arising from a bottom-up process, is clearly distinguishable from a utility effect, since the former is stimulus-driven and the latter is goal-driven.

Consistent with bounded rationality theory, heuristics shape patterns of attention, directed by the information that a heuristic calls for (e.g., by alternative or by attribute). Yet, eye-tracking studies conducted to trace the progression of decision processes could not corroborate the patterns of heuristics used as proposed in the literature. More formally, studies failed to substantiate the assumption that heuristics in use can be inferred from the patterns of attention recorded. Transitions of consumers between alternative-wise and attribute-wise rules during a decision task make inferences especially difficult. Not only decision rules influence what information is attended to, but information cues met with during the decision process can modify the course of the decision strategy applied — consider the potential effect that salient stimuli captured unexpectedly in a bottom-up manner can have on the progression of the decision strategy.

In summary, regarding the decision-making theories, Orquin and Mueller Loose conclude: (a) firmer support for the relaxed rational model over the strong model (nonattendance is linked to down-stream effects); (b) a two-way relationship between decision rules and attention, where both top-down and bottom-up processes drive attention; (c) the chosen alternative has a higher likelihood of fixations during the decision task and also of being the last alternative fixated — they find confirmation for a choice bias but offer a different interpretation of the function of evidence accumulated; (d) an advantage of the favoured alternatives or most important attributes in receiving greater attention, and advantage of salient alternatives receiving more attention and being more likely to be chosen (concerning dual process parallel constraint satisfaction models).

Following the review, I offer a few final comments below:

Orquin and Mueller Loose contribute an important and interesting perspective in the projection of the role of [visual] attention from similar or related tasks onto decision-making and choice. Moreover, relevance is increased because elements of the similar tasks are embedded in decision-making tasks. Nevertheless, we still need more research within the domain because there could be aspects specific or unique to decision-making (e.g., objectives or goals, structure and context) that should be specified. Insofar as attention is concerned, this call is in alignment with the conclusions of the authors. Furthermore, such research has to reflect real-world situations and locations where consumers practically make decisions.


In retail stores, consider for example the research by Chandon, Hutchinson, Bradlow, and Young (2009) on the trade-off between visual lift (stimulus-based) and brand equity (memory-based); this research combined eye tracking with scanner purchase data [2]. However, it is worth looking also into an alternative approach of video tracking as used by Hui, Huang, Suher, and Inman (2013) in their investigation of the relations between planned and unplanned considerations and actual purchases (video tracking was applied in parallel with path tracking)[3].

For tracing decision processes more generally, refer for example to a review and experiment with eye tracking (choice bias) by Glaholt and Reingold (2011)[4], but consider nonetheless the more critical view presented by Reisen, Hoffrage and Mast (2008) following their comparison of multiple methods of interactive process tracing (IAPT)[5]. Reisen and his colleagues were less convinced that tracking eye movements was superior to tracking mouse movements (MouseLab-Web) for identifying decision strategies while consumers are acquiring information (they warn of superfluous eye re-fixations and random meaningless fixations that occur while people are contemplating the options in their minds).


 

It should be noted that a large part of the research in this field, using eye-tracking measurement, is applied with concentrated displays of information on alternatives and their attributes. The most frequent and familiar format is information matrices (or boards), although in reality we may also encounter other graphic formats such as networks, trees, layered wheels, and more art-creative diagram illustrations. Truly, concentrated displays can be found in shelf displays in physical stores and also in screen displays online and in mobile apps (e.g., retailers’ online stores, manufacturers’ websites, comparison websites). However, on many occasions of decision tasks (e.g., durables, more expensive products), consumers acquire information through multiple sessions while constructing their decisions. That is, the decision process extends over time. In each session consumers may keep some information elements or cues for later processing and integration, or they may execute an interim stage in their decision strategy. If information is eventually integrated, consumers may utilise aides like paper notes and electronic spreadsheets, but they do not necessarily do so.

Orquin and Mueller Loose refer to effects arising from spatial dispersion of information elements in a visual display as relevant to eye tracking (i.e., distance length of saccades), but these studies do not account for temporal dispersion of information. Studies may need to bridge data from multiple sessions to accomplish a more comprehensive representation of some decision processes. Yet, smartphones today can help in closing somewhat the gap since they permit shoppers to acquire information in-store while checking more information from other sources on their smartphones — mobile devices of eye tracking may be used to capture this link.

Finally, eye tracking provides researchers with evidence about attention to stimuli and information cues, but it cannot tell them directly about other dimensions such as meaning of the information and valence. The importance of information to consumers can be implied from measures such as the frequency and duration of fixations, but other methods are needed to reveal additional dimensions, especially from the conscious perspective of consumers (vis-à-vis unconscious biometric techniques such as coding of facial expressions). An explicit method (Visual Impression Metrics) can be used, for example, to elicit statements by consumers as to what areas and objects in a visual display that they freely observe they like or dislike (or are neutral about); if applied in combination with eye tracking, it would enable to signify the valence of areas and objects consumers attend to (unconsciously) in a single session with no further probing.

The review of Orquin and Mueller Loose opens our eyes to the versatile ways in which [visual] attention may function during decision tasks: top-down and bottom-up processes working in tandem, toggling between fixations and memory, a two-way relation between decision strategies and visual attention, choice bias, and more. But foremost, we may learn from this review the dynamics of the role of attention during consumer decision-making.

Ron Ventura, Ph.D. (Marketing)

References: 

[1] Attention and Choice: A Review of Eye Movements in Decision Making; Jacob L. Orquin and Simone Mueller Loos, 2013; Acta Psychologica, 144, pp. 190-206

[2] Does In-Store Marketing Work? Effects of the Number and Position of Shelf Facings on Brand Attention and Evaluation at the Point of Purchase; Pierre Chandon, J. Wesley Hutchinson, Eric T. Bradlow, & Scott H. Young, 2009; Journal of Marketing, 73 (November), pp. 1-17

[3] Deconstructing the “First Moment of Truth”: Understanding Unplanned Consideration and Purchase Conversion Using In-Store Video Tracking; Sam K. Hui, Yanliu Huang, Jacob Suher, & J. Jeffrey Inman, 2013; Journal of Marketing Research, 50 (August), pp. 445-462.

[4] Eye Movement Monitoring as a Process Tracing Methodology in Decision Making Research; Mackenzie G. Glaholt and Eyal M. Reingold, 2011; Journal of Neuroscience, Psychology and Economics, 4 (2), pp. 125-146

[5] Identifying Decision Strategies in a Consumer Choice Situation; Nils Reisen, Ulrich Hoffrage, and Fred W. Mast, 2008; Judgment and Decision Making, 3 (8), pp. 641-658

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Health insurance, financial investments, telecom service plans — consumers frequently find it harder to make choice decisions in these exemplar domains. Such domains are more susceptible to exhibiting greater complexity: details, many and technical, to account for, multiple options difficult to differentiate and to choose from, and unclear consequences. In products, we may refer in particular to those involving digital technology and computer-based software that some consumers are likely to find more cumbersome to navigate and operate. When consumers are struggling to make any choice, they develop a stronger tendency to delay or avoid the decision at all. They need assistance or guidance in making their way towards a choice that more closely matches their needs or goals and preferences.

Handel and Schwartzstein (2018) are distinguishing between two mechanism types that obstruct or interfere with making rational decisions: frictions and mental gaps.

Frictions reflect costs in acquiring and processing information. They are likely to occur in earlier stages of a decision process when consumers are encountering difficulties in searching for and sorting through relevant information (e.g., what options are more suitable, what attributes and values to look at), and they have to invest time and effort in tracing the information and organising it. Furthermore, frictions may include the case when consumers fail to see in advance or anticipate the benefits from an available alternative  (e.g., consider the difficulty of older people to realise the benefits they may gain from smartphones).

Mental gaps are likely to make an impact at a more advanced stage: the consumer already has the relevant information set in front of him or her but misinterprets its meanings or does not understand correctly the implications and consequences of any given option (e.g., failing to map correctly the relation between insurance premium and coverage). Mental gaps pertain to “psychological distortions” that generally may occur during information-gathering,  attention and processing, but their significance is primarily in comprehension of the information obtained. In summary, it is “a gap between what people think and what they should rationally think given costs.”

In practice, it is difficult to identify which type of mechanism is acting as an obstacle on the way of consumers to a rational decision.  Research techniques are not necessarily successful in separating between a friction and a mental gap as sources of misinformed choices (e.g., choosing a dominated option instead of a dominating one apparent to the rational decision-maker). Notwithstanding, Handel and Schwartzstein are critical of research practices that focus on a single mechanism and ignore alternative explanations. In their view, disregard to the distinction between mechanisms can lead to spurious conclusions. They suggest using counterfactual approaches that test a certain mechanism, or a combination of explanations, and then argue against it with a ‘better’ prospective mechanism explanation. They also refer to survey-based and experimental research methods for distinguishing frictions and mental gaps. The aim of these methods is to track the sources of misinformed decisions.

Consumers often run into difficulty with financial investments and saving plans. In some countries policy makers are challenged with driving consumers-employees towards saving for retirement during the working years. Persuasion per se turns out to be ineffective and other approaches for directing or nudging consumers into saving are designed and implemented (e.g., encouraging people to “roll into saving” through a scheme known as ‘Save More Tomorrow’ by Thaler and Sunstein).

Confronting employees with a long list of saving plans or pension funds may deter them from duly attending to the alternatives in order to make a decision, and even risks their aborting the mission. When consumers-employees have a hard time to recognise differences between the plans or funds (e.g., terms of deposit, assets invested in, returns), they are likely to turn to heuristics that brutally cut through the list. Crucially, even if information on key parameters is available for each option, decision-makers may use only a small part of it. Similar difficulties in choosing between options may arise in financial investments, for instance when choosing between equity and index funds or bond funds. One may be assisted by suggesting a default plan (preferably, recommending a personally customised plan) or sorting and grouping the proposed plans and funds into classes (e.g., by risk level or time horizon). However, it should be acknowledged that consumer responses as described above may harbour frictions as well as mental gaps, and it could help to identify which mechanism has the greater weight in the decision process.

A key issue with health insurance concerns the mapping of relationship between an insurance premium and the level of deductibles or cost-sharing between the insurer and the insured. For example, consumers fall into a trap of accepting an insurance policy offered with a lower premium while not noticing a higher deductible they would have to pay in a future claim. An additional issue consumers have to attend to is the coverage provided for different medical procedures such as treatments and surgeries (given also the deductible level or rate). Consumers may stumble in their decision process while studying health insurance plans as well as while evaluating them.

  • Public HMOs (‘Kupot Holim’) in Israel offer expanded and premium health insurance plans as supplementary to what consumers are entitled to by the State Health Insurance Act. Yet in recent years insurance companies are prompting consumers to get an additional private health insurance plan from them — their argument is that following changes over the years in the HMOs’ plans and reforms by the government, those plans do not offer adequate coverage, or none at all, for more expensive treatments and surgeries. The coverage of private insurance plans is indeed more generous, but so are the much higher premiums , affordable to many only if paid for by the employer.

In addressing other aspects of healthcare, Handel and Schwartzstein raise the issue of consumer preference for a branded medication (non-prescription) over an equivalent and less costly generic or store-branded medication (e.g., buying Advil rather than a store-branded medication that contains the same active ingredient [ibuprofen] for pain relief as in Advil). Another vital issue concerns the tendency of patients to underweight the benefits of treatment by medications prescribed to them, and consequently do not take up medications satisfactorily as instructed to them by their physicians (e.g., patients with a heart condition, especially after a heart attack, who do not adhere as required to the medication regime administered to them).

Customers repeatedly get into feuds with their telecom service providers — mobile and landline phone communication , TV and Internet. Customers of mobile communications (‘cellular’), for example, often complain that the service plan they  had agreed to did not match their actual usage patterns or they did not understand properly the terms of the service contract they signed to. As a result, they have to pay excessive charges (e.g., for minutes beyond quota), or they are paying superfluous fixed costs.

With the advancement of technology the structure of mobile service plans has changed several times in the past twenty years. Mobile telecom companies today usually offer ‘global’ plans for smartphones that include first of all larger volumes of data (5GB, 10GB, 15GB etc.), and then practically an infinite or outright unlimited use of outgoing talking minutes and SMSs. While appealing at first, customers end up paying a fixed inclusive monthly payment that is too high relative to the traffic volume they actually make use of. On the one hand customers refrain from keeping track of their usage patterns because it is costly (a friction). On the other hand, customers fail in estimating their actual usage needs that will match the plan assigned to them (a mental gap). In fact, information on actual usage volumes is more available now (e.g., on invoices) but is not always easily accessible (e.g., more detailed usage patterns). It should be noted, however, that companies are not quick to replace a plan, not to mention voluntarily notifying customers of a mismatch that calls for upgrading or downgrading the plan.

A final example is dedicated here to housing compounds of assisted living for seniors. As people enter their retirement years (e.g., past 70) they may look for comfortable accommodation that will relieve them from the worries and troubles of maintaining their home apartment or house and will also provide them a safe and supportive environment. Housing compounds of assisted living offer residence units, usually of one or two rooms of moderate space, with an envelope of services: maintenance, medical supervision and aid, social and recreational activities (e.g., sports, games, course lectures on various topics). The terms for entering into assisted living housing can be nevertheless consequential and demanding. The costs involve mainly a leasing payment for the chosen residence and monthly maintenance fee payments.

Making the decision can be stressing and confusing. First, many elderly people cannot afford taking residence in such housing projects without selling their current home or possibly renting it (e.g., to cover a loan). In addition the value of the residence is depreciated over the years. Second, the maintenance fee is usually much higher than normal costs of living at home. Hence residents may need generous savings plus rental income in order to finance the luxury and comfort of assisted living. Except for the frictions that are likely to occur while looking for an appropriate and affordable housing compound, the prospect residents are highly likely to be affected by mental gaps in correctly understanding the consequences of moving into assisted living (and even their adult children may find the decision task challenging).

Methods of intervention from different approaches attempt to lead consumers to make decisions that better match their needs and provide them greater benefits or value. Handel and Schwartzstein distinguish between allocation policies that aim to direct or guide consumers to a recommended choice without looking into reasons or sources of the misinformed decisions (e.g., nudging techniques), and mechanism policies that attempt to resolve a misguided or misinformed choice decision by tackling a specific reason causing it, such as originating from a mechanism of friction or mental gap. From a perspective of welfare economics, the goal of an intervention policy of either type is to narrow down a wedge between the value consumers obtain from actual choices subject to frictions and mental gaps, and the value obtainable from a choice conditional on being free of frictions and mental gaps (i.e., assuming a rational decision). (Technical note: The wedge is depicted as a gap in value between a ‘demand curve’ and a ‘welfare curve’, respectively.)

Policies and methods of either approach have their advantages and disadvantages. An allocation policy has a potential for greater impact, that is, it can get farther in closing the welfare wedge.  Yet, it may be too blunt and excessive: while creating a welfare gain for some consumers, it may produce an undesirable welfare loss to consumers for whom the intervention is unfitting. Without knowing the source of error consumers make, it is argued that a nudging-type method (e.g., simplifying the structure of information display of options) could be insufficient or inappropriate to fix the real consumer mistake. A fault of allocation policies could particularly be, according to the authors, that they ignore heterogeneity in consumer preferences. Furthermore, and perhaps as a consequence, such policies overlook the presence of informed consumers who may contribute by leading to the introduction of far better products at lower prices.

Mechanism policies can in principle be more precise and effective while targeting specific causes of consumers’ mistakes, and hence correcting the costs of misinformed decisions without generating unnecessary losses to some of them. The impact could be more limited in magnitude, yet it would be measured. But achieving this outcome in practice, the authors acknowledge, can be difficult and complicated, requiring the application of some costly research methods or complex modelling approaches. They suggest that “[as] data depth and scope improve, empirically entangling mechanisms in a given context will become increasingly viable”.

The analysis by Handel and Schwarztsein of the effects of intervention policies — mechanism versus allocation — could come as too theoretical, building on familiar concepts of economic theory and models, furthermore being difficult and complicated to implement. Importantly, however, the authors open up a door for us to a wider view on sources of mistakes consumers make in decision-making and the differences between approaches aimed at improving the outcomes of their decisions. First, they clarify a distinction between mechanisms of frictions and mental gaps. Second, they contrast allocation policies (e.g., nudging) versus mechanism policies which they advocate. Third, to those less accustomed to the concepts of economic analysis, they demonstrate their ideas with practical real-world examples. Handel and Scwharzstein present a perspective well deserving to learn from.

Ron Ventura, Ph.D. (Marketing)

Reference:

Frictions or Mental Gaps: What’s Behind the Information We (Don’t) Use and When Do We Care?; Benjamin Handel and Joshua Schwartzsetein, 2018; Journal of Economic Perspectives, Vol. 32 (1 – Winter), pp. 155-178. (doi: 10.1257 / jep.32.1.155)

 

 

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Consumer purchases from Internet retailing websites continue to expand, and their share out of total retail sales increases. Yet there is no real reason to declare the demise of physical, bricks-and-mortar stores and shops any time soon. Online purchases from e-stores (including through apps) indeed pose a stressing challenge to many physical stores, but the latter still hold a solid and dominant majority share of retail sales. Nonetheless, owners of physical stores will have to make changes to their mission and approach to retailing in order to answer effectively and successfully to the challenges from electronic retailing (‘e-tailing’).

The share of sales revenues from online retailing varies across categories (e.g., from groceries to electronics) yet the share overall out of total retailing revenues still floats around 12%-15% on average; there is also important variation between countries. Tensions are high particularly because of the threat from overarching e-tailers such as Amazon and Alibaba who grew their businesses in the virtual online environment. However, retailers do not have to choose to be either in the physical domain or the virtual domain: Many large and even medium bricks-and-mortar retailers are already double-operating through their physical stores and the Internet and mobile channels. Moreover, the master of Western e-tailing Amazon is lurking into the physical world with the establishment of its Amazon Go food stores, its venture into physical bookstores in selected US locations, and notably the acquisition of the food retail chain Whole Foods — what better testimony of the recognition that physical stores are still in need. All these observations should tell us that: (1) The lines between physical and virtual (electronic) retailing are blurred and the domains are not exclusive of each other; (2) It is a matter of linking between the domains where one can operate as an extension of the other (and it does not depend on which is the domain of origin); and (3) The domains are linked primarily by importing technology powered with data into the physical store’s space.

Technology alone, however, is not enough to resolve the challenges facing physical stores. Focusing on technology is like harnessing the carriage before the horses. The true and crucial question is: What will consumers of the coming future be looking for in stores? This is important, because consumers, especially the younger generations born after 1980, still have interest in shopping in bricks-and-mortar stores but they could be looking for something different from past decades, moreover given the digital options available to them now. The answers will have to come through rethinking and modifying the mission and strategy set for physical stores. The direction that seems most compelling for the mission is to shift emphasis from the merchandise offered in a store to the kind of experience offered in the store. The strategy may involve reconsideration and new planning of: (a) the product variety and volume of merchandise made available in the store; (b) interior design and visual merchandising; (c) scope and quality of service; and (d) the technologies applied in the store, all tailored to the convenience and pleasure of the shoppers.

This article will focus primarily on aspects of design of stores, including  interior design and decoration, layout, and visual merchandising (i.e., visual display of products); together with additional sensory elements (e.g., lighting, music, texture, scent) they shape the atmosphere in the store or shop. Yet it should be noted that the four strategy components suggested above are tied and influence each other in creating the kind of experience a retailer desires the customers-shoppers to have while in-store.

Shopping experiences in a store rely essentially on the emotions the store invokes in the consumers-shoppers. Notwithstanding the sensorial and cognitive reactions of shoppers to the interior scene of the store, the positive and pleasant emotions the shoppers feel will most likely be those that motivate them to stay longer and choose more products to purchase (further desired behaviours may include recommendation to friends and posting photos from the store on social media). Prior and close enough to consumption itself, the personal shopping and purchasing experience may invoke a range of positive emotions such as joy, optimism, love (non-romantic), peacefulness, and surprise; of course there also are potential negative emotions that retailers would wish to reduce (e.g., anger, worry, sadness)[*].

The need for shift in emphasis in physical stores is well stated by Lara Marrero, a strategy director with Gensler, a British design firm: “It used to be a place where people bought stuff. Now it is a state where a person experiences a brand and its offerings”. Marrero, who is leading the area of global retail practice at the firm, predicts a future change in mentality of shoppers from ‘grab and go’ to ‘play and stay’ (“Retail 2018: Trends and Predictions”, Retail Focus, 15 December 2017). This predicted shift is still inconsistent with a current retail interpretation of linking the digital and physical domains through schemes of ‘click-and-collect’ online orders at a physical store. Additionally, consumers nowadays conduct more research online on products they are interested in before coming to a store: The question is if a retailer should satisfy with letting the consumer just ask for his or her preferred product at the store or encourage the consumer-shopper to engage and interact more in-store, whether with assistance from human staff or digital utilities, before making a purchase — the push may have to come first from the consumers. Marrero further notes the social function of stores: retail environments become a physical meeting point for consumers to share brand experiences. Retailers will have to allow sufficient space for this in the store.

In order to generate new forms of shopper experiences the setting of a store’s scene also has to change and adapt to the kind of experience one seeks to create. New styles and patterns of in-store design are revealed through photo images of retail design projects, and the stories the images accompany, on websites of design magazines (e.g., VMSD of the US, Retail Focus of the UK). They demonstrate changes in the designing approach to the interior environment of stores and shops.

A striking aspect in numerous design exemplars is the tendency to create more spacious store scenes. It does not necessarily mean that the area of stores is larger but that the store’s layout and furnishing are organised to make it feel more spacious,  for example by making it look lighter and allowing shoppers to move more easily around. Additionally, it implies ‘loading’ the store’s areas which are accessible to customers with less merchandise. First, merchandise would be displayed mostly on fixtures attached to walls around the perimeters of the store, but even then it should not look too crowded (i.e., in appreciation that oftentimes ‘less is more’ for consumers). Second, fewer desks and other display fixtures are positioned across the floor to leave enough room for shoppers to walk around conveniently (and possibly feel more ‘free’). In fashion stores, for instance, this would also apply to  ‘isles’ of demonstrated dressing displays. Third, desks should not be packed with merchandise, and furthermore, at least one desk should be left free from merchandise — leave enough surface for shoppers and sellers to present and look at merchandise and to converse about the options. In some cases, it may allow for the shoppers to socialise and consult among themselves around a desk at the store (e.g., inspired by Apple stores). Opportunities to socialise can be enhanced in larger stores  by allocating space for a coffee & wine bar, for instance, which may serve also sandwiches, patisseries and additional drinks. Stores would be designed to look and feel more pleasant and enjoyable for consumers-shoppers to hang around, contemplate their options and make purchase decisions.

  • Large stores that spread over multiple floors with facades turning outwards to the street may fix the facades with glass sheets, and in order not to block natural daylight from entering into the store they would place desks and mobile hangers or other low shelf fixtures along the windows.

Modissa Fashion Store set for Christmas

In the new-era store not all merchandise the store may offer to sell needs to be displayed in the ‘selling areas’ accessible to shoppers. Retailers may have to retreat from the decades long paradigm that everything on display is the inventory, and vice versa. It is worth considering: First, some merchandise can be displayed as video on screens, and thus also add to the ‘show’ in the store; Second, shoppers can use digital catalogues in the store to find items currently not on display — such items may still be available in stock on premises or they may be ordered within 24 hours. But furthermore, customers may be able to coordinate online or through an app with a store near them to see certain products at a set time; up-to-date analyses of page visits and sales on a retailer’s online store can tell what products are most popular, subsequently guaranteeing that the physical stores keep extra items of them in stock on premises.

Here are references to a few exemplars for illustration of actual store design projects published in design magazines’ websites:

Burberry, London — The flagship store of luxury fashion brand Burberry on Regent Street is highlighted for both the use of space in its design and the employment of digital technology in the store. A large open space atrium (of an older time theatre) occupies the centre of the store (four floors, 3000 sqm), impressive in how Burberry allowed to keep it. The digitally integrated store is commended for its fusion of a ‘digital world’ into its bricks-and-mortar environment: a large high-resolution screen plays video in the atrium, synchronised with a hundred digital screens around the store, some 160 iPads (e.g., for finding items on the catalogue that may not be on display), and RFID tags attached to garments (VMSD, 18 December 2012).

Hogan, Milano — The footwear ’boutique’ store (277 sqm in via Montenapoleone) is designed to reflect the brand, “luxury but accessible”. The store’s mission has been described as follows: “Hogan is a lifestyle brand, championing contemporary culture. The store therefore needed to be dynamic, working hard to adapt from retail space to live event or gallery space”. Characteristic of the store: tilted surfaces for display, lying on top of each other like fallen-down domino bricks; and an animated display of patterns by LED lighting behind frosted glass walls — they both reflect movement, the former just symbolically while the latter more dynamically, to “express the dynamism of the city”. The store of Hogan also fosters social activity around its host bar and customization bar (Retail Focus, 15 February 2018).

Black by Dixon’s, Birmingham (UK) — The technology retail concept aspires to make “the geeky more stylish and exciting”. Digital technology is “dressed” in fashionable design, aiming at the more sophisticated Apple-generation (distinctive in the images are the mannequins “sitting” on desks as props, and colour contrasts on a dark background). (VMSD, 24 May 2011.)

Stella McCartney, Old Bond Street, London — The re-established flagship store resides in an 18th century historic-listed building (four floors, 700 sqm). Products such as dresses and handbags are displayed (sampled) across the store in different halls. The design and lighting give a very loose feeling. Refreshingly, the ground floor features an exhibit of black limestones and “carefully selected rocks” from the family’s estate, a piece of nature in-store (Retail Focus, 14 June 2018).

Admittedly, some of the more distinctive and impressive design exemplars belong to up-scale and luxury stores, but they do give direction and ideas for creating different experiences in retail spaces, even if less lavishly. Furthermore, technology can enrich the store and add a dimension of activity in it. Yet it is part of the whole design plan, not necessarily its central pillar, if at all.

Installing digital technology in a store does not mean importing the Internet and e-store into the physical store. Features of digital technology can be employed in-store in a number of ways, and the use of an online catalogue is just one of them. There is no wisdom for the physical store in trying to mimic Internet websites or compete with them. It should find ways, instead, to implement digital technologies that best suit the store’s space and transform the experience of its visiting shoppers.

Moreover, the store owner should identify those aspects that are lacking in the virtual online store and leverage them in the bricks-and-mortar store (e.g., immediacy, non inter-mediated interaction with products, sensorial stimulations other than visual and audio, feeling fun or relaxed). Thereof, the store should borrow certain technological amenities that can help to link between the domains and make the experience in-store more familiar, convenient, interesting, entertaining or exciting. According to an opinion article in Retail Focus on “The Future of High Street” (Lyndsey Dennis, 25 April 2018): “To draw customers back to brick-and-mortar, [retailers] need to rethink how they use their physical space and store formats. The key is to give customers something they can’t get online, whether that’s information, entertainment, or service“. Advanced technologies such as Virtual reality (VR) and Augmented Reality (AR) are part of the repertoire that are increasingly introduced in high street stores [e.g., AR applied in the fitting rooms of Burberry’s store, triggered by the RFID tags].

Matt Alderton, writing in ArchDaily magazine of architecture and design (25 November 2015), details key technologies and how they are implemented in stores to create new possibilities and leverage shopper experiences. One group of technologies can provide vital data to retailers which in turn can be applied to interact with shoppers and return useful information to them (e.g., beacons, RFID tags, visual lighting communications). The second group includes display technologies that may be enriching with information and entertaining to shoppers: for example, VR and AR, touch screens, and media projected on a surface such as table-top which thus becomes a touch screen. Alderton clearly sees consumer need for physical stores, the question is how consumers would want them: “What the data says is that shoppers want to move forward by going back: Like their forebears who visited Harrods, they crave emporiums that are experiential, not transactional, in nature“. (See also images in this article as they portray new-fashioned designs in space and layout; notably these stores feel less crowded by merchandise, and some show in-store digital displays.)

These are challenging times for bricks-and-mortar stores. New possibilities are emerging for physical stores to grow and thrive, yet they will have to adapt to changed shopping and purchasing patterns of consumers and develop new kinds of experiences that appeal to them. It should be a combined effort, with contribution from interior design of stores and visual merchandising, utilities and amenities based on digital technologies implemented in the store, and the support and assistance by human personnel. The in-store design is especially important in setting the scene — in appearance, comfort and appeal — that will shape shoppers’ experiences. Retailing could evolve as far as into new forms of ‘experiential shopping’.

Ron Ventura, Ph.D. (Marketing)

Reference: [*] Measuring Emotions in the Consumption Experience; Marsha L. Richins, 1997; Journal of Consumer Research, Vol. 24 (September), pp. 127-149.

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