Consumers: We'll Share Our Data If You Give Us What We Want
A new IBM survey of more than 28,000 consumers -- the largest global survey of its kind -- found that, overwhelmingly, consumers are looking for a more personalized shopping experience, and are willing to share select details about themselves with their favorite retailers, in order to educate brands on exactly how, when and where to approach them.
Just as we chat with our local shopkeeper, consumers are willing to dish to retailers about their media usage (75 percent); demographics (73 percent); identification, such as name and address (61 percent); lifestyle (59 percent); and location (56 percent) for a more targeted and smarter shopping experience.
Consumers are telling IBM that they actually want to receive more communication – not less – but they want it to be delivered through preferred media channels and in a relevant way.
Increasingly, savvy retailers are responding to this need and using sophisticated technology to make sure every interaction with customers is spot-on, based on individual preferences, location and lifestyle. IBM's ongoing research shows that retailers must provide clear compelling reasons to shop; deliver personalized offerings and reach shoppers when and where they prefer, in order to win over their wallet share. According to the research above, consumers are more than willing to give retailers the data to make this experience possible.
At the same time, the rapid influx of digital data is posing new challenges for retailers. Customers are sharing their experiences widely online, giving them more control and influence over brands. A recent IBM CMO study of more than 1,700 chief marketing officers from 64 countries and 19 industries revealed that the majority of the world’s top marketing executives recognize a critical and permanent shift occurring in the way they engage with their customers, but question whether their marketing organizations are prepared to manage the change. This shift requires new marketing approaches, tools and skills to effectively reach customers.
“The speed of technology innovation, consumer adoption and access to information has created an environment where everything is known and the consumer is truly the one in power, coalescing around shopping communities of ‘we,’” said Jill Puleri, global retail leader, IBM Global Business Services. “Retailers can win over this empowered consumer based on re-establishing a trusted relationship and building loyalty through improving the store environment, product assortment and store communications.”
53 percent of consumers actively seek out sales, this is not limited to the mature markets. 69 percent of Brazilians seek out sale items
24 percent of consumers reward themselves with a few big purchases, whereas 34 percent do not; the remainder are neutral; However the emerging markets will reward themselves, travel more and spend more in general
Only 18 percent are spending more in general; 43 percent say they are not spending more
Willingness to share personal information with retailers (Actual question: What is your willingness to provide information in exchange for something relevant to you [non-monetary]?)
The retailer’s store has the greatest influence during product awareness phase of the shopping experience. Following the store in rank order of influence are:
2) Traditional Advertising (Mail, TV, Radio/Billboard)
3) Friends/Family
4) Search Engine (Jump from No. 8 in 2010)
5) Online Streaming/Video Hauling
6) Retailer Website (Jump from No. 10 in 2010)
7) Shopping portal (e.g. Amazon)
8) Mobile App (Dropped from No. 4 in 2010)
9) Social Media (Dropped from No. 7 in 2010)
10) Magazines
11) Email (Drop from No. 5 in 2010)
How consumers research new products
Again, the retailer’s store has the greatest influence on how consumers research new products. Following the store in rank order of influence are:
2) Search engine
3) Retailer Website
4) Friends/Family
5) Traditional Advertising (Mail, TV, Radio/Billboard)
6) Mobile Apps
7) Online Streaming/Video Haul
8) Shopping Portal
9) Social Media
10) Magazines
11) Email (Dropped from No. 7 in 2010)
Just as we chat with our local shopkeeper, consumers are willing to dish to retailers about their media usage (75 percent); demographics (73 percent); identification, such as name and address (61 percent); lifestyle (59 percent); and location (56 percent) for a more targeted and smarter shopping experience.
Consumers are telling IBM that they actually want to receive more communication – not less – but they want it to be delivered through preferred media channels and in a relevant way.
Increasingly, savvy retailers are responding to this need and using sophisticated technology to make sure every interaction with customers is spot-on, based on individual preferences, location and lifestyle. IBM's ongoing research shows that retailers must provide clear compelling reasons to shop; deliver personalized offerings and reach shoppers when and where they prefer, in order to win over their wallet share. According to the research above, consumers are more than willing to give retailers the data to make this experience possible.
At the same time, the rapid influx of digital data is posing new challenges for retailers. Customers are sharing their experiences widely online, giving them more control and influence over brands. A recent IBM CMO study of more than 1,700 chief marketing officers from 64 countries and 19 industries revealed that the majority of the world’s top marketing executives recognize a critical and permanent shift occurring in the way they engage with their customers, but question whether their marketing organizations are prepared to manage the change. This shift requires new marketing approaches, tools and skills to effectively reach customers.
“The speed of technology innovation, consumer adoption and access to information has created an environment where everything is known and the consumer is truly the one in power, coalescing around shopping communities of ‘we,’” said Jill Puleri, global retail leader, IBM Global Business Services. “Retailers can win over this empowered consumer based on re-establishing a trusted relationship and building loyalty through improving the store environment, product assortment and store communications.”
Listening to the noise on the wire
In addition to directly surveying consumers to understand their attitudes towards shopping, IBM also listened to how consumers are talking to one another. Using IBM Cognos Consumer Insight, a social media analysis tool, IBM reviewed more than 1.2 million documents – publicly-available videos, tweets, Facebook updates, discussion boards, blogs and newsgroups -- over a six month period to study attitudes related to sporting retailers and apparel manufacturers.
The analysis delivered significant insight into shoppers’ attitudes as they relate to brands. For example, discussions around some brands focus predominantly around transaction-related terminology (price, availability, where to purchase, etc.), indicating that these brands are highly price-sensitive. On the other hand, discussions around different brands are focused on lifestyle-related terminology (self-improvement, style, love, “I can’t live without this brand,” etc.), indicating that these brands are less price-sensitive.
With these insights, retail brands with more price sensitivity can focus their marketing efforts around promotions and sales, whereas retail brands with more of a lifestyle orientation could improve margin and focus on different segments of shoppers.
With these insights, retail brands with more price sensitivity can focus their marketing efforts around promotions and sales, whereas retail brands with more of a lifestyle orientation could improve margin and focus on different segments of shoppers.
The IBM research also showed that when people are discussing brands, they will often highlight certain characteristics about a brand, for example, a shoe’s construction or its sole, as opposed to its color or style. The matters in a product attribute is insightful because it can give manufacturers and retailers a better sense of what they are known for in the market, and help them capitalize on those insights in a smarter way.
How technology can help
With the volume of conversations happening online, retailers need to listen and learn to their customers using sophisticated analytics technology to gain insight and adjust their marketing messages to address what they are hearing on the wire. Retailers must now deploy an evolved strategy for redefining the customer experience to deepen the brand relationship and create brand advocates who will promote the retailer to others. At the same time, retailers must improve operational efficiency in order to protect profitability and enhance agility.
IBM Retail Analytics solutions help retailers segment customers; tailor offers, promotions and communications; and create greater loyalty and retention through a seamless brand experience. IBM technology also allows retailers to analyze consumer behavior to improve their overall shopping experience and their business operations.
Study Background
IBM survey of more than 28,500 global consumers in 15 countries (eight mature and seven emerging) to find out more about how consumers have changed and how they’re changing their shopping habits
Countries
IBM survey of more than 28,500 global consumers in 15 countries (eight mature and seven emerging) to find out more about how consumers have changed and how they’re changing their shopping habits
Countries
- Emerging: Argentina, Colombia, Brazil, Mexico, Chile, South Africa, China
- Mature: Australia, Japan, Canada, France, Spain, UK, Italy, United States
- The largest consumer study of its kind
- Third annual consumer survey by IBM
Who is today’s global empowered consumer?
- 71 percent desire to shop digitally using technology (e.g. website, mobile, social network, retailer website to co-create products, TV using remote control, social videos like YouTube, electronic games)
- 29 percent desire to use one technology, 18 percent use two and 24 percent use three
- 85 percent of consumers believe social networks will save them time
- 87 percent of consumers willing to use TVs because of convenience
- 74 percent believe electronic games will be a convenient, fun way to shop
- 66 percent of consumers are optimistic about the future of their income
- 31 percent believe their income will stay the same
- 35 percent believe income will increase by 20 percent in the next 5 years
- Optimism driven by China (95 percent), Brazil (91 percent), and Mexico (63 percent) in their belief that their incomes will increase
53 percent of consumers actively seek out sales, this is not limited to the mature markets. 69 percent of Brazilians seek out sale items
24 percent of consumers reward themselves with a few big purchases, whereas 34 percent do not; the remainder are neutral; However the emerging markets will reward themselves, travel more and spend more in general
Only 18 percent are spending more in general; 43 percent say they are not spending more
Willingness to share personal information with retailers (Actual question: What is your willingness to provide information in exchange for something relevant to you [non-monetary]?)
- 75 percent of consumers will share their media usage (e.g., media types like TV, radio, etc.)
- 73 percent will share demographic information (e.g., age, ethnicity)
- 61 percent will share their identification (e.g., name, address)
- 59 percent will share information about their lifestyle (e.g. # of cars, home ownership)
- 56 percent will provide location-based information
- 54 percent will share medical information
- Only 36 percent, however, will provide financial information
- 42 percent of consumers in mature markets trust friends and family the most; In emerging markets, friends and family are number one as well, with 36 percent
- However, retailers are on the rise in terms of trust with a 66 percent increase year over year in mature markets and a 25 percent increase in the emerging
- Manufacturers are also showing strength with trust up 70 percent in mature markets and 54 percent in emerging markets
The retailer’s store has the greatest influence during product awareness phase of the shopping experience. Following the store in rank order of influence are:
2) Traditional Advertising (Mail, TV, Radio/Billboard)
3) Friends/Family
4) Search Engine (Jump from No. 8 in 2010)
5) Online Streaming/Video Hauling
6) Retailer Website (Jump from No. 10 in 2010)
7) Shopping portal (e.g. Amazon)
8) Mobile App (Dropped from No. 4 in 2010)
9) Social Media (Dropped from No. 7 in 2010)
10) Magazines
11) Email (Drop from No. 5 in 2010)
How consumers research new products
Again, the retailer’s store has the greatest influence on how consumers research new products. Following the store in rank order of influence are:
2) Search engine
3) Retailer Website
4) Friends/Family
5) Traditional Advertising (Mail, TV, Radio/Billboard)
6) Mobile Apps
7) Online Streaming/Video Haul
8) Shopping Portal
9) Social Media
10) Magazines
11) Email (Dropped from No. 7 in 2010)