Linkages between Retail Studies and Consumer Analysis:

We next turn to the use of Consumer Analysis and Marketing Research in studying the retail shopper.. Now, some
of you have had these classes, some have had one, some are taking them, so I am not taking anything for granted. Let's try to make it logical and easy:

Consumer behavior is the study of how people identify their needs, search for solutions, and make purchases in the marketplace to meet those needs (or perhaps they decide not to make purchases).

An easy way to divide consumer behavior is to consider the following:
 

There are GROUP characteristics	There are INDIVIDUAL  characteristics
Such as reference groups, families,  cultures, households,         social class	Such as personality learning, motivation,  perception,         and  lifestyles

Retail analysts attempt to determine which characteristics are associated with different types of needs, search for solutions, evaluation of alternatives, and shopping behaviors.

Simple?  Yes, but how do we learn to use them?

One way is to consider the demographic characteristics of these concepts - that is, what is measurable and identifiable and objective - such as income, number of people in household, gender, etc.  For instance, we can ask whether there are any specific retail needs of employed mothers of young children, of senior citizens, of people with low incomes, etc.

We supplement demographics with psychographics.

We try to relate these concepts to our understanding of how people shop, what they buy, what types of communciations they choose and understand, how we develop stores, etc.

We identify retail problems (unmet needs), determine how to study these problems, select the appropriate group and/or individual types of information, and attempt to obtain that information through secondary and/or primary sources.

Some basics to know, related to retail decisions:

1. There are some basic demographic statistics which can help us, such as increasing numbers of seniors.

2. There are changes in today's households which affect the ways that we sell and the ways that people buy - for instance, households are getting smaller.

3. In addition, households are busier - at least some!

4. Other people have what is called the a time surplus - they have too much time to spend - many seniors are like this.

5. In looking at cultures and subcultures, we want to learn when members of a specific group have unmet needs which are related to their group identities. Such cultures and subcultures can be considered as ethnic, racial, regional, age, gender, and so forth. The basic idea is that sometimes group ideas, mynorms, preferences, tastes, etc are quite important in the ways that people want to satisfy their needs. However, overgeneralization can be dangerous, such as the examples we will consider of
the Hispanic consumer. With some products and services, consumers want their countries of origin taken into account, since preferences do differ. Thus, Puerto Rican Hispanics may have very clearly defineable needs which are different from the mass market and are different from other Hispanics.  In fact, there are times when various ethnic subgroups may be more similar
to each other than to other related groups.

6. Social class is another area which I find is not generally understood  by students. basically, social class is a way that members of a social designate "levels" or groups which are common on certain societally-defined criteria. In the US, such criteria may include income, education, house type, dwelling area, occupation, etc depending on which
formula you are using.  In other countries, the societally-valued criteria may be different.

7. Family Life cycle - be careful here!  The typology in the text is a good place to start, but it is not complete, given changes in today's households. Thus, rather than dismiss it as not helpful, consider it as a foundation.

8. Some other areas include:

perceptions - how we interpret incoming stimuli
personality - consistent reactions to incoming stimuli
motivations - a drive to satisfy a given need
psychographics - study of lifestyles

and so on.

We also examine shoppers' self-concept - such as your actual, social, and idea self-concept. How does this related to retailing?

These are a smattering of the consumer behavior characteristics that marketing analysts can use in developing a better understanding of retail behaviors, needs, and directions for the future.

We need to consider several types of data:

secondary - what are the strengths and weaknesses? what are sources of reliable secondary data?  e.g. NRF data
primary - how do we generate good consumer info?

We also want to look at other methods that give us information for future forecasting, such as bar-coded id cards, traffic counts, etc.

Several types of surveys formats can be useful.

Likert -type format:

A statement of interest on one idea.  (followed by a range)
strongly agree/agree/ neutral/disagree/ strongly disagree

Such statements can be several "points" in length. Also I like to include
Dont know, and No answer, in some formats.

Also semantic differentials are commonly used to trace different perceptions among store image and characteristics. Please know how this works.

Hope that these notes give you some direction.

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HERE IS WHERE WE BEGAN OUR CLASS NOTES
Knowing the Consumer
What Information does the Retailer need to know to adjust the strategy mix?
 

“An Industry That Has Lost Touch with Its Customer”
Chapter 11 Casualties:  Kmart, Jamesway, Ames, others?
“The consumers who made shopping a recreational sport in the 1980s now
       have less time, less money, and less stomach for the whole experience.”
“Retailers need to go through a shakeout before the industry can prosper again.”
    Reinventing the Store, Business Week Cover Story, Nov. 27, 1995
Will department stores survive? New Formats?
The dot.com bust
How can we use consumer research to address these issues?
 

Target Market
Identifiable, accessible, reachable, responsive
Demographic, psychographic (lifestyle), geographic, usage, benefits desired
 

Demographics:  the Objective Characteristics of a Group
How many households are in the US? in other countries?
Average age at first marriage:  men = ?  women =?
Typical family income =?
Annual retail expenditures per household = ?
Median age of US population is = ?? Years
 

The Complementary Side:  Psychographics
What are people’s lifestyles like in the 1990’s?
How do their lifestyles affect their shopping behaviors?
How do their activities fit with the shopping opportunities that are available?
What do their activities, interests, and opinions have to do with the stores that
       they choose and the product combinations that they buy?
 

Some Basic Consumer Behavior Concepts Regarding Individuals
Personality – consistent ways of reacting, effect of moods
Learning – relatively permanent change in behavior
Motivation – drives to fulfill our needs
Perception – selection, interpretation, organization, derived meaning
Lifestyles – activities, interests, opinions
 

 Some Basic Consumer Behavior Concepts regarding Groups
Social class - we know what it is, but how is it measured?
     Income source, house type, dwelling area, occupation, education
Family life cycle - look at the chart and see who’s missing!
What is a household vs. a family?
What is the impact of culture?
 

Example of the Ethnic Market
Research on Puerto Rican Immigrant shoppers
Grocery store shopping process in bodegas in Northeastern Philadelphia
Consumers walked to corner stores
Centers for trust, personal help
Are Hispanics REALLY too proud to use coupons?
 

Other types of Consumer Issues
Outshopping
Interactive shopping
In-home Shopping
Shopping from the Office
Web site browsing and purchasing
Types of items bought online
 

Consumer Decision Process
Meeting an unmet need (e.g product)
Choosing a shopping area or center
Choosing a store
Choosing within the stores
Evoked set of centers, stores, and products
 

Types of Decision Making
How much search does the consumer want?
Extended
Limited
Routine Response
Americans with Disabilities Act - how much search is available to them?
 

Steps in the Decision Making Process
Presence of stimulus
Problem awareness
Information search – how much?
Evaluation of alternatives – by what criteria?
Purchase (or not?)
Post-purchase behavior
 

Existing Assumptions about Customers
Extended shopping times are desirable
Rational choice by shopper  is assumed
Customers have adequate access to retail centers
Uniform scheduling of retail chains is desirable
Posted hours of opening and closing carry accurate meaning
All shopping hours are desirable

Emerging Issues in Consumer Research
In-depth studies of motivations of web shopping behavior:  impact of design of web background on consumer choice
In-depth studies of induced consumer arousal and pleasure on Internet
Studies of loyalty in e-commerce
Service quality delivery through web sites
 

Shopping 24 Hours a Day: A Study for the International Council of Shopping Centers
OLDER STUDY that points to some of the foundational problems underlying dissatisfaction with traditional shopping methods
1993 NRB Shopping Center Directory used as sampling frame to
     select five community shopping centers
Three in NJ and two in MI
Supermarket, pharmacy, another anchor, and several other stores
     with varied schedules, and outside access to stores
Large parking lots, external lighting
Shopper was regular patron of the center
 

Multiple Methods Provide a Closer Look
Consultation with retail managers
Anthropological retail study - videos, sketches, maps
Matched surveys with customers and retailers
Interviews with center management and local retailers
Experiential work with challenged shoppers
 

Variability in Shopping Hours: An Example of a NJ Center
Coin laundry opening at 6am
Post Office opening at 730 am
Majority of stores roughly 930 to 10 pm
Restaurants closing at midnight
Cinema closing at 1230am
Video observations indicate dark, poorly-lighted parking lot (seasonal hours)
 

Characteristics of Shoppers Interviewed
586 total respondents (328 NJ, 258 MI)
63% female; 58.4% married
Average age: 39.4 years
43% had children under 18 at home
Avg. Income:  $40,000 to 49,000
90% completed high school, 30% college
83% employed, average 33.6 hrs./week
 

Are Shoppers Driven Out of Centers?
Store hours do not match shoppers’ schedules
Store closing prevents customers from making purchases
Hours of operation are not accurate and not understandable
Departmental hours do not match store hours
 

Customer Reality:  Life in the Trenches
Customers think in completed groups of errands
Customers prefer to shop on their way to activities
Customers prefer to shop at one location
Customers prefer to finish their shopping list
Customers will travel to other centers
 

Retail Reality: Perceptions by Retailers
Store hours determined by corporate headquarters, upper management,
     or shopping center management
Few indicated that store hours were set with their particular customers in mind
Little attention was paid to regional or local differences among chains
Reported that their customers had difficulty scheduling their shopping
 

Center Reality: A Lack of Synergy
Retailers reported that other stores antagonized their customers
    by not opening on time, or by closing too early
Depth Interviews with store and center management:
Chain store management could not coordinate hours with center
Store mix : mismatch with customer needs
Are customers’ decisions made at store or center level?
 

Challenging the Competition
New forms of in-store retailing meet resource needs
Help shopper to maximize their resources
Broken routines mean lost shoppers
Non-store retailing
Teaches customers to buy at all hours
Teaches customers to buy without physical touch
 

Creating a Center Synergy
Balanced tenant mix - recruiting “missing” stores
Responding to the customers’ resource mix
Communication of center information
Coordination among all center stores
Application of TIMES Approach