Less is more

I came across a very interesting white paper by Kaon Interactive on how to create a "wow" factor in the retail customer's experience. The paper begins with citing some very common obstructions to achieving this in the retail stores. A summary is given below

1. When too many product features or categories are available, customers find it difficult to understand and evaluate options. This results in them either choosing the cheapest product as price is something they can easily evaluate. This leads to them being dissatisfied at a later stage due to lack of features.
2. The space available on the shelf is insufficient to provide a informative presentation of the product assortment to the customer leading to an underinformed customer
3. While overcoming customers’ inconsistencies in decision making and physical space limitations are both challenges for retailers, finding the sales support to help customers make a purchase, and more importantly, make the right purchase is perhaps the retailer’s greatestconcern.

The paper talks about generating a positive emotional response in the customer while shopping - "Emotional response is also kindled when consumers better understand and appreciate the product they are about to purchase. While providing product information that details how a product is used, or clearly explains why a feature is present sounds obvious, it’sactually a rare occurrence in the retail world"

The first factor cited by the paper is corroborated in a recent presentation "Re-imageering Retail" given by Thom Blischok of Information Resources Inc. As per Mr. Blischok "84% of shoppers are fully satisfied with 23% of the merchandise at a typical store". This is also seen in terms of a trend towards "express" store formats which is expected to "grow from around 20 locations today to 4,000 by 2010"

Consumer Behavior

Continuing from my last post on "Active Design", an interesting article appeared in the NY Times on how more and more marketers are using consumer behavior rather than consumer perceptions obtained through market studies and then figuring out what fits their profile the best. Behavior based marketing is taking a step further and looking at what the consumer actually buys and identifying correlations to design the product offerings. In other words, if you know how your consumers "Acts" then you can design for her to act and offer her what she acts for. The article talks about the role of new media in helping identify consumer behavior and also market product offerings identified through an understanding of consumer behavior - "The ability of new media to monitor what consumers are doing — like keeping track of which Web sites they visit — is fueling the interest in behavioral targeting"

Creature of Habit

Something very interesting that I came across in an NY Times article referenced on one of the retail e-letters that I subscribe to. Retail customers (that includes most of us) seem to be creatures of habit. So much so that a lot of them were upset when Macy's decided to do away with coupons as part of an initiative to make it easy for customers. Retail customers apparently like to get a deal even though most retailers actually budget for promotions so its not that someone is really getting a bargain. It was already accounted for to yield that much margin. I have also heard that some retailers like to give a treasure hunt kind of feel to shopping in their stores where some unannounced deals are selective placed in different aisles which give their customers a sense of achievement when they find them adding to that "I got a real smart deal" feeling. Its like "you win when you let them win".