IBM and NRF reveal the findings from their second global consumer retail study: hybrid shopping, the purpose driven consumer and sustainability can all best describe the post-pandemic consumer.
- 62% of consumers are willing to change their purchasing habits to reduce environmental impact, up from 57% two years ago. Many said they’d pay a premium for sustainability, but there’s still an intention/action gap
- Purpose-driven consumers, who choose products/brands based on their values like sustainability, are now the largest segment of consumers (44%)
- Hybrid shopping is table stakes, and 72% of consumers still rely on stores as all or part of their primary buying method
- 1 in 5 consumers want more information about where products are sourced, produced, and manufactured
After a Covid induced hiatus in 2021, the IBM and NRF global consumer retail study made a welcome return for 2022. Surveying 19,000 consumers around the globe it is one of the most comprehensive studies of consumer attitudes and behaviour and as we emerge from our imposed Covid confinement, it is more critical than ever for retailers to understand how their customers are thinking and behaving.
The study revealed that there are three key emerging trends:
Consumers are seamlessly using a combination of digital, physical and hybrid methods to research, shop and purchase. And this is spanning all platforms and channels including in store, website, friends & family, reviews, however 72% of consumers still rely on stores to complete their path to purchase.
Comment: For too long, retailers have thought in terms of channels, they’ve even structured themselves according to channels. These findings well and truly bury that myth and confirm that as consumers we utilise all kinds of sources of information as part of the buying process. And not only that, we often go round similar or perhaps the same loop multiple times before making our decision – often depending on the value of the item we are considering. It’s often a complex process but nevertheless, one which retailers need to understand if they are to truly know their customers.
Purpose driven consumer
Perhaps the elephant in the room has been the purpose-driven consumer and the findings suggest that they now represent the largest segment of global consumers, up 4% to 44% from 2020 whereas value-driven consumers are down from 41% to 37%. By contrast, brand and product-driven consumers come a lowly 15% and 4% respectively. And don’t for one minute think that this only applies to vegan food or bamboo clothes, according to the study, it’s right across grocery, apparel, home goods and beauty.
Comment: The business of business is shifting away from 100% shareholder value to one of employee relations, serving the community and investing in the future of the planet. As consumers, we increasingly want to see our own beliefs and aspirations mirrored in the brands and retailers we choose to shop with.
Sustainability continues to be something of an enigma when it comes to understanding consumer behaviour. We all want to be good citizens however, our behaviour doesn’t always reflect our best intentions. Nevertheless, 62% of consumers said that they’re willing to change their purchasing habits in order to reduce environmental impact.
Comment: By now, we’ve all seen images of birds wearing face masks and turtles with plastic straws stuck in their mouths. And yes, when asked, we would all say that we are concerned about climate change and the future of the planet but the great insight from the study is that there still remains an “intention / action” gap. Nevertheless, retailers can no longer treat sustainability as an optional add-on, it must permeate their DNA.
Recommendations for retailers from the findings of the report:
- Streamline the hybrid shopping experience
- Make your stores special
- Integrate AI to gain valuable insights, regardless of channel
- Use Blockchain to establish trust and transparency.
- Make sustainable shopping easier
- Know your customers and appeal to their preferences
For years a retail term which has been seeking a properly defined meaning now has one. Because in the post pandemic retail world we now find ourselves inhabiting, we expect to be able to shop anywhere, any way and any how. In fact, not unsurprisingly, as the study reveals, as consumers, we want it all.
For more information and to access the full report: https://www.ibm.com/thought-leadership/institute-business-value/report/2022-consumer-study