2011 shopper experience survey

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| 2011, Cognizant

2011 Shopper Experience

SurveySteven SkinnerVice President Cognizant Business Consulting

June 2011


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Second Annual Shopper Experience Study

2011 Shopper Experience Study

Joe SkorupaGroup Editor-in-Chief RIS News

[email protected]

joeskorupa@twitterrisnewsinsight@twitterRIS News @FacebookRIS News @LinkedInwww.risnews.com

To download full study:

www.risnews.com/research

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mailto:[email protected]


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Methodology North America

2,427 shoppers in U.S. andCanada

70% female to 30% male tomirror influence in buyingdecisions

Age groups are split into fourlarge segments with a slight biastoward baby boomers

Income group breakout matchesthe overall population picture


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Methodology - Global

1554 shoppers in Singapore,Hong Kong, UK and China

69% female to 29% male

Age groups biased toward theyounger segments

Income groups biased towardsthe lower segments based onthe lower per capita incomes

Japan not covered due to timingof their natural disaster

Global aspects of survey notcovered in todays presentation


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How well do you know Generation Y?

First Things First

Yes, the winner gets a very nicedoor prize!

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The Shopping experience is becomingdisaggregated

What We Learned

Retailers must teach the newways of shopping

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The future of shopping is upon us

What We Learned

Retailers must re-integrate theshopping experience

Easy to brush aside shoppercomplaints

Variability of pricing not knownor understood

You were the only source of

information

Everything was time-boxed

Everything is seen and touched

Task workers

Dumb in-store assets Focus on fundamentals

The whole world knows instantly

Full and instant access to allyour offers

Independent third parties putoffers together

Everything is 24 x 7

Virtual shopping and social-based decision making

Knowledge workers

Interactive in-store assets Focus on fundamentals

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20th Century Shopping 21stCentury Shopping


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What is the shopper experience?


Research ShopTransact

Post Sale

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Indiana Jones

We do not follow maps toburied treasure and X never,

ever marks the spot.

IndianaJones

Research

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What did we learn?

Research

Social Media is not the dominantdriver of decision making

In the box still dominates

Retailer mobile solutions seemedto regress in preference

Web-based out-of-store research ispreferred

Coupons, coupons, coupons

Carefully understand thesocial media hype

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Traditional methods (at least from the last10 years) still hold sway

Research

Social media lagged across allstudy segments

5%

6%

12%

15%

17%

20 %

24 %

0 % 5 % 10 % 15% 20 % 25%

Social Networ king

Smart Phone Research

Shopping Comparison Site

Coupons.Com

Family & Friends

Manufacturer Website

Web Research (PC)

Shopper internetresearch

dominates, but

Prior to making a purchase decision, what step are you most likely to use to ensure

you have all the relevant information

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Whats on the box is still important

If each of the following were available, which would be your preferred

method to receive product information

Research

Generation Y skews high onmobile usage

24 %

27%

31%

33%

57%

61%

66%

0 % 10 % 20 % 30 % 4 0 % 50 % 60 % 70 %

By scanning the product w ith your personal mobiledevice

By reading online customer f eedback on the store

site or t hird-part y social media platform

Through r eview publications such as ConsumerReports

Through a dynamic display that pr ovides product

From an inform ed stor e associate

From signs or cards on the st ore shelves

From bett er informat ion on the pr oduct package

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Large growthfrom 2010, but

still lags


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And the preference for in-store informationhas increased year over year

If each of the following were available, which would be your preferred methodto receive product information

Research

By scanning the product with your personal mobiledevice

By reading online customer feedback on the stor esite or thir d-party social media platform

Through review publications such as ConsumerReports

Through a dynamic display that provides product

From an infor med store associate

From signs or cards on th e store shelves

From better inform ation on the product package

2011

2010

12

Preference for Technology-assistedservice regressedyear over year

Preference,not usage


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Theres no overwhelming preference to usemobile methods to conduct research

If a retailer offered the following services for a mobile device, indicate how likely you would

be to use them on a scale of 1 to 10

But momentum is certainly growingfrom last year

Research

4.7

5.0

5.1

5.2

5.3

5.3

5.3

5.9

1 2 3 4 5 6 7 8 9 10

Ability t o receive location, personalized or

View your status/points in the store loyalty

Ability t o place an order

Store locator

Product comparisons

Ability to instantly use loyalty program

Product and price lookup

Coupons

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Have shoppers been turned off by the retailermobile experience to-date?

If a retailer offered the following services for a mobile device, please indicate how likely you would be

to use them using the 10-point scale

This was a startling statisticfrom the survey

Research

5.6

5.9

6.2

6.0

6.6

7.0

5.0

5.1

5.2

5.3

5.3

5.9

1 3 5 7 9

View your status/points in the

store loyalty program


Store locator

Product comparisons


Coupons

2011

2010

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But as with all things retail, you need to knowwho your customer is

Research

When do you chase Generation Ybehavior & attitude?

If a retailer offered the following services for a mobile device, indicate how likely you

would be to use them on a scale of 1 to 10

6.0

6.2

6.1

6.7

6.7

6.4

7.0

7.3

5.1

5.5

5.5

5.8

5.7

5.7

5.9

6.3

4.2

4.4

4.7

4.6

4.7

4.9

4.7

5.3

3.6

3.8

4.2

3.9

3.9

4.3

3.7

4.6

1 2 3 4 5 6 7 8

Ability t o r eceive location,

View your status/points in the


Store locator

Product comparisons

Ability to instantly use loyalty


Coupons

Emerging Elders

Baby Boomers

Gen X

Gen Y

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Stephen Wright

Shop

I went to a general

store but they wouldntlet buy anything specific

Stephen Wright

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What did we learn?

Shopper sophistication is increasingrapidly

Shop

In-Stock Position is King

The Basics Still Rule

Shoppers Want Technology-Enabled Associates

Cross-channel Price Inconsistency Is anIrritant

Poor Associate Knowledge

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Dislike of channel price differentiationgrowing

Which of the following experiences do you dislike most when shopping in a store?

Price differentiation makestheoretical sense, but

Shop

11%

12%

13%

18%

28 %

30 %

47%

67 %

73%

0 % 10 % 2 0 % 3 0% 4 0 % 5 0 % 6 0 % 70 % 8 0 %

No Refund for Online Purchase

Not Accept Return fr om Another

Not Accept Return without Receipt

Diff Promo (Sto re vs Online)

Diff Price (Stor e vs Online)

No Cash Refund

Store Assoc With Poor Knowledge

Slow Checkout

Out of Stock

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Generation Y is even more sensitive toprice inconsistency


Shop

Are we creating disloyalgeneration Y customers

20

38 %

37%

67%

72%

34 %

43%

65 %

72%

21%

50 %

69 %

77%

20 %

61%

66 %

72%

0 % 10 % 2 0 % 30 % 4 0% 5 0 % 6 0 % 70 % 8 0% 9 0 %

Diff Price (Stor e vs Online)

Store Assoc With Poor Knowledge

Slow Checkout

Out of Stock

Emerging Elders

Baby Boomers

Gen X

Gen Y


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Execution issues indexed higherthan all others

Shop

Shopper expectations areincreasing each year


69%

73%

85%

0 % 10 % 2 0 % 3 0 % 4 0 % 5 0% 6 0 % 7 0 % 8 0 % 9 0 %

Poor promo tional signage no clear way toknow what is on sale

Store is difficult to navigate thr ough -- too

clutt ered, and/ or wit h poor access to aisles

you get t o the cash register, it rings up the

regular pr ice, or a different price

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Shoppers are telling you how to fix the poorassociate knowledge problem

Shop

In general, which of the following would you most like to see improved among store associates?

Knowledgeable assisted salesdrive transaction size

9%

27%

53%

58 %

64 %

68 %

0 % 10 % 2 0 % 30 % 4 0 % 5 0% 6 0% 70 % 8 0 %

More multi-lingual stor e associates to support

your local area

Better product knowledge enabled by smart

phone, tablet t echnology and digital signage

Better electronic access to product

information, inventory location and ordering

More store associate engagement in t heaisles with check-out processing capabilities

Improved custom er service skills enabled by

technology

Ability of st ore associates to match

competitive online prices

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What you may not have known

Emerging Elders have almost twice thedislike of unknowledgeable store associatesthan Gen Y

Gen Ys do their homework 38% dislikedifference between store and on-line price

Facebook tied with Groupon, at least forthe Gen Ys

Personalized store experience moreimportant for men than women

Women have a lower tolerance than menfor poor store service

Older shoppers consistently have higherexpectations of store associates

Shop

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I've never felt like I was in thecookie business. I've always beenin a feel good feeling business.

My job is to sell joy. My job is tosell happiness. My job is to

sell an experience.

Debbi Fields

Transact

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What did we learn?

Europe and Asia are driving a newtransactional model

Transact

Mobile Payments are not a shopper priority

but in Europe and Asia Pacific it is!

Coupon management is a huge sore customerpain point

Slow check-out remains an enigma

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Time is money,for you and your customers

Transact

Which aspect of the check-out process at a store do you dislike?

Probably nothing new here

39 %

43%

48%

56 %

0 % 10 % 20 % 30 % 4 0 % 5 0 % 6 0 %

A barcode that does not wor k at check-out

Products without stock numbers having to

Slow or inattentive cashiers

The wait in line

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Mobile Payments not ready for prime time

Transact


Standards and customers in USare not ready

5%

0 % 10 % 20 % 30 % 4 0 % 5 0 % 6 0 %

Not being able to use a personal mobile device to checkout

How likely would you be to pay using a personal mobile device

4 .7

4 .6

4.0

3.1

5.2

4.2

3.1

2.5

1 3 5 7 9

Gen Y

Gen X

Baby Boomers

Emerging Elders 2011

2010

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Yet preferences in other countriessuggest its coming

Transact

How likely would you be to pay using a personal mobile device

US-Based Global retailers need amobile payments strategy

3.7

4 .2

6.8

6.8

7.7

1 2 3 4 5 6 7 8

North America

UK

Singapore

Hong Kong

China

Research alert!There is a globalversion of this.

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Bad shopping experiences drive higher profit.Shouldnt we feel bad about that?

Transact


Can you think of a bad experienceat an Apple store?

52 %

0 % 10 % 2 0 % 30 % 4 0 % 5 0 % 6 0 %

Getting t he manufacturer discount

by having to mail in the r ebate

coupon after purchasing the product

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T t


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Shoppers want simple coupon redemptionand no paper

Transact

If a retailer offered the following new or alternative payment methods, how likely

would you be to use them?

Digitizing coupon management isthe next frontier

3.7

4 .2

5.3

5.7

8 .3

0 2 4 6 8 10

Pay using a personal mobile device

-wallet service withpre-fil led out credit authorization

PayPal or other third-party onlineservices that allow payments to be

made through the Internet)

Pay using a mini store loyalt y card

that att aches to your key ring

Coupons/gift cards

30

T t


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Everyone wants a better couponmanagement system

Transact

How likely would you be to pay using alternative coupons/gift cards

Fast check-out, happy customers.Seems reasonable.

8 .4

8 .4

8 .4

8 .0

1 2 3 4 5 6 7 8 9

Gen Y

Gen X

Baby Boomers

Emerging Elders

31

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No refund, how big a deal? lowest dislikeof all choices

Level of income has little bearing onlike/dislike of mobile methods

Emerging Elders have almost twice thedislike of a price check than gen Y

Gen Ys more sensitive to wait in line thanEmerging Elders, yet more accepting ofself checkout

Men more likely than women to pay usingmobile devices or 3rd party services

Transact

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Post Sale


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Give your clients the earliestdelivery consistent with

quality - whatever theinconvenience to us.

- Arthur C. Nielsen

Post Sale

33

Post Sale


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What Did We Learn?

Cross-Channel Fulfillment is nowTable Stakes

Mobile commerce lags

Nothing beats a live voice orperson

A bad experience is nowcommunicated to thousands

Post Sale

Post-sale execution is even morecritical to loyalty

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Post Sale


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Multi-Channelis now expected by shoppers

Post Sale

Which store service offerings do you value 1stand 2nd

Mobile Commerce not yetdemanded however

3%

6%

9%

36 %

43%

46%

57 %

0 % 10 % 2 0 % 30 % 4 0 % 5 0 % 6 0 %

Ability t o purchase a product v ia a personal mobile device, have it

delivered to your home, and retur n it (if needed) to the store

Ability to pur chase a product via a personal mobile device and pickit up in the store

Ability to purchase a product in t he store and return it (if needed)using online procedures

Ability t o purchase a product online, have it delivered to yourhome, and return it (if needed) to the store

Ability t o purchase a product online and pick it up in the store

Ability to automatically redeem a retailer or m anufacturer coupon

Ability t o purchase a product in the store and have it delivered toyour home at no extr a charge

35

Post Sale


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When things go wrong shoppers still wantto talk to a live body

Post Sale

If a retailer provided access to customer service/product representatives how likely would you be to

use this service

When you have an issue in-store, which means of communication are you most likely to use?

4.2

4.6

5.1

6.4

1 2 3 4 5 6 7

Video assistanceText assistance

Text/ Call to r eceive Live AssociatePhone assistance

36

4.0

4.2

5.6

6.2

6.8

1 2 3 4 5 6 7 8 9 10

Post comment s on retailer pages within social netw orking

sites (i.e. Facebook, Twitter)

Post comments to your personal social networking netw ork(i.e. fr iends and family)

the retailer's website or mobile site

Ask to speak with the Stor e Manager

Post Sale


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Generation Y uses newer methods to connect

Post Sale

If a retailer provided access to customer

service/product representatives how likely wouldyou be to use this service

When you have an issue in-store,

which means of communication are you mostlikely to use?

4.2

4.6

5.1

6.4

4.8

5.9

6.3

6.4

1 3 5 7 9

Video assistance

Text assistance

Text/ Call to receive LiveAssociate assistance

Phone assistance

Gen Y Only

All Shoppers

37

4 .0

4.2

5.6

6.2

6.8

4 .7

5.0

5.2

6.2

6.1

1 3 5 7 9

Post comments onretailer pages within

social netwo rking sites

(i.e. Facebook, Twitter)

Post comment s to yourpersonal social

networking networ k (i.e.

friends and family)

customer service

number

Send an email to th e

retailer through the

retailer's website or

Ask to speak with the

Store Manager

Gen Y Only

All Shoppers

Post Sale


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Cash is king, at least for women - Morelikely to want a cash refund than men

Gen Y more likely to try alternativecustomer service contact methods, butphone is still #1

Older shoppers quicker to go to the store

manager, but younger shoppers not thatfar behind

Gen Y will make their displeasure morewidely known via Facebook, Twitter andother sites

Post Sale

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Never tell people how to do things.Tell them what to do and they will surprise you

with their ingenuity.

General Patton

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The 10 Megatrends we highlighted last year

Taking Off Taking the Store to the Shopper

Shopper Demand for Consistent Cross-ChannelExperiences Drives Retailer OrganizationalIntegration

Distributed order management Integrates theRetailer

Social Media and Product Development Collide

The Death of the Task Worker

Generation Y Changes the Behavior of All OtherGenerations

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Sales and Product Information via MobilePhone

Mobile Shopping (Finally) comes of age

Death of POS becomes a possibility

Real SKU Rationalization Takes Hold

The 10 Megatrends we highlighted last year

Still Emerging

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A good plan violently executed now is betterthan a perfect plan executed next week.

A Final Thought

42

Tech-assisted associates &coupons leap to the planning front.


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About Cognizant

Cognizant is a member of the NASDAQ-100, theS&P 500, the Forbes Global2000 and Fortune500.

We are also ranked among the top informationtechnology companies in BusinessWeeks

InfoTech 100, Hot Growth and Top 50Performers.

A leading provider of information technology,consulting, and business process outsourcingservices

With more than 50 global delivery centers and over110,000 employees*, we help clients transform core

processes for greater flexibility, higher efficiency and

lower costs.

*as of March 31, 2011

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Thank youIf you would like the detailed Global Shopper

Experience Study -

Please contact:Rachel Cosby [email protected]
mailto:[email protected]:[email protected]

2011 shopper experience survey

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