Retail shopping changes more quickly than almost any other industry. Harvard Business Review notes companies like Amazon and Alibaba have continued to redefine the industry and how people shop. In fact, CNBC reported for the 2017 holiday season, 45% of shoppers expected to do most of their holiday shopping online.
Still, the brick-and-mortar retail store is far from dead. In fact, Forbes pointed out in March 2018 that retail store openings have grown by fifty percent year over year. While stores face fierce competition, they should continue to look for ways to gain market share in competitive retail markets.
Who Purchases at the First Store?
With stores as competitive as they are, the way people shop becomes critical. A majority of all in-person shoppers – 65% according to TraQline data – continue to visit only one store before purchasing. This behavior can serve as a mirror image of online shopping, of which 38% of shoppers look at only one store before making a purchase.
Families Who Shop Together…
Within these numbers, some interesting data points emerge. One is gender: a similar number of males and females shopping alone make purchases in their first store; 66.4% and 67.3%, respectively. When a male and female shop together, the number drops to 59.3%. When looking at income, only the middle income families are slightly less likely to buy at the first store shopped (68% for high and low income vs. 65% for middle income)
What First-Store Product Purchases Are Trending?
The kinds of products matter, too. Many larger-price items lean more heavily toward first-store purchases in dollar share:
- Exercise equipment 72.7%
- Imaging products (such as digital cameras & camcorders) 69.7%
- Computers 64%
- Computer peripheral products 60.4%
- Home Audio 55.4%
In contrast, many smaller ticket items have very low first-store shopping behavior, most notably products which are “creative” in nature, such as paint and plants.:
- Cleaning chemicals 7.3%
- Paints and stains 6.3%
- Nursery items 5.6%
- Paint supplies 4%
Understanding how shoppers look at these items can help retailers develop a strategy for marketing, both outside the walls of the store and at the point of purchase.
Online Impact on In-Store Retail Shopping
One key to understanding what a first-store purchase means is the amount of information available outside of stores. According to Forbes, shoppers spend an additional $4.82 in store for every dollar spent online after doing product research on the web. Shoppers are using online research and social media information to learn about products before they buy. This is particularly true for big-ticket items, in which customers can discover a wealth of information before they ever set foot in a store.
Today, Millennials – those born between 1982 and 1996 – constitute 28% of all daily retail spending in the United States, a figure expected to rise to 35% by 2030. These shoppers still spend a majority of their retail money in stores, but their online habits show what and where they shop. They are intensely price-conscious, but also aware of brand reputation and image. They usually know what they want by the time they enter the store, especially for larger purchases.
How Stores Can Capitalize
When retailers create business plans, they should build around the information they have on how people shop. Point-of-sale displays and marketing can have some impact, but when the majority of shoppers purchase at the first store they enter, retailers should focus on developing an online presence that supplements and complements point-of-sale displays.
Traditional online marketing content is not enough. While internet content can drive foot traffic, the prevalence of smartphones and shopping apps means stores have every reason to build an interactive in-store experience. The more retailers can do to create this, the more likely they are to bring customer in and close sales in the store.
This interactivity may create the most opportunity in areas where single-store purchases are the least prevalent. For example, stores selling chemical products like paints and cleaning supplies can find tremendous opportunity: They can develop an experience focused on inspiration for creative projects and also delivering products needed to complete those projects to their customers.
Retailers who develop the information customers need have an opportunity to grow market share by preventing shoppers from going elsewhere to make these purchases.
The data on solo shoppers versus paired shoppers can also be instructive. For example, many manufacturers and retailers market products in gender-specific ways. At the same time, TraQline data show a significant drop in single-store shopping for couples shopping together. This is likely due in part to brand imagery that targets one gender to the exclusion of the other. When stores build a shopping experience, they have room to gain from a more well-rounded marketing strategy for the products they sell.
Takeaways from Store Strategies
No one can reasonably argue that e-commerce has not impacted the world of brick-and-mortar retail. But the evolution of online applications has not created an either/or, winners/losers retail world. People still shop stores, with e-commerce and online marketing doing more to focus that shopping than to eliminate it.
For retailers seeking to adjust to these developments, embracing online information and blending it into a universal shopping experience can create marketing strategies that efficiently connect two seemingly disparate worlds. Building store strategies that unite effective online elements will help them continue to build both the traffic they crave and the sales results they need.