All retailers worldwide want to understand consumers better so that they can influence their purchasing decisions. But maybe they’ve been going about it in the wrong way. Traditional retail research relies on using demographical and transactional data to group people into fixed categories, such as ‘Busy Housewife’, ‘High-Income Professional’ or ‘Budget Seeker’. That’s fine up to a point, but it suggests that each individual and their motivations can be entirely defined in one particular way. The reality is more diverse and fluid: at different moments in life or even in the course of a day, a consumer may behave as any or all of these personas. What’s missing is the connection between who is shopping and how they’re shopping. No wonder it’s so hard to predict or influence people’s purchasing patterns.
Time to look at ‘why’ rather than ‘who’
So, is there a better method? We wondered what would happen if, instead of just focusing on the demographics or even psychographics of who is shopping, we focused on what’s in consumers’ minds when they are looking for something at a specific point in time. Might consumer mindsets be the key to a more successful communication strategy? After all, it’s these mindsets that cause people to shop a particular way at a particular moment. For example, a successful executive who likes to decide which little luxuries she is going to treat herself to after a hard day’s work might suddenly go into ‘housewife mode’ on Saturdays when wheeling her trolley around the supermarket with her children, or decide to buy a month’s supply of toilet tissue via the internet because it’s on special offer. It all depends on an individual’s mindset at a particular moment. In other words, context and timing are key. This raises the intriguing question of how to capture different mindsets at key decision-making moments.
What’s in a Mindset?
A mindset represents the way in which consumers approach their purchasing decisions. Each consumer may have several different main mindsets that influence how and when they buy different categories of groceries, and most consumers don’t have only one motivation for buying the range of items they choose. For instance, when buying fish and meat, a person might consider quality as the most decisive factor, while being perfectly happy with the budget version of items such as crackers. In fact, the decision-making process is more dependent upon the mindset than upon the person making the decision. Grouping people according to their mindsets can therefore be highly illuminating when you want to shine a light on the wide variation in the frequency of shop visits, the different number of SKUs purchased per visit, and the decisions that are made in different phases of the shopper journey.
Five Key Mindsets
To discover more, we dived deep into our shopping data from all over the world and came up with five key mindsets that influence how people shop. These cover all sorts of customer behaviours ranging from repetitive or bulk buys to last-minute convenience purchases, fresh food shopping trips, and pilgrimages in search of quality. For instance, one mindset is largely responsible for triggering shoppers to plan and buy groceries for the whole week. In this mindset, most decisions are made at home and not in the store, so a retailer can leverage this insight by triggering consumers in their home environment. In another mindset, quality is the most important driver, resulting in separate trips to specific stores, which is where most product decisions are made. Knowing this, the retailer can then influence these consumers by offering the type of service they are most receptive to while they are in the store. Another mindset is closely connected to on-the-go purchases. There’s also a mindset in which the key motivation is the flexibility to eat whatever and whenever you want to – especially if you see some temptingly fresh produce, meat or fish. And let’s not forget the mindset in which the greatest satisfaction comes from obtaining the best deal.
Master the Mindset Moments
Considering that each individual customer may be influenced by different mindsets at different times, we then examined the moments in which each mindset is more receptive to your marketing message. We’ve called these our Mindset Moments. Retailers can use our insights to influence or respond to these key Mindset Moments, enabling them to make communications more personal and relevant. By mastering the Mindset Moments, you can also reach out to whole segments of your customer base that may otherwise be overlooked because they don’t fit into the traditional definitions of customer types.
So how does this work in practice? Well, for a start it means not just continuing to send your consumers a whole load of undifferentiated offers on a Sunday, just because that happens to fit in with your own marketing or store schedule. Instead, we are currently testing our algorithm that recognizes the mindset of a consumer based on their purchases. With this algorithm we can help you pinpoint the best moments and methods to target each mindset and enhance your understanding of the motivations behind each purchase. For example, a consumer with a high number of products, a large range of categories and relatively low average spend per product, is likely to be in the mindset of a ‘repetitive planning’. Whereas a consumer buying only a few products, mostly in one or two categories of which often prepared and with a relatively high average spend per product, is more likely to be an ‘on the go’ mindset. With the aid of our Mindset Moments strategy, you’ll be able to put a sharper focus on your marketing communications. And frankly, it’s really about time.
by Anna Witteman and Lenneke van der Meijden, Consumer & Business Intelligence at BrandLoyalty.
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