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1 © 2017 Ipsos.© 2017 Ipsos.
2 © 2017 Ipsos.
Today’s Conversation
Framing the opportunity
1The future of
shopping
2 3The future of
shopper insights
4The role of
behavioral science
3 © 2017 Ipsos.
Framing the opportunity
Framingtoday’s shopper opportunity
1
4 © 2017 Ipsos.
BLENDINGCLICKS & BRICKS
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19621919 1999
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China #1USA
#2
UK #3
Japan
#4#6
Germany#7
S. Korea
#8Canada
#10
Russia
#5France
$24B $975B
$79B
$192B
$74B $71B
$43B
$649B
Top 10 e-Commerce markets (based on $ revenues)
Source: Statistica 2017
$124B
#9India
$45B
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e-Commerce in China…
201620% China
#1
$975B
% of retail sales online
201934%
Source: Statistica 2017
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Alibaba's New Retail
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1“e-commerce isn’t the cherry on the cake, it’s the new cake”
Jean-Paul AgonChairman & CEO L’Oréal
The continued growth of e-Commerce
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Opportunity to improve ecommerce satisfaction
43
26
31
Delight Satisfied Not so satisfied
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TOP 5 ISSUES
67%had an issue
during last visit
18
17
15
15
13
Delivery costs too expensive
Delivery times too long
Prices too high
Lack of details/information
Not enough product choice
Key issues with e-commerce
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Buyers vs. non-buyers: overall satisfaction & % at least 1 issue
Ecommerce satisfaction clearly hurts conversion
43
27
26
24
31
49
Delight Satisfied Not so satisfied
BUYERS
NONBUYERS
67%
Had an issue during last visit
77%
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New game changing e-Commerce models
The future of shopping
2
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Amazon ‘everywhere-commerce’
Source: Ipsos Global Omnichannel Survey
Source: Amazon 2017
10%Uplift in sales among
Echo Users first 6 months
Share of USA e-Commerce sales
43% Prime
Non Prime
$1,300
$700
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AMAZONAmazon constantly surprising us
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Now Walmart is full of surprises……
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Order on App
Order links direct to nearest Grab Bike
Items delivered - COD
Bringing convenience shopping online
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Instant delivery – unthinkable possibilities
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Connecting those who need work with everything youneed in one app…leads to Top 20 innovative apps in the world
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Less is more
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New definitions of food deliverywill soon get us to 25% meals online
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Sharing economy comes home
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Omnichannel healthcare
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3The future of
shopper insights
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First time category buyers
Trigger
Pre-trigger preferences
Purchase
Retailer choice
Product choice
Today’s complete path to purchase
OmnichannelTouchpoints
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Passive behavior metering
of granular digitalpath to purchase
FOLLOW
Digital conversation and content landscape of
potential shoppers
LISTEN
Structured survey with omnichannel touchpoint
modeling for holistic understanding
INTERVIEW
Behavioral science enabled qualitative for deep understanding of “why” behind “what”
ENGAGE
Holistically Mapping
Path to Purchase
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The complete path to purchase
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Performance of brands on touchpoints
SHOPPER PURCHASE
INTERVIEW
LISTEN FOLLOW
ENGAGE
Intenders
RecentPurchasers
Different paths for different shoppers
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Brand growth starts with how people make choices
DECISION-MAKING IS OFTEN UNCONSCIOUS
BRANDS AS MENTAL NETWORKS
MEMORY AND ATTENTION SALIENCE
HOW PEOPLEARE INFLUENCED
HOW PEOPLEMAKE DECISIONS
HOW PEOPLETHINK ABOUT BRANDS
System 2 System 1
MEMORYSALIENCE
ATTENTIONSALIENCE
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Framing the opportunity
The Role of Behavioral Science
4
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What Is Behavioral Science?
An interdisciplinary field of science which generates and applies insights to understand, predict, and ultimately implement behavioral change
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Our B Sci Creds…
Think Tanks: Duke University and Yale University
Ipsos Centers of Excellence New York and London
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Our understanding of people is based on traditional thinking that the mind is rational & logical
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The Intuitive System 1 is more influential than your experience tells you and is the secret author of many of the choices and judgments you make…
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• The influence of a healthy alternative on indulgent choice
• Respondents presented with options for a side with lunch…either see no healthy option or a set that includes a healthy option
Choice Architecture
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Share Of The Least Healthy Option
10
0
10
20
30
40
No Salad
PercentageChoosing theFrench Fries
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Share Of The Least Healthy Option
10
33.3
0
10
20
30
40
No Salad Salad Included
PercentageChoosing theFrench Fries
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Branded vs. Private Label - “Security” Prime
Examines the degree to which evoking emotions around “security” will generate a preference for national brands versus private label
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Branded vs. Private Label - “Security” Prime
35
Neutral
PercentageChoosing National
Brand
Duke-Ipsos Research Center & Think Tank - Category and brand have been altered for confidentiality
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Branded vs. Private Label - “Security” Prime
35
Neutral
PercentageChoosing National
Brand46
Security
Duke-Ipsos Research Center & Think Tank - Category and brand have been altered for confidentiality
42 © 2017 Ipsos. 42Yale Center for Customer Insights (YCCI)
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Yale Center for Customer Insights (YCCI)
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Yale Center for Customer Insights (YCCI)Yale-Ipsos Think TankApplying Behavioral Economics to Consumer Marketing
GAME CHANGERS
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4.68 4.22
Charmin Ad with money shown
Charmin Ad with no money shown
Likelihood of buying store brand
Yale Center for Customer Insights (YCCI)
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The Behavioral Science Opportunity GapINCREASED POTENTIAL FOR VALUE WILL CONTINUE TO DRIVE CLIENT EXPERIMENTATION AND THE CREATION OF RELEVANT FRAMEWORKS . . . BUT MANY FIRMS WILL LAG OVER TIME AND A GAP WILL RESULT.
2005 2010 20182000
VALUE
TIME
Value
Average firms ability
to exploit
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The Missing Bridge…
47
Academic Knowledge & Experimentation
Practical & Commercial Application
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What’s at stake?
• More effective promotions• Better shelf placement• More profitable pricing
• Increased conversion & transactions• Faster usage• Higher customer satisfaction
Sustainable competitive advantage not obvious to
your competitors
Stronger manufacturer-retailer relationships and joint business
planning advantage
If we could understand how our shoppers make decisions better than our competition…what’s that worth?
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Applied Helping Answer Critical Issues
How can I foster habitual behavior to increase usage?How do I increase penetration that “sticks”?How does priming impact behavior at the
shelf?What imagery creates higher conversion
rates?How does a mind set of “choice
architecture” versus traditional “adjacencies” change my strategies?What pricing cues work best?How do I win critical touch points?
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Market Research & Strategy – The 5 Elements of Evolution
1. HOW WE ASK QUESTIONS2. EMBEDDED INTO TRADITIONAL SOLUTIONS3. “APPLIED” BEHAVIORAL SCIENCE – CREATING SUSTAINABLE GROWTH
STRATEGIES4. ORGANIZATIONAL THINKING & CULTURE5. RETAIL STRATEGIES & PARTNERSHIPS
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Challenges…
1. Its new!2. Finding partners3. Creating the frameworks4. Functional collaboration5. Where is my organization on the adoption
curve?
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A Transformative Change?
52
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Thank you!
Alison ChaltasGlobal President, Path to Purchase
Mark BerryEVP US, Path to [email protected]
