Winning Over the Elusive Consumer
NEW YORK -- In today's changing world, consumers are shopping less, but are more engaged. With this trend expected to continue, retailers need to start thinking about new ways to capture the “elusive consumer,” according to global information and measurement company Nielsen.
In a webinar entitled "What's In Store 2014: Engaging the Elusive Consumer,” the New York-based company outlined ways retailers and consumer packaged goods (CPG) companies can win with consumers who are spending less time shopping -- a behavior that began with the economic downturn in 2008. Tuesday's webinar was the latest installment in Nielsen's annual “What's In Store” series.
According to Nielsen’s retail sales forecast for 2014, total retail dollar sales will increase by 1.8 percent and total units will decrease by .02 percent. What these numbers show is that while things are improving, there is still a level of pragmatism going on, said James Russo, senior vice president, consumer insights at Nielsen.
He explained that although the economy is improving, consumers are not changing their spending behaviors. Plus, the on-the-go revolution is creating an elusive consumer, he noted. For example, 67 percent of households own a smartphone -- not just a cell phone -- and even cars are being designed to become the next smartphone.
"All this change is creating a seemingly elusive, but engaged consumer," Russo noted.
For companies to find growth in this challenging environment, the Nielsen exec said they should focus on the top 10 trends of 2014:
- Faster, fresher, better. Consumers are looking for better-for-you products and services. The industry has made strides in this department, but still has far to go.
- Wellness required. The No. 2 global trend, behind the economy, is health. Don't get caught with a health and wellness void.
- What's in it for me? Consumers will pay a premium for innovative products. It's not just a price game. Retailers and CPG companies should give consumers a reason to spend more and they will.
- The Great(er) Divide. Nearly 50 percent of consumers say they are livingly comfortably and spending freely vs. 52 percent who say they are only affording the basics -- though the basics are subjective.
- Shopping less, engaging more. Shopping trips have declined post-recession, partly due to lifestyle and partly due to increased use of technology. Each in-store transaction and interaction therefore becomes increasingly more important.
- More choices, more chances to get lost. Consumers used to face simple decisions in the store, but no more. Break through the clutter by keeping up with and staying ahead of consumers.
- Less loyalty, but more opportunity. The average loyalty is 22 percent for retailers and 29 percent for brands. That leaves a 78-percent and 71-percent opportunity, respectively.
- Innovation. It is not just about understanding what makes new product launches and reinvented mature product launches successful, but also utilizing new ways to measure what matters.
- Make a big impact with minimal content. One of the most retweeted messages during Super Bowl XLVII last year was a seven-word tweet from Oreo: "You can still dunk in the dark." The tweet came after the lights went out during the National Football League faceoff at the Superdome in New Orleans.
"There are more opportunities than challenges and those opportunities are rooted in the consumer condition," Russo said, adding that capturing the elusive consumer will be won by those companies who focus on the consumer. "Find your consumer and know them better than they know themselves."