Towards a predictive two-axis model that combines product characteristics with consumer attitudes
I’m presenting a theory here that attempts to explain when and for what types of shopping occasions, do consumers want to have a seamless, convenient online solution (saving time) or a rich, enjoyable in-store experience (spending time)?
This blog builds on my earlier one, ‘The New Role for Stores in an Omni-Channel Era’ that divides consumer shopping into two phases: discovery and fulfillment.
Does it hold up to reality? The fact is that it is still too early to tell how consumers prefer to shop online or in physical stores. And the answer is, that consumers are shopping in many kinds of ways. It is too early present anything close to a definitive picture of what types of shopping, for what products and in what situations are happening on and offline. However, recent consumer data can reveal some trends about what types of shopping is happening online, what types of shopping are occurring offline, and why.
However, I believe that an overall explanatory model, based on existing marketing concepts can help. Let’s dive in and get theoretical!
Homogeneous to Heterogeneous
If you ever took an introductory marketing class you might remember the way different consumer products are often classified; such as convenience products (everyday staples – bread, milk, kale,) shopping products (higher ticket – a refrigerator), and specialty (iphones, branded fashion).
Shopping products are often divided again, into homogeneous (sameness) and heterogeneous (uniqueness). Homogeneous products are viewed by consumers as basically the same and interchangeable. And for which they want the lowest price. Examples would be different brands of laptop computers with 8GB memory, 15.6˝ HD screens and Intel i7 processors. While not literally the “same” as each another, they are similar. Their interchangeability often makes them suitable to be comfortably researched and shopped online.
Heterogeneous products are viewed by consumers as having very different qualities from one another making them less interchangeable. They’re items they want to inspect in-person for quality and suitability. Examples are clothing and furniture. A plum-colored wool cardigan has many details that are hard to evaluate on a screen with just product descriptions to go on, even when there are consumer reviews. To really evaluate the subtleties of color, fabric texture, button construction and, of course, fit, this type of product must be experienced.
The first part of our model, the horizontal axis, uses these two ways of looking at products. It’s a spectrum from homogeneous on the left, to heterogeneous on the right.
Low to High Engagement
A second, complementary spectrum we’ll layer on to the first one is about the shopper. It indicates a consumer’s level of emotional engagement with a purchase.
At the bottom of this vertical axis are low-engagement products and buying occasions. These are products that are often viewed as merely functional, such as pasta, laundry detergent and paper towels, perhaps. They’re equivalent to convenience products in classic marketing theory. They are the often-purchased, usually lower cost, staples of life.
And at the top end of the engagement axis are products and shopping occasions that consumers find more important and rewarding. Examples include shopping for a car, home furnishings or clothing.
Likely, this high engagement will have a lot to do with the price point of the item, as well as how long the buyer will have to live with the product because of its durability and quality. But not always. Consumers who are home chefs may be highly engaged in buying produce, for example, while others may find this to be more routine.
Drawing the parallel again with classic marketing ‘classes of products’, our high-engagement products would be roughly equivalent with shopping products and specialty products. Again, these are products that consumers care about. And for which they will invest a lot of time researching and comparing options. They are often more expensive because they are an expression of their lifestyle. And they include brands that consumers have a strong attachment to, like Apple computers or a high-end watch.
Here is a more detailed image, tying the two axes together.
Using this two-axis framework, we can plot different product types, according to their suitability for online shopping versus in-person, brick & mortar shopping.
Items in the lower left quadrant, because they are easy to evaluate online (homogeneous) and are more routine (lower engagement) are most suitable to being shopped online. I call these Mundane products (no insult intended!).
In the top left quadrant we have what I call Elite products and shopping occasions. These are specialty, often branded products where we may want to have a high-end shopping experience.
In the top right quadrant are Unique are shopping events where we want to compare many items for uniqueness and self-expression; higher-end furniture, clothing and accessories.
In the bottom right we have Artisan products, many of which are probably fresh food. Artisan products may also include less expensive items that we could comfortably buy online (cheese, produce, flowers, stationary, used books, even) but where in-person shopping offers a fun excursion.
Here are some product examples plotted onto the diagram:
There we have it; a conceptual framework which can help us evaluate consumer products and shopping in the context of current, omni-channel retail world.
To read more about these ideas and how brands, retailers, restaurants and retail real-estate companies can use them to refine and focus their business models, read my new book, “The Future of Omni-Channel Retail: Predictions in the Age of Amazon”.
And again, read the Retail Dive survey about online and offline shopping behavior.