Research Reinvented

Joel Rubinson of the ARF does Willie and Waylon and goes a little outlaw on the future of research here.

Good stuff.

Good Stuff from Unilever on Shifts in Shopper Behaviour

Great presentation from Unilever via Retailwire on actual changes in shopper behaviour due to recession in the US.

The seven distinct patterns of CPG shopping give a good framework to understanding category shifts and avoiding generic "consumers are cutting back on ...." concepts.

Why is social media called "media"?

Looking up "definitions of media" on Google I find many different ones. But they all have the same tone and talk about "Messages that are distributed"..."means of providing information and instructions"..."transmission tools".

Which makes me wonder why people call social media, "media". Nobody is distributing or providing anything. People are just talking to each other.

No wonder marketers are scratching their heads. They've been told this thing is "media" when in fact it isn't. But they're trying to understand why they cannot broadcast through it.

I think I'm a bit late to this. But this blog is about shopping.

Shopping and Dopamine

I am really enjoying the latest book by Jonah Lehrer : "How We Decide" (an excellent kind of Idiots Guide to neuroscience and decision-making).

I have also been reading his blog on neuroscience that has a few posts on shopping and the brain.
Essentially the act of shopping is pleasurable because when someone is seeing something they desire the nucleus accumbens (NAcc) floods the brain with dopamine. This is what urges people to buy.

This is essentially why sadness increases the likelihood of purchase. Shoppers attempt to offset sadness by increasing this pleasure. And this is why shopping, like gambling can be addictive.

Increasing desire is a basic function of all marketing and retailing. And many marketers and retailers understand that anticipation is an important element of the shopper or consumer experience. Again, the actions of the brain guarantee this. The most intense NAcc activity is not during consumption or after purchase but before purchase. Once an item is acquired the shopper is likely to experience 'dopaminergic adaptation' so the rate of NAcc activity decreases and pleasure declines. This is one of the reasons that the shopper can feel a sense of regret after purchasing.

Of course this is not just about shopping. The Buddha observed the same nature of desire - hence his pronouncement that trying to fulfill desire is like trying to slake thirst with salt water (or something like that).

It is fairly obvious that desire drives the urge to shop. But as I have noted before, this desire is mitigated by the hip-pocket nerve - or in neuroscientific terms, the insular cortex. Just as the NAcc makes the shopper feel good when the item is anticipated, the insular cortex delivers feelings of fear when the price is introduced.

Jonah Lehrer's conclusion is that retailers need to mitigate the sense of loss that activates the insula cortex. Of course that's what salespeople have been attempting since time began. I realise he is not entirely serious as he ventures out of his area of expertise into marketing and retailing but blunt discounting is one way but certainly may not be the most effective way - or the most profitable.

Neuroscience and behavioural economics certainly shed light on shopper behaviour. Although the conclusions are hardly earth shattering for marketers or retailers - who know all too well that increasing desire and decreasing reluctance to buy is their job. What it does show us is how much of the shoppers' evaluation is 'non rational'. It was previously assumed that desire was somehow 'emotional' and resistance was a rational function of careful evaluation. As a result, brand marketing was given the task of increasing desire through emotional messages and retailing then attempted to cater to the shoppers' 'reason'. In fact both are 'emotional' - and that does have implications for shopper marketing and retailing in general. More on that in the next post...

Bad Reporting

This article from Ad Age is bouncing around. The headline "Trouble in Store for Shopper Marketing?" is really misleading.

Firstly, "shopper marketing" does not just refer to "in store marketing" or POP. Secondly, even it it were, the fact that impulse purchasing is declining does not make it less important, it probably makes it more important. And certainly the fact that people are putting more thought into their purchase decision does.

But the biggest mistake is the notion that the economy is having dramatic impact on the fundamental nature of consumer decision-making. Unless it is overturning the result of evolution on the human brain over the last million or so years.

Synovate Aztec to Challenge AC Nielsen in Canada

Synovate Aztec have been looking at the Canadian market for some time. Their seriousness at mounting a challenge to AC Nielsen's Marketrack has been confirmed by the announcement that they have just hired Dave Mann - who was, until recently Sr. V.P. Marketing & Sales at Nielsen.

IRI looked at the Canadian market in the 1990's and succeeded in forcing Nielsen to remove exclusive contracts that prevented retailers providing transactional data to anyone else.

They eventually were unable to create an alternative to Nielsen's service in Canada. It was reported that they did force Nielsen to improve their service at the time in response to the challenge.

We'll see the result of Aztec's challenge. It comes at an interesting time as Nielsen recently recently restructured in Canada, letting go of a large number of staff.

Whatever happens it'll be fun to watch. These guys are not friends.

British Retailers - A nation of shopkeepers

Tim Mason, Fresh & Easy's CEO, recently said that Tesco overerstimated the power of retail brands in the US when they launched. "There's less loyalty in the American market. A Brit has to hear it a few times before you accept that people make up their mind where to go each week when they check out the special offers round the kitchen table."

This doesn't surprise me. American retail brands have always been hampered by fragmentation of the market. And by the fact that their owners didn't see them as brands. Hence the surprise at the recent growth of private label brands - a development that is well advanced in Europe - where a store brand is often seen as superior to a national brand.

I have worked for French, British, Canadian and American retailers (including Tesco) and the Brits are always more likely to see their store as a brand and employ brand marketing thinking to promote it. A nation of shopkeepers indeed. Tesco were probably among the most advanced. No surprise that they misread the American market.

Tesco is now backtracking on those statements.