A recent study by GroupMNext and Compete indicates that "there are six distinct segments of consumers who exhibit similar behaviors and intent." The thread that ties these similar behaviors together is that they are all completed online. In other words, these segments all represent digital consumers (i.e., "consumers who utilized digital at least once in their purchase pathway"). ["The 6 Types of Digital Consumers and Their Paths to Purchase," by Tyson Goodridge, Compete Pulse, 30 May 2013] The six types of digital consumers are:
- "Basic Digital Consumers: These are not highly digital users. They are comfortable with Internet shopping and research, but they are not mobile or social and have the second-highest likelihood of buying offline.
- "Retail Scouts: These consumers have short journeys and prefer retail sites to brand sites. They use mobile, but are twice as likely to use it in the home as out. They are comfortable buying online but did not express a preference between online and offline.
- "Brand Scouts: Brand Scouts are the spiritual partner to the Retail Scouts except instead of having a favorite retailer, they have a favorite brand. When asked, 72% said they start their journey with a brand in mind.
- "Digitally Driven Segment: They use every digital tool at their disposal. They use social and mobile more than any other segment in the study, value convenience above all else and they do everything in their power to avoid physically going to a store. The Digitally Driven exist in good numbers already, but within five years this will be the dominant segment of consumers.
- "Calculated Shoppers: These shoppers seem to know they are going to make a purchase, but they are deciding which brand to choose. They are similar to the Digitally Driven Segment, but have no urgency to their purchase and they’re willing to take the time to get the best deal.
- "External Shoppers: These are non-mobile shoppers. They want the answers to, 'Should I buy?', 'What do I buy?' and 'What brand do I buy?' – all at the same time. These shoppers have no urgency to make a purchase and they do their research on desktop and laptop computers."
Just from reading those descriptions you should realize that there is no single path to purchase for the digital consumer. In fact, the study concluded that for External Shoppers there can be as many as three dozen steps involved in their path to purchase (see the image below).
The important thing for manufacturers and retailers to understand is that the digital consumer can jump on and off the path to purchase at any point. That means that they must provide a good touchpoint (i.e., a good experience) at every one of the jump on/jump off locations. Aaron Baar explains, "Omnichannel marketing is making the path to purchase so complicated the linear funnel model is obsolete. Today's consumer journey is more like an infinite loop, where shoppers are always discovering, considering and buying via multiple channels. So keeping them engaged is an ongoing process." ["The Funnel is Dead, Long Live the Loop?" Digiday, 25 July 2013]
Simon Van Wyk believes that the best way to ensure that consumers have a good experience all along their digital path purchase is to think like a customer. ["Thinking like a customer: the value of customer journey mapping," Marketing, 26 August 2013] He writes:
"Customer journey mapping and experience design are among the most powerful tools marketers can use for innovating and meeting customer expectations – allowing diagnosis of customer experience issues and formulation of innovative and differentiated brand experiences – but retailers are failing to come to grips with the modern shopper's path to purchase."
One mistake that Van Wyk believes too many companies make is lumping "mobile" technology marketing into a single category. He notes that recent reports indicate that consumers use smartphones and tablets for different reasons and in different contexts. That means that marketers need to design their approaches for those platforms differently. There is one way in which smartphone and tablet users are similar – they both prefer using their devices at home. Van Wyk explains:
"According to Nielsen, more than two-thirds of US smartphone shoppers and four out of five tablet shoppers use their devices most frequently in the home, often with one eye on the TV. So even though smartphones and tablets offer the convenience of shopping on the go, it seems like the vast majority of tablet and smartphone shoppers who make a purchase with their device prefer the comfort of their couch while they shop."
The big difference between smartphone and tablet users, Van Wyk reports, is that users of tablets are more likely to make purchases than users of smartphones. He writes:
"When it comes to actual purchasing, eMarketer says there's a stark contrast between the behaviour of smartphone owners and their tablet owning counterparts. Nearly 71 million tablet owners will make purchases via their device this year, compared with 53 million buyers using smartphones. This distinction is critically important and highlights why marketers need to think like a customer."
Yaakov Kimelfeld, Chief Research Officer at Compete, agrees with Van Wyk that mapping the consumer's path to purchase is important. "The explosion of digital channels," he writes, "the always-on media ecosystem, and the increasingly mobile consumer challenge even the savviest of digital marketers with the simple question: how can I reach the right consumer, at the right time, in the right place, and with the right message to influence his or her purchase decision? There is a way, and this time, it's the marketers (not the consumers) making the crucial decisions along the consumer path to purchase." ["Marketers Can Map the Consumer’s Journey To Purchase," Compete Pulse, 8 May 2013] Like Baar, Kimelfeld believes today's digital path to purchase is best represented by an eternal loop. "Consumers are all over the place," he writes. "It only takes a click to embark on a journey away from the brand – but it also only takes a single click to come back. Consumers can come 99% of the way towards the conversion, but then regress back to researching, simply because it’s easy to do." He concludes his article with three recommendations about how to map a consumer's digital path to purchase:
- "Start from the lowest common denominator – an individual consumer's path to purchase – and build from the bottom up. Each individual path is different, but the combinations are not infinite. A deep, hard look into the data trail consumers leave behind and a meaningful summarization can and should be attempted by any company interested in how their consumers really arrive at the purchase decision.
- "Cluster around behavioral variables. Ad exposure, search queries, visits to the brand website, visits to competitors, repeat visits, reading reviews, visits to aggregator stores, and purchase reviews are all typical touch points that consumers encounter on the way to purchase.
- "Extract the commonalities found in individual paths and identify a manageable number of distinct behavioral patterns. Every brand is different, but in our experience three to seven paths are sufficient to describe consumers in their progress towards the conversion and easy enough for a marketer to craft separate messaging strategies. This helps to engage consumers with the right message and impact the decision process at the right time. Keep a close eye on marketing costs and isolate the digital paths that are driving the most ROI for the business – then steer consumers towards them.
"This data mining approach allows marketers to extract prevailing path characteristics of their consumers and brands, and by revising their marketing strategies, influence consumers' actual journeys toward the purchase."
Understanding the digital consumer's path to purchase will become even more important as billions of new consumers in emerging markets begin shopping online. For most them, smartphones will be their primary access to online purchases. For more on that topic, read my post entitled The Growing Power of the Digital Path to Purchase.