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Transforming outdated stores: a strategic marketing investment

Remodeling retail stores boosts sales to new customers by almost 50 percent new research from Monash University has found. According to a report by Marketingmag.com.au, the study, conducted by Tracey Dagger and Peter Danaher of Monash University’s department of marketing, found that after remodeling the retail environment, sales to new customers increased by up to 44 percent, while sales to existing customers increased by 7 to 10 percent. These additional benefits persisted for at least a year following the remodel.

Other findings included:

  • new customers to the remodeled stores increased from 13 percent to 17 percent;
  • new customers visited the remodeled stores 16 percent more than before; compared with a 2 percent increase for existing customers; and
  • new customers increased their spending by 14 percent, whereas existing customers did so by 7 percent.

 

New customers had much higher perceptions of the remodeled stores’ retail environments shopping (including atmosphere and layout), service quality and customer satisfaction than existing customers. But the study found no difference in short-term behavioral intention.

Dagger recommended that managers view store remodeling as a strategic marketing investment rather than “a necessity to endure.”

“The in-store experience continues to have high relevance; retailers must keep their appearance modern, fresh and in line with that of competitors. The look, feel and mood of a firm’s retail or service environment are unique and crafted purposefully to contribute to the brand and ultimately, its profitability,” she said.

On average, retailers remodel their stores every seven to 10 years.

The researchers collected information at two different retail stores before and after remodels in order to draw their conclusions.

Study one looked at an equipment retailer and service provider in a worldwide industry worth $100 billion annually. Its store remodel involved moving the retail servicescape into a previously unused area of the store including opening the store via a different door. It took about one month to complete.

Before the remodel, immediately after and 12 months after, customers to the store were given surveys to complete either in-store or return via postage paid envelope. 1666 customers were surveyed.

The second study looked at a large department store in a shopping mall of a major metropolitan city, with combined annual sales of more than $3 billion. This store’s remodel was much more significant than the first, as was its data collection method.

The store’s outdated decor underwent an eight-month transformation including a redesigned store layout, new lighting, floor coverings, decor, furniture, fixtures and fittings, upgraded fitting rooms, parents room and employee areas, redecorated and painted walls and ceilings, remodeled kiosks and retrofitting heating and air conditioning systems.

The study also compared another of the retailer’s stores as a control store, since the remodel caused significant disruption to the store during the eight months and to account for external factors including seasonality, advertising and promotions. The control store was in a similar suburb, of a similar outdated condition, with similar products, sales and customers.

Rather than handing out surveys to collect a sample, the study used data from the retailer’s loyalty program, of which 70 percent of customers are a member, to collect a census of all transactions 12 at both the treatment and control stores for 12 months before remodeling, eight months during and 12 months after (May 2010 to December 2012).

 

Posted in Brand and Image Research, Consumer Research, Data Collection/Field Services, Retailing, Shopper Insights | Comment

Photo recap from Cocktails with Quirk’s in Boca Raton!

We’ve had a blast hosting Cocktails with Quirk’s, a series of free events for researchers to network with their peers in a casual, comfortable environment. Our next party will be on Monday, February 23, in the New York Marriott Brooklyn Bridge Expo Hall after the first day of The Quirk’s Event.

But before we jump into 2015, we wanted to share some photos of our Boca Raton, Fla., event, which took place at the Biergarten on October 20th in conjunction with The Market Research Event.

Many thanks to Nelson Davis of AIP for photographing the event. Click here to view the rest of the photos.

 

Cocktails with Quirk's Cocktails with Quirk’s

 

 

 Cocktails with Quirk’s Cocktails with Quirk’s

Posted in The Business of Research | Comment

A little holiday humor

Quirk’s would like to wish you and yours a happy and safe holiday season.

Santa MR

Posted in The Business of Research | Comment

New study shows Millennial support for expanded Thanksgiving Day shopping hours

A recent LoyaltyOne research shows there are three kinds of American Thanksgiving Day shoppers:

  • fifty percent who say all-day  retailers' sales flyers and brochureshopping hours on Thanksgiving Day are a bad idea that detracts from the traditional celebration;
  • thirty-three percent who say stores being open all day Thanksgiving is a great idea that provides more time for holiday gift shopping; and
  • seventeen percent who can’t make up their mind.

 

In the all-important Millennial demographic (ages 18-34), attitudes about stores being open all day on Thanksgiving shift dramatically compared to the general population (ages 18-55+). No less than 50 percent of consumers age 18-24 say all-day shopping on Thanksgiving is a great idea. That support dropped only slightly to 48 percent in the 25-34 year-old age group.

Iconic retailer Macy’s plans to launch Black Friday shopping at 6 p.m. on Thanksgiving evening, which is down from 8 p.m. last year and from midnight in 2011. Other leading retailers are following suit and even one-upping in the case of JCPenney’s 5 p.m. opening. Against this backdrop, LoyaltyOne, a global provider of loyalty marketing services and customer analytics, obtained opinions on extended Thanksgiving Day shopping hours from 1001 U.S. consumers in a nationwide survey taken in October 2014. The consumer views provide a window into the likelihood that all-day holiday shopping on Thanksgiving Day will become a reality.

“Savvy retailers put the customer at the center of all their decisions,” said Fred Thompson, LoyaltyOne retail practice leader. “Although opening on Thanksgiving Day may lead to incremental sales that day, retailers could risk upsetting their most loyal customers who routinely shop their stores year-round. Retailers should identify who their best customers are and respond with Thanksgiving and Black Friday sales strategies accordingly.”

Some other key findings from the research based on various consumer segments include:

  • thirty-seven percent of men say being open all day on Thanksgiving is a great idea, compared with twenty-nine percent of women;
  • sixteen percent of consumers age 55 and older say that open all day on Thanksgiving is a great idea; and
  • forty-percent of consumers in the South say all-day store hours on Thanksgiving is a great idea, compared with 32 percent in the West, 29 percent in the Midwest and 26 percent in the Northeast.

 

LoyaltyOne’s nationwide survey of 1001 U.S. consumers on extended Thanksgiving Day shopping hours has a margin of error, which measures sampling variability of +/- 2.6 at the 90 percent confidence level.

Posted in Advertising Research, Consumer Research, Customer Satisfaction, Demographics, Public Opinion/Social Research, Retailing, Shopper Insights | Comments Off

New study shows the significant role of promotions in driving sales

RetailMeNot, Inc., which operates the world’s largest marketplace for digital offers, released the findings of a November 2014 study it conducted using Google Consumer Surveys. The study, which also includes other third-party research, unveils the six stages of the consumer shopping journey and demonstrates how promotions have a significant impact at each stage along the way. Promotions are shown to impact decisions including when and where to shop, how much to spend, what to buy and whether or not a shopping cart is abandoned. Additionally, the study reveals how retailers are able to drive results by leveraging promotions and distributing them via marketing channels like RetailMeNot.

“Research continues to reiterate the positive impact that promotions have on both consumers’ decision-making process when considering a purchase and in helping retailers achieve their revenue goals,” says Michael Jones, SVP of Retail and Brand Solutions at RetailMeNot, Inc. “By leveraging RetailMeNot’s marketplace platform, retailers win by increasing customer loyalty, building brand affinity and driving incremental sales both online and in-store.”

Promotions trigger both in-store and Online Shoppingonline purchases

Of those who are deal seekers, promotions triggered in-store purchases for 91 percent of shoppers. Similarly, 89 percent of deal seekers said a promotion triggered an online purchase.

Promotions have an impact on consumers’ decisions on where to shop and what to buy

Of online shoppers who use promotions, 82 percent sometimes, frequently or always consider promotions when planning what items to buy, and 81 percent sometimes, frequently or always consider promotions when planning where to shop.

Additionally, consumers reported using promotions to plan purchases in advance. Nearly three-fourths (74 percent) of in-store shoppers and 66 percent of online shoppers said promotions were used to help plan a trip to the store several hours, days, weeks or more prior to making a purchase.

Promotions help reduce shopping cart abandonment

Consumers most often abandon shopping carts due to cost-related reasons. Survey data shows that 78 percent of cart abandoners have sometimes, frequently or always looked for a promotion before abandoning their cart over the past year, and 68 percent have sometimes, frequently or always used promotions to return to their abandoned cart and complete their purchase.

Post-purchase, promotions positively affect loyalty, brand advocacy and the likelihood of future purchases

Sixty-eight percent of consumers are more likely to be loyal to a brand that offers online coupons or promotion codes; 68 percent are likely to tell a friend about a company that uses online coupons or promotion codes; and 50 percent are more likely to buy a product or service at full price later from a company that offers online coupons or promotion codes.

Promotions drive incremental revenue for retailers

Retailers have much to gain from the steady demand for promotions by consumers. Based on the analysis of a third-party, one department store retailer with thousands of locations across the United States found that on transactions involving a RetailMeNot coupon, 18 percent of total coupon sales were incremental. Additionally, RetailMeNot customers spent and visited the retailer, on average, 30 percent more than non-RetailMeNot customers. The same retailer also found that customers who go in store for the first time with a RetailMeNot coupon increase their spend over the subsequent six months by 52 percent.

Access the full study for more information.

Methodology

The findings of the study are based on four surveys conducted using Google Consumer Surveys between August 22, 2014, and August 29, 2014, among a sample of the U.S. adult Internet population. The survey about the online shopping journey reached 1,107 online shoppers among 3,506 initial respondents. The survey about the in-store shopping journey reached 1,110 in-store shoppers among 2,686 initial respondents. The survey about online cart abandonment reached 1,064 online cart abandoners among 3,297 initial respondents. The survey about in-store cart abandonment reached 1,149 in-store cart abandoners among 1,641 initial respondents (Percentages may not total 100 due to rounding).

 

Posted in Consumer Research, Market Research Findings, Online Surveys and Research, Retailing, Shopper Insights | Comments Off

Pre-Halloween infographic: It’s all about the candy

As consumers load up on the best candy for this year’s round of trick-or-treaters, they may be focusing in on brands highlighted by a recent study on the most influential candy brands on Twitter.

StatSocial analyzed the followers of the largest candy brands on Twitter to provide the demographic and lifestyle information about these users. StatSocial founder and CEO Michael Hussey explained that the study gathers this information from public sources like Twitter and 60+ other social sites, including blogs, to understand who they are and what they like.Candy Brands Ranking

Posted in Consumer Research, Retailing, Social Media and Marketing Research | Comments Off

‘Key life moments’ spur Millennials to use public libraries

Earlier this month my co-worker handed me an article discussing the results of a recent Pew Research Center Internet Project study titled “Millennials still checking out public libraries.” A proud member of the “me” generation and public library advocate, the title was all the convincing I needed to read on. The article reports on the study’s latest work, which pulled together research on the role of libraries in the lives of Americans.

The overall consensus: Millennials still frequent libraries. As a group, Millennials are just as likely as older adults to have used a library in the past 12 months. The study points out that the reasons Millennials engage with public libraries are often based on “key life moments such as having a child, seeking a job, being a student and going through a situation in which research and data can help inform a decision.” This really rings true for me. I associate libraries with many specific life moments: group projects in high school, resource papers in college and job searches using the free Wi-Fi in my early 20s.

The study also reports that Millennial Americans are more likely to have read a book in the last year than those 30 years old and above. As a member of a seasonal book club (members all under 30) I wasn’t surprised to find that my peers are reading. The survey results I did find surprising? Sixty-two percent of Americans under 30 years old agree that there is “a lot of useful, important information that is not available on the Internet.” By comparison, only 53 percent of older Americans said they believe that. Apparently my technology-loving peers are looking up from their screens more often than I thought.

The report calls younger Americans’ engagement with public libraries “complex and sometimes contradictory” and it is easy to see why. Millennials may frequent libraries and find value in resources outside of the Internet but they do not place a high priority on libraries. Only 19 percent of Millennials surveyed say their library’s closing would have a major impact on them and their family, compared with 32 percent of older adults.

Check out the full report here and let me know your thoughts in the comment section below!

Posted in Consumer Research, Market Research Findings | 1 Comment

Americans to spend more on spooky traditions

Editor’s note: The complete NRF 2014 Halloween Consumer Spending survey can be accessed here.

Ready … set … scare! According to National Retail Federation’s (NRF) Halloween Consumer Spending Survey conducted by Prosper Insights & Analytics shows that more Americans than ever are planning to purchase costumes. More than two-thirds (67.4 percent) of celebrants will buy Halloween costumes for the holiday, the most in the survey’s 11-year history. The average person will spend $77.52 this Halloween, compared to $75.03 last year. Total spending on Halloween this year will reach $7.4 billion.*

Halloween is currently one of the fastest-growing consumer holidays. Party-goers will splurge on spooky and fun garb to wear this year as $2.8 billion will be spent on costumes overall with $1.1 billion on costumechildren’s costumes and $1.4 billion on adult costumes. Costumes for furry family members will also be high on the list, with Americans planning to spend $350 million on pet costumes.

Candy and greeting cards alike will be popular items this season, as consumers will spend $2.2 billion on candy this year and 35.9 percent of people will be sending Halloween greeting cards. With Americans planning to spend $2 billion on decorations for the frightful holiday, life-size ghosts, pumpkins and festive décor will be aplenty on lawns and doorsteps throughout the country.

Consumers will celebrate the holiday in many different ways, but topping the list of planned activities is handing out candy (71.1 percent), while others will decorate their homes and yards (46.7 percent), and dress in costume (45.8 percent). One-third of Americans will throw or attend a party (33.4 percent), which is up from last year (30.9 percent).

Much like last year, consumers will hit the stores and the Internet early to get the first pick of costumes and candy. According to the survey, nearly one-third of celebrants (32.1 percent) say they will start their Halloween shopping before the first of October. And, while 43.3 percent of celebrants kick off their shopping in the first two weeks of October, 24.6 percent will wait until the last minute and shop the last two weeks of October.

More consumers turning to social media

While the bulk of Americans will look for costume inspiration online (34.2 percent), in a retail store or costume shop (33 percent), Pinterest is a growing source of inspiration this year. The survey found 11.4 percent of Americans will turn to Pinterest for costume ideas, up from 9.3 percent last year. Young adults will drive the most Pinterest traffic: 21.2 percent of 18-to 24-year-olds will turn to the popular site for ideas, as will 21 percent of 25- to 34-year-olds.

For some consumers the U.S. economy is still top-of-mind. According to the survey, 18.8 percent say the state of the U.S. economy will impact their Halloween spending plans. Specifically, nearly two in five (19.7 percent) of those impacted will utilize their creative skills and make their own costumes rather than buying a new one this Halloween.

NRF’s 2014 Halloween Consumer Spending Survey was designed to gauge consumer behavior and shopping trends related to Halloween spending. The survey was conducted for NRF by Prosper Insights & Analytics. The poll of 6,332 consumers was conducted September 2-8, 2014. The consumer poll has a margin of error of plus or minus 1.3 percentage points.

* The total spending figure is an extrapolation of U.S. adults 18 and older.

Posted in Apparel, Consumer Research, Public Opinion/Social Research, Retailing, Social Media and Marketing Research | Comments Off

Buyers or sellers: Who is driving customer-to-customer Web transactions?

Editor’s note: All quotes come from a University of Michigan Ross press statement. Puneet Manchanda’s working paper can be viewed here.

As Chinese e-commerce firm Alibaba prepares for what could be the biggest IPO in history, University of Michigan Ross School of Business professor Puneet Manchanda has dug into its Taobao Web site to help solve a lingering chicken-and-egg question.

Taobao.com is the world’s largest customer-to-customer shopping site, with nearly 500 million users and more transaction value than Amazon and eBay combined. The buy sellcompany gave Manchanda access to its data to help answer a question: Who drives the growth that results in higher transactions – buyers or sellers?

It was long assumed buyers were the primary drivers of traffic, but Manchanda’s research showed otherwise. His working paper with Junhong Chu of NUS Business School in Singapore reveals that sellers are the ones who get the ball rolling. The finding has implications for how companies like Taobao that set policies for buyers and sellers.

“There’s very little information on these platform markets, and it’s not clear that companies know which side is more important when they’re doing the matchmaking,” says Manchanda, Isadore and Leon Winkelman Professor of Marketing. “It’s difficult to get information right from the site’s beginning to study this cross-network effect – how buyers affect sellers and vice versa – but Taobao gave us the data because they wanted to know.”

The prevailing wisdom that buyers were more important for driving traffic comes from the belief that it’s buyers who have the money to spend. But the research showed those buyers won’t come if a Web site doesn’t have enough to sell.

Manchanda’s and Chu’s analysis revealed that the cross-network effect of a seller – the probability that it induces a buyer to join – is 3.5 times that of a buyer inducing a seller.

The finding can affect how companies set policy and promotions. For example, some policies will become more “seller-friendly” after seeing the results, Manchanda says.

His analysis also revealed product variety is critically important for buyers. That can help companies induce more buyers by fast-tracking sellers who bring something new to the table, he says. For sellers, it turns out that the quality of the buyer base – the number of transactions per 100 buyers – is critical. Based on these results, Taobao started running programs to incentivize dormant buyers to “wake up” and start buying again.

“Taobao is huge and has a virtual monopoly in China,” Manchanda says. “These types of platforms are growing, so being able to study and contribute to this new way of doing business was a big motivation for us.”

 

Posted in Chinese Consumers, Consumer Research, Shopper Insights | Comments Off

NFL fan loyalty drops after Ray Rice scandal

A new survey demonstrates how National Football League fan loyalty is affected by action on and off the field. Fan loyalty in the NFL has fallen from first to third place among major league sports as a result of the Baltimore Ravens Ray Rice scandal according to a new survey. The Brand Keys survey Sports Fan Loyalty Index measures overall professional league loyalty.

football In January 2014, self-classified football fans representing the NFL’s 32 teams rated the NFL first in terms of league loyalty. Survey results taken after the Rice domestic violence case show the fans rating the NFL in third, dropping below Major League Baseball and the National Basketball Association. Loyalty for the Baltimore Ravens team (ranked at number 7 this year) has not been unaffected by the publicity surrounding the Rice video.

The Sports Fan Loyalty Index was designed to help professional team management identify precise fan loyalty rankings in their home and national markets. The survey is based on an apples-to-apples comparison of the intensity that fans within the team’s home market area support their team versus the corresponding values of fans from other teams or leagues. The survey measures on the following components:

History and tradition (33 percent): Are the game and team part of a fan’s community rituals, institutions and beliefs? These include both moral and legal codes of behavior and principals.

Fan bonding (29 percent): Are players particularly respected and admired? (An issue like domestic violence will not only have its effects primarily on this driver, but on an overall basis as well.)

Pure entertainment (21 percent): How well a team plays, wins and losses – but even more importantly than a win to loss ratio, how entertaining is the play?

Authenticity (17 percent): How well do the players work as a team? What’s the offense and defense like? (How does the team – and in this particular instance the league – behaves in a situation like Rice’s.)

Here are the top five and bottom five NFL teams according to the 2014 survey. For comparative purposes, the numbers in parentheses provide the team’s 2013 rankings:

Top five

1. New England Patriots (1)
2. San Francisco 49ers (4)
3. Green Bay Packers (2)
4. Denver Broncos (7)
5. Indianapolis Colts (5)

Bottom five

32. Oakland Raiders (32)
31. Jacksonville Jaguars (31)
30. Cleveland Browns (30)
29. Tampa Bay Buccaneers (24)
28. Dallas Cowboys (26)

Posted in Brand and Image Research, Consumer Research | Comments Off