Press release -
Meet the Hybrid Consumer
Meet the Hybrid Consumer
Here’s the thing;
consumers are not rational. They are complex individuals who switch between
letting their economic sense and their heart decide what to spend their hard
earned cash on. In a report from May 2013, the Dutch investment bank Rabobank
gave this kind of consumer a new name: the hybrid consumer; a consumer that is
putting the retailers at risk of ending up in the squeezed middle; which is
what is happening to many of the big retailers now.
Let’s use Tesco as an example. Originally the pioneer in
food premiumisation, Tesco launched their Finest range in 1998, giving the
consumer easy access to affordable premium products whilst shopping for their
everyday groceries. The black, cream and silver coloured packaging with the
exclusive font, elaborate descriptions and engaging stories behind the products
reassured the buyer that these were products worth paying extra for. No need to
go into small, independent specialty shops anymore – all could now be found in
one place.
With the retailers expanding their ranges to include premium
food products as well as clothing and home ware, the small retailers started to
struggle and lose their market share. Convenience dominated the market and the
busy modern family could now buy all they needed in one place; the superstore.
Or, if they wanted to make a day of it - the retail park.
So why is it that Tesco and the rest of the ‘Big Four’ are
losing market share, if all the consumer wants is convenience? With so much
choice comes the liberty to pick and mix across retailers and price points.
Convenience is therefore no the longer the USP that sets retailers apart –
especially not in the middle of a recession; value for money, on the other
hand, is.
With the recession came the need to find new ways of feeding
the family without breaking the bank. Although initially, few felt like being
seen with an Aldi or Lidl shopping bag, discount retailers began to gain
popularity and slowly the consumers started realising that they could have their
needs met both in terms of choice and quality – and at a much lower price.
What does this mean? It means that for everyday staples such
as, toilet paper, some toiletries and cleaning products, the consumer will
happily go to a discount retailer or one of the £1 stores that keep popping up
on the high street, thereby saving a lot of money on the things their guests
are very unlikely to see or comment on in their homes.
It also means that the money freed up from ‘going discount’
on a large number of everyday products leaves the consumer with extra resources
to go all in for indulgence and special occasion treats. Here the big four are
yet again losing their market share – this time to the more high-end retailers
such as Waitrose and M&S….and on the plus side, consumers feel more
comfortable putting premium products on the table rather than showing their
guests that they have gone to Tesco or Asda to shop for their visit. We are
what we eat – and that includes the brand images of the products we eat.
The fact is that even though consumers are more brand-aware
than ever before they are also decreasingly loyal to brands. Not because they
don’t want to be loyal, but because supply is so massive and choice is many and
varied. Re-gaining market share is therefore not only about matching prices
with the competition or having outstanding offers on; it’s equally about
connecting with the customers at an emotional level. Without the emotional
connection, customer loyalty will only last until someone offers a lower price
than yours.
Topics
- Data, Telecom, IT
Categories
- retail
- consumer
- shopper
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