Consumer Behaviour & Retail Research
Introduction
• Consumers have wide choice• Retailers- who understand the needs and wants of the
customer- are successful• Many variables to identify and understand the retail
consumer• Retailer that integrates the above information is able to
achieve profitability• Thus retailers need to research on their customers – who,
and why for a decision• This data can be used to select the target market and
integrate it into RIS- Retail Information system
Consumer information- four parts
• Demographics• Psychographics• Geographics• Behavioristics
Demographics• Statistics about any given population base• These variables are used to help retailers about selecting better
target markets/segments for business• Retailer can use this data to help forecast product/service sales• and to develop better communication with customers• Includes data on population sizes,no of households in a given
market area,household sizes,income levels,education,gender age occupation etc
• Most popular method and easiest to obtain• Alone may not be enough but when tied to product buying
situation- leads to info about consumer preferences• Most common- age ,income,ethinicity
Psychographics
• Refers to lifestyle analysis• Provides insights into what consumers do• includes info on activities,interests,and
opinions• utilizes also VALS
Geographics
• helps to find out where the customers are located
• divided into separate geographic area• Nation,state,region etc
Behavioristics
• Subdivided into retailers current or potential markets based on buying responses,product usage pattern,product/store loyalty
• Develop user profiles and their responses to retail mix elements
• Eg 80-20 rule
Consumer behaviour
• Relates to how consumers buy products• Reflects to the totality of consumers decisions
wrt to acquisition,consumption,disposition of goods services etc
• Clear picture will help retailer to understand how to increase sales
• How they make purchase decisions- which store to enter and which merchandise to select
Consumer decision making process
Problem awareness
• Consumer buys only when he is aware of the need• Problems are associated with unsatisfied consumer
need• Need recognition – conscious and subconscious• Eg exam and textbook, food retailing• Need to study needs to formulate as to why a
consumer buys from a particular outlet• never fully stated• Need to develop better understanding about customer
motivations
Information search
• Next step after problem recognition• Consumer will search for information to solve the
problem• Depending upon the time,effort and cost associated –
info search may take long or short time• Internal search- based on experience• External search- find out info• Thus retailers need to provide info about itself so that
the consumers are aware when they attempt to satisfy needs and wants
Alternative evaluation
• After search and gathering all information to solve, the consumer must make the decision for best alternative
• If routine- less time• If new- long term phase- for this phase,
retailer must supply all info and prove that how he can satisfy the needs and wants
Purchase
• Actually purchases or does not purchase the product
Post purchase evaluation
• if consumer is happy- he will make further purchases
• If not happy- will make reevaluation• Customer service is important in this phase• Happy customers- positive word of mouth
advt• Cognitive dissonance: consumers doubt about
products – research and customer feedback
In store decision making process
RETAIL INFORMATION SYSTEMS AND RETAIL RESEARCH
RIS
• Data: News facts and figures which are unorganized • Information: A meaningful body of facts organized
around any topic• Once raw data is gathered and organized- retail
information results• Retailers managers need to inform themselves with
sufficient information to make decisions possible• Data used- from customers, the marketplace, the
retail environment, employees and competition
RIS
• A method for systematically gathering, analyzing, storing,utilizing valuable retail information and data
• facilitates the process of finding solutions to problems• The process of collecting, organizing, analyzing, disseminating
data relating to particular area is called as Market research• can be high tech or low tech• could be used in almost all areas of operation• Generally accessible to all users but specific enough to
generate solutions to any retail problems• RIS – could be used among store groups,vendors,internal
buyers,planners,dc
RIS
• Could be used in Supply chain mgt• Data warehousing• Distribution • Pricing• Merchanidising• IMC• Product acquisition• Strategy
RIS
Inputs-Mission--Vision- Objectives- Situational analysis- Environment scanning- strategic plans
Processes-Data collection and interpretation- Control of information
SystemsData
storage ,retrieval and updates
Outputs Data dissemination
to internal and external public
Benefits of RIS
• Development of an effective RIS helps to ensure that the system is fully integrated into the overall retail management plan
• Effective RIS- allow for continuous data updation• Necessary to be competitive in todays retail
environment• Use RIS to access data regarding which items
have the highest turnover rates and where EOQ items have to be ordered
RIS- facilitators
• Universal Product Code (UPC): Used along with a optic scanner to read the bar code and gather the particular data
• A barcode which stores all pertinent product information• Quality of codes is important : unscannable, erroneous-
concern- additional expense for improper information fed into an RIS
• A typical UPC has a company identifier,specific SKU built into it
• US and Canada- 12 digit• EAN 13 EAN 8
RIS- facilitators• Point of sale terminal (POS) • Data from UPC collected and sent to centralized location for analysis• Used by managers to make decisions regarding
inventory,merchandise advt,accounting,planning etc• POS – another facilitator in RIS• A computer workstation designed to collect info from sale of
products or services• Each workstation has optional peripherals- barcode
readers,scanners,invoice printers,magnetic card readers. Can be fixed ,handheld or both.
• Effective in providing data to generate retail information• RFID
RIS- facilitators
• Self checkout systems: A format in which shoppers scan,bag and pay for their own purchases
• Outsourcing: certain expertise
MARKETING RESEARCH
Marketing research
• Research conducted to identify and define marketing opportunities and problems, generate, refine and evaluate marketing actions, monitor marketing performance and improve understanding of marketing as a process
Marketing Research process
1. Formulate the research problem2. Conceptualize a research design3. Create a data collection instrument4. Select a sample5. Write the research proposal6. Data collection7. Analysis and interpret the data8. Conclusion
Formulate the research problem
• looks for cause• Formulate the research problem• Internal/External• Clearly define the problemResearch design:Depends on the type of data to be collectedCan be observationSurveyStudyIt is a guide for the entire process