Losing the Impulse

They are called impulse purchases and they are dying out across the retail landscape. The reason is fairly simple. Consumers, motivated by tighter budgets, are much better informed about exactly what they are looking for and go to the store with a firm plan and stick to it. A recent story on Bloomberg.com has several tags for this shopper behavior. But whether you call it surgical shopping, mission shopping or shopping like a man, the behavior is engrained and is a direct threat to traditional retail principles.

As the story points out, many retailers have thrived on the strategy to get shoppers into the store and then up-sell them on things they did not intend to buy. But the presence of online shopping, ironically put in place by the retailers themselves, has trained the consumer to focus their wants and needs. That behavior has spilled over to the bricks-and-mortar side of retailing.

Impulse sales require consumers to browse the floor. But mission shoppers visit fewer stores and spend less time in the store. The story quotes a ShopperTrak statistic that says shoppers now visit three stores per trip versus five before the recession. Another telling stat from NRF says that although retail sales grew 3.5 percent last year, store traffic declined 0.5 percent. Historically, traffic and sales growth move in tandem.

Retailers responded to down economic times by cutting back on store upgrades and reducing sales staff. This further drove consumers to the web and further entrenched the behavior. The evidence points to the consumer being farther ahead of the retailer at this point and the retailer is playing catch-up.

There are many examples of how retailers are combating this challenge and they all involve making sweeping changes in-store. If consumers really are on a mission, the retailer has to make sure that the product is in-stock and on shelf or risk losing the shopper altogether. In-store events are becoming a more prevalent tool for retailers to retain consumers longer and enhance the shopping experience. Samples and demos grab their attention for just a few more moments, but they are important moments. Departments and sections are being realigned to put complementary products in the path to purchase.

All of these activities require labor in a time when retailers are cutting stores and store staffs. At-retail merchandising and marketing service companies not only deliver these services, but they do so with trained, expert in-store personnel. This variable cost model allows manufacturers and retailers to play catch-up without acquiring any more fixed costs and provides sales lift at the same time. A third-party, outsourced solution at-retail is more important than ever.