Shopper Loyalty…No Longer the Natural State of Things

May 1, 2013 by Mark Heckman Leave a Comment

I have often wondered how many loyal, dedicated shoppers there truly are.  I suppose it comes down to how one defines loyalty itself.  One definition could infer that loyalty means displaying a preference for where you shop or what you buy due to a certain set of attributes of  the retailer or the brand you prefer.
In the past, being loyal or having a distinct preference for where you shop was built upon a foundation of several key elements.  These elements included some level of perceived value (comprised of attributes such as price, assortment, service, ambiance, convenience, etc).  Roughly translated, the retailer that did the best job of providing the shopper the highest level of perceived value, received more of your business than others.
Further, being loyal to a particular retailer was the “natural state of shopping and the default position of the shopper”.   This was particularly true with supermarkets as shoppers coveted being able to get as much of their needs fulfilled at single retailer as possible.  To that end, loyalty programs, promotions, assortment, and services simply determined where the inherently loyal shopper spent most of their dollars.
The burning question of the day perhaps ought to be “Is loyalty still the natural state of shopping”?  …..Evidence abounds that it is not.
Data shows that shoppers are spending an increasingly larger share of their requirements on line, and when they shop in the physical store, the number of stores in their “consideration set” is expanding.  The contemporary shopper is also changing demographically and technically.  Millennials are becoming “critical mass”.  Further, their ways and technology is influencing how  ”Boomers” and “X’ers” and even seniors shop.  This new shopper leverages applications, websites, and shopping options that actually discourage loyalty to anyone retailer, but rather have become de facto advocates of the consumer.
Sourcing groceries from multiple sources is no longer heresy, but rather in vogue.  Getting the best deal or product, whether it be from the growing number of bricks and mortar sources, or the emerging e-commerce options no longer is in conflict with the comfort and serenity of shopping one store again and again for the consumer’s requirements.
So if you “buy” my premise that loyalty to a single dominant retailer is no longer the “natural state of shopping”, then we must also agree that the tactics by which retailers and brands win in this environment must change as well.  
In the old model, securing loyal shoppers meant you were competing with other retailers for shopper.  Now you are competing with the shoppers themselves as they are becoming “naturally” disposed to being disloyal to any one retailer or store.   In this new environment, instead of securing loyalty which typically involved investing upfront in securing shoppers and then “coasting” after the shopper was entrenched, marketing must now be about “disruption”.  Disruptive marketing is a very different beast.  Disruption implies being intrusive, compelling, and standing out from the pack.  That takes thoughtful and creative planning, not recycling the same promotions year after year.   Disruptive marketing does not lend itself to spending heavily upfront and then “coasting”, but rather demands a constant drum beat.
More to come on the topic, but in the world of retailing the game is changing, and so must its players.