Executive Summary

Today’s UK shopper is an “empowered” consumer. This new breed of consumer is changing the rules of engagement for retailers simply by the power they possess in managing their own shopping experiences. Shoppers can easily access competing stores, brands, and products as part of their product research—whether it be online or on their mobiles.

These new consumers are also shopping across channels; it is now common for shoppers to discover and evaluate products in one channel and then buy them in another. In fact, 44% of all UK shoppers have “channel-switched”—researching a purchase online then buying it in a store.

Today’s shopper is looking for three kinds of content when deciding to buy: product details, peer reviews, and personalised recommendations. For online purchases, 86% of UK shoppers rely on product ratings and reviews. Personalised product recommendations—like “shoppers who bought this also bought that”—are also widely used for purchases. Ninety-three percent of UK shoppers have seen recommendations on retailer sites, and 42% of these have made a purchase based on personalised product recommendations displayed on a retailer’s site.

What’s the impact? New ways of shopping. Typically, shoppers have made some—but not all—purchase decisions when researching products online. (e.g., the brand, the item, even the store). In fact, nearly one out of 10 UK shoppers has not made any firm decisions before going online to research what or where to buy, providing retailers a unique opportunity to exert influence at many points in the purchase process.

To capture these new consumers, retailers need to give shoppers copious, reliable information at the point of decision—not just the point of purchase—in a way that enhances their entire shopping experience.

Background

In the UK, more than 30 million people access the Internet each day (roughly twice the number in 2006), and 62% have made online purchases in the 12-month period before August 2010. These shoppers are hardly timid in the face of technology; rather, the Internet is a regular part of their lives, as are shopping-comparison sites, social networking and mobile phones.

How has shopping behaviour changed in recent times, and what can a retailer do to capture more customers?

RichRelevance and Bazaarvoice first commissioned Forrester Consulting in 2009 to answer this question, and found that tools that provide access to other users’ opinions effectively drive customer loyalty. In September 2010, RichRelevance and Bazaarvoice again commissioned Forrester Consulting—this time to explore the behaviour of UK and European consumers.

Forrester conducted the study in the UK, France, and Germany, surveying 501 people from each country, giving a total of 1503 respondents. The survey was administered in the local language for each country. Forrester was responsible for survey fielding and initial data validation. All respondents were screened to ensure they had researched and/or purchased products or services online in the last 12 months.

In this paper, we report on the UK findings from this study. All of the data points were taken from this study unless otherwise indicated.

Key Findings

Three principal themes emerged:

1. UK shoppers are cross-channel shoppers. They use the Internet to make purchase decisions in both online and offline channels, and they often purchase items using one channel after first seeing them in another. To better meet customer expectations and provide better service, retailers should build towards seamless consistency between online and offline channels.
2. UK shoppers are open to influence. When they go online to research or purchase products, they have made some, but not all key decisions. Also, they no longer tend to be loyal to particular retail brands; rather, they are open to shopping from a wide variety of retailers, from the largest to the smallest. To capture more customers, retailers should employ marketing and promotional strategies that aid shoppers in their rigorous decision-making processes.
3. UK shoppers are content-hungry. Shoppers rely heavily on three kinds of content: product details; peer reviews and personalised ratings; and recommendations. Retailers need to look for ways to provide this kind of content and ensure that it is timely, accurate and relevant.

UK Shoppers are Cross-Channel Shoppers

Shopping in the UK is becoming a cross-channel experience, as shoppers frequently conduct their research in one channel but make their purchases in another. After researching a product online and purchasing it offline, most shoppers (55%) indicated that they needed to see the item before they purchased it. The next biggest reason for purchasing the product offline was the need to have the product immediately (47%), but relatively few indicated that they simply preferred to buy products at a physical store (5%), or that the product was not available online (11%). This suggests that the difference between online and offline channels is not so distinct in the shopper’s mind: The shopper’s preference for one channel over another will shift for each purchase, based on the time frame, convenience, and other factors.

[Download PDF to see Graph]

Another factor is at work here. Increasingly, UK shoppers are using mobile phones to validate product attributes and compare prices. Consumers are taking the Web with them on the go, with its shopping-comparison sites, its social networks, and its expert and user-generated reviews. Sixteen percent of shoppers compare prices using their mobile phones, 11% pull up reviews, and 6% read product content. In fact, 42% use smart phones as part of the in-store shopping experience. This fast-growing subgroup of the wider shopper population is composed of savvier, more discriminating people. They are in analysis mode even whilst away from their computers, and are quickly able to access new information. The bad news is that they’re hard to pin down; if they receive a discount coupon on their phone for the store across the street, they’ll quickly thank you for your time and go. But if you can provide them with the right kind of information that complements their knowledge quest, you will engage their attention, the first step to capturing their business.

[Download PDF to see Graphs]

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UK Shoppers are Open to Influence

When shoppers first go online to research a product or make a purchase, they are not necessarily settled on such matters as the exact make, model, or price. Rather, for many shoppers, the processes of researching and purchasing are combined in a detailed effort that extends across multiple retail websites, shopping-comparison sites and a variety of online consumer publications.

UK shoppers are more open in this regard than shoppers in other European countries. Nearly one out of every ten shoppers in the UK (9%) has not made any firm decisions before going online, roughly two times the proportion in France or in Germany. Most significantly, UK shoppers are often undecided about where they make their purchases: most (82%) will visit more than one site before they buy, and 17% will visit as many as four. Since retail websites are visited most frequently, these consumers are actively comparing products, information and offers from multiple vendors.

[Download PDF to see Graph]

What kinds of online stores do shoppers visit when researching or purchasing products? UK shoppers browse from an extremely wide field, most often using online aggregators (83%), followed by discount retailers (52%), consumer electronics stores (51%) and “big box” retailer sites (38%). The overwhelming popularity of aggregators shows that shoppers are less loyal to individual, trusted retailers, and more open to a wider mix of alternatives presented for comparison.

UK Shoppers Are Content-Hungry

Whether shoppers make their purchases online or offline, they use the same online resources: product information, user ratings and reviews, expert reviews, and recommendations. This is a testimony to the strength of this content. When making offline purchases, 71% still reference store or retailer websites, and 54% will refer to the manufacturer website for more detailed information about the product. Understandably, the most important content for shoppers is the product pages of retailer websites. Two kinds of supporting content are of key importance to shoppers: reviews and recommendations.

[Download PDF to see Graph]

Shoppers Rely on Expert and Peer Reviews

Product reviews, whether in the form of expert reviews or user reviews, perform a valuable function for shoppers by validating and confirming their online or offline purchase choices. Most user-review formats include ratings; the more users that participate, the more valid the overall rating.

Beyond basic product and pricing information, 86% of UK shoppers, when making purchase decisions, rely on other shoppers’ ratings and reviews of products on retailers’ sites. Sixtyone percent turn to expert reviews such as those found on the sites of independent online publications or consumer organisations.

Shoppers Rely on Recommendations

Like reviews, recommendations have a strong impact on a shopper’s decision process, particularly when recommendations are accurate and timely and complement the shopper’s information needs at a given stage in the sales cycle. Nearly half (42%) of shoppers made purchases that were recommended by an online retailer site.

Why do shoppers respond affirmatively to recommendations? Six out of ten UK shoppers (63%) use recommendations because they come “at the right time” in their decision-making process, and an equivalent proportion (60%) employ recommendations because they show products whose “price was right.” Fifty-seven percent of respondents said that they find recommendations to be relevant. Recommendations frequently play a role in product discovery: one in three UK shoppers (36%) makes a recommended purchase because it helps “discover products I wouldn’t have considered.”

[Download PDF to see Graph]

Shopping and the Current Economic Climate

In the current economic climate, some shoppers are understandably shopping less overall (18%) or avoiding major purchases (6%). However it bears mentioning that a far greater percentage (48%) are shopping more wisely, taking time to do more research online, to find the right product at the right price.

Conclusion

Today’s UK shoppers are active, “empowered” shoppers: they switch channels when necessary or convenient and they comparison shop products and brands across multiple retail sites. UK shoppers are avid consumers of product-related content, ranging from manufacturer/retailer information to expert and peer reviews. Personalised recommendations also exert a noted influence.

Successfully selling to these shoppers requires that retailers engage with them at several different stages of the shopping cycle, and via different content types and media.

Retailers must facilitate product discovery and comparison, using product information, reviews and personalised offers. If done in a helpful, relevant, and timely manner— appropriately contextualised to the shopper’s current purchase behaviour and history—then retailers will achieve the critical “micro-wins” that secure customer engagement. Conversely, retailers who do not engage with shoppers run the risk of customer loss and defection.