Shopper Marketing expert Matt Nitzberg recently joined Nepa as the Chief Client Officer of Nepa US. Matt brings a wealth of global experience helping marketers make better decisions. To help understand the dramatic changes in shoppers’ journey to buy products and services, we sat down with Matt for a short Q&A about the evolution of the path to purchase. Read on for Matt’s timely observations, encouragement, and watch-outs for brands that want to master the path to purchase.
Let’s start with the basics: What is the “path to purchase?”
“Path to purchase” (P2P) describes the process shoppers execute and experience as they move toward a buying decision. It includes the active efforts of shoppers (such as researching a product or downloading coupons) as well as their passive experiences (such as seeing advertising when watching online videos).
What’s changing in the P2P?
I’ll mention three broad changes that are relevant for brands.
- New expectations: When I can click a few images and have items delivered to my car the same day, it reframes what it means to “go shopping,” doesn’t it? Amazon and other customer-centric organizations are creating new expectations for personalization, availability, ease, and fulfillment.
- New influences: The range of touchpoints shoppers can seek or experience is expanding through new media options, platforms, apps, IoT interactions, and self-guided research. Of course, individual influences have interactive aspects as well, so each new touchpoint creates multiple new combinations. We recently completed a category project which measured the impact of more than 50 online and offline touchpoints and many sets of combinations.
- New, nimble competition: New, direct-to-consumer brands and business models (such as the various online marketplaces, subscription services and clubs) are creating new options for shoppers.
What complications does that create for brands?
The evolving path to purchase creates complications for brands on two fronts:
- With shoppers: Besides choosing a category and brand, shoppers have many options regarding the buying and fulfillment process. This can challenge both mass and niche brands, unless they adjust their strategies. For example, in laundry detergents, both Tide and Seventh Generation have achieved higher market shares in ecommerce than in brick-and-mortar stores.
- Internally: Brands have always faced upward pressure on growth, downward pressure on costs, and challenges around marketing effectiveness. As the P2P becomes more complex, with more touchpoints and influences out of a brand’s direct control, it’s become even more challenging to connect cause and effect and operate with clarity and confidence.
What additional changes should brands expect in the next 2 – 3 years?
Brands will continue to experience an incredible amount of change in the path to purchase ahead. Some of the main areas to watch-out for are:
- Rising shopper expectations: Now that shoppers have enjoyed years of continuously improving shopping experiences, ongoing progress is expected. Standing still will be seen as moving backward, and the rate of change will continue to accelerate.
- Increased competition from retailers: Retailers have first-party data, the physical or virtual real estate, their own brands, control over price, and increasingly sophisticated analytical and marketing capabilities. They’ll look to leverage these advantages and increase market share and margins for their own brands. Amazon is investing in its own brands, and shoppers are investing time in Amazon: 55% of online product searches start on Amazon.
- Increased automation in shopping: The rise of voice-first assistants and AI will shift the decision-making locus even further from the real or virtual shelf. Traditional brand preferences may be further cemented or constantly challenged, based on the instructions given to digital assistants and on their sophistication. How will you convince a robot to put your brand on the shopping list?
- Improved effectiveness: The pressure to tie all activities and touchpoints – individually and interactively – to their influence on purchase decisions will increase, as organizations look to offset many of the challenges mentioned above through deeper shopper understanding and more effective strategies and tactics.
This is a complex and fast-changing topic. We’d be glad to get any follow questions about mastering the path to purchase at firstname.lastname@example.org.