Millennials and pensioners less price conscious, baby boomers most frugal

This article is brought to you by Retail Technology Review: Millennials and pensioners less price conscious, baby boomers most frugal.

Millennials and pensioners are the shoppers least influenced by price, while affluent baby boomers are more likely to watch costs, research has found.

The findings, from Webloyalty's 5Ps of Shopper Motivation report, created in conjunction with Oxford Brookes University, identified five profiles of behaviour: Peer, Price, Practicality, Personalisation and Perk Motivated shoppers. The report provides retailers with information on each profile's typical gender, country of residence, age and occupation, guiding them on which groups of shoppers to nurture in order to help ensure repeat business, loyalty and promote 'customer marketers'.

The report, based on a survey of more than 5,000 consumers in 13 countries, found that Price Motivated shoppers were the most common profile– with 51% of people falling into the category globally and 52% in the UK. Outside the UK, they were most likely to be found in Brazil (63%) and Turkey (61%) and least prevalent in Norway (29%) and Spain (36%).A higher proportion were baby boomers aged 55-64 (57%), compared to 44% of millennials (18-24 year olds).

Consumers motivated by peers were people who based their choice of favourite retailer on where their friends and family shop, as well as social media reviews. Shoppers falling under this profile were most likely to act as advocates, with 65% claiming to promote their favourite retailer to others, compared with 38% of Price Motivated shoppers. This group was amongst the least common, making up just 8% of the overall population and 5% in the UK, but rose to 10% and 11% respectively for 18-24 and 25-34 year olds.

Practicality Motivated shoppers – those influenced by convenient store locations or delivery/returns policies were the second most common group, representing 24% of the global population surveyed. However, in the UK only 18% of people were practicality motivated, despite retailers going to enormous lengths to offer free and same day delivery. Women were slightly more likely to be practically motivated at 26% (compared with 22% of men). Bucking the trend, Practicality Motivated shoppers were the only group to prefer online shopping to bricks and mortar stores, with 65% choosing online as their preferred channel of interaction, compared with 51% instore.

Perk Motivated shoppers – those who base their choice of favourite retailer on its loyalty programmes, exclusive offers or additional services – were identified as a small but active group. Representing just 7% of shoppers in the UK, they are most likely to shop frequently (with 24% shopping with their favourite retailer daily, compared to just 6% of Price Motivated shoppers).

In total, 15% of shoppers fall into the category of Personalisation Motivated shoppers - those influenced by the ability to tailor a product or receive personalised offers. Surprisingly, the UK came in below the global average with only 12% of British shoppers coming under this profile. They are slightly more likely to be female (16% versus 14%), and aged 25-34 years old (20%).

Socially-conscious young shoppers aged 18-34 were identified as twice as likely than people aged 55+ to seek the approval of their peers before deciding where to shop. They are also more likely to stay with the same retailer and recommend to friends, making them the most loyal and influential demographic.

Commenting on the findings, Guy Chiswick, Managing Director of Webloyalty Northern Europe said: "Consumers are more demanding than ever, with their tastes and demands changing at an unprecedented rate. There is no longer such thing as the 'typical' consumer profile, instead there are multiple and their needs are complex. Our report reveals that there are trends that drive purchasing decisions across different generations, genders and geographies.

"Retailers are facing challenges as they struggle to remain profitable, but it is not just about cutting costs and reducing margins when it comes to survival. There's no denying that price motivated customers are the most common profile and there is pressure on competitive pricing. However, there are other drivers and advocacy has, and always will be, important in the retail landscape. Keeping in mind the results of our research, retailers need to make sure make they are designing their offerings, stores and websites with the correct shopper profile in mind. Nurturing your Peer and Price Motivated shoppers can mean they become your biggest advocates; never underestimate the power of the customer marketer."