Magazine article CRM Magazine

Understanding the Shopper Economy: How Marketers Can Turn Behavior into Currency

Magazine article CRM Magazine

Understanding the Shopper Economy: How Marketers Can Turn Behavior into Currency

Article excerpt

As every marketer knows, today's consumer is more connected and informed than ever before. The trick is to make that work to the marketer's advantage. Liz Crawford, a senior industry analyst at the Path to Purchase Institute, shows readers how to motivate shoppers and leverage the new shopper currency--behavior--in her new book, The Shopper Economy. Associate Editor Judith Aquino caught up with Crawford to find out how companies can ramp up their marketing efforts just in time for the holidays.

CRM: What can marketers do to stand out in the shopping frenzy and build their customer base?

[ILLUSTRATION OMITTED]

Liz Crawford: The key question from a shopper's perspective is "What will I get if I buy from you?" Shoppers will be looking for great selections and doing price comparisons, but they will also be looking at the transaction behind the transaction. What this means is savvy shoppers will be evaluating the return on their purchasing behavior.

American Express, for example, offers reward points for shopping in its digital mall. They're offering something in exchange for buying this way. Shoppers will compare this to the value of buying the same item in a brick-and-mortar mall. Retailers will be competing on the level of perceived value. Also, the more versatile the redemption of that value add, the more perceived value it has for shoppers.

A 20 percent discount on a designated product is perceived as less valuable, for example, than the equivalent if it is redeemable across channels. The more flexibility you give shoppers and how they can redeem it, [the more it] causes [the value] to go way up in their minds.

CRM: You noted in your book that the best brand advocates are not necessarily the same as heavy buyers. How can marketers apply that knowledge to their campaigns?

Crawford: I would run a quick test to see who are my heaviest buyers and who are my heaviest advocates and then ask myself, how can I market to these groups differently? What is most important to a heavy buyer and what is most important to an advocate? Segment these groups clearly so that you can effectively incentivize them.

The holidays are an advantageous time to do this. It's a great opportunity to put your advocates to work with something like a Groupon, where a person gets rewarded for recruiting three more buyers. …

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