Category: Marketing

Understanding the factors influencing consumer behavior

Posted on by shopkick

Understanding the factors influencing consumer behavior

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Market cultures, social circles, personal preference, and psychology are all factors influencing consumer behavior in the shopping aisle. These factors aren’t static, meaning brands have an opportunity to change the consumer’s mind before they make a purchase decision. By leveraging options like mobile marketing, personalization, user interaction, and virtual greetings, brands can better understand and adjust consumer behavior to grow their market share.

When it comes to CPG purchases, consumers can change their minds very quickly because oftentimes the purchase isn’t seen as something with long-term consequences. The low price point of these products makes consumers more willing to try new things and deviate from their existing purchase patterns. Brands can further drive purchase decisions by offering rewards programs and incentives that encourage consumers to test out new products.

Breaking Down the Factors Influencing Consumer Behavior

Cracking the code to consumer behavior has long been a goal of marketers. By understanding why they purchase, marketers can address those issues and improve advertising. The factors that influence consumer behavior can be broken down into four comprehensive categories.

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Market culture:

The culture within the market will determine the consumer’s overall desire for a particular product. For example, a discount baby supply store would not likely do well in a neighborhood populated with millionaire retirees, but would be an excellent addition to a community where a lot of middle-class families live, perhaps near an elementary or nursery school. The market in that particular area would likely be rife with potential consumers, while the retiree’s neighborhood wouldn’t have as many.

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Social circles:

People are tied together through the individuals they affiliate with, be it family members or just those who share the same hobbies and interests. Within these social circles will be individuals who make purchase decisions, those who influence purchase decisions, and those who follow them. Consider a traditional nuclear family. One parent might request certain products at the store; the other will do the shopping and take their requests into account. Meanwhile, the children in the household will accept the decisions made between the decision maker and influencer, and later on may choose those brands because they were introduced to them by their parents.

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Personal preferences:

Personal preferences are the conscious things people choose for themselves, like the brands they’re loyal to as well as the products they avoid. These preferences often change with age and life circumstances. They can also be impacted by consumers social circles, and the culture in the market where they live. Brands that market to niche groups, like challenger brands, often focus strictly on personal preferences as a matter of marketing as this provides a more authentic feel to advertising.

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Psychological triggers:

Psychological triggers can tie into personal preference, but really, they’re about subconscious decisions rather than active ones. Things consumers see, hear, taste, touch, and smell, can trigger positive or negative reactions which brands can use to drive sales. Consider how many brands use the color blue prominently in their logos. The color triggers a feeling of trust and security which brands can impart to their products by using it in their advertising.

During the purchase journey, a number of these factors can be in play. As such, it’s best that brands create diverse campaigns that transcend categories.

Catering to a Culture With Location-Based Mobile Marketing

Location-based mobile marketing allows brands to connect with a specific community and engage users based on the culture of that community. Levi’s gave us a prime example of this when they partnered with Disney and Snapchat on a location-based augmented reality campaign.

According to Visit Orlando, the city receives an estimated 70 million tourists on an annual basis. The vast majority of those tourists visit the region due to Walt Disney World or one of the many other themed Disney attractions. The culture in the area is decidedly Disney-centric, and as such, consumer buying behavior is very tied to Disney in this market. Levi’s recognized this and chose to capitalize on it by offering a limited time deal at their Orlando store.

Visitors to the store received a Snapchat notification through which they could access a limited time deal. Through an augmented reality feature, they were able to see and even virtually try on a Disney-themed Levi’s hat while at the location. Additionally, shoppers could order the hat through the Snapchat app and have it delivered to their hotel as a souvenir from their vacation.

While the location-based mobile campaign targeted individuals based on the culture of the market, it also worked on a psychological level by leveraging scarcity. Individuals visiting the store could only access the product for purchase while they were on the premises. Once they left, they lost their chance to receive a limited-edition, Disney-themed item. Since these individuals were on vacation and likely in a spending mindset to begin with, this made it far more likely they’d make a purchase rather than risk missing out on a deal.

Exclusivity and an understanding of the market culture helped to make this campaign a success. This is a strategy other brands can leverage by understanding their unique selling points and how they impact the market where they are available. By providing a location-based, limited-time deal, brands can drive consumers to make purchases and enhance the customer experience.

Engaging Social Circles With Interactive Campaigns

Many brands choose to work with influencers to reach a wider audience. However, such relationships don’t always pay off, as influencers may not have the capacity to inspire people to make purchases. It’s far more likely that individuals will be interested in the opinions of those they know. In fact, nearly half of consumers say that recommendations from friends and family members have driven their decision to make purchases.

Interactive content acts as a way to drive this word of mouth without leveraging costly influencer campaigns. Brands can leverage content that encourages consumers to participate when creating campaigns to drive awareness of products.

This is something that Kellogg’s leveraged with their Super Bowl LIII ad for their chip brand Pringles. The brand ran an interactive, livestreaming connected TV (CTV) campaign during the Super Bowl. The campaign served two versions of shoppable experiences, allowing viewers to interact with them via the CBS Sports app on Apple TV. One version of the campaign, which changed a city name based on a user’s geography and revealed different Pringles chip combinations upon swiping, generated over 6.4% engagement.  

Another creative element for the campaign included a shoppable experience with a QR code linked to Pringles’ online store on Amazon. Viewers could lift their phones to the screen and “connect” with the code, generating an automatic link to the storefront.

This strategy helped consumers remember the brand and participate, which also drove them to discuss it with friends and family who could be influenced by the second-hand knowledge. Additionally, the campaign reached consumers on a personal level. Such personalization humanizes brands and creates a connection which can drive purchases.

Using Personalization to Connect With Consumers

Personalization is a bit of a buzzword in the marketing space, and there are many definitions of what qualifies as “personalized.”  For some brands, it may mean merely adding the recipient’s name to the beginning of an email. To others, it might include targeted messages that take into account their favorite brands and previous search history.

Walmart is one company creating its own slant on personalization. The retailer chose to update its baby registry service with a unique feature which offers personalized advice via Hoo the Owl, an intelligent chatbot capable of providing recommendations based on the user’s questions. This type of information, explicitly aimed at expectant parents, creates a personal connection with the retailer which makes consumers more likely to choose Walmart for selecting items for their new family member.
This strategy allows the company to connect with expectant parents on a personal level. It also connects to their social circles by encouraging them to send their Walmart registry details to friends and family. It expands on the intimate connection by encouraging word of mouth advertising for the brand by keeping consumers on their site.

Registries are an excellent opportunity to both connect with consumers and gain the attention of their friends and family members. By adding an intelligent chatbot, Walmart made themselves stand out in a competitive space.

Creating a Positive Consumer Experience Through Virtual Greetings

One of the final factors influencing consumer behavior comes from psychological triggers. Colors, smells, and even feelings can put consumers in a positive purchase mindset which drives them to make purchases.

This is a strategy that Shopkick leverages in many of its campaigns, by using branded entrance messages to create both a positive experience for the consumers and top-of-mind awareness for brands. Bomb Pop chose to partner with Shopkick for such a campaign in the lead up to the Fourth of July.

On arrival, consumers visiting partnering stores were greeted with a Bomb Pop branded message which reminded them of their offerings while also putting them in a positive purchase mindset. Consumers were further incentivized to seek out the company’s products through additional rewards which encouraged them to find and scan product UPCs. The process of merely holding the product created a sense of ownership, which urged consumers to make purchases. Overall, Bomb Pop saw strong incremental results, with 68% of purchasers choosing to buy the products due to influence from Shopkick.
Mobile marketing strategies which provide incentives for purchase are in-store sales drivers because they casually remind consumers of products and encourage them to seek them out, even if they weren’t planning on purchasing them before their visit. These strategies also reach shoppers on a personal level, as the rewards are delivered to consumers based on their locations and shopping behaviors.

It’s possible to leverage multiple factors influencing consumer behavior to drive sales through a single campaign. Often, in attempting to target one of these factors, brands cross over into other areas. As such, these strategies are ideal for reaching consumers on multiple fronts, whether brands want to trigger certain psychological behaviors or connect to an entire market. By reviewing some successful marketing campaigns related to these factors, brands can better understand consumer purchase behaviors to improve their sales overall.

Shopkick guides our partners through the in-store factors influencing consumer behaviors through the use of our innovative mobile app. To see how brands have leveraged this for the best results, check out our success stories.

3 successful ways brands are using mobile apps for marketing

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3 successful ways brands are using mobile apps for marketing

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Contemporary brands are using mobile apps for marketing with great success. These programs help get the word out about new products, offer increased advertisement viewing, and provide an opportunity to boost results in the store. Mobile presents the option to highly target specific individuals when they’re most likely to make a purchase. Such strategies make them invaluable for any company in a competitive market segment, including CPG brands.

Mobile app marketing is all about flexibility. As more consumers shift their browsing behavior to mobile options, brands must find ways to connect with them no matter where they’re viewing content. While there are many examples of brands successfully using mobile apps for marketing, here are three with reliable results that brands can emulate when developing their marketing campaigns.

#1: Bacardi Leverages Original Video Content in a New Product Launch

Mobile video marketing is a highly effective option as many consumers prefer video over any other kind of media. By 2022, about 82% of all global IP traffic will come from video. As such, brands must find ways to add this type of marketing to their mix to stay competitive in the future. This isn’t all about advertising, either. Instead, it’s about creating original content with the potential to grab the attention of many viewers.

When Bacardi wanted to drive interest in its new premium collection, the company rolled out an advertising campaign that provided users with a unique look inside their business. The Angels Share was a short informative film that shared the legacy of Bacardi, as well as a unique phenomenon in rum-making where liquid evaporates during the aging process. The Bacardi premium rum line loses more of that share than any other spirit. It’s aged in the Caribbean sun, which improves the result by concentrating its flavor. In the short film, three different individuals and members of the Bacardi family shared their views on the phenomenon while promoting the new product. The company leveraged a few tactics in this commercial which helped to make it a success:
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They went digital first.

One big focus of this campaign was ensuring it was digitally optimized to allow consumers to view it easily on popular online platforms. This expanded the reach of the marketing message.

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They established themselves as industry experts.

The campaign didn’t center on hard sales but instead on sharing unique information about the creation and aging of the company’s premium rum line, discussing the process of liquor evaporation and how it can improve spirits.

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They leveraged celebrity recognition.

The film was co-directed by actor and filmmaker Michael B. Jordan and Emmy-nominated director Paul Hunter, ensuring there was enough name recognition to get fans of the two interested in the advertisement.

Overall, Bacardi’s campaign helped them make consumers aware of a new product and leveraged the audiences of famous directors and actors to improve viewing. The use of a highly engaging commercial presented this line as a luxury liquor, making it ideal for targeting consumers in the premium market. Brands should consider how they can create their own informational mobile content to share their knowledge and intrigue consumers. Partnering with the right influencers in their market can help brands reach a larger audience and increase product awareness.

#2.: The NFL Boosts Advertising Results With a Mobile-Enabled Ecosystem

The purpose of creating branded content isn’t always about advertising. Occasionally, it’s the primary focus of a brand. In the case of the NFL, their content, or their sporting events, is the brand’s primary product. But down the road, the NFL introduced additional products, like merchandise and memorabilia. On the other hand, sometimes a company will evolve from a single initial product into one whose primary purpose is content. For example, Red Bull began with its signature energy drink, but eventually created its own channel through its extreme sports focus. In either case, mobile is the vehicle that delivers content to the masses.

The NFL recently underwent a major digital initiative due to the prevalence of multiscreen viewers. Multiscreen viewers are those who might watch a sporting event, but at the same time, check their phones for additional information. By focusing heavily on improved digital access to their games, the NFL saw strong results. Overall, they saw a 147% increase in mobile viewership.  
This move also provides an additional opportunity for advertisers. Current figures indicate that it costs $5 million to run a 30-second ad during the Super Bowl. Meanwhile, digital ads delivered through the NFL’s mobile platforms reach the same number of viewers—if not more. After all, the average Super Bowl viewer is going to save commercial time for bathroom breaks or snack runs, rather than sitting in front of the TV waiting for the game to start again. Meanwhile, someone searching the NFL’s mobile app during the game will be engaged with their phone, which makes them more likely to view advertisements. There are many things the NFL did right with their digital campaign, including:
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Catering to multi-screen viewers:

Just about everyone today uses their smartphones to pass the time when their favorite TV show lags or goes to commercial break. By offering an additional mobile option, the NFL kept viewers within their brand’s ecosystem, allowing them to view information from their partners and advertisers.

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Reaching out to millennials:

Millennials currently watch more online content than they do traditional television. This viewership shift is essential to account for in advertising as it sets the path for future viewing patterns. By ensuring their content is viewable by the audience most likely to drive consumerism over the next decade, the NFL aligns their brand with them and improves marketing efforts.

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Offering added value:

The NFL app isn’t just a smaller version of what’s available on TV. Consumers can gain greater insight on player stats, watch instant replays, and even play NFL branded games. This strategy ensures users aren’t facing an either-or scenario when dealing with the app. They’re using the app to enhance the customer experience.

All brands, even ones that aren’t strictly content focused—like CPG brands—need to understand how consumer viewing behavior has shifted. It’s far more likely consumers will discover and remember a brand’s products via a popular mobile app, rather than through a simple television commercial. As such, now is the time to take a mobile-first approach to marketing.

#3. Purina Improves Sales Using Mobile Apps for Marketing in the Store

Mobile marketing apps can help boost sales in the store by providing consumers with timely notifications based on their location. This strategy is ideal for CPG brands that must contend with significant competition in the aisle. After all, much of that competition includes value and white label brands that can easily undercut prices and steal away their market share. Brands must find a way to direct consumers to their products to stand out among both discounted brands and other big industry names. Mobile apps that provide rewards for interacting with products can ensure that brands gain the attention they need to drive in-store sales.  

This was a strategy Shopkick implemented through a partnership with Purina when the pet food brand wanted to expand sales during the holiday season. Their goal was to increase sales across several products and encourage consumers to try out items for the first time. Shopkick created a campaign for Purina specific to Target locations. Consumers would initially see Purina content when in the app, which familiarized them with the brand. On arrival at participating locations, they received a notification from Purina that increased top-of-mind awareness. Finally, consumers were encouraged to seek out the products in-aisle, and scan their UPCs with their camera phones to obtain kicks (aka rewards points). The campaign helped to drive awareness, as 36% of consumers reported the content introduced them toproducts they weren’t aware of before. It also improved sales, as 85% of those who made purchases said Shopkick drove their decision to buy. Purina chose to contact Shopkick because their mobile app provides several sales driving benefits, including:
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Proximity marketing:

By using the consumer’s location to trigger messages, Purina was able to connect with consumers as they shopped. Targeting consumers based on proximity is especially useful as it allows brands to reach those in the best position to make a purchase. It also will enable brands to scale their campaigns more efficiently, as they’re paying for marketing based on potential sales prospects rather than using more expensive mass media delivered to consumers regardless of their location.

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Incentivized engagement:

Priming consumers for sale is critical for driving purchases, but it can be challenging to get them to interact with products in the shopping aisle. With Shopkick, consumers receive an incentive which encourages them to handle the product to scan its UPC, which increases the likelihood of purchase.

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Rewards over discounts:

One problem brands may have with discounts is that they don’t typically drive long term sales. Once the product’s price returns to normal, the discount-driven consumers choose a lower cost competitor. Meanwhile, rewards programs don’t require discounts, meaning that the brand sees no immediate loss on the campaign. Consumers often see rewards as having a higher value than their simple dollar amount due to the emotional return from receiving the rewards points.

Third-party shopping apps can be a significant benefit for CPG brands that want to stand out in the shopping aisle. They can help minimize the distractions consumers face from other competitors, while also making the brand’s products top-of-mind during their trip. Also, these third-party apps provide a way for brands to take advantage of mobile advertising without the high expense of creating their own in-house programs. Brands should consider partnering with multiple mobile app marketing platforms to drive product awareness and increase sales.
Using mobile apps for marketing is a smart move for brands that want to increase product awareness in the digital space and drive sales in the shopping aisle. These apps travel with consumers, making them ideal for increasing top-of-mind awareness of products when it matters most. Brands leverage shopping apps, mobile video, and entire mobile ecosystems because of the effectiveness of campaigns that travel. Those wishing to increase their market share and enhance the customer experience should consider how mobile marketing can be a critical component of their marketing mix.  
Shopkick assists our partners using mobile apps for marketing by supplementing their programs with our unique, engaging shopping app. To learn more about how our program improves in-store conversion, review some of our success stories.