The Purchasing Tumbler

by editor , David Baker, Sep 17, 2007, 4:45 PM

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In a 2006 study by Yahoo and OMD called the "Long and Winding Road: The Route to the Cash Register," Yahoo identified four distinct purchasing paths people take. The study incorporated 4,301 online surveys and 13 in-depth and in-home ethnographics. Research on broadband users was focused on several categories: autos, finance, tech, Retail Goods, and Consumer Packaged goods. Pete Lerma at Clickhere wrote a nice article about this a few months ago, as did David Verklin and Bernice Kanner in their book, "Watch This, Listen Up, Click Here".

What makes this so interesting are the four paths and their personality traits. For years we've contended that there are different levels of active considerations involved in an online and offline purchase, yet we've typically not isolated it to online or influence of channels. If you tie these to the traditional stages of the "purchase tumbler," (researching a purchase, streamlining options, deciding where to buy and making a final decision) the study was able to show how consumers now turn to the Web (more even than to friends and family, offline reviews and traditional media sources), and are open to new suggestions floated there. Rather than narrowing their choices, the Internet often broadens them.

We've always tried to design communication programs, media plans and site experiences to support the consumer's level of involvement with a product needed to make a purchase decision, and we've tried to customize the channels to this need for information and to make the purchase. The paths include:

Quick Paths: typically routine or impulse purchase tied to decisive, opportunistic competent personality traits and those seeking instant gratification (examples of products: barbecue sauce, toothpaste, cereal).

Winding Paths: involve movement between channels and sources of information, with consumers typically comparing pricing, options, coupons, and often seeking their friends' advice. Most involved in this path are risk-tolerant, adventurous and open to new ideas. Retail goods like waffle irons and body weights often take a winding route, involving a modicum of comparison.

Long Paths: as it sounds, this involves a long-consideration cycle. Technology products are great examples, where consumers wait for pricing to drop on flat-screen TVs and typically research through few channels. What's important to note is that people typically only shop through one channel.

Long and Winding Paths: As you can imagine, on this path consumers can take months to make a purchase decision on items like automobiles, annuities, and home mortgage products. There is a lot of research, comparison and use of multiple channels to support this kind of purchase.

As you design acquisition programs, lead cultivation programs, loyalty programs or simple retention programs, it's vital to take careful consideration of each customer mindset, beinh realistic about the level of active consideration involved and how communication programs can support this.

Now translate what you know about your customer base and its willingness to read consumer email, or how they visit your site to research a product, how targeting is applied, how frequency is timed to the purchasing decision, the seasonality of the purchase and how historically your consumers have consumed digital channels during these stages and events. Now you have the foundation of your communication strategy.

I've done a lot of work with brands in each category and love this story, as it forces you as marketers to be smarter about the incremental effect of email on the purchase cycle and how you build attribution into the entire customer story.

It's easier to think about the value of email on a longer purchase cycle where a consumer needs a lot of information to make a decision (financial services, automobiles). We know that if you enable bill-paying at your online bank, the likelihood of switching banks is minimal, just as we know that reminding people to renew their medicines will increase persistency in prescription renewals and sales. Impulse decisions are easy to consider as well, when only one channel is involved, but when you introduce a "winding road," the effect of each discrete channel gets clouded.

The net value is to understand each customer segment that is important to your business and isolate these purchase paths, levels of consideration, and ways that people use consumer information through email and the Web to make decisions. This is communication strategy at its finest.

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