Today's Consumers Want Simplicity
For decades the business template for electronics retailers involved traditional print and broadcast advertising and a friendly, beautiful in-store experience. The Internet and smartphones have changed the marketing landscape.
For more than a decade, American consumers have been drifting toward digital commerce. Even before the first Cyber Monday in 2005, shoppers were looking online for product information, sales and consumer reviews. Meanwhile, an enormous new consumer demographic emerged – Millennials. They look at the world through a digital lens and their shopping behavior is still evolving.
With almost unlimited access to information and numerous online purchasing options, retailers may think consumers would become more scrupulous when picking products. Not really. Recent research reveals that today’s shoppers, especially Millennials, value simplicity and efficiency. They want quality and value, but they also want integrity and an easy purchasing process.
Synchrony recently completed its 2019 Major Purchase Study1, the seventh such study it has conducted over the past eight years. Among its findings:
- Deciding faster – 29 percent of electronics shoppers bought on their first in-store visit, compared to 25 percent in 2012, a trend that was true in every product category studied.
- Ease of purchase – 48 percent of all electronics shoppers said “ease of purchase process” is extremely important, a 14-point jump in just two years.
- Streamlined shopping – consumers are visiting fewer retailers, both online and in-person, than they did five years ago.
- Consumer loyalty – the percentage of consumers who said they’re likely to go back to the same electronics retailer increased by 20 points since 2017.
“The trends are a little surprising, maybe contrary to our intuition as marketers,” said Rob Krause, SVP and Payment Solution’s General Manager at Synchrony, the largest issuer of private label credit cards in the U.S. “Consumers seem to be making purchasing decisions faster than before. They are visiting fewer stores digitally and physically, and they seem more loyal to stores where they have an efficient purchasing experience.”
Clearly, consumers appreciate convenience more than ever. The access to product information increases every day, but with so many choices, shoppers are choosing to simplify the selection process.
The Synchrony findings seem to reflect the trends found in other recent studies of consumer behavior. According to the Siegal and Gale Simplicity Study in 2017, 62 percent of consumers would pay more for a simple shopping experience.2 This parallels findings from research conducted by the Corporate Executive Board where they studied 40 variables of consumer “stickiness”; that is, what factors encourage a customer to buy, make repeat purchases and recommend the store to others. The most significant factor – decision simplicity, the ease of gathering trustworthy product information and making the purchase quickly.3
“Research seems to be telling us that consumers want greater simplicity in their lives,” said Krause. “It’s too early to reach conclusions, but the trend could be driven by Millennials as they become a larger segment of the consumer universe.”
Indeed, Millennials are on the cusp of overtaking Baby Boomers as the largest consumer demographic in America.4 Born between the early-80s and 2000, there are now about 73 million Millennials, compared to 72 million Boomers. And the purchasing power of Millennials grows daily as they enter in the workforce and move up the career ladder. Millennials are not kids anymore, they are buying homes, furniture, cars and electronics, including TVs, computers and appliances.
Millennials were raised in an Internet-connected world; they are “digital natives.” Mobile phones have given them access to constant connectivity. They can research products and purchase online if they choose, with the merchandise delivered to their doorstep in a matter of hours. They can compare prices in an instant and they have access to product reviews by friends and professional endorsers.
Despite access to almost unlimited information, Millennials don’t seem interested in endless product research and comparisons. Perhaps because of technology, they seek a more streamlined consumer experience. Online grocery shopping, Internet banking, and the emergence of Amazon are all indications of a shift to a more linear purchase path.
Brick-and-mortar electronics retailers have the choice to embrace this trajectory or wring their hands. Forward-thinking retailers are responding by enhancing their online experience, promoting same-day purchase and delivery, and providing smart, easy financing choices.
Synchrony recognized the trend to simplicity and responded with a consumer credit program called the Synchrony HOME™ Credit Card, which debuted in January 2019. The HOME card is accepted at more than a million locations nationwide and provides 2 percent cash back on purchases under $2995, 6 months promotional financing on purchases of $299 or more6, plus even longer promotional financing6 at participating Synchrony HOME locations. It simplifies purchasing by consolidating all home-related purchases on one cash-back card.
Websites that are search-engine optimized and designed for easy navigation, especially on a smartphone, open the door for consumers. Likewise, offering financing online helps expand options for customers and promotes repeat business. Note that 86 percent of major purchase shoppers said purchases become more affordable if financing is an option and 89 percent of purchasers who use financing are likely to come back to the same retailer in the future1. Brick-and-mortar store owners can take heart that 77 percent of buyers surveyed made their purchase in store, including consumers who did on-line product research1.
Once in the store, the same simplicity guidelines should apply; merchandise should be logically and beautifully displayed, financing options clearly stated and sales personnel well-trained about the products and financing. Your sales staff should also be sensitive to the consumer’s desire for an efficient, low-stress sales experience.
Keep in mind that all consumers, including Millennials, value integrity. They want to do business with companies that have the right priorities and values. Socially-responsible companies score highly with Millennials, so it pays to be invested in your community in ways that resonate with consumers.
Today’s consumers want simple, direct and easy transactions; technology has taught them to expect it. They are willing to be loyal, but you must be worthy of their loyalty. Once you have their trust, you may earn their business for years to come.
Synchrony (NYSE: SYF) is a premier consumer financial services company delivering customized financing programs across key industries including retail, health, auto, travel and home, along with award-winning consumer banking products. With more than $140 billion in sales financed and 80.3 million active accounts, Synchrony brings deep industry expertise, actionable data insights, innovative solutions and differentiated digital experiences to improve the success of every business we serve and the quality of each life we touch.
- 2019 Synchrony Major Purchase Study
- Siegal and Gale Simplicity Study, 2017
- “To Keep Your Customers, Keep it Simple.”, 2012, Patrick Spenner and Karen Freeman
- “Millennials projected to overtake Baby Boomers as America’s largest generation”, 2018, Richard Fry
- Net card purchases (purchases minus returns and adjustments) less than $299 made with the Synchrony HOME credit card will earn 2 percent cash back paid as a statement credit. Statement credits will be issued within 1-2 billing cycles after qualifying purchase is made. Fees and interest charges do not qualify for rewards. Account must remain open, in good standing, and not become delinquent. Subject to credit approval. We reserve the right to discontinue or alter the terms of this offer at any time.
- Subject to credit approval. Minimum monthly payments required. Promotional financing offers available at the time of purchase may vary by location. See store for details.
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Synchrony (NYSE: SYF) is a premier consumer financial services company delivering customized financing programs across key industries including retail, health, auto, travel and home, along with award-winning consumer banking products. With more than $140 billion in sales financed and 80.3 million active accounts, Synchrony brings deep industry expertise, actionable data insights, innovative solutions and differentiated digital experiences to improve the success of every business we serve and the quality of each life we touch. Engage with Synchrony Financial.