Thursday, November 4, 2010

Dear Diary: The Search for Understanding Consumer Behavior

Companies interested to do thorough research know to employ many types of research, ranging from qualitative and quantitative methods. For instance, you might use survey research, case study analysis, and content analysis to gain a full picture of what interests you. The most traditional method for public relations is  surveys and focus groups to understand consumers. However, one could also employ other methods, such as content analysis. In this methodology, researchers analyze social artifacts to gain an understanding of a phenomenon. For instance, analyzing news paper articles and company produced press releases from the year 1992 should tell how media used the messages you disseminated about your company and portrayed your company in the year 1992. This would tell you how effective you were in getting your message into the media.

Unilever, from 2005-2006, conducted a content analysis research project to understand consumer behavior in the Hispanic market. The research reviewed more than 3,600 diary entries and store receipts to understand actual consumer behavior (rather than relying on reported behaviors through question and answer surveys). The research looked at Hispanic markets in Houston, Los Angeles, Miami, and New York and involved about 800 participants, almost 90% of which were born outside of the U.S. (Mexico, Central or South America, or the Caribbean). Michael Polk, President of Unilever United States, stated the importance of this kind of research: "We're confident that the Hispanic shopper insights in this study will help retailers develop more specific actions as they look to build their strategies for reaching these increasingly important shoppers."

The research found that while shoppers of different country origins buy different things, much of their behavior is similar in the frequency and type of shopping trips they take and the emphasis placed on planning shopping and meals. The study also highlighted that the Hispanic consumer is a “highly food-involved, smart, efficient and value-oriented shopper; one that retailers ignore at their own peril.”

This research design required participants to keep journals and receipts for analysis, allowing the chance to really show Unilever what is important to them about shopping and food. This kind of information is highly useful for a company like Unilever. By understanding consumer needs and behavior, they can better tailor their approach to meet the needs of one of their keystakeholders: consumers.

Unilever listed additional key findings of their research:
  • The Hispanic Shopper makes a higher number of bigger trips, Fill-In and Major Stock-Up, and far fewer Quick Trips than the general market consumer.
  • Quick Trips are just 44% of all trips she makes vs. 62% for general market shoppers. Non-food items drive Quick Trips for the Hispanic Shopper. 
  • Hispanic women are significantly more aware (by a 48% to 36% margin) of "specials" before going to the store than are general market shoppers. Even within the store, Hispanics' awareness of specials is higher than the general markets.
  • Nearly 1 in 4 Hispanic shoppers walk or take public transportation (22%) compared to just 1 in 33 of general market consumers. Geography is responsible for choice, as is value.
  • She knows her needs beforehand, hence a full 56% of her trips are routine vs. 26% in the general market.
  • The Hispanic Shopper may spend less per routine trip, but a full 54% of her total grocery spending occurs on routine trips vs. 22% in the general market.
  • Even more dramatic, only 2% of her trips are urgent, vs. 19% for the general market – that's 1 in 50 compared to 1 in 5.
  • More than half surveyed use cash, one quarter used a debit card and 11% paid with a credit card. Only 2% paid by check.
  • 35% of all Hispanic shopping trips occur after 6 p.m. compared to only 18% in the general market.
  • Hispanic shoppers are shopping with someone else – most frequently with kids – on 29% of all trips, compared to 23% in the general market.
  • They’re nearly twice as likely to be shopping with a non-family member, such as a friend, than is the general market.    

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