Independent Research on Major Marketplace Shifts and the Effect on Consumer Shopping Motivation
The Changing Online Shopping Environment
March 2020 was a defining moment for our world in more ways than one due to the nationally declared pandemic Covid-19. E-commerce has seen a drastic and sudden shift on the digital platform that is thought to last through the coming decade (UNCTAD, 2021). Prior to the pandemic, shopping in a traditional brick and mortar environment was straightforward; if a customer wanted to buy an item they could walk into a store, purchase the item, and leave without encountering unexpected o obstacles . However, once the pandemic was declared and the United States was placed on a national lockdown, spending habits changed for reasons beyond those specifically related to virus. In March 2020, there were around 10 million Americans without jobs in the wake of the virus thus resulting in unemployment applications at an all-time high since 1982 (Casselman and Cohen, 2020). With the numerous layoffs and store shutdowns, retail revenue dropped 8.7 % from February to March of 2020 (Bauer, L. et al, 2020). In response to the economic crisis, multiple stimulus checks were dispersed which then prompted the highest increase in personal savings in U.S. history at a 34% peak (Bauer, L. et al, 2020). This increase soon started to decrease once online purchases skyrocketed.
The aftermath of the U.S. national lockdown included the closing of over 10,000 retail stores, with some companies falling into corporate bankruptcy for the first time (Wahba, 2021). With these brick-n-mortar stores closing, consumers turned to online multi-industry shopping such as grocery, retail, and home/self-improvement shopping avenues. Consumer psychologist Kit Yarrow described consumer’s pandemic mindset as the need to protect, entertain and connect (Whitten, 2020). There was an obvious spike in the “protect” category with a noticeable increase in grocery, sanitizing, and health product categories (Whitten, 2020). A surprising increase in the entertainment category highlighted the purchasing of board games such as Sorry, Jenga, Clue and more (Whitten, 2020). Yarrow describes the pandemic induced lockdown as a time for consumers to take up hobbies that kept them entertained during their time at home such as baking, exercising, and crafting (Whitten, 2020). With the increase in online shopping, there now was a shift in what both consumers and companies expected in regard to shipping times, sanitation procedures, and panic buying. Thus began the shift in the online marketplace. Customers now faced longer shipping times due to an increase in demand of some necessities such as toilet paper, hand sanitizer, Lysol products and more; these products even went as far as selling out entirely on most online stores (Tarlton, 2020).
Response to Online Marketplace Shift
The aftermath of the U.S. national lockdown included the closing of over 10,000 retail stores, with some companies falling into corporate bankruptcy for the first time (Wahba, 2021). With these brick-n-mortar stores closing, consumers turned to online multi-industry shopping including such as grocery, retail, and home/self-improvement shopping avenues. Consumer psychologist Kit Yarrow describes consumer’s pandemic mindset as the need to protect, entertain and connect (Whitten, 2020). There was an obvious spike in the “protect” category with a noticeable increase in grocery, sanitizing, and health product categories (Whitten, 2020). A surprising increase in the entertainment category showcased the purchasing of board games such as Sorry, Jenga, Clue and more (Whitten, 2020). Yarrow describes the pandemic induced lockdown as a time for consumers to take up hobbies that kept them entertained during their time at home such as baking, exercising, and crafting (Whitten, 2020). With the increase in online shopping, there now was a shift in what both consumers and companies expected in regard to shipping times, sanitation procedures, and panic buying.
The term “omni-choice” solution was coined describing the type of shopping experience consumers now sought after (McQuilkin, A, 2021). Since the pandemic took over the retail environment, consumers had to use multiple purchase channels to find products that were no longer available for in person shopping (McQuilkin, A, 2021). This meant, that in response to government regulations and consumer safety concerns, retailers had to offer safe alternative methods to get customers their product and/or allow for ins-tore shopping. For example, stores limited the number of people allowed inside at one time; as well as specifying the flow and direction of customers while they shopped (Shumsky & Debo, 2020). To do this, stores utilized arrows on their floors indicating a particular aisle is a one direction browsing only; sometimes arrows were not enough, so retailers would disguise promotion displays that were intended to “nudge” customers in a certain direction (Shumsky & Debo, 2020).
Literature Review
Evolution of Online Shopping and Business to Consumer Relationships
In the early 1980s, consumers used the internet primarily for information gathering and price comparison of products across different industries and product choices (Dickson, 2000). This was mostly due to the fact that webpages were a read only way of shopping the products certain retailers provide information and descriptions of; the spread of online shopping allowed businesses to reach customers through channels that were previously not available through the online web page format called hypertext (Steinhoff et al., 2019). While this channel allowed business to expand past their brick-n-mortar stores, it also created a sense of competition with the introduction of online-only stores (Steinhoff et al., 2019). With this new shopping opportunity came new resistance and uncertainty. Consumers now had to electronically purchase items which meant putting personal information on the world wide web instead of swiping a card in the store (Steinhoff et al., 2019). However, despite these concerns, the online retail market continued improving and growing.
Following the hypertext shopping format was the social web shopping format which was introduced in the early 2000s. This type of online outlet now allowed consumers to not only read and research, but also post on the internet retail platforms (Steinhoff et al., 2019). This began the growing popularity of social media beginning with Pinterest, Facebook, and YouTube in conjunction with the increasing popularity of smart phones and mobile app versions of the above-mentioned social media platforms (Steinhoff et al., 2019). With this new addition of easy shopping access, businesses now had to think of a way to personalize shopping experiences for consumers. Companies were now able to easily access consumers and personalize money saving deals and form relationships with customers; specifically creating an easily accessible communication channel between customers and companies (Steinhoff et al., 2019). With these new developments came new data- and a lot of it. Now companies are able to collect data on consumers and as a result can create customized services and messages based off buying and browsing behavior (Steinhoff et al., 2019).
The Symbiotic web period, specifically described as the “read-write-execute-concurrency" period includes the introduction of artificial intelligence in the online shopping platforms (Steinhoff et al., 2019). Online shopping has shifted from a research-oriented search engine to an all-inclusive shopping experience with on demand “customer service” robots. These bots are able to assist shoppers with any questions they may have and assist in an easy checkout process. This service was added to offer a more personal shopping experience online since the added personal element of talking to a salesperson is not available online. The bots allow customers to have a similar shopping experience to in person shopping without the hassle of time or geographic restraints (Steinhoff et al., 2019).
Shopping Value: Hedonic vs. Utilitarian
Previous research has given the term “value” several definitions, but the one most prevalent in this instance defines value as the consumer’s “perception of quality, sacrifice, and a product’s intrinsic and extrinsic attributes” (Dodds and Monroe, 1985). The shopping literature often considers two very specific types of value that can be obtaining through the shopping experience – Hedonic and Utilitarian (Babin et al, 1994; Arnold and Reynolds, 2003).
Hedonic value is usually gained from a shopping experience that provides a consumer with “potential entertainment and emotional worth” (Bellenger et al, 1976). Early researchers suggest that “increased arousal, heightened involvement, perceived freedom, fantasy fulfillment, and escapism all may indicate a hedonically valuable shopping experience” (Bloch & Bruce, 1984). Hedonic value can come from multiple stages of the buying process, starting with the research of the product all the way to the final purchase of the product. In some cases, walking around a retail store can produce the same amount of hedonic value that a purchased product can produce (Babin et al, 1994). Bargain shopping, interestingly, has a lot of hedonic value attached to it; consumers associate bargains with excitement because in some cases “it feels like [they’re] stealing something” (Babin et al, 1994).
Utilitarian value differs from hedonic vale in a few different ways. Utilitarian value does not always result from an actual purchase; instead, value can be found from the ideas that a search fosters (Babin et al, 1994). Utilitarian value introduces the term purchase involvement, which is used to describe the amount of time and effort put into a purchase (Bloch and Bruce, 1984). High involvement purchases are not always to the same caliber as product involvement because while the product itself is not an arduous item to use or enjoy, the research and thought put into the product purchase can be time consuming (Bloch and Bruce, 1984). A common example of a high involvement purchase with little product involvement would be a washing machine. There may be a lot of time and research put into choosing the best option, but the actual product itself and the enjoyment it may bring is not always a contributing factor. Utilitarian value can sometimes result from the accomplishment of a task at hand; for instance, Babin (1994) provides an example of two different types of consumers and their idea of a successful shopping trip compared to an unsuccessful trip. One consumer considered her shopping trips successful if she is able to find what she is looking for; she sees it as accomplishing a mission, and if she is able to do that she is satisfied (Babin et al, 1994). In contrast, the other consumer feels their trips are unsuccessful if they have to go to multiple stores to find the desired product; they prefer to “get in and out with a minimum amount of time wasted” (Babin et al, 1994).
Shopping Motivations: Hedonic vs. Utilitarian
Consumers’ motivation for shopping stems from the idea that there are two types of internal shopping motivations; these two types of shopping motivations are described as utilitarian and hedonic (Babin et al, 1994). Utilitarian orientated shoppers tend to have a task fulfilment approach when shopping for a product, and at times describe experiences as the “dark side of shopping” (Babin et al, 1994). Often, utilitarian purchases involve a level of involvement that may not always involve a purchase. Babin at el. argued that this type of involvement is often described as relating to a task that a consumer “just has to get through” (1994). An interesting way to consider shopping motivations can be by considering there are two types of shoppers: satisfiers and maximizers. While both relate to utilitarian shopping motivations, they do have a slight difference, specifically the involvement in purchases. Maximizers can closely relate to consumers who are interested in exploring all shopping outlets and options thus resulting in maximizers rarely settle for anything less than what they are searching for (Chowdhury et al., 2009). This shopping motivation usually results in long browsing times, and a higher level of involvement (Chowdhury et al., 2009). In contrast, Chowdhury et al. argues that satisfiers, tend to take the first option that fulfils whatever purchase necessity is in question; these types of shoppers tend to spend less time shopping as compared to maximizers. These customers tend to have an internal pull to easy, quick, and organized shopping instead of its counterpart internal shopping drive labeled as hedonic motivation.
Hedonic shopping motivations comes from the shopping experience that provides an emotional response from consumers; specifically, consumers who seek hedonic shopping experiences “buy so they can shop, not shop so they can buy” (Langrehr, 1999, p. 428). This experience is usually acquired by shopping in person at brick-n-mortar stores, because retail atmospherics play a large role in the emotional response from consumers. Retail researcher Frederick Langrehr observed that some retail atmospheric elements can have a certain behavioral response when encountered in person such as crowding, lighting, music selection, and temperature (1991). These elements can make the shopping experience hedonically valuable without the end function being a purchase of an item (Babin et al, 1994). Arnold and Reynolds argue that there are two types of hedonic shopping motivations: social and personal (p. 78, 2003). Examples of personal hedonic shopping can include keeping up with trends, “physical activity, sensory stimulation, self-gratification”, and more (Arnold and Reynolds, 2003).
Motivational Orientation/Individual Difference Variable
Whereas shopping value is assessed after each shopping experience, motivation orientation is consistent over time and varies from person to person. The interesting aspect of consumer behavior is that while there are different motivations for different experiences and their resulting values, every consumer can have a different reaction to different shopping experiences. For example, for some consumers laundry detergent shopping can be seen as a task orientated, or utilitarian, shopping experience. However, the act of smelling the different detergents could result in hedonic experience value due to the purchase of the best smelling detergent. For another consumer, detergent shopping is a quick and simple one: they find the aisle, pick out the plainest label, and check out without smelling all the different choices. The individual difference variable in this case is the motivation orientation for each customer in regard to the specified shopping experience. In essence, one customer who sees grocery shopping as a task fulfilment type of experience can gain hedonic value from the success of finding every item on their list.
Browsing Behavior and Purchase Intention
The retail in-store browsing behavior focuses on the in-person shopping experiences and atmosphere that stores provide for customers. The shopping experience itself is a major draw for in-person shopping as compared to online shopping (Hasan and Mishra, 2015). Retail store browsing provides consumers with hedonic value that they cannot get while online shopping; consumers who seek hedonic value tend to like the physical act of browsing (Sakar, 2011). Retail stores allow customers to touch the products directly and speak to employees with instant feedback, as opposed to online browsing which could take longer to receive help (Sakar, 2011). While there are not many sites who have actual people conversing with consumers, the development of decisional aids plays a major role in the attraction of online shopping (Wei Shi and Zhang, 2014). Purchase intention is a little different for in person shopping, because stores can sometimes have an atmospheric affect that leads to impulse buying (Sun & Yazdanifard, 2015).
The online shopping environment is vastly different from the offline for which there is no person-to-person contact. However, this is seen as an upside to shopping for some utilitarian motivated shoppers (Sakar, 2011). Utilitarian motivated shoppers are more likely to prefer online shopping for apparent convenience that it provides in the forms of a quick and easy shopping process with the greatest source of variety that cannot be found in a retail store (Sakar, 2011). In addition to the added benefit of convenience, online shopping is also beneficial to utilitarian shopping because they can purchase specific brands with usually no worries of it being out of stock, which is a potential issue that could come about in retail shopping in person. Hedonically motivated shoppers tend to avoid online shopping because there are not enough benefits that make the shopping experience worthwhile (Sakar, 2011).
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