A landmark study of 19,000 consumers from 28 countries reveals a huge opportunity for retailers and brands who are able to align themselves with shifting, purpose-driven buying behaviors.
IBM in partnership with the National Retail Federation released a study of 19,000 consumers, ages 18-73, from 28 countries that affirmed what many retailers and brands already know while providing fresh insights into the motivators of shoppers’ future behaviors.
The survey results, released ahead of NRF’s annual Big Show in New York revealed that brand purpose surpasses cost and convenience for today's shoppers. One-third of all consumers today will stop buying their preferred products if they lose trust in the brand, and one-third of consumers have already stopped purchasing their longtime, favorite brands in 2019, according to IBM’s survey. As a result, consumers are prioritizing those that are sustainable, transparent and aligned with their core values, demonstrating a willingness to pay more, and even change their buying habits, for brands that get it right.
With a proliferation of brands and products at shoppers' disposal anywhere at any time, corporate values now outweigh product costs and convenience, according to IBM. Consumers of all ages and incomes pay much higher premiums for products aligned with their personal beliefs. On average, 70% of purpose-driven shoppers pay an added premium of 35% more for sustainable purchases, such as recycled or eco-friendly goods. Fifty-seven percent of them are even willing to change their purchasing habits to help reduce negative environmental impact. Another 79% of all consumers today state it is important for brands to provide guaranteed authenticity, like certifications, when they're purchasing goods. Within this group, 71% are willing to pay 37% more for companies offering full transparency and traceability.
IBM used insights from the research to tout its capabilities to executive transparency and brand compliance programs by leveraging blockchain, a key area of emphasis at the company for several years.
"Transparency constitutes proof that an organization and its offerings are what the company claims to be – a way to earn consumers' trust. Brands can leverage data and integrate blockchain technologies as brand differentiators that effectively provide transparency and traceability – which will also boost profits as the study shows that shoppers willingly pay more if a retailer can demonstrate provenance," said Luq Niazi, global managing director, IBM Consumer Industries.
IBM also launched at NRF a suite of pre-integrated capabilities that leverages AI, IOT and blockchain capabilities branded as, “Store in the Cloud,” to help retailers manage these issues and accelerate store innovation. IBM worked with partners in its developer ecosystem, including Flooid (formerly PCMS), Opterus, RelevanC, Trax and other to bring Store in the Cloud to life. The premise behind the initiative is that retailers are able to quickly extend digital experiences into physical stores, provide consistent personalized interactions, improve customer fulfillment, empower store associates with intuitive apps, enable consumers shop everyway they choose and better manage store costs, according to IBM.