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The psychology of shopping: What makes shoppers tick

By Blog-Guest Authors
A guest article by Pete Marsh, senior retail and consumer sales expert

The consumer sales landscape has been in a state of flux for some time and I’m sure all of us have read more than once about the death of the high street.

Multiple physical and digital touchpoints in the modern buying journey create a hugely complex process and many retailers have difficulty keeping up with the pace of change technology brings. However, one of the core reasons retailers struggle has a lot to do with losing sight of how people think, behave and feel when it comes to shopping.

I’ve worked for major retail brands for over 25 years and find the subject of retail abandonment endlessly fascinating. In this piece I want to share some of my key learnings, covering both broad lessons as well as specific things we know about the role payments can play helping merchants to thrive.




The average abandonment rate of online ‘buyers’ is around 70%, according to the Baynard Institute: 96% of people who enter a physical retail store leave without making a purchase. Abandonment costs retailers an estimated $18 billion per year. These figures reflect the extent of the challenge retailers face in converting sales after they’ve already done so much work to get people to their stores, and the task is far from straightforward. For all the different strategies retailers can develop and execute to tackle abandonment, there are some core principles about consumer behavior that you, as a retailer, should not lose sight of.

1. It’s not your fault

OK. I want to get this one out there to kick start the article. Breathe deeply…

Sometimes, most of the time in fact, abandonment is not the retailer’s fault. In fact, I often think it’s a misnomer. After all, labelling something as having been abandoned suggests that there was ever an intent to actually complete a purchase in the first place.

In reality, there’s plenty of evidence to show that this is simply not the case.

According to 2018’s Global Path to Purchase Survey, just under 84% of people ‘showroom’ in physical retail stores. That is, they go in there to look with no specific intent of purchasing anything. Over half of these ‘shoppers’ - if indeed we can think of them in that way - go in to see the physical goods before making any decision. They are researching, looking for comparisons with online pricing, etc., but only around a quarter are actually there because they enjoy the physical retail experience.

These habits also extend to online shopping: In a 2019 study by Royal Mail, 39% of respondents stated that the top reason they abandon their cart is because they were just browsing, with unhappiness with the delivery fee (36%) still playing a decisive role.

Delivery Matters, Royal Mail 2019

The point is that rather than abandonment being seen purely as a symptom of bad practice on behalf of the retailer, we have to appreciate that it’s actually part and parcel of the psychology of shopping. That’s something retailers need to embrace rather than rally against, and adapt their approach accordingly. The physical retail space is used increasingly to showcase the brand and build consideration for future purchases, as well as converting sales. Thinking broader than cold hard conversions is going to become a critical concern for the retailer of tomorrow.

2. Pain of paying

It’s also worth keeping in mind that researchers have known for over two decades that people have inbuilt mechanisms that kick in when we have to pay for something, and it presents a major obstacle if we’re not mindful of them.

Back in 1998, Prelec & Loewenstein reported on the link between paying and pleasure. The findings were significant yet unsurprising: rather than enjoyment, people dislike paying for things, so much so it provokes a natural reaction similar to those stirred up by pain and disgust. That’s pretty heavy odds for retailers to have to work against from the very beginning, but it does remind us exactly why putting a seamless purchasing journey at the very heart of your conversion strategy is vital. Just look at what companies like Amazon are doing in this space to lead the market.

Specifically, while we focus a great deal on the retail environment - physical and digital - and making it conducive to driving purchases - we absolutely cannot afford to see payments as just another step in that process. Payments made effortless for the consumer are going to maximize the conversion opportunity for retailers and, as the numbers I cited at the outset of this piece show, we are up against it enough already without compounding the issue by overlooking this.

3. Customers are changing

The great news for retailers is two-fold. On the one hand, payment technology is evolving at an immense rate. And, on the other, there’s already a healthy level of adoption of time-saving innovations like contactless payments in retail, whether through cards, phones or wearable devices.



Some people - globally around 36% - still insist on using cash according to the Global Path to Purchase Survey. The adoption rate of non-cash payments fluctuates massively across Europe, let alone other parts of the world in my experience, but it’s clear digital payments are already being adopted in leading markets, as revealed in the 2019 Wirecard Global Shopping Report. That’s only going to increase as consumer confidence and familiarity grow.

For example, self-service checkouts are already in high demand but around a third of people like the idea of automating their payments through an app or other handheld device to further increase their convenience.

Similarly, biometric ID and payments appeal to around 20% of people, driven largely by its integration with smartphone technology. I anticipate this will grow exponentially over the next couple of years as its greater convenience and security over other forms of contactless payment benefits shoppers and retailers alike.

As retailers try to reduce the delta between current services and customer demand for seamless, efficient and secure purchasing experiences, it feels like the new generation of retail is pushing at an open door.

Innovating to combine technology and a clear understanding of what makes our prospective customers tick is set to transform the way we think about and plan our approaches to managing and integrating channels. More than 25 years into my sales career, that makes me more excited about the future of our sector than ever before.

About the author

Pete Marsh has headed up sales organizations within major retail brands including Dixons, Vodafone and Travelex. He has worked in UK and global roles, covering direct sales, partnerships and franchising, distribution and operational oversight.

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