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Understanding the Ultra-Connected Consumer

In August, leading research company Forrester introduced the world to “The Always Addressable Customer.” They evaluated consumers’ social behaviors and relationship to connected devices and came to the conclusion that there is a new type of consumer; one who owns and uses at least three data-connected devices, accesses the Internet multiple times per day, and goes online from multiple physical locations. Their research is conducted from a marketing perspective. They claim that businesses and marketers should make the adjustments needed to operate mostly on mobile devices because within a few years purchasing power will be in the hands of Generations X (born 1960s–1980s) and Y (born 1980s-2000), which, at large, already fit the new consumer profile.

Forrester gave a name to a phenomenon we all are already aware of but do not completely understand. This post is aimed to remedy that by trying to explain the behavior patterns of the ultra-connected customer.

Recent research conducted by e-commerce consulting firm the e-tailing group sheds light on the behavior of this new and emerging customer. The researchers come to four key findings:

Information Empowerment: The information available at the tip of their fingers has led consumers to research before making a purchase. Consumers look to make an aware and educated decision, and therefore they research, compare, and read about a product to make sure it is the best fit for their individual needs. The survey reveals that today 56% of purchases involve researching products online 50% of the time or more. The amount of research conducted before a purchase varies according to purchase category. Financial investments, technology, and travel are typically planned and therefore involve at least some research, while apparel and accessories are usually purchased without research.

Channel Shift: Customers report greater satisfaction from online stores than from retail stores, and this has led to a channel shift. Retailers find it difficult to compete with the time-efficiency, convenience, and researchability of online shopping. Customer experience is also much more dynamic and easy to change online than in retail stores. All in all, satisfaction levels from online purchasing are predicted to increase and attract more connected consumers, especially in light of the penetration of smartphones and tablets.

Social Studies: Social networks have connected brands with consumers and have made the consumer an advocate and authority of the brand. Even though 88% of the participants in the e-tailing survey report they haven’t made a purchase through social networks, the volume of connection made between users and brands indicates that shopping on social networks is in it infancy. Another support of that notion comes from Sheryl Sandberg, Facebook’s COO, who recently announced that Facebook is working on entering the online shopping business. She also mentioned that Facebook’s shopping solution will target small businesses.

Mobile Meets Shopping: Mobile-connected devices such as tablets and smartphones are becoming crucial the new shopping process. Nowadays, people mostly use them to look up store information, perform research, compare prices, and hunt for promotions, but they will become the main “one-stop shop” tool for purchasing once the “channel shift” is completed. The complete shift will happen once the majority of people have tablets that are considered to be much more comfortable for shopping. Reports show that the conversion rates (online visitors who become customers) on the iPad are double the conversion rates on desktops.

Today, the ultra-connected consumer is a large market segment, but in a few years that is going to change. This segment is going to be the whole market as purchasing power in its entirety will be in the hand of generations X and Y. Large companies already understand that changes must be made, and small businesses should follow.

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