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Why retailers will be forced to reinvent themselves in the mobile age - eBay strategic director

Increasingly fragmented, complex shopper journeys are forcing retailers to reinvent themselves, ushering in a new era in which the traditional purchase funnel model is no longer relevant.

eBay is keen to lead the charge in this new era and is radically adapting its services to meet and even anticipate multichannel consumer demands, rather than face falling behind.

eBay’s head of strategic sales Rob Bassett told delegates at The Drum’s Digital Convergence event in London this week, that it must “get inside the minds” of its consumers so it can better understand the behaviour of today’s shoppers.

He referenced a piece of research called “Screenagers” which it commissioned in 2012 to explore the shopping habits of 1,000 tablet users.

It showed half of smartphone users shop online using these devices, while 12 per cent of UK households own a tablet – a 469 per cent hike compared to 2011.

However, it was a particular statistic that resonated strongly – tablet users tend to spend more – not necessarily online but in-store - following device-based research. Over half (54 per cent) of tablet users shop more online while 16 per cent shop more in-store.

“Tablets are fundamentally changing shopping behaviour and we have a theory at eBay that we are seeing the end of the traditional purchase funnel.

“Traditionally we had four steps leading from the top with a customer’s desire for an item to the bottom which ended in a purchase. That model is based on old retail. It involves a physical and emotional investment in shopping – going through the shopping centre, walking through a shop, putting things in your basket, and queuing up to checkout before going home,” he says.

However, the shoppers’ traditional path to purchase is evolving at breakneck speed and now resembles more of a loop than a funnel-type model, according to Bassett.

“The purchase funnel is being broken down and as a customer I don’t have to go through all four distinct steps. It means once I want something I can get it right now which begs the question - is the purchase funnel really relevant today?”

That’s not to say everyone’s shopper journey is complex, with some simple paths to purchase still common such as seeing a TV ad and then immediately buying an item off the back of it. In fact 46 per cent of tablet users shop more when in front of the TV, according to the Screenagers report.

However, an increasing number of people are using up to five different devices and can spend a week researching and price-comparing before making a purchase. Buying a clothes item often includes a visit to a physical store, with the shopper then making the final purchase online the following day.

Bassett believes that the purchase funnel model has become obsolete because the very term “funnel” denotes the shopper journey ends with the final transaction. However, eBay is increasingly finding the reality is quite the opposite, with consumers staying on a continuous cycle of buying and researching other items immediately after purchasing the initial one.

This has coined a new term at eBay – “e-spree”, according to Bassett. “This is the final nail in the coffin of the purchase funnel because with the purchase funnel there is a natural ending after the purchase. But now there is something we refer to as ‘e-Spree’ – and it is more a loop than a funnel – people get to the final purchase, only to find that it’s not the final purchase. The result is a new, complex, fragmented shopping journey,” he says.

Bassett outlines four tips for retailers that want to stay ahead in this new era: "Personalise to inspire commerce; bring social to shopping, decipher dual-screening, and be omnipresent."

eBay is putting its money where its mouth is and has launched a personalised news feed in the US, so it can curate its site content based on an individual’s preferences and purchase history.

“We realise we are not just the end part of the funnel because it no longer exists - we must now inspire, using what we know about the customer to show them what they like. We are broadening our model because we have a wider part to play in eCommerce than we would have in the traditional model,” he says.

He also believes brands must take advantage of the rise in dual-screen shopping habits or risk losing out on a rapidly growing potential revenue stream.

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Jessica Davies

All by Jessica