PriceRhythm

Intro

The holiday shopping seasons, traditionally begins few weeks before Thanksgiving and ends in Christmas. During that season the Jewish holiday of Hanukah also occurs. The traditions of gift giving during those holidays created the foundations for the raise of shopping volumes. The shopping season usually reaches its peaks during “Black Friday” and “Cyber Monday”. In previous years this period alone accounted for more than 50% of annual sales in the United States. During the shopping season, retailers invest heavily in promotions and sales in order to increase their share of the season’s sales. According to a report by comScore, consumers in United State alone had already spent more than $10.1B this November.

From a consumer’s point of view, the holiday shopping season is a chance to perform the larger annual purchases while still saving money. Since the season itself is relativity short (Some sales last less than 12 hours and longer sales last around a month) and the range of sales is endless, consumers turn to different tools to assist in their shopping.  Among the common tools that are gaining popularity among shoppers are Smartphones. There is steadily and rapidly increasing consumer adoption of mobile commerce as a critical shopping channel, use of mobile devices for purchase or product research (According to Oracle, IBM  and Yankee group). While in 2010 during ‘Black Friday’, only 5.6% of the traffic for online stores and retailers came from mobile devices, in 2011, mobile traffic increased to 14.3%, and, according to report by Walmart in 2012, during the upcoming ‘Black Friday’, mobile traffic is expected to reach up to 40% of the traffic to online stores and retailers.

Most of the consumers use their mobile device to compare prices (59%), get product specifications (51%), read reviews (45%), shop online (45%), search for deals and coupons (40%) and scan barcodes (40%) ( Digby mobile statistics). Moreover, as for the wide distribution and use of Smartphones, and due to the mobile devices availability anytime and everywhere, location base differentiations and analysis of consumer shopping behaviors, especially aiming to personal and close acquaintance of the consumer preferences and needs , makes mobile devices a leading platform for shopping aids.

The following study was done to uncover the importance of different shopping factors when it comes to a consumer’s shopping decision for the upcoming holiday shopping season. In addition, we wanted to evaluate the strength of different brands when it comes to making this shopping decision. The study was done based on analysis of data gathered using Price Rhythm’s mobile apps. The results of the following study should allow retailers and manufactures a better concentrate on the factors that matter the most to their target audience.

Study’s data set

The data used in the following study was gathered from more than 50,000 users from around the world (The user distribution by location can be found in figure 1). The biggest user base comes from North America, followed by Europe and then Asia.   From demographic point of view, we found that women are more likely to use shopping recommendation applications, such as Price Rhythm, than men.  In our data set, women represented 58.75% of the users while men only represented 41.25%. When trying to understand the gap between the men and women tendency of using such apps, certain anecdotes might shed a light. First, women shop more than men and therefore might be more likely to use such app. Secondly, based on our data, the most common product category searched in our app was groceries (41.7%), which traditionally is more dominated by women. On the other hand, Electronics category, which traditionally is more dominated by men, only covers 18.9% of the total searches.  The complete category distribution can be found in figure 2.

Figure 1 – User distribution by geographical location

Figure 2 – Product searches by category

What was measured

In this study we measured two things. First, we measured how consumers, from different geographical locations, perceive the importance of different factors when performing their shopping decisions. Secondly, we measured which brands consumers are most emotionally attached to.

In order to measure the importance of different shopping factors, we first defined nine different shopping factors. Each factor represents a different angle for examining the product before bought. The factors were: Product’s price, Quality, Performance, How tech savvy is the product, Product’s brand, It’s visual appearance, Product’s popularity, Product healthiness and the product’s environmental friendliness. Each consumer from our data set had selected, from these nine factors, which matters to him most when performing a shopping decision. Using the data gathered, a graph was created, for each geographical location, showing from 0-100% how many consumers defined a specific shopping factor as important in their shopping decision.

To measure brands strength, we defined five possible feedbacks a consumer can have for a certain product. The feedbacks were: very positive, positive, indifferent, negative and very negative. In the data set used for this study we included more than 250,000 feedbacks. We then summed up the feedbacks by their product’s brand. Feedbacks that were indifferent were ignored.  Using the data gathered, we created a list with the brands with the largest feedback.

 Findings

When we examined the shopping preferences analysis results, few interesting facts were found. We found out that a product’s price is the most popular factor by almost all consumers in all geographical locations. More than 96% of North American (Highest) consumers marked “price” as important. In Europe (Lowest) only 89% percent marked it as important. The second most popular factor after “price” is the product’s quality. Between 73% (Europe) and up to 82% (South America) marked “quality” as an important factor in their shopping decision process. The third factor differs depending on the geographical location. For example, in North America, 69% of consumers consider a product’s performance as an important factor while in other locations such as: Asia and Oceania, the third most popular factor is a product’s “brand” (69% and 62% accordingly). The results appear on figure 3 to 7.

Figure 3 – North America

Figure 4 – Europe

Figure 5 – Asia

Figure 6 – Oceania

Figure 7 – South America

List of strongest brands

When it comes to products brand, we found that the strongest brand was unsurprisingly Apple, followed by Samsung and Canon.  The list of brands is showed below.

1. Apple
2. Samsung
3. Canon
4. Panasonic
5. Sony
6. Microsoft
7. Asus
8. Nintendo
9. Crayola
10. Hasbro

Conclusion

Our study shows that the behavior in the western countries, with highly developed consumption culture, are  basically the same, and most of the consumers take into consideration more than just the product’s price.
Along with the increase use of mobile devices for shopping, consumers show a growing interest to better understand what they are spending their money on. Price Rhythm, as a shopping aid which is available anytime and everywhere, helps to increase consumer awareness of their shopping decisions, increase consumers’ satisfaction.

Price Rhythm.

Shop smarter.