the explosion in consumer choice
TRANSCRIPT
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Choices, choices, choices. The rise in consumer choice and how charities should respond October 2011 Tel: 020 7426 8888
Email: [email protected]
Web: www.nfpsynergy.net
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The talk in a nutshell
• Choice is mushrooming
• What do we think of this growth in choice
• This is driven by technology, regulation, competition and culture
• We learn to cope with this choice in a number of ways
• What choice do charities offer?
• So how do charities mirror and respond to this rise in choice
o With branding
o With motivations
o With products
o With supporter-centred strategies
2
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The talk in a nutshell
• Choice is mushrooming
• What do we think of this growth in choice
• This is driven by technology, regulation, competition and culture
• We learn to cope with this choice in a number of ways
• What choice do charities offer?
• So how do charities mirror and respond to this rise in choice
o With branding
o With motivations
o With products
o With supporter-centred strategies
3
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If you went to Starbucks and got a different drink every weekday, how long before you would have to have a drink for a second time?
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5
Complexity and Managing Choice
Modern choice culture allows consumers to express all manner of preferences not always directly related to price and functionality.
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0
500
1000
1500
2000
2500
3000
1992 1993 1996 1999 2001 2006 2008 2009
Mobile phone tariffs Number of different tariffs available at the Carphone Warehouse
6
Source: Carphone Warehouse/nVision Base: UK
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Number of unique shopping baskets available for various product combinations
7
0
2,000
4,000
6,000
8,000
10,000
12,000
14,000
Orange juice & chicken pieces
Milk & bread Tea & bread Cereal & washing powder/liquid
Source: nVision Fieldwork, March 2009
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Number of different kinds of products in the home
0%
5%
10%
15%
20%
25%
30%
35%
0 1 2 3 4 5 6 7 8 9 10 11+
Breakfast cereals
Shampoos
Household cleaningproducts
Source: Complicated Lives /The Future Foundation, 2000
Base: All aged 18+
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Number of television channels available 1990 - 2004
0
100
200
300
400
500
600
700
800
900
1000
1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004
Sky
multichannel
package
CH 5 Digital TV
Source: nVision, UK
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0
5000
10000
15000
20000
25000
30000
35000
40000
45000
1982 1984 1986 1988 1990 1992 1994 1996 1998 2000
Sainsbury's (average lines per store)
Tesco (total lines across all stores)
Products available at multiple stores Number of products at two top multiple retailers
Source: nVision, UK
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Even a bigger wardrobe can add complications
o “In my wardrobe, I had (in the fifties) my everyday clothes,
skirts, sweaters and blouses, and my Sunday clothes, one
coat, two pairs of shoes and a best dress” (Woman, AB,
70s)
Compare this with a 20 year old woman today:
o “I have so many clothes, I‟ve got nowhere to put them …but
I‟ve still got nothing to wear!” (Woman AB, 20)
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If you went to Starbucks and got a different drink every weekday, how long before you would have to have a drink for a second time?
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13
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If you went to Starbucks and got a different drink every weekday, how long before you would have to have a drink for a second time?
So 87,000 divided by 5 days a week divided by 52 weeks a year is 334 years!
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The talk in a nutshell
• Choice is mushrooming
• What do we think of this growth in choice
• This is driven by technology, regulation, competition and culture
• We learn to cope with this choice in a number of ways
• What choice do charities offer?
• So how do charities mirror and respond to this rise in choice
o With branding
o With motivations
o With products
o With supporter-centred strategies
15
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“When making an important purchase decision (like a holiday, computer, car or mobile phone) these days there is too much information to go through” % who agree or agree strongly by gender, age, social grade
16
Source: nVision Research
Base: 1,000 face-to-face respondents aged 16+, GB
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“When looking to buy the following products or services, in which of these cases have you used price comparison websites as part of your decision making process?” % who use them to buy the following products or services
17
Source: nVision Research
Base: 2,207 online respondents aged 16+, GB, 2011
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“I often share tips on how to cut costs and save money ” % who agree or agree strongly by gender, age and social grade
18
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
To
tal
Ma
le
Fe
ma
le
16
-24
25
-34
35
-44
45
-54
55
-64
65
+
AB
C1
C2
DE
Agree Strongly agree
Source: nVision Research
Base: 1,000 online respondents aged 16+, 2010, GB
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“Have you recommended any of the following to a friend or family in the last 12 months?” % who have recommended the following to family and friends
19
0% 10% 20% 30% 40% 50% 60%
A film
A restaurant
A book
A holiday location
A hotel
A band
A travel website
A theatre performance
A comedy show
A music venue
A musical
A spa location
A travel agent
Source: lastminute.com/The Future Foundation/nVision
Base: 1,000 respondents aged 16-65, GB, 2010
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Influential sources when choosing particular leisure activities “Thinking of the time you last did each activity, which of the following sources, if any, were influential in your choice?”
20
0% 10% 20% 30% 40% 50% 60%
A recommendation from friends or family
Personal experience
Coverage on the internet
A special offer or promotion
Online advertising
TV programme
Offline advertising
Through social networking discussions
A sales person / shop assistant
Coverage in a blog
Other
None of these
Travel destination
Restaurant for a special occasion
Live event
Source: lastminute.com/The Future Foundation/nVision
Base: 900-950 aged 16-65 who do each activity, GB, 2010
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“A well-known brand is the best assurance of quality there is” % who agree or agree strongly, by gender, age and social grade
21
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
To
tal
Ma
le
Fe
ma
le
16
-24
25
-34
35
-44
45
-54
55
-64
65
+
AB
C1
C2
DE
Agree strongly Agree
Source: Friends Life/The Future Foundation/nVision
Base: 1,000 online respondents aged 16+, GB, 2011
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“I regularly review my financial services products to ensure I’m getting the best possible deal” % who agree or agree strongly, by gender, age and social grade
22
Source: Friends Life/The Future Foundation/nVision Research
Base: 1,000-2,000 online respondents aged 16+, GB
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It is so hard to make perfect choices “When buying a holiday, computer, car or mobile phone these days there is too much information to go through.”
23
0%
20%
40%
60%
80%
100%
Male Female
1999 2007 2010
Source: nVision Research
Base: 1,000 face-to-face respondents aged 16+, GB
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Compared prices online forecast % of adults who have compared prices online in the last 6 months
24
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
2013
Price comparison forecast
Price comparison - actual
Internet users (those using it at least once a week) - forecast
Source: nVision Research Base: 1,200 respondents aged 15+, GB
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The talk in a nutshell
• Choice is mushrooming
• What do we think of this growth in choice
• This is driven by technology, regulation, competition and culture
• We learn to cope with this choice in a number of ways
• What choice do charities offer?
• So how do charities mirror and respond to this rise in choice
o With branding
o With motivations
o With products
o With supporter-centred strategies
25
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Expectation of choice and the need for instant gratification
• Choice is increasing in every area of our lives… and we employ different strategies for managing it
• Choice driven by competition o More than 8,500 mortgages, 1,600 models of new car
• Choice driven by technology
o More than 2500 mobile phone tariffs in Carphone Warehouse alone
o 900+ TV channels (up from 4 only 10 – 15 years ago)
• Choice driven by deregulation
o 16 choices of electricity supplier o 22 choices of gas supplier… from a base of no choice of utility
supplier as recently as 1990
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Mobile phone penetration by age Proportion of adults who own a mobile phone - nVision forecast
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010
16-24 actual 25-34 actual35-44 actual 45-54 actual55-64 actual 65+ actual16-24 25-3435-44 45-5455-64 65+
Source: „Changing Lives‟, nVision Base: 1000 adults 16+, UK
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Proportion who have internet access anywhere, by age "Do you have access to the internet? At home; At work; At school/college; Somewhere else“ * Excludes “Don‟t Know”
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
All 16-24 25-34 35-44 45-54 55-64 65+
Jul-00 Jul-03 Jul-05
Source: „Changing Lives‟, nVision
Base: 1000 adults 16+, UK
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People participating in social networking websites “Which of the following, if any, have you done on the internet in the last 6
months…? Created / updated a personal profile on a social networking site
(e.g. facebook / myspace / bebo)”
0%
5%
10%
15%
20%
25%
30%
35%
40%
45%
To
tal
Ma
le
Fe
ma
le
15
-34
35
-54
55
+
AB
C1
C2
DE
Spring 2008 Autumn 2008 Autumn 2009 Summer 2010
Source: nVision Research
Base: 1,000 face-to-face respondents aged 16+, GB
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Digital / Multichannel TV progress % of TV households
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011
Total multichannel
Total digital
Satellite
DTT-only
Cable
Source: Ofcom Digital TV Update/nVision
Base: UK
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The talk in a nutshell
• Choice is mushrooming
• What do we think of this growth in choice
• This is driven by technology, regulation, competition and culture
• We learn to cope with this choice in a number of ways
• What choice do charities offer?
• So how do charities mirror and respond to this rise in choice
o With branding
o With motivations
o With products
o With supporter-centred strategies
31
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Faced with too much choice What strategies do consumers adopt?
Depends on interest in category
Brands as choice
managers
Relax search criteria
Independent advisors
Profit-making Not for profit
PriceValues/ ethical
concerns
Source: 'Citizen Brands', Michael Willmott/Future Foundation 2001
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The importance of irrationality
• Charities deal with complex social issues and need a rational focus .… this can translate into the belief that appeals must be completely rational
• Facts in some studies have been shown to be a turn-off for donors o Experiment where people were asked to talk about
babies (emotions) or to do math calculations (rational) – the latter donated less
o Experiment where people in one group could donate to a fund for medical treatment to save the life of 1 child or the lives of 8 children – people donated twice as much money to help save that one child
• Often an irrational world where brands, celebrities, fashions, emotions rule
• Disproportionate concern on individuals e.g Amanda Knox, Madeleine McCann, Cheryl Cole
• The solution – a „Darfur Puppy‟ as the way to make mass human disasters matter
Source: Nicholas Kristof, New York Times, “Save The Darfur Puppy”, 9th May 2007
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Learned helplessness
• Perceived lack of control can result in feelings of paralysis or in conceding defeat
• People today have access to more information about the world than at any other point in history. News of disasters, wars and terrorist activities flood in everyday
• All of this can leave donors feeling that their actions are futile and that nothing they do will make a difference… o Feelings about climate change move from disbelief to paralysis
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Continuous Partial Attention
• CPA is described as a new phenomenon of juggling tasks that require a reasonable amount of cognitive engagement o Listening to this talk, scanning your Blackberry for work emails and emails from
friends about social arrangements o More complex tasks than multi-tasking
• Linda Stone of Microsoft and Apple describes CPA as a behaviour we have
learned to help us cope with an information rich environment: o “In this sleep-deprived, interruption-driven, always-on world, our ability to focus
is compromised. In trying to process a never-ending and ever-widening stream of incoming data, we can put off decisions indefinitely or even burn out.”
• How can you communicate with supporters in a way that doesn‟t increase
sensory overload?
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36
0%
5%
10%
15%
20%
25%
30%
35%
40%T
ota
l
15
-24
25
-34
35
-44
45
-54
55
-64
65
+
Agree Agree strongly
“I often can't be bothered to make a decision, I'd rather other people made it for me”
Source: nVision Research Base: 1,200 respondents aged 15+, GB, 2008
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The talk in a nutshell
• Choice is mushrooming
• What do we think of this growth in choice
• This is driven by technology, regulation, competition and culture
• We learn to cope with this choice in a number of ways
• What choice do charities offer?
• So how do charities mirror and respond to this rise in choice
o With branding
o With motivations
o With products
o With supporter-centred strategies
37
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My hypothesis is that we don’t offer real choice to supporters of charities because we don’t do enough to help them choose – we don’t provide the mechanisms for choice that they understand.
38
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Choice in charities
• We could be offering choice between charities
• We could be offering choice in how to support charities
• We could be offering better brand distinction
• We could be offering better choice of mechanisms to engage
• We could be offering better mechanism to help evaluation of impact
39
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The talk in a nutshell
• Choice is mushrooming
• What do we think of this growth in choice
• This is driven by technology, regulation, competition and culture
• We learn to cope with this choice in a number of ways
• What choice do charities offer?
• So how do charities mirror and respond to this rise in choice
o With branding
o With motivations
o With products
o With supporter-centred strategies
40
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Choice through branding
• What makes an organisation different?
• What is its niche
• What kind of people are mostly likely to support it
• What reasons would they have to support it
41
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Choice through motivations
The motivations
Ideology
Beliefs
Capability
Specifics
Environment
42
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Five motivations in more details
The motivation The descriptions
Ideology
This charity shares my view of the world and how it works or should work – my ideology
Beliefs
This charity share my beliefs about a right or wrong in the world and how to solve it
Capability
This charity has shown they have the capability to do the good that I want done
Specifics
This act is a specific, achievable good thing that I can do
Environment
This act benefits me, my life or my immediate world
43
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Five motivations in more details
The motivation
Ideology
Beliefs
Capability
Specifics
Environment
44
More on
volunteering and
reactive support
More about the
cause and the
issue
Greater
loyalty
More about
the donor &
their concerns
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Five motivations in more details
The motivation The examples
Ideology
Political parties, Greenpeace
Beliefs
Amnesty International
Capability
Red Cross
Specifics
Plan UK Child sponsorship, Smile Train
Environment
Comic Relief, Local charities
45
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Choice through productisation
• How much money is wanted
• Why is it wanted
• What sorted of feedback will donors get
• What impact will it have
• What kinds of people will value it the most
46