Mindshare consumer barometer vouchering edition

Spring 2012 VoucheringConsumer closeness barometer

Mindshare’s Quarterly Confidence BarometerSpring 2012

This is the first in a series of on-going reports commissioned by Mindshare to evaluate consumer confidence in relation to the current economic climate in the UK & to assess how different trends are impacting upon consumer spending.

In this report we have focused on the impact of vouchering schemes on consumer spending, exploring whether their prevalence is creating any sense of a discount society amongst consumers.

Our investigation was carried out on The Hive, Mindshare’s exclusive co-creation community. This community has been set up to help us get closer to the British public enabling us to embed the consumer voice in our thinking.

The Hive is populated by 300 members from around the UK, all of whom are slightly ahead of the curve when it comes to adoption.

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● It could all get a lot worse before it gets better

Many of our community can cast their minds back to times when recession periods had a huge impact on the lives of the general population – “I can remember 15% inflation, 3 day week, 83% highest rate of income tax (+ 15% investment income surcharge for your savings) and no refuse collected from households”. Although the community were in agreement that things were not as bad as they had been in the past big recessions, many expressed concerns that this type of outcome was still a very real possibility in the future.

● Confidence is in short supply, with no clear direction forward.

There is a slight perception that the private sector is on a road to recovery, but this belief is extremely fragile. Although the financial crisis in the EU was raised by our community as one of the most important factors impacting on future stability, there was a sense it being out of their control, and to a degree, an almost academic problem. Issues closer to home were of more immediate concern – the future of the public sector over the next year or so, and the impact this could have on day to day lives, were a much more tangible fear for many.

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“ I think back to how grim things felt in the late 70s and early 80s – bin men on strike, emergency workers on strike, miners on strike… and it seemed like there were cuts on top of cuts, on top of cuts” Meeow999, Female, 45–54


● On a day-today basis, consumers are more conscious about their spending habits

Consumers are now much more self-aware when it comes to their purchasing behaviour, with the equation of rising bills, and stagnant pay packets high on the agenda.

With luxuries being reigned in for many, we have also seen the rise of a niche savvy shopper who is more careful about their day to day purchasing. The recession has given permission for these individuals to become much more heavily reliant on high street deals and vouchering schemes, and they are actively playing the system wherever they can.

● It’s all out of my control…

Even the most optimistic of consumers appear to have very little sense of direction or vision for future growth – from either the UK Government or wider global powers. Consumers do not feel that the government have done enough to explain the implications of poor economic performance, or relate this to the individual.

As yet, consumers are not personally seeing the benefits of any growth, with the long haul of the recession wearing people down – “I’m feeling pretty depressed about the economy and fed up feeling depressed about it.”

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“I personally feel I haven’t caught up at all since all this began. I’m trying to save as much as I can so if anything does happen in the near future, I have something to fall back on. I honestly don’t know why all this is happening, I don’t think that the government have done enough to help people like myself, nor have they explained what it all means.” lkscotland, Female, 18–24


● Awareness of vouchering schemes is high, however, adoption is less widespread

Vouchering schemes have entered the public consciousness big time, with the vast majority of respondents having heard of at least one vouchering scheme. In particular this has been driven by the proliferation of services, such as Groupon and myvouchercodes, as well as through trusted advice forums such as moneysavingexpert.com

Exploration of the various sites, and signing up to receive emails and alerts was similarly impressive. However despite this strong initial base, active uptake – outside of the ubiquitous pizza express voucher – was much less

widespread. Bad press around Groupon had damaged consumer trust in these services, and the types of offers available were simply not compelling enough for many of our consumers – “I have signed up to loads of these schemes and receive lots of emails every day (some from schemes that I don’t remember signing up to!), but don’t really use them, as I don’t usually have the time to read them all, and it is very rarely that I see something that I want. I’m sure that they are of use to some people, but as I’ve stated, I rarely see anything that appeals to me! “

“Five years ago, there were nowhere near as many online vouchers available as there are today. In the last couple of years they’ve become really popular….

John, Male, 35–44

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For the top tier of voucher users, technology has provided a platform for comparison and they were actively trawling the Internet for the best deals. Our niche users had signed up to a wide range of discount sites including groupon, living social, wowcher, voucher could, my voucher, KGB, Priority Moments and HUKD. They were also making active use of Facebook to find discount on their favourite brands – “I also like pages on Facebook to keep an eye on coupons that come up. I do it because

they are products/brands that I love, and that I either choose to shop with regularly, or can’t afford to shop with often, and the vouchers/general online deals they send can make a difference to me financially.” For the majority of voucher users, however, existing technology lags behind expectation, for the following reasons:

● How has technology Influenced Voucher adoption?

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FINDING WHAT THEY’RE SAYING

YOU DON’T KNOW ME

Experience based vouchers are not targeted, and therefore consumers feel overwhelmed

“I seem to get sent all sorts of things but none of them are ‘for me’... I ignore most of the emails”

OFFERS CONTRADICT LOYALTY

Consumers tell us that they tend to eat out at the same restaurants and buy the same products; they want discounts on the things that they use

“Somewhat ironically, I have not used voucher schemes as I’m subscribed to emails from my favourite restaurants and shops and they send me offers direct”

IT’S NOT REALLY SIMPLE

The process of sourcing relevant discounts, then printing and remembering to claim vouchers, is seen as a hassle

“I think scrabbling about in your bag for pieces of paper is unseemly”

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● Where next for Vouchering? Consumers perceive that smartphones are the next natural home of the e-voucher – with the hope that apps would streamline the process of locating, and using offers. Smartphone voucher uptake was in place amongst a minority of our community, and for these converts, the experience was a much more straightforward process – “I use vouchercodes on my smartphone. I think they are a great way to save money and much quicker and easier than printing off vouchers at home. I’ve used two in the last week just by showing staff my phone. Who wouldn’t want to save money, this can only be a positive thing!”

For the majority though, awareness of this type of service just hadn’t registered yet. And for those in our community who were using vouchers on a more regular basis, they saw little chance that their shopping behaviour would revert back to full price once the economy recovers. Realisation of how much profit companies had been making before the recession, had clearly impacted on their attitudes; “I wouldn’t buy anything without vouchers if they were available. Why pay the full price? There is so much discount available, that it is clear retailers make huge profits anyway.”

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“I think many people perceive vouchers as things that poor people might use to help them make ends meet. Although I think in this day and age, with money problems, any kind of voucher is more acceptable to use… I do think that electronic vouchers are much more acceptable; most people have a smartphone now & are embracing technology, so it’s just another app on your phone” Jren207, Female, 18–24

MATT DID ORIGINALLY SIGN UP FOR A COUPLE OF THE bIG SCHEMES, bUT FOUND THEM TOO MUCH OF A HASSLE, AS HE KEPT GETTING bOMbARDED WITH EMAILS AbOUT STUFF HE DIDN’T WANT. He is in his late twenties or early thirties; he tends to know what it is he wants to buy in his day to day life and is loyal to particular brands within his routine. Matt perceives that he is too busy to be bothered with vouchers – if one falls in his lap, then he might use it however, it’s unlikely he will actively seek savings on his

purchases. Matt did originally sign up for a couple of the big schemes, but found them too much of a hassle, as he kept getting bombarded with emails about stuff he didn’t want. He told us that the process of finding a voucher, printing it, remembering to take this print out to the store and then claim at the till, was just too much – the up front investment doesn’t justify the saving.

He is excited about the possibilities that smartphones can offer vouchering and sees location based services as an exciting next step, so long as he has control over the offers he receives.

MEET MATT THE APATHETIC OCCASIONAL

“To be honest, I’m not sure I can be bothered to search out relevant vouchers. MikeGParry, Male, 35–44

“I have heard of Groupon, Wowcher, Keynoir, etc… I don’t use them. I think they’re a great idea but I’ve just never been that bothered to use them. I think that I am terribly lazy; I don’t want to jump through lots of hoops for the chance to have 5% off… It’s not convenient and just too complicated” Larysa, Female, 25–34


MEET CAROL THE SURPRISE ME SHOPPER

“I use the ASDA price check thing and sometimes get money back from my weekly shop, which always helps… I also have a Tesco clubcard and so use the vouchers that they send me from time to time. Skiller40, Female, 45–54

“Vouchers give the average customer a little treat and make them feel like they’re getting something special. There are things that I don’t yet know I want… These are the things that will delight” GloriaD, Female, 35-–44

CAROL REPRESENTS THE MAJORITY OF DIGITAL VOUCHER USERS. She has a part time job, however her routine centres around her two young children – who keep her busy much of the time. Carol is in charge of the household shopping and regularly uses her Tesco vouchers, making sure she gets maximum value out of the scheme wherever

possible. Carol has signed up to a couple of online voucher services. Most of the time she feels a little overwhelmed by the number of ‘random’ offers she is sent, but every once in a while there is a diamond in the rough. These occasional bargains help to make her feel like a savvy and satisfied bargain hunter.

She uses these vouchers to enjoy some quality ‘me’ time – investing in a haircut or a spa day, with friends. ‘Finding’ a discount on these expensive luxuries is a real treat & allows her to justify the expense.

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MARLENE ACTIVELY SEEKS OUT DISCOUNTS ON ALL PRODUCTS SHE bUYS – SHE REPRESENTS THE VERY TOP TIER OF VOUCHER USERS. Marlene retired a couple of years early and her children have left home – she spends a number of hours each day trawling the Internet for the best possible deals. It’s important for Marlene to keep an eye on the pennies, particularly in these tougher economic times (although she isn’t necessarily from a low income background).

Marlene recognises that different sites will promote different offers, often within the same product category. If there is a product she spots, she will hunt down the best saving. In order to help streamline this process, Marlene is a member of multiple online saving sites and frequently uses price comparison sites.

She will also actively seek out paper vouchers in magazines. She has limited brand loyalty – her shopping habits are dictated by price and on finding the best deals.

MEET MARLENE THE DISCOUNT DIVA

“I never buy anything without using vouchers! I currently use many internet forums and the mobile app Quidco, which can give me instant in store vouchers and also cash back opportunities. Activist3, Male, 55–64

“Just yesterday, I bought a Dettol No Touch Cucumber Splash Hand Wash System from Superdrug for £4.79. In payment, I used a £5 off voucher, which meant they paid me 21p to have the product – this was deducted from the rest of my shopping.” CrazyDaisy, Female, 45–54

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Our quarterly Consumer Closeness report sits alongside our Future Of… programme, Mindshare’s future facing research initiative which examines emerging technologies within the media landscape.

To receive more information about either of these initiatives, please contact Trevor Roberts or Jeremy Pounder via [email protected]

Mindshare consumer barometer vouchering edition

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