Lessons learned from studying customer behaviour patterns in convenience and proximity
It is a well-known fact to the food industry that consumer convenience relates very strongly to the time consumers have available to make a purchase and then get on to do the next thing in their day. What is striking are the parallels between dynamics in the research around social interaction in urban areas and in learnings on consumer behaviour in convenience grocery and informal eating out. To wit, the drivers of and barriers to convenience seem to operate similarly for both social interaction and informal food and grocery purchases.
Decay curves on volume of visits to convenience stores and informal eating places show that frequently 80% of the visits are as short as 5-10 minutes walk, cycle or drive from the starting point of the consumer journey.
This seems to be an almost universal truth across geographies. In high density urban environments it will be 5-10 minutes walk. and in less dense rural and suburban areas it’s more likely to 5-10 minutes travel by car, scooter or bicycle (depending on the geography). If the consumer is using public transport, their visits to informal eating or convenience grocery are highly likely to be 5-10 minutes walk from the underground station or bus stop.
In Asian business districts where workers are likely to be working on the 20th, 30th or even 40th floor of the building it’s now increasingly common to see food courts with western fast food as well as local Asian informal food offerings in the basement of the office building as it can take 5-10 minutes to get down by lift from the 30th or 40th floor – and the majority of workers do not even leave the building to get their lunch.
The phenomenon of short visit times to these places is driven by efforts in both industries to making themselves available to consumers almost “at arms reach”, and is fuelled by ubiquity of offerings, availability of close alternatives and competitive outlets nearby. In Tokyo and other Asian mega-cities the soft drinks industry takes this dynamic to the next level by making their products available at vending machines every few yards on the street and at key commuter nodes like bus stops and subway platforms. In Seoul, Commuters can now even order groceries and informal eating items delivered to their work or home address by pointing their phones at groceries advertised across the track and ordering them by QR code.
The 5-10 minute “rule”, however does not apply to when consumers are making “destination” visits or purchases. These tend to be higher involvement purchases or eating out events. This might be visiting a special bakery or butchers on a weekly visit to buy products are unusually good quality, or going to a more upmarket restaurant for special anniversary celebration. Also in both retail and eating out there is a “new kid in town” effect when a new chain or brand enters the market for the first time, particularly if it is a well known brand whose arrival has been anticipated for some time. A high proportion of visits to these places in the first few months will be destination visits to allow customers to check out the new offering but if they are of convenience and informal in nature, visit patterns will settle down over time and convenience will start to rule again as with the existing chains.
Successfully tapping-in to the convenience dynamic in these industries is firstly about understanding the underlying landscape of consumer availability and traffic flow patterns . Most major chains will be able to correlate the number consumers available within 5-10 minutes walk or drive (typically driven by either home, work or shopping visits) and the potential sales volume of a new or existing outlet. Although the 5-10 minute convenience rule applies almost regardless of age, class, sex and income, the needs of different customer demographics do of course vary, and the relevant customer profile will be nuanced appropriately by chain or brand.
Less obvious, however are some of the barriers to convenience which limit customer access and customer willingness to visit particular convenience outlet locations. The barriers can be both physical and psychological. Physical barriers are obvious enough. A dual-carriageway with central barriers for instance, will obviously effectively halve the number of convenience visits that can be counted on from a particular location from vehicular traffic. At an airport or train station, the location of outlets at different levels in terminals and various platforms can divide consumer flows and limit the potential volume of a particular convenience site.
Psychological barriers, however, are not so obvious. For instance, research shows that traffic volume and speed can be a barrier to both pedestrian, cycle and vehicular visits to convenience sites. For instance, in central London, many of the “red routes” that lead into the core part of the city centre are fast-moving 40mph dual-carriageways with metal barriers across the centre with crossing traffic lights which are generally 100-200 yards apart. Research exists that shows that even when crossings are available, these roads are a major barrier to pedestrian convenience shopping, in some instances acting almost like a physical barrier in their own right. This is a function of the potential of discomfortingly close fast-moving and heavy traffic, but also the fact that to cross the road and wait for the traffic lights it can easily take 5 or 6 minutes to cross – and to get to a destination on the other side of the road you may need to walk 50yards in one direction and 100 in the other.
Heavy vehicular traffic is also known to have a malign impact on social connectivity and neighbourliness. The best-known study on this is by Donald Appleyard and Mark Lintell and was conducted as long ago as 1972. In 2008 Joshua Hart and Graham Parkhurst replicated this study in Bristol. They took three streets with different levels of traffic and compared the average number of friends and acquaintances that people had on each street type. They compared the results with the mean values from the previous San Francisco study. Both studies show that people living on streets with heavy vehicular traffic tend to have fewer friends on their street and not many acquaintances. Those living on lightly trafficked streets appear to have three or four times as many friends and twice as many acquaintances.
The unpleasantness of environment for pedestrians and barriers to convenience that informal eating out places and convenience grocery businesses are challenged with on the red routes in London clearly have implications for how the urban and suburban environment are planned. Breaking down barriers of space, time and convenience could be a major element in planning social cohesion. Casual interaction with neighbours on a regular basis is easier if they are closer – in speaking distance, it takes you no time at all to interact and the environment is a more pleasant and less pedestrian- threatening space.
Alistair Fairgrieve is Managing Partner at ArrowLine Marketing. He specialises in consumer insights and was formerly Chief Insight Officer at McDonald’s Europe.
Photo by Robert Kwolek.