••• automotive research

The auto repair process needs an overhaul

Shop visits on par with the dentist

Most consumers (83 percent) continue to feel overcharged in the auto repair process and rank the experience of going to the repair shop/dealership to get their car repaired on a par with going to the dentist (with women preferring the dentist), according to a new consumer survey from AutoMD.com, an online automotive repair information site.

While women have a more negative view of the repair shop/service center experience than men do, across the board consumers say a more transparent process would improve the experience. Consumers say that not knowing what a repair should cost is the biggest challenge in the process and that they want real apples-to-apples repair job quotes. But, the survey shows, these consumers are empowering themselves digitally, by going online to research pricing and to look at consumer reviews before going to a repair shop.

The survey, which was conducted online among over 2,400 car owners from March 27-April 30, 2014, offers a snapshot of how car owners view the current repair shop experience. The survey included self-identified do-it-for-mes (46 percent) and do-it-yourselfers (54 percent), who shared consistent and similar views of the overall repair shop experience.

A whopping 83 percent of those surveyed say they have felt overcharged for vehicle service at the repair shop or dealership, a number that has remained stubbornly high over the past four years: in 2010, it was 88 percent and in 2012 it was 85 percent. Women dislike going to the repair shop more than going to the dentist, when asked to rank it against other experiences. Men ranked it just below going to the dentist.

Not surprisingly, over 44 percent of women have a negative view of the auto service center/repair shop experience, with only 12 percent viewing it positively. Overall, only 16 percent of all survey respondents had a positive view – but the silver lining for repair shops/service centers is that 40 percent overall had a neutral view, meaning perception change is possible.

Respondents ranked “not knowing what a job will cost” as the No. 1 challenge in the repair process.

Eighty-four percent said that a more transparent experience, i.e., “knowing exactly what I will be paying up front for the job I need done, before I go to the repair shop,” would improve the process, vastly trumping speedier repairs (8 percent) and better customer service (6 percent).

Eighty-four percent overall reported that getting the same kind of apples-to-apples repair price quotes usually available for most goods online is either “important” or a “must have” in the auto repair process. And an even greater percentage, a combined 91 percent, said that knowing the specific part to be used in the repair – and its price – was either “important” or a “must have.”

Ninety-eight percent ranked having a good mechanic as a “must have” or “important,” followed by fair pricing (97 percent) and a convenient location (52 percent). Shuttle service ranked low in importance: 56 percent either don’t care or say it is not important.

Almost two-thirds (65 percent) report that they have looked at reviews before going to a repair shop/service center, with women considerably more likely to do so than men (73 percent versus 64 percent).

And over three-quarters have gone online to research what the price of a repair job should be, with men only slightly more likely to do so than women. Overwhelmingly, consumers say that Web sites offering actual quotes for an actual job from an actual repair shop are of far higher value than Web sites offering just a general repair price range.

Even though over half of those surveyed have over 100,000 miles on their primary vehicle, only 55 percent of those who normally go to a repair shop to get their vehicle serviced follow a maintenance schedule, with 45 percent only taking their vehicle in when something is really wrong.


••• consumer research

Money to burn

Study sees spending upticks in several categories

Americans appear ready to move on from worrying about the recession and one thing seems clear: They need a vacation. The annual comparative audit report, American Lifestyles 2014, from Chicago researcher Mintel, suggests that renewed consumer spending is in line with pre-recession trends and consumer optimism is higher than it’s been in years. In 2013, Mintel estimates that personal consumption expenditures on consumer goods reached $10 trillion for the first time. The outlook for 2014 continues the positive trend, with spending expected to increase further by 3.6 percent – more than three times the projected rate of inflation for the year.

In 2014, just one in 10 Americans say that they don’t spend extra money – that they save it; a similar share say that they “never” have any extra money. These sentiments are in stark contrast with 2013 and 2008 survey results, when the share of savers was at least double. Meanwhile, all the saving and responsible spending appears to have paid off. The percentage of those who say they “never” have any extra money has declined since 2008 from 15 percent to 12 percent in 2014.

Mintel forecasts that total U.S. consumer expenditures will grow by 20 percent from 2013-2018 to reach $12,025 billion. In comparison, expenditures increased just 15 percent from 2008 to 2013 (with a 1.5 percent decline 2008-09). The categories that appear to poised to show the greatest gains over the next five years are many of the same ones that performed the strongest from 2012-13: nonessentials such as leisure and entertainment (+28.5 percent), vacations and tourism (+27.3 percent), technology and communications (+25.2 percent) and alcohol on-premises (+23.7 percent).

Over the course of one year, the share who say they spend extra money on vacations nearly doubled. This is the greatest gain for any one area of consumer spending and is a sign of improved finances – or at least optimism since, when money is tight vacations are often one of the first discretionary areas to be cut from the budget.

“One of the common themes noted across different sectors examined in the report is that optimism is a hallmark of youth,” says Fiona O’Donnell, category manager, multicultural, lifestyles and leisure at Mintel. “Adults aged 18-24, in particular, are looking at the world around them and see all the possibilities ahead. Owing in part to social media and the ability to share instantaneously with others, young adults are placing a higher value on ‘experiences’ as opposed some of the more traditional purchases of their parents’ generation. A desire for experiences over stuff, coupled with a record number of Baby Boomers reaching retirement – meaning that this relatively wealthy demographic has more free time on their hands – has seen expenditures on categories such as dining out, vacations, leisure and entertainment and alcohol outpace spending overall. This is a trend that is expected to continue over the next five years.”

Along with a renewed optimism in the economy, Americans are also focused on self-improvement for 2014. Top goals for 2014 include increased family time (88 percent), a healthier diet (88 percent), exercising more (87 percent), getting household finances in order (84 percent), achieving a better work/life balance (82 percent) and taking care of personal appearance (81 percent). Perhaps not coincidentally, those who have seen their financial situations improve in the last year are more likely to report having more goals.

Breaking down some of the winning categories paints a full picture, and it’s one of optimism and growth:

Vacations and tourism spending has outpaced total U.S. consumer expenditure growth and is estimated to have increased by 4.6 percent from 2012 to 2013, compared with a total growth of 3.4 percent. Over the next five years, steady growth is expected in the vacation and tourism segment, with total expenditures forecast to reach $282.4 billion by 2018 – a 27.3 percent increase over 2013 spending in comparison to the total spending growth prediction of 20 percent over the same time frame (2013-18).

Interestingly, when respondents’ change in vacation spending in 2013 is compared to results from last year’s survey, it appears that Americans are more likely to indulge. While previously, 41 percent of respondents indicated they were spending less on vacations than they had in the year before, this share has now declined dramatically to just 30 percent.

Leisure and entertainment is the star performer, with expenditures forecast to increase by 28.5 percent to reach $431.6 billion in 2018 – nearly $150 billion more than the total forecast for vacations and tourism.

More than half of respondents surveyed say they spent more or about the same amount on leisure and entertainment in 2013 compared with prior years. Similar to vacations and tourism, young adults – particularly men aged 18-34 – are most likely to say they are spending more on this category. In 2013, nearly half of the spending in this sector is attributed to membership dues for clubs and fees associated with sports centers, parks, theaters and museums.

Millennials’ average spend per year on entertainment is about $716 dollars less than the average American’s. Despite this difference, Millennials have increased their spending on leisure compared to prior years and plan to spend more in the coming two years. True to the moniker of “digital natives,” Millennials spend half of their entertainment budget on audiovisual and video-gaming equipment and 57 percent of Millennials prefer to spend downtime in front of an electronic device. They are also more likely to experience this leisure time alone, especially the 18-24 age group.

As the relatively wealthy Baby Boomer generation moves on to its next life stage (retirement), this group will have more time to devote to leisure and entertainment. In 2014, the youngest of the Boomers turns 50. At 76 million strong, their shift from the workplace to the leisure space will positively impact the category. 

Spending on out-of-home alcohol is estimated to have increased by 5.4 percent from 2012-13 (the strongest year-over-year growth of any other sector evaluated) reaching an estimated $92.7 billion in 2013. Steady growth is predicted, with the market forecast to reach $114.7 billion in 2018, an increase of 23.7 percent over the next five years.

Success in this sector may be at least partially attributed to operators’ creative, innovative offerings and on-site experiences designed to boost traffic. According to Mintel Menu Insights, on-premise alcohol offered at restaurants has grown 59 percent over the past three years. Such areas of innovation include alcohol type used, ingredients, flavors, preparation, packaging, portions and menu claims.

Over the past year, nearly one in 10 said they increased spending on alcoholic drinks (out of home). Additionally, compared with 2013, more consumers have moved from saying they are “spending less” (26 percent) compared to years prior to “spending about the same” (34 percent). While the increase is only marginal, these numbers indicate that consumers aren’t trading down or drinking at home as much and that people are craving products and experiences with a stamp of authenticity.

“Consumers are beginning to return on-premise for alcohol consumption. While still price-sensitive, operators will need to create added value through innovative items and an experience that cannot easily be created at home. Operators are focusing on fresh flavors and local ingredients, as well as specialized alcohol types to spur interest and boost sales,” says Bethany Wall, foodservice analyst at Mintel.

Many of the staple consumer electronics products and services have struggled to maintain their historically high growth levels. This is largely due to market saturation for electronic items such as televisions and the consolidation of functionality to multipurpose devices such as smartphones. Aside from smartphones (two out of three consumers own one) and tablets (four out of 10), the rate of increase in consumer spend on hardware and electronic equipment has slowed considerably and is also being impacted by consolidated functionality within mobile technology.

With more content going digital, consumer interest in streaming, video-on-demand and other Internet media will rise rapidly, with projected sales of streaming TV and movies doubling between 2013 and 2018. Furthermore, nearly half of consumers reported they watched some form of streaming video (purchase, rental or free) in 2013.

While the cable, satellite, television and radio segment saw a 7.5 percent uptick in sales in 2013, this may be driven largely by bundled services that include Internet. There is not much room for growth in the pay TV market and sales are forecast to slowly decline through 2018. In addition to traditional bundling options, service providers may be able to add value by offering unique bundles that include home security and automation features or cellular service at a discount.

“Many segments of technology and communications are at a turning point, given the prevalence of hardware in consumers’ lives. While device manufacturers have historically focused on bigger and better devices, consumers and the supporting infrastructure will need time to catch up. A major emphasis for 2014 will be on the quality of the software and services that those devices provide access to rather than the hardware itself,” says Bryant Harland, technology analyst at Mintel.


••• social research

From this day forward

Harris Poll charts changing idea of marriage

How important is the institution of marriage in today’s modern society? Pretty important, as seven in 10 U.S. adults (71 percent) say marriage is important to Americans in general, with over one-quarter (28 percent) saying it is very important, according to a Harris Poll of 2,266 adults surveyed online between February 12 and 17, 2014. When it comes to them personally, three-quarters of Americans say marriage is important, with half saying it is very important. And, while one might think that men and women have different answers on this, they are not as different as one might think: Just over half of women (54 percent) say marriage is very important to them personally and just under half of men (45 percent) say the same.

While marriage may still be important, the idea of marriage has changed over the decades. Almost three-quarters of Americans (72 percent) say, when compared to previous generations, the idea of marriage today is less important than it was; one in five (20 percent) say it is just as important and only 4 percent believe it is more important today. And this attitude is consistent across the generations. Seven in 10 of both Millennials (71 percent) and Gen Xers (71 percent), 72 percent of Baby Boomers and three-quarters (75 percent) of Matures all say the idea of marriage is less important today when compared to previous generations.

But, when asked to think back to the TV sitcoms from the 1950s and 1960s, with the father heading to work and providing for the family while the mother stayed home, took care of the kids and had dinner ready every night, seven in 10 Americans (69 percent) do not think this is how families should look today, while 31 percent believe it is. Here, however, there is a generational difference. Matures are divided, with 46 percent saying this is how families should look and 54 percent saying it is not. Three-quarters of Millennials (74 percent), on the other hand, say it is not how families should look, as do 72 percent of Gen Xers and 69 percent of Baby Boomers.

As women’s rights changed across the centuries so did the dynamic of a marriage and four in five Americans (82 percent) agree that in a marriage, men and women are equal in every way, with half (51 percent) strongly agreeing. In fact, just 16 percent of Americans agree that to make a marriage work, one partner needs to be dominant.

But marriage may not be for everyone. In fact, two in five U.S. adults (39 percent) agree that marriage is not necessary. More than two in five men agree with this, compared to just over one-third of women (43 percent compared to 36 percent). And, setting the stage for the future of marriage, there is a generational divide. Just one in five Matures (19 percent) agree that marriage is not necessary, compared to over half of Millennials (54 percent).

In most marriages, at some point down the road (or occasionally before the vows are even taken) there is a child that causes the couple to become a family. And, while unfortunately not every marriage works, two-thirds of Americans (67 percent) agree that children need to be brought up in a family where the parents are married, with one-third strongly agreeing (34 percent) and one-third somewhat agreeing (33 percent). There is a large generational divide on this, as over four in five Matures (86 percent) agree compared to three in five Millennials (60 percent).

There is also the issue of staying at home with the children or not, and over half of U.S. adults (57 percent) agree that children should ideally be raised in a household with a stay-at-home parent, while 43 percent disagree with this notion. There is a greater agreement about one factor of the stay-at-home parent: Over four in five (83 percent) agree that in households with a stay-at-home parent, it is not important whether it is the mother or the father; 45 percent strongly agree.

For some, before marrying there may be cohabitation. Over half of Americans (57 percent) agree that couples should live together before getting married while 43 percent disagree. Again there are some generational gaps on this idea, as just one-third of Matures (32 percent) agree that couples should live together first, compared to about two-thirds of Gen Xers (65 percent) and Millennials (68 percent). There is also a gender gap, as two-thirds of men (65 percent) agree that couples should live together, compared to just half of women (50 percent).

And, marriage is not for only men and women, but also for same-sex couples – depending on who you ask. Americans are truly divided on this, as just over half (51 percent) do not believe that the term “marriage” should only apply to a man and a woman, while just under half (49 percent) agree that it should. Once again, the generations think differently, as two-thirds of Matures (68 percent) agree that the term should only apply to a man and a woman, compared to less than two in five Millennials (38 percent).


••• food/grocery research

Web grocery shoppers: We're less impulsive

Online = on-budget?

According to a recent consumer survey from London-based eDigitalResearch, online grocery shoppers tend to buy fewer impulse purchases online than in store, resulting in smaller basket sizes. The survey of 1,154 online grocery shoppers found that 29 percent of respondents feel that they make far fewer impulse purchases online than in store. In comparison, just 7 percent said that they purchase more additional impulse buys online than they do in a store, highlighting a significant potential threat for retailers and their bottom lines, especially as more and more consumers switch to online shopping.

“The growth of online has the ability to drastically hamper supermarkets, retailers and suppliers,” says Derek Eccleston, commercial director at eDigital Research. “With more of us becoming all the more reliant on online and digital technologies, the online grocery market is only likely to grow. These results suggest that with this online growth, supermarkets are going to see overall spend shrink. They therefore need to be working closely with suppliers to understand this new breed of grocery shopper – they need to know how they shop and why, as well as what makes them buy what they do – in an effort to encourage online shoppers to spend more.”

However, the results also suggest that online shoppers are more likely to switch amongst various brands compared to their in-store counterparts. Of those online grocery shoppers surveyed, just 10 percent said that they always stick to the same brands for particular items, suggesting that there is a huge opportunity to influence people’s purchase decisions and disrupt their journeys online.

Perhaps unsurprisingly, price is one of the key drivers behind brand switches, suggesting that promotions and offers are the best way to disrupt online grocery shops and encourage impulse buys. However, loyalty-card promotions, search positions and product images all also have an effect on how people shop online.


••• mothers

Millennial moms creating new media patterns

The lure of all things digital

Evidence of Millennial moms’ growing passion for digitally-delivered experiences was quite evident in the newest wave of LMX Family, New York researcher Ipsos’ study of the media behaviors and attitudes of parents and kids. From time spent using apps and watching online videos with their children to number of SVOD subscriptions, Gen Y moms are increasingly turning to the Internet to find entertainment to share with their kids aged 6-12 years old.

While lifts were seen across the board in families’ use of online entertainment, Millennial moms and their children aged 6-12 spent 18 percent more time consuming app content and 14 percent more time consuming online videos than moms of other generations. Additionally, subscriptions to SVOD services were significantly more popular in families of Millennial moms, indexing at 135 compared to Gen X/Boomer moms. “This is an important finding not only because it provides a moment-in-time snapshot of what is happening in families today but also because it establishes where and how young moms are teaching their children to seek out entertainment content, “ says Donna Sabino, SVP and leader of the Ipsos Kids & Family Center of Excellence.

The allure of digital experiences also attracts Millennial moms while they are consuming traditional media with their kids. In fact, more than eight in 10 Millennial moms reported simultaneously going online while watching TV with their children – significantly more than moms of other generations. From visiting social networks to generating social TV conversations, across the board Millennial moms were more likely than other moms to TV-online multitask when consuming traditionally-delivered TV content with their children. “Moms are demonstrating concurrent consumption behaviors when watching TV with their children. This provides a salient model for kids’ own media consumption patterns moving forward,” says Sabino.


••• customer experience

Chat works for some, not for others

Quick takes on customer interaction methods

CX Act Inc., a customer experience improvement firm, has released findings from its Customer Touchpoint Stress Test, a snapshot of the customer experience across multiple service channels – phone, e-mail, chat and social media – involving 50 prominent brands in various marketplace categories such as airlines, auto manufacturers, financial, consumer electronics, consumer packaged goods, retailers and supermarkets – all of which invest heavily in digital marketing. Social Lens Research conducted the study by recruiting a pool of existing customers to test responsiveness on day-to-day customer experience issues such as billing questions, product issues and general inquiries. Customers followed a testing script asking them to document their experience in detail.

Top study findings include:

-- Phone outperformed all channels on issue resolution at 86 percent yet only 58 percent were very satisfied with service.

-- Customer experiences were inconsistent and being a top performer on phone service did not translate to high satisfaction scores on chat (40 percent), e-mail (22 percent) or on Facebook (17 percent).

-- Only 20 of 50 brands tested offered chat; even when chat was offered, quality of service was rated low, with one in three testers failing to reach resolution. However, for those who were successful, time-to-resolution was fastest among all channels at nine minutes.

-- Only half of the tested companies offered e-mail as a customer service channel, with only one in four companies offering a Facebook channel for customer inquiries

-- Ease of use continues to be a surprising challenge for brands serving customers: only 52 percent said customer care information was easy to find on company Web sites and when they did find it, only one in four (24 percent) found it extremely helpful.

-- Of most concern to brands is the impact of customer engagement on the key ROI metric of “likelihood to buy.” When customers had positive experiences, likelihood to purchase across channels ranged from 88 percent to 100 percent. But in negative experiences, likelihood to purchase plummeted.