The importance of the shopping experience in times of recession: an analysis from the perspective of the hedonic and utilitarian shopping values.

Author:Cano, Marta Blazquez
Position:Art
 
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  1. Introduction

    The term recession has been defined as a state in which the demand for a product is less than its former level (Kotler, 1973). According to recent studies, the global economic recession has deeply affected consumers' shopping habits worldwide (Passport, 2012). In the case of Spain an unprecedented recession, considered unique with regards to the time of recovery, is eroding the economic stability and household confidence which has generated a greater risk perception and, as a consequence, has led to a contraction of consumption and has situated Spain among the least optimistic countries in the world (Nielsen, 2012, Millward Brown, 2012).

    The described background is common to all economic activity but the specific effects of the crisis on consumption are different depending on the specific activity sector. In particular, the clothing sector seems to be one of the most resilient in the current recession (Mintel, 2010). Recent data published by the Barometro de Empresas de Moda en Espana (2012) indicate that the majority of Spanish fashion companies improved their turnover in 2011 and forecast positive results for the next year. The same report notes that fashion ecommerce share of market is increasing and it is expected to be one of the most important ways of growth in the fashion industry. However, according to data published by the Organizacion Nacional de las Telecomunicaciones y la Sociedad de la Informacion (ONTSI onwards, 2012) the fashion B2C market suffered an important contraction last year in Spain, in a context of growth and expansion of the online channel in other sectors. Precisely because of the contradiction that seems to arise with respect to that subject in view of the reports consulted, this research aims to determine how the economic situation has affected the consumer' relationship to fashion consumption and specifically to analyse how it influences perceptions, motivations and use of different retail channels by consumers.

    Academic research related to strategic responses to economic downturn is limited and little is known about what the appropriate actions and decisions in times of crisis are (Dawson and Larke, 2004, Srinivasan et al., 2005, Sands and Ferraro, 2010). However, different authors agree that one of the main strategies applied by marketing managers to stimulate the consumer demand is the increase of marketing segmentation efforts. This strategy requires to know who the consumers are and how they behave during a crisis (Shama, 1993, Dawson and Larke, 2004). Because of that the relationship between consumers and the textile sector in times of recession will be reviewed in the next epigraph.

    The consumer, the recession and the textile sector

    Spanish consumers face a high rate of unemployment (INE, 2012), which has led to a reduction in the income level of an important part of the Spanish population. In addition to this real reduction of income, active workers have a negative perception about their working stability and the future of the economy in the country. Thus, workers feel that their income and their strength in the labour market are weakening and therefore, their consumption levels are falling (Millward Brown, 2012).

    The scarcity of resources creates changes in consumers' practices of consumption (Lehtonen, 1999) and has also contributed to strengthen a consumption trend, emerged and consolidated with the recession, which is expected to continue when the economy improves: the consumers' search for value (Euromonitor International, 2011, Westbrook, 2012). The consumer is becoming more aware about prices and is more cautious and committed in his shopping activity (Grewal et al., 2009). However, this behaviour is not new. Stones' (1954) shoppers typology included the 'economic shopper', which is the segment most frequently identified in the literature. The 'price-bargain conscious shopper' (Stephenson and Willet, 1969) has evolved toward the 'economic-convenience shopper' (Bellenger and Kargaonkar, 1980) and the 'value for money consumer' (Shim and Mahoney, 1992). Value refers not just to price but to all factors that make the shopping experience as a whole (Zeithaml, 1988). This way quality is set as an important shopping aspect for fashion because a more expensive garment can provide greater value than a cheaper one (Mintel, 2010). It can be said that the recession is giving rise to a 'smart shopper' who has many tools to find the best value for money, for example comparing prices or finding the best deals on the Internet (Mintel, 2010, PWC, 2011). Due to this active seek for value, one of the main shopping motivations for consumers in times of recession is the purchase of items at reduced prices, either in sales or special promotions (Passport, 2012).

    This demand of lower prices has led to the creation of new ways of collaboration between brands and channels, allowing retailers to make their products accessible to a broader segment of the population without damaging the brand image (Euromonitor International, 2009). These collaborations include ways to promote online channel as flash sales of prestigious brands across online fashion platforms (Barometro de Empresas de Moda, 2012). But this demand for lower prices has also boosted the development of discount concepts in physical stores, popularly known as outlets (Passport, 2012). Mintel (2011) forecasts a growth of discount fashion stores in the short term in Spain while specifies that the trend could be reversed once the economy recovers due to the preference of the Spanish population to buy clothes in traditional stores.

    Spaniards are highly involved with fashion (Mintel, 2011) and even though they are changing their consumption patterns due to the recession, they still continue maintaining a strong relationship with the textile sector (Millward Brown, 2012). Once basic needs have been covered, buying clothes is the second main expenditure for Spanish consumers and they plan to come back to their consumption patterns once their economic situation improves (Nielsen, 2012).

    Other remarkable aspect of consumer's relationship with the textile sector is the use of fashion shopping as a reward or to change a negative mood, especially at current times (Mintel, 2010). On that issue Nicholson's et al. (2002) state that when the consumer looks for hedonic items, defined by the authors as 'prizes', they prefer the physical store because the physical environment reinforces the mood through social interaction opportunities, product evaluation and sensory stimulation. Visiting stores can be considered a way of scapism, a break from everyday life as shopping is seen as way in which consumers treat themselves (Backstrom and Johansson, 2006). However, recent research shows that buying clothes over the Internet is also perceived as an enjoyable activity that provides hedonic value (Clifford, 2012).

    Whether the consumer chooses one channel or another in recessionary times is related with the search for aesthetics as well. Lehtonen (1999) demonstrated that the lack of resources makes consumers see the shopping activity in a new light and that they are able to find aesthetic meaning in consumption even when their resources are limited.

    Generally it can be said that the recession is having a bigger impact on physical stores than on the Internet. Dawson and Larke (2004) found that retailers who chose to open more stores as a strategy to generate more sales in times of economic downturn had high levels of debt and low productivity and the strategy proved to be a mistake. However, retailers who invested on online channel were successful. In fact the crisis is boosting the consumer migration to the online channel and it is expected that this trend will continue when the economic situation improves (Euromonitor International, 2011).

    Recent data shows that e-commerce is growing worldwide and even in Spain at a lower pace (ONTSI, 2012). E-commerce is a retail channel that helps consumers to save money in times of recession through the purchase of products and services at discount prices and through the access to downloadable coupons and daily deals (Passport, 2012). Internet makes easier to establish the correlation between price and value for a specific product as well (PWC, 2011). In fact, the European Commission estimated at 204 billion euros the overall gain for consumers in the hypothetical situation that 15% of total sales would be made through the Internet (European Commission, 2012). However, there is little agreement about the relationship between consumers' working situation and the development of the Internet as a retail channel. On the one side it has been pointed out that the increasing level of youth unemployment could lead to a lower development of e-commerce in some categories (Mintel, 2010b) and that, in fact, unemployed people are in risk of digital exclusion in Spain (Fundacion Orange, 2012). On the other side it has been defended that unemployed people have more time to use the Internet and find the best deals, which leads to a higher development of the channel. In addition, working people have less leisure time and they could use Internet to save time in their in-store shopping (Passport, 2012). This lack of agreement indicates a need to understand this relationship in detail.

  2. Literature review

    The shopping experience: hedonic and utilitarian shopping values

    The concept of value has been defined in multiple ways in the literature. Zeithalm (1988) carries out an extensive review of the concept and comes to the concept of value as 'all factors, both qualitative and quantitative, subjective and objective, that make up the complete shopping experience' (Zeithaml, 1988, pp. 13). So value is not limited to the acquisition of the product but it is derived from the consumption experience generated from that acquisition (Holbrook, 1996).

    Shopping value can be both, hedonic and utilitarian (Babin et al...

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