The Omnichannel Deal Prone Consumer

Today’s retail promotional environment is driven by channel proliferation, consumers’ channel preferences, and managers’ efforts to create a unified “omnichannel” customer experience, especially across online and offline channels. This paper identifies and characterizes the deal prone consumer segments that emerge in this environment. Specifically, we investigate the existence and determinants of omnichannel deal prone segments - consumers who use online and offline channels to procure and use promotions. We use the motivations-opportunities-abilities (MOA) framework to analyze why consumers belong to various segments. We apply latent class cluster analysis to a database of over 1000 survey respondents in three product categories. We find omnichannel deal proneness dominates the consumer electronics category, but there is a strong online-focused deal prone segment in clothing and an offline-focused deal prone segment in groceries. Importantly, opportunities and abilities have more explanatory power than motivations in differentiating segments. Since opportunities and abilities are more likely to change in the future than motivations, the current size of the various deal prone segments is not in equilibrium. Simulations suggest, for example, an online, not omnichannel, deal prone segment may come to dominate the clothing category, driven by an expected increase in online shopping experience. Our results show how managers can target particular deal prone segments to achieve goals such as increasing consumption, encouraging brand/store switching, or reinforcing brand/store loyalty.