RETAIL: Alter Agents launches lower-cost service to provide new clients with information on shoppers’ spending habits.

Many traditional retailers have seen dwindling sales thanks to a decline in consumer purchasing power and the proliferation of online shopping websites.

But downtown L.A. research firm Alter Agents Inc. is hoping that big data can help more brands pull themselves out of the trenches through tailored consumer insights. The company is launching a service this month designed to make its research more affordable for small to medium-size businesses. The program would save those firms thousands of dollars compared with Alter Agents’ more in-depth services.

Phil Dance, co-founder of Alter Agents, said the idea for the service, called Shopper Spend, Triggers, Attitudes and Trends (Shopper Stat), came after attending a retail conference where many experts discussed one thing – the promiscuous shopper.

“People … aren’t loyal to brands and we’re seeing that especially amongst millennials,” Dance said. “They’re looking for something that kind of fits their personality and how they see themselves.”

Alter Agents co-founder Rebecca Brooks said the research tool will be able to empower retailers by showing them how and why consumers are shopping.

“Promiscuity is not really a trend,” Brooks said. “It was a new way of shopping and we wanted to start building research to demonstrate that because we were seeing it across all of our custom studies but we can’t share custom proprietary research with other brands. But having the Shopper Stat allows us to use that data to talk about it to kind of push that information out.”

Alter Agents’ new service comes at a shaky time for retailers at all points on the price spectrum, from Wal-Mart to Macy’s to Nordstrom. Some chains have been forced to rethink their business model and close stores.

It’s no secret that technology has greatly impacted the retail industry, but there are other issues as well, such as reduced consumer spending.

Frank Badillo, director of research for Macro Savvy in Glen Allen, Va., said there’s been decent to strong growth overall but it’s happening in other service areas.

“It’s going into buying cars,” Badillo said in a statement. “It’s going into eating out. And it’s going into primarily other services,” including health care, he added.

Uncharted territory

Alter Agents, previously known as Dialogue, was co-founded in 2010 by Dance, Brooks and Angela Woo. The trio said they launched the business to further explore how digital technology was changing the way consumers shopped.

The three previously worked for Playa Vista market research firm Hall & Partners on projects such as testing the effectiveness of global ad campaigns before they launched for companies such as Microsoft Corp.

Now, Alter Agents works with clients including Hyundai Motor Co., eBay Inc. and Physicians Formula Holdings Inc.

The firm’s main focus has been taking on custom research projects for clients that can last anywhere from six to 12 weeks, depending on the intensity of the study. For example, when client Viking River Cruises launched an ocean liner last year, Alter Agents spent a year working on a study to help the cruise line design its new ship and select activities to include in its itinerary.

Prices for its custom research can be $25,000 to $50,000 a project. But with its new Shopper Stat tool, clients can view data instantly through an online dashboard for about $20,000 to $55,000 a year.

Shopper Stat’s data covers the consumer product goods category – think cereal, beverages and condiments – but the firm plans to roll out data on other sectors such as hospitality and fast-casual restaurants. The information is culled from interviews with shoppers. The plan is to figure out not just what customers are buying, but also establish a time line of the whole purchase process – from what a consumer was doing before stepping into a store to what they were thinking after they bought their items. That way Alter Agents’ clients can get a sense of a shopper’s lifestyle.

Until now, the firm has only taken on custom study projects for clients that were built from the ground up. But after six years, Alter Agents felt it was time to offer its research to brands that might not be able to afford a custom study.

“(Shopper Stat) is something created by us,” Brooks said. “We’re collecting a thousand interviews a week and then clients can buy into that and see that data. While they don’t have control over the questionnaire, it’s a much more affordable way to get access to the data than doing custom work and they can see what all their competitors are seeing.”

The original article can be found on the LA Business Journal’s website.