The Candid Voice in Retail Technology: Objective Insights, Pragmatic Advice

Do Customers Enjoy Shopping With You?

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It’s not up for debate: shopping is objectively easier than at any other point in history. Consumers can buy just about anything they want (often-times from a multitude of sources) and take delivery of those products in any number of ways they deem most convenient to their personal needs.

For retailers, however, “easy” is no longer part of the internal lexicon. To sell successfully in the modern world, one most overcome competition from sources old and new, or as RSR so often points out, consumers will “just buy it on”. That has become the default-mode response by many consumers for an ever-growing host of shopping needs. Competition is seemingly everywhere at all times.

As a result, many retailers have identified that offering an excellent customer experience is the way to differentiate their brand. But what is an “excellent customer experience”? The answer to that can vary wildly from one category to another (luxury goods vs. mass merchandise, for example), one product sub-segment to another (specialty sporting goods vs specialty musical instruments), and even from one competitive brand to another within the same sub-segment. Consider just how differently seemingly similar retailers (REI and, for example) approach their customer experience offering, despite selling nearly identical brands and products.

A retailer’s approach to customer centricity and offering a compelling customer experience is core to its brand. And for many, they are betting their future on it.

At the same time, the technologists that service the retail industry have promoted the idea that personalization holds the key to future success. Communications must be personalized. Product offerings must be personalized. Delivery methods, customer service, help center tactics, pricing… the list goes on and on.

As our most recent research shows, however, for retailers, personalization may well not be the right objective. Their sights are currently set on establishing relevance. In retailers’ view, customers don’t need a personalized price, but they certainly want a fair one. They may not need a true 1-to-1 communication from their favorite brand – but if that brand does try to reach out, then the communication (and the offer it holds within) must be relevant.

As it turns out, consumers tend to agree.

What makes our latest benchmark report unique is that not only did we survey roughly one hundred retailers about their vision for the customer experience, but we also surveyed over one thousand US-based shoppers (aged 18 and up) to gauge their sentiment as well.

It turns out there are a lot of breaks between their perceptions of what is – and what should be:

  • Virtually all retailers (98%) say that building relationships with their existing customers is key to success in today’s challenging economic times. Unfortunately, only 39% say they can confidently even identify who their best shoppers are – which is absolutely paramount to building any such relationship. At the same time, only 36% of retailers have assigned a single owner to oversee the overall customer experience, and customers feel that lack of accountability.
  • Less than 40% of shoppers report that retailers know enough about them to identify the products they may like, make offers that might be relevant, or perhaps most telling: make offers based on what they actually buy – not what a retailer may want to sell. Consumers strongly sense that retailers are still operating from a product-centric point of view.
  • Retailers have a very clear view of what they think customers want. They believe their biggest external challenge – out of a long list of options – is that consumers want more targeted and personalized offerings. They are only half correct.
  • Consumers do want more targeted communications, but only if those communications provide access to the lowest price possible: 66% of shoppers rated “lowest price” more important than anything else (a “consistent” experience – even from one store to another – was rated 2nd most valuable to achieving an excellent shopping experience).
  • In good news, shoppers do believe retailers are providing a consistent experience – 55% say their favorite brands perform very well, and another 42% say they do it “somewhat well”. But according to shoppers, retailers fall short in their abilities to deliver a great loyalty program, and in their ability to make relevant offers. Fundamentally, retailers are not perceived as knowing enough about consumers to identify the ways people like to shop.
  • Perhaps most importantly, customers believe that even their favorite retailer can provide the low price they want only half of the time. This puts 50% of their potential purchases up for grabs.
  • As it relates to the technologies that can help them better meet all of these growing shopper demands, retailers identify solutions that integrate the physical and digital selling environments – integrated eCommerce, integrated POS, and customer order management – as three of the top-five “very important” choices in their customer centric strategy. Unfortunately, responses show that they are decidedly not yet satisfied with efforts to-date to implement a customer order management and fulfillment capability.

If you’re interested in the full report, it’s available here, for free. We’re quite proud of it, and hope you find it valuable.

Newsletter Articles March 2, 2023
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