While retailers have historically used the “multichannel” approach to reach consumers, the rapidly growing focus on the consumer and integrated, customer-focused technology has paved way for a “Total Retail” experience, according to a new report by PwC titled, Achieving Total Retail: Consumer Expectations Driving the Next Retail Business Model. Based on a survey of more than 15,000 online shoppers globally, the study reveals eight consumer expectations that call upon retailers to create a Total Retail business model transformation.
“Consumers now view multichannel shopping as a given, and the costs and complexities of managing a multichannel model are too great and offer too few rewards to benefit the customer experience,” says Steven Barr, PwC’s U.S. retail & consumer practice leader. “Today’s non-stop shoppers have taken things into their own hands, becoming more tech-savvy than retailers. Consumers have the tools at their fingertips to immerse themselves into the retail brand. Our report finds that consumers have strict expectations that challenge today’s shopping experience and, in response, retailers should embrace what we at PwC are calling Total Retail.”
PwC outlines eight key consumer expectations and provides business implications for retailers to help achieve the Total Retail model:
A compelling brand story that promises a distinctive experience. Retailers should better establish a strong brand promise that solidifies a core of loyal customers. A high percentage of survey respondents were attracted to brands that tell a story in an engaging manner. Seventy-nine percent of U.S. shoppers say they shop at their favorite retailers/brands because they trust the brand.
Customized offers based on totally protected, personal preferences and information. Big data and predictive analytics will help retailers use customer data to increase marketing and sales effectiveness through customizing digital coupons, exclusive content, and social media promotions, among others. However, 37 percent of U.S. shoppers say they do not use their smartphone for shopping because they are worried about security. Retailers should better safeguard data, by either building their capabilities step-by-step or adding proper capabilities through acquisitions.
An enhanced and consistent experience across all devices. Among U.S. survey respondents who do not use their mobile phones or smartphones for shopping, 32 percent say they do not own mobile/smartphones and 33 percent said device screens are too small. However, as screen sizes get bigger and more consumers obtain newer mobile devices, mobile shopping will likely accelerate. To prepare for this growth, a Total Retailer will need to have the technical agility to provide one seamless experience via PC, tablet, mobile phone, in app or web browser.
Transparency, real time, into a retailer’s inventory. When asked which in-store technologies would make for a better shopping experience, 45 percent of U.S. survey respondents chose the ability to check other store or online stock quickly. Consumers are looking for actionable inventory information from retailers, pushing retailers to upgrade technology on their supply chain, on how products are tracked, warehoused and distributed.
Favorite retailers are everywhere. When asked what they would do if their favorite retailer shut down its local store, 53 percent of survey respondents noted they would locate the next nearest physical store and 40 percent said they would increase ordering from their website. Shoppers today assume retailers are everywhere and always connected like themselves, and retailers need to look at store portfolio management more strategically.
To maximize the value of mobile shopping, both store apps and mobile sites must improve. PwC’s survey finds shoppers do not have a strong preference regarding using an app or browser for mobile shopping. When asked how often they use an app and mobile browser for shopping, respondents noted 22 percent and 28 percent weekly, respectively, with mobile browser faring a bit higher due to convenience (53 percent prefer mobile browser because of convenience). Retailers should take note to ensure their mobile site is optimized, while also ramping up apps to improve the experience.
Two-way social media engagement. Enthusiasm for social media by retailers and brands is driving consumers to engage, comment and even effect change. When asked what attracted them to a particular brand’s social media site, 61 percent of U.S. respondents noted attractive deals and promotions, 38 percent noted new product offerings and 28 percent said because they shop with the retailer. Retailers should in return better listen to customers on social media, transforming commentary into actionable data for new ideas and improved experience.
“Brands” act like retailers, and we’ll treat them that way. The gray area of overlap is growing between brands and retailers, and 44 percent of U.S. survey respondents noted that lower price is the main reason they buy from a brand’s website. Retailers today are partnering with brands/manufacturers to share consumer insights and collaborate on category management to drive more success for both.
For more information and to download an electronic copy of Achieving Total Retail: Consumer Expectations Driving the Next Retail Business Model, visit http://pwc.to/ttlretl.