With retailers quickly becoming aware of the crucial importance of customer engagement, it’s clear that the shopping experience is likely to be a key battleground for retailers in the immediate future.
In fact, a recent study found that customer experience will overtake price and product as the key brand differentiator by 2020. Furthermore, 86 per cent of buyers are willing to pay more for a great customer experience, while 73 per cent point to customer experience as an important factor in purchasing decisions. (1)
Improving the shopping experience can, therefore, have a significant material impact on the bottom line. To compete successfully in 2019 and beyond, retailers need to understand how they can improve the shopping experience.
Here are five key trends that Australian resellers should consider to improve the shopping experience:
1. New concepts and formats in-store can strengthen retailer identity
In Australia, discount retailer Kmart dramatically revamped its store layout, leading to backlash in the short-term but resulting in increased sales as consumers got used to the new-look layout. (2) Arguably, the Kmart brand is stronger than ever in the wake of the controversial changes. In 2019, this approach is likely to continue with more retailers retrofitting stores with new, more appealing, and more experiential layouts designed to provide clear pathways for customers.
Some stores will look to mix physical retail with online elements, while others will create a collaborative or immersive experience.
2. Artificial intelligence will become mainstream
Artificial intelligence (AI) will help retailers leverage the vast amounts of information they have regarding shopper habits, drivers, and preferences.
AI can help collect and analyse data from myriad sources, turning information into insights that retailers can action immediately. AI could even automate the action phase, so marketing teams can focus on higher-value activities and strategy. This will help retailers communicate more effectively, offer more successful deals and promotions, and attract more customers, all while reducing marketing costs.
3. Convenience and simplicity will be key
Regardless of reality, most consumers perceive themselves to be time-poor. When it comes to shopping, many are looking for low-key, frictionless experiences that let them get what they need faster.
Self-service and self-checkout options are already here to stay, with interactive displays and smart fitting rooms just around the corner. With this new model comes risks, however, and retailers will need to improve fraud and theft detection.
4. Direct-to-consumer services could help win business from online
Value-added products such as meal kits that help people save time, for example, can attract customers because they offer something functional that is not available online. This lets retailers capitalise on store traffic, and leverage excess capacity by offering services that yield higher margins.
5. Physical stores will go online
If they haven’t already, physical stores will now build a digital presence. This can help capitalise on the growing consumer preference of researching items online before buying in-store. To make this model successful, businesses must integrate their systems so that customers are aware of what is available near them, for example. This will address the potential frustration customers feel when they see an item online but can’t buy it in-store because it’s not in stock.
Not all solutions will match every retailer’s unique customer base, capabilities, or requirements. However, regardless of which of these approaches retailers adopt, the key defining factor will be the technology they use to unify the customer experience.
With the right technology, retailers will be able to seamlessly improve the customer experience and, potentially reduce costs. However, it’s important to work with an expert partner to maximise the value of any investment in technology and avoid undue risk.
Ian Mooney, retail solutions manager, Fujitsu
References:
(1) https://www.walkerinfo.com/knowledge-center/featured-research-reports/Customers-2020-A-Progress-Report-OLD
(2) https://www.smartcompany.com.au/industries/retail/kmart-opens-200th-store-three-reasons-much-loved-retailer-seen-success/