Consumer trends change like seasons, and Aussie retailers are currently enduring a chilly market, with four-fifths (79%) of shoppers cutting down on something to save money, as uncovered by Shopify’s 2024 Australian Retail Report.
But there are still opportunities to drive growth. After all, Aussie consumers are returning to physical retail stores, with over two-fifths (43%) of consumers preferring to shop in-store in 2024 – proportionately more than those who like shopping online (31%). At the same time, 23% are still treating themselves every month or so, even if money is tight.
Getting consumers’ attention, however, requires more focus, on more fronts, than ever before. Disruptions to the discovery-to-purchase pipeline have forced large businesses to operate with the agility of a startup and refocus on all their different sales channels.
In order to reach this new retail equilibrium, brand strategies must now focus on efficiency and customer experience, eliminating friction whenever and wherever consumers are ready to make a purchase.
So how can retailers position themselves to win customers wherever they are? By doubling down on delivering a holistic customer experience and the same core brand experience on every surface, from in-store to social media.
Unify commerce to create exceptional experiences
Omnichannel isn’t a new term, as for years it’s been high on the agenda to ensure the online and offline are blended to create a seamless experience for the customer. But, as more and more capabilities and technologies are added into the mix, it can become even more challenging for retailers to avoid customer experiences that feel disparate and disconnected. This is where unified commerce comes in – ensuring all your channels work in unison.
The first step businesses must understand is that, in the eyes of consumers, the divide between channels no longer exists. Online and offline are no longer separate. Shoppers expect to be able to order online and pick up in-store; they expect to be able to check out a product in-person and order on their phone rather than wait out a long queue. In short, they expect a seamless unified shopping experience so they can choose exactly how they want to engage with a retailer.
It’s not a surprise, then, to find that free returns rank highly for shoppers as a must-have for brands online (47%), and instant refunds for offline, when you consider that over a quarter (26%) of consumers like both in-store and online shopping equally. These are the same shoppers.
Value becomes synonymous with service quality – but not all businesses have got the memo
With inflation continuing to rise, consumers are keen on seeing value in their purchases, impacting retailers’ sales as a result.
But while price is always an integral part of the value offering, it is not the only one. Quality is crucial too, but in our study, 45% of consumers also cited loyalty points or rewards as an effective way to foster loyalty, while a third (32%) said they would be more loyal if offered a seamless user experience. Clearly, service and experience can be hallmarks of value, even in a downturn.
Most businesses recognise this opportunity: our research found 99% of retailers are planning to invest in customer experience in the next 12 months, and 64% on technology to enable this.
But are they doing enough? Our findings also show that retailers are carving out just 11% of their total annual revenue in customer experience in the coming year, on average, highlighting a clear opportunity for agile brands to invest more. But even they can only reap the rewards with the right platform underpinning their omnichannel vision.
More data across more channels needs the right tech stack
The key to delivering a better experience for consumers across channels is personalisation. Retailers have a huge opportunity to connect with shoppers by harnessing their data to deliver a much more relevant encounter based on their interests and preferences, and through the media that suit them.
Sure enough, we found that over three-fifths (61%) of Aussie businesses plan to increase investment in customer personalisation in the next 12 months.
But, if not executed properly, businesses stand to be left behind. If the tech stack that underpins the commerce platform isn’t future-proofed, retailers will miss out on opportunities to capture the data that customers are willing to give them to make more informed data-driven decisions.
So, retailers have to ask themselves: does your platform let you capture a customer’s details when they shop in-store, so that you can provide them with personalised discounts online later? Is your platform built to integrate sales through social platforms? Australia’s social commerce is expected to be worth $2.7 billion this year – a 12.2 per cent growth – so it had better be.
Back-end processes are the unsung heroes of customer experience, but often the thing that businesses are least willing to change. But change they must: even in sales slumps, innovation does not stop, and neither must retailers’ focus on consumer experience across every channel.
Shaun Broughton is managing director for APAC at Shopify.