As the world changes, so does the way consumers shop. Thanks to our evolving behaviours and expectations, technological advancement and retailers experimenting with new, innovative business models to remain competitive, we are constantly finding new ways to buy. Knowing how shopper expectations are evolving can go a long way towards driving business growth and avoiding retail extinction. So it pays to ask: Which of these major trends are on your business agenda and what practices have you put in play to meet (and exceed) expectations?
Omni-channel as the norm
Determining how and where people shop is always top of mind for retailers. Customers now check multiple channels before they make a purchase.
eMarketer reports that 65% of customers expect “consistent levels of service across physical and digital experiences,” while 55% expect “frictionless flow of information between multiple channels.” Retailers need to look at which channels their customers expect to be served on and optimise the experience between them. Having inventory available across all your channels and providing the widest range of fulfilment options to best fit customer needs is vital. Amazon and other market innovators have gone a long way to raise the bar on how easily and quickly consumers can obtain the products they want.
Retailers need to realise that integrating their online and offline retail experiences is becoming less of a choice and more of a necessity - it is no longer about competitive advantage and more about meeting the default expectation of savvy shoppers who have more choice than ever of where to buy their goods.
Consumers expect hyper-personalisation from brands
Consumers are after richer, more personalised shopping experience both online and in-store. Research shows consumers are willing to share the data necessary to allow for those personalised experiences. 54% of consumers expect to receive a personalised discount within a day of making themselves known to a brand, and 71% express frustration when their shopping experience feels “impersonal.” Further research shows that 63% of consumers are interested in personalised recommendations and are willing to share their data to receive benefits like credits for coupons and loyalty points, exclusive deals, and special offers on relevant items. Retailers need to plan out their customer journeys, identify what data is vital to capture at each stage and build the programs that can drive growth and loyalty.
Personal Data Protection
While shoppers are willing to enter into an exchange of their data to receive a better, more personalised experience, their expectations around security and privacy are greater than they have ever been. Perceptions have been tainted in recent times due to misconduct and breaches from high profile brands. Gone are the days where customers would willingly hand over all their information without a clear benefit in return. Today, they want assurances that their data will be protected, and they want to understand why their data is required and how it will improve their experience. 75% will avoid purchasing a product if they do not trust the brand to protect their information. Given we are seeing more dialogue around customer data rights; brands will demonstrate trust and transparency in the way they handle data, and ensure that their strategy focuses on data collection methods that drive an improved experience.
The rise of social sustainability in retail
More than ever, people are rethinking their consumption and monitoring behaviour to prevent plastic pollution, reduce CO2 emissions and minimise their ecological footprint. Reusable coffee cups, bamboo straws and plastic bans are just the beginning. Brands are taking the opportunity to make significant changes in production. The more fair and transparent production methods are, the more trust people place in those brands. Google and Stella McCartney recently announced a new pilot created to encourage fashion brands to rethink their production processes. Google has created a learning tool that gives brands insight into the impact of their supply chains. The tool uses data analytics and machine learning to focus on sources that measure the impact of raw materials. The collected information, relevant to critical environmental factors such as air pollution, greenhouse gas emissions, land use and water scarcity, helps brands understand the supply chains they are using more clearly.
Another leader in this space, Nike, has released a new, open-source design guide to provide designers and product creators with a common language for circularity. Nike’s Circular Design Workbook offers sustainable guidelines for all designers. It was created in collaboration with students and staff of Central Saint Martins, University of the Arts London and with input provided from Global Fashion Agenda. The aim is to create products that promote circularity, last longer and are designed with the end in mind.
Voice search adoption is on the rise
20% of all searches are now completed using voice search. This behaviour supports the trend toward quick and easy shopping experiences. While voice search is hands-free and faster than typing, mobile shopping solves real-time problems related to location. Retailers need to look at how their digital channels can be made voice-search friendly sooner rather than later.
More than two-thirds of Australians have subscription services today, up from 49 per cent just five years ago, according to the survey, which was conducted by Harris Poll on behalf of Zuora, a subscription management platform provider. About 75 per cent of Australian respondents to the survey believe people will subscribe to more services and own less physical “stuff” in the future, and about two-thirds said that a person’s status is no longer defined by what they own.
“Commercial goods such as food, clothing and transportation are being re-imagined as utilities to leverage where and when needed, much like water, gas or electricity is consumed today,” Iman Ghodosi, Zuora vice-president and general manager of the Asia-Pacific region said.
The question for most Australian and New Zealand retailers will be whether they see subscription a commercially viable part of their business model (now or in the near future) or a potential competitor?
Today’s marketplace is more challenging than ever for retailers. It's a tough gig. Unfortunately, shoppers aren’t in any hurry to forgive those who fail to keep up with key trends like those discussed in this article. Just dealing with 'business as usual' matters can be time consuming enough. However, retailers who want to thrive in this new era must somehow carve out the time needed to look at key shopper trends, work out which present the greatest opportunities and risks and identify the critical practices to put in place.