In the Era of Digital Technology, the Personal Touch Still Makes a Difference

Posted January 4, 2016

The Power of Personalization: Consumers Increasingly Seek Customized Offers

It seems everyone today boasts a public profile on social networks from Facebook and Twitter to LinkedIn. And in the e-commerce space, consumers have become armchair critics, commenting on retailers, products and services via customer reviews. In turn, notions of privacy have been upended in the era of social sharing.

So it’s not surprising that most shoppers (74%), are willing to share some level of personal information with retailers, such as their age, likes, dislikes and purchasing history. As a bargain never goes out of style, those shoppers reluctant to share are swayed most by discount offers to provide their personal information. But they expect personalized product and sales offers in return.

One-size-fits-all retail promotions and blanket sale offers, like a diaper coupon emailed to a woman without children, seem woefully archaic today.

Shoppers prefer receiving personalized offers, for example, before leaving home via email rather than in the store so they can plan ahead. That’s because consumers often research products online, or “webroom,” before heading to the store to make a purchase. By contrast, once consumers are near a store or shopping its aisles, a relevant text offer is preferred, shoppers surveyed said.Retailers now make product recommendations based on shoppers’ purchasing patterns. That’s helped condition consumers to expect offers targeted directly at them.But while consumers increasingly expect retailers to be clued in to their needs with customized offers, they want to determine themselves how they get those offers. Once they’ve set the agenda, they’re open to a variety of marketing tactics.

Shoppers expect retailers to give them the ability to control their personalized experience and when given control they are open to a variety of marketing tactics.

Shoppers Value Advice and Privacy

Consumers are turning to their peers for shopping guidance like never before. Sites like Facebook, Pinterest and Instagram have created online communities that weigh in on retail products and services, giving rise to the “social shopping” phenomenon.

A thumbs up on a product from a virtual “friend” can hold more weight than a brand’s marketing message. Consumers surveyed said advice from family and friends and online peer reviews and ratings had the greatest influence on their buying behavior.

However, the massive security breaches at big national chains in recent years, whereby hackers stole personal data and credit card information from billions of customers, have heightened shopper worry over their cyber security.

The fallout? Retailers rank low on the trust scale among consumers: Only 38% of shoppers trust retailers to protect their personal data, while 61.7% and 49.3% said they trust hospitals and financial institutions, respectively. As a result, the privacy and data protection of shoppers are top priorities for retail chief information officers.

Shoppers rely on advice from friends and family for purchase decisions, and they expect better values when shopping.


Location-Based Micro-Marketing Wins Over Shoppers

With shoppers increasingly tethered to their smartphones, location based marketing offers are gaining appeal.

Case in point: More than half of the consumers surveyed expressed interest in receiving highly relevant, real-time mobile coupons when shopping. And, national chains are investing in mobile beacon technology to do just that, and to use location-based micro marketing to increase sales.

Beacons are sensors embedded throughout a retail store’s shelves, signs and product displays that interact with mobile devices via a Bluetooth signal. Consumers who opt in via a retailer’s mobile application are sent Beacon-triggered messages based on their precise location in a store, such as a discount on a frying pan while browsing the cookware aisle.

Beacons are predicted to significantly influence retail sales this year amid an industry shift from marketing to many, to marketing to one.

Marketing to this connected shopper makes good business sense: Smartphone users spend more in brickand-mortar stores than those not carrying a mobile device, research shows.

Shoppers show likelihood to use location technologies and Wi-Fi technologies on their own smartphones when shopping.

New Dimensions in Store Loyalty

Mobile commerce has added a new dimension to store loyalty programs: 69.8% of consumers surveyed said they’d like to receive exclusive mobile coupons and sales perks from these memberships.

Supermarkets and drug chains should take note, as more shoppers are enrolled in loyalty programs at these outlets — where purchasing frequency is high — than other retail channels such as department stores, for example.

Shoppers want to receive coupons and sale notices from their mobile loyalty programs.

Shoppers Appreciate Technology-Enhanced Stores

There’s no doubt, e-commerce has reduced shopper traffic in retail stores. And as consumers increasingly research products online before heading to the store to buy, these more purposeful shopping trips mean fewer impulse purchases.

The good news is that consumers surveyed still highly value the immersive, sensory experience of traditional stores, citing the ability to browse and touch merchandise as the main reason they would opt for a brick-and-mortar environment over e-commerce when given the choice.

But a retail landscape upended by non-stop digital innovation is changing what consumers look for in a store. Shoppers are gravitating to brick-and-mortar retailers that use technology designed to make the shopping experience more efficient, from flexible delivery and payment options to digital tools that help consumers help themselves.

Indeed, in-store “self-help technologies” improve the shopping journey, consumers said. These include price checkers that let shoppers scan barcodes to pull up the precise cost of an item; electronic shelf labels that display the price of an item and automatically update any changes; shelf-checkout payment lanes and terminals; kiosks that offer product information and availability; as well as “smart” shopping carts that help consumers locate merchandise in the store and scan product bar codes for faster checkout.

Consumers also value apps that create maps from shopping lists to help them navigate stores and find what they need quickly and easily.

Shoppers agree that being equipped with self-help technology improves the shopping experience, especially shoppers equipped with price checkers and locations that offer shelf labeling, self-checkout terminals and kiosks.

Consumers Seek Trained, Digitally-Equipped Sales Associates

Consumers are looking for a shopping environment in which digital technology adds value to how they interact with the sales staff on the floor.

The importance of trained, accommodating store associates can’t be underestimated: Helpful sales associates ranked second to product availability in influencing how much a shopper spends, the survey found.

And store associates equipped with technology further improves the shopping experience, consumers said.

Especially sales staff armed with handheld mobile computers that offer insight on product availability and pricing, and store associates carrying mobile point-of-sale devices that can check out shoppers right in the aisle, saving them the wait in line.

One survey respondent succinctly summarized shoppers overall needs, “I know technologies can and will improve shopping for both the shopper and the retailer.”

Shoppers agree they have a better experience in stores where the sales associates use the latest technology to assist customers.

Customer Service Remains Highly Valued

While there’s a growing appetite for self-help technology, consumers still place a premium on high quality customer service. Heightening service, which has become a more critical differentiator when consumers can easily shop from their homes, can yield higher sales for retailers: Consumers will spend more in a high-service shopping environment, the survey revealed.

The definition of meaningful customer service is evolving along with changing shopper habits. For one, a seamless purchasing journey between online, mobile and in-store channels has become more important to consumers. To that end, retailers are expanding their buy online, pick up in-store service to more stores based on customer demand for this convenience. They’re also trying new twists on the concept, such as reserve online and try on in-store. In addition to offering an extra convenience to shoppers, buy online, pick up in-store is a strategic play for add-on sales. Once shoppers are in a store, they often make impulse purchases.

It might sound like retailing 101, but being in stock is crucial to customer satisfaction. And there’s a high correlation between in-store product availability and how much a consumer rings up at the register: Shoppers surveyed ranked product availability as the biggest influence on the amount they spend in a store.

Retailers can recoup sales lost to out-of-stock inventory by offering shoppers something in exchange for that inconvenience, like a discount on the item as an incentive to return to the store when it’s available, or an offer to later ship it to the shopper’s home for free.

Shoppers still prefer traditional purchase options both in-store and online, but there is definite interest for in-store pickups.

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