Amazon's Impact on Retailers’ Customer Experience Spending

It seems 2017 has been the year of personalization in retail. Consumers have shifted to an on-demand mind-set and want an omnichannel shopping experience tailored to their preferences. However, despite a rapidly changing retail environment and competition from Amazon.com, not all retailers have shifted their approach to experiential retail and personalization just yet.

In the chart above from Total Retail's most recent research report, The Amazon Effect: How Retailers Are Adapting Their Businesses to Better Compete With the Industry Leader, 47 percent of retailers surveyed say they haven’t changed their technology spend on personalization and customer experience tools as a result of Amazon's influence in this area, which is surprising considering the level of success Amazon has enjoyed primarily through an personalized, seamless shopping experience (not to mention fast delivery as well).

Amazon thrives in part because of the personalized experiences it gives customers throughout their purchase journeys. Overall, 50 percent of respondents said they have either somewhat or significantly increased their spending on personalization and customer experience technology as a result of Amazon. Thirty-seven percent of respondents report they're “somewhat” increasing their tech spend, and 13 percent say they're “significantly” increasing their tech spend. I expect to see these numbers to rise in the coming years as retailers position themselves to better compete with Amazon.

We’ll continue our coverage of the "The Amazon Effect" report on Thursday. In the meantime, make sure to download the full report!