Despite retailers’ heavy spending on value-added services and personalization, shoppers say they see little return on the investments, according to a new survey from Cognizant and Forrester Consulting.
In the online poll of 4,500 smartphone-owning shoppers, only 35 percent on average make use of in-store services such as interactive displays and mobile checkout. Personalization receives equally low marks, with 38 percent of shoppers saying retailers too infrequently create customized shopping experiences from the reams of personal data they collect.
Why aren’t retailers’ efforts resonating with shoppers? The study’s surprising findings underscore the disconnect, and point to ways retailers can fine-tune their efforts and better connect with today’s assertive customers.
Value-Added Services Are Missing the Mark
Not only have just one-third of shoppers used value-added services, but only 26 percent intend to use them again in the near future. The exceptions are loyalty programs and self-service checkout counters. Both programs have been used by more than 50 percent of shoppers.
One reason for shoppers’ flagging interest in the services is technology has altered their expectations for engaging with retailers, putting a premium on simplicity, convenience and faster service. Services not meeting those criteria go unused. Another reason is poor execution: nearly one in four shoppers reported encountering out-of-order in-store services.
The takeaway: In today’s marketplace, assumptions aren’t good enough. To know customer preferences, harness data that’s already been collected and reach out to them through surveys and focus groups to better understand the experiences they value. Build use cases from ethnographic research to understand each step of the shopper journey to ensure simplicity for shoppers.
Shoppers Will Share Personal Information … As Long as They See Payback
Shoppers bristle at divulging details like contact information and income, but in exchange for more targeted offers and promotions, they’re eager to swap other details that are far more relevant for personalization.
For example, 71 percent of shoppers will provide their brand and promotional preferences, and 58 percent are happy to let retailers know their hobbies and activities. That’s good news for retailers which know that understanding behaviors and preference drivers are a better predictor of shopper purchase conversion.
Shoppers also state they want greater transparency from retailers in how their information is used.
The takeaway: Smart strategies for collecting and using customer data play a key role in today’s data-driven marketplace. Know which data customers will and won’t share. Develop a customer data plan that includes informing consumers about how your organization uses personal details to create curated shopping experiences.
Shoppers Find Value — and Inconsistency — in Cross-Channel Experiences
Omnichannel services bundle the convenience and price advantage of online shopping with the immediate fulfillment and service of the in-store experience. Two-thirds of shoppers have used at least one omnichannel fulfillment option — e.g., buying merchandise in-store and having it shipped to their home.
However, only 31 percent report consistently positive omnichannel experiences. Their top complaints? Lengthy shipping times, improperly listed inventory and operational issues such as long pickup lines and high service fees.
The takeaway: Negative, inconsistent experiences with omnichannel fulfillment reduce customer satisfaction. More important, inconsistency deters use, and that’s a problem for retailers that are looking to appeal more broadly to shoppers and deepen customer engagement. It’s telling that 74 percent of shoppers surveyed rank convenience-related offerings as more important than price in determining where they shop. They want products in stock and easy to find, as well as convenient store locations. It’s the responsibility of retailers to ensure they find what they’re looking for.
The upshot? Develop an omnichannel strategy that optimizes digital experiences, in-store processes and last-mile capabilities to help shoppers find products they need, order them on the spot, and have them delivered where and when they want.
Consumers have no shortage of opinions regarding their shopping experiences. They’re willing to offer suggestions for connecting with them. All retailers have to do is listen.
Steven Skinner is senior vice president and global consulting practice leader for products and resources at Cognizant, a professional services company, transforming business, operating and technology models for the digital era.