Published on 21 May 2015

Timetrade "State of Retail 2015 Report"

> Consumers prefer Brick & Mortar over Online Stores: More than 70% of consumers would prefer to shop a brick & mortar Amazon store versus Amazon.com
> In-store expertise drives purchase volume: 90% of consumers are more likely to buy when helped by a knowledgeable associate
> In-store purchasing preferences span generations: 92% of responding millennials plan to shop in-store in 2015 as often or more than they did in 2014
> Mobile purchasing is slow to grow: Only 13% of respondents have previously made a purchase using a mobile device

Source: http://www.timetrade.com/

Executive Summary

In today’s connected society where consumers are used to service anytime, anywhere, the bar has been set very high for customer experience and the retail industry is no exception. Retailers are realizing they must provide a superior customer experience in order to survive.

TimeTrade recently conducted a survey of 1,029 consumers, which asked in-depth questions regarding their perceptions and behaviors around retail shopping. What the survey reveals is that the physical retail store is still relevant because more than ever, customers are looking to the in-store experience to help them validate their final purchasing decisions. Retailers must be aware of this shopping behavior and make sure their in-store associates are equipped with the right knowledge to help customers. Additionally, not only should store associates be knowledgeable, but also readily available, which means improved management of the store flow and balancing pre-scheduled appointments as well as walk-ins. Recent research by eMarketer also reveals that disposable income spent by consumers in the U.S. for brick-and-mortar retail stores will grow to be $5 trillion by 2020, all the more reason for retailers to focus on enhancing their in-store experience.

Retailers must also keep in mind that when consumers are searching online, this is the opportunity to convert the digital first contact to a more valuable level of engagement, such as an in-store visit. This creates a high-value, personalized interaction that leads to a more satisfying experience for the customer as well as creates an opportunity for cross-sell/up-sell for the retailer.

Retailers can also use survey and analytic tools to track the customer’s experience (from inquiry to purchase) and learn how to improve processes in the future. The store associate or manager can use this information to follow up with the consumer for future needs. All these elements create an optimal path to purchase, which TimeTrade sees as most crucial to retailers in terms of creating brand loyalty.

The TimeTrade survey also reveals that various demographics have different shopping habits. For example, Millennials have different shopping habits than Baby Boomers or Gen Xers. In addition to demographics, the survey reveals habits around mobile shopping as results reveal that consumers are using their mobile device for browsing more than actual purchase.

This report examines the current state of retail, what changes are occurring in terms of consumer habits and what actions retailers need to take in order to retain their customers. This report gives an overview of TimeTrade survey data as well as research from other sources and industry outlook and opinions from retail and customer experience analysts on the current state of retail as well as predictions of what will happen in retail over the next few years.

Introduction and Key Findings

Today’s connected consumers have set the bar very high for customer service and retailers know they must accommodate these expectations through superior service, or they will lose market share.

Retailers are realizing more and more that the key to superior customer service is personalization. This means knowing the customer and being able to anticipate their wants and needs, and in the case of retail, being able to anticipate their purchase behaviors and give them the appropriate help. Companies have been using analytic tools to gather information online, through digital and social channels, as well as call center data, to get to know and build a closer relationship with their customers. However, retailers also realize that a highly personalized in-store experience with a knowledgeable associate is what leads a lasting impression and creates brand loyalty.

This is where we see a paradigm shift in retail. Though e-tail channels are still popular, we are seeing retailers placing a renewed value on the physical, in-store experience. Even traditional e-tailers such as Amazon are opening up brick-and-mortar stores in hopes of providing a more personalized experience. And, congruently, consumers are admitting that in terms of their shopping habits, they prefer the in-store experience so they can feel and touch items and most importantly, make final purchase decisions.

This changes the dynamic of the in-store experience, as retailers must keep in mind that consumers are now much more educated and want knowledgeable help. C-level retail executives, store managers and associates must be prepared for this new type of customer while understanding that different demographics will have different spending habits and needs.

This report further examines the drivers behind changing consumer purchase behaviors today, what this means for retailers and what changes need to be made in order to keep them relevant.

Key Findings:

> Retail stores are still relevant: 87% of respondents to the TimeTrade survey plan to shop in stores at least as often as they did in 2014.

> Consumers prefer to shop in-store: More than half (65%) of survey respondents report that if an item they want is available online or in a nearby store, they prefer to shop in the store.

> Drivers for shopping in-store: An overwhelming majority of consumers (85%) report they like to shop in the store because they like to ‘touch and feel’ products before they decide what they want to buy.

> Once consumers are in the store, they are willing to spend: Nearly 60% of consumers prefer to shop in store when spending as little as $50 and as much as $200. And, 82% of all consumers surveyed will buy more than they originally planned to.

> Mobile Shopping is slow to grow: More than 42% of consumers have never purchased something on their mobile devices and when consumers are looking to buy something, only 13% will make a purchase from their mobile device.

> Traditional e-tailers open brick-and-mortar stores and consumers are welcoming with open arms: More than 70% of consumers would prefer to shop at an Amazon store versus Amazon.com

> Though mobile and online shopping trends frequent headlines, mobile shopping is not predominant: Most consumers use their mobile device only to browse for items (50% to research products, more than 60% to compare prices, and 46% to look for the nearest store location).

> Millennials can be a gold mine for retailers who get it right:  More than 90% of 18-34 year olds plan to shop in stores as often if not more in 2015 as they did in 2014 and 92% will walk into a store either know exactly what they want or having narrowed it down to 2-3 products and 87% will buy more than they intended to when shopping in a store.

> Millennials look to meet in person: 25-34 year olds are more likely than any other age group to book online appointments.

> Baby boomers are spending as well: Baby Boomers are still the group controlling 70% of the disposable income in the United States.

> Consumers want knowledgeable help:  Nearly 90% of survey respondents are more likely to buy when helped by a knowledgeable associate.

> Consumers today do much research online prior to going into the store and approach the in-store experience as the final buying decision: Nearly 90% of consumers are more likely to buy when helped by a knowledgeable associate.

> Consumers seek associates with expertise: 50% of respondents report what they value most in a sales associate while shopping is smart recommendations.

> Consumers shop based on superior customer experience: 63% of respondents report that if an item is the exact same price at four different retailers, they will decide where to shop based on the overall customer experience they have in the store.

> Knowledgeable help creates customer satisfaction: If a knowledgeable sales associate recommends items a customer may need or based on what the store knows about them, 64% of respondents report they will leave the store much more satisfied

What This Means for Retailers

What does this mean for retailers? There is no doubt that all generations of consumers are more educated and more selective than ever. Consumers are using digital channels for research, but still looking to the in-store experience to help with final purchasing decisions. More than ever, retailers need to have a seamless flow between channels and, once the customer is in the store, provide a superior in-store experience.

In order to standout, retailers must make sure they are providing customers with the right knowledge while keeping in mind that the majority of TimeTrade survey respondents prefer shopping in stores so they can touch and feel things. Retailers can enhance the in-store experience through prompt service and enable a smart hands-on experience that helps customers with their final purchasing decisions.

Adam Silverman, a Principal Analyst at Forrester, who covers in-store commerce technologies, comments:

“Forrester believes that, in the future, retail stores that drive convenience, service, and relevant personalized experiences through the use of digital store technology will succeed. Why? Because today, customers show an affinity for digital store technology. In fact, 66% of luxury apparel customers are more likely to shop with a digitally-enabled associate. Those retailers who wait on the side-lines are at risk of maintaining the status quo and may only grow marginally.

Although in-store experiential technologies exist today, most implementations will fail to provide a positive ROI because they lack meaningful use cases and do not create convenience for customers. Look for retailers in 2015 to focus on digital store technologies that help customers and associates complete tasks faster and with greater insight.”13 13 Adam Silverman Forrester Research blog, “The Digital Store Platform Will Support the Retail Store of the Future,” November 2014.  66% of luxury apparel customers are more likely to shop with a digitally enabled associate - Adam Silverman, Forrester Research

Gartner Research also notes in its report Top 10 Strategic Predictions for 2015 and Beyond: Digital Business is Driving ‘Big Change’ that:

“With the rapid rise of personal digital technology, customers have become savvier and more demanding about how they want to interact through technology. No longer can a business assume that the experience it has with its customers is good enough, or that it will not need to change in a short time.”

The practical digital business sees customer experience innovation as the next frontier, and half of all consumer goods product investments are likely to be directed toward improving the customer experience.”14

Richard Reynolds, Director of Retail Operations for C Spire, a regional U.S. telco, notes the changes they are making to their retail stores in 2015.

“We believe customers expect more today than ever before as far as their retail experience. That is why in 2015 we created a new store design. The new design brings to life a shopping experience like no other by creating a more interactive and inviting store environment. We designed our new retail experience around the people who matter the most to us – our customers. We looked at how consumers use technology and built our store from the ground up to reflect that reality. The new design delivers an interactive shopping experience that mirrors how customers live, work and play, and will help our company move closer to its goal of becoming known as one of the nation’s premiere retailers.” Gartner Research Top 10 Strategic Predictions for 2015 and Beyond:  Digital Business Is Driving ‘Big Change,’ October 2014

Anthony Johndrow, Chief Enterprise Strategy Officer at Reputation.com, recently wrote a white paper titled Chain stores must transition from online liability to digital asset: A Hub White Paper. In the white paper, Johndrow writes: “Modern marketing is dominated by the rise of digital media over traditional channels - witness today’s treasure chest of powerful cloud-based platforms that integrate mobile, local, and social - an obsession with the customer experience, and significant focus on data, automation, and proving return-on-investment. But let’s not forget about the actual humans in the physical world that all of marketing is concerned with; the real people in your stores, having real experiences that make their way online. (“Chain stores must transition from online liability to digital asset: A Hub White Paper” by Anthony Johndrow, April 24, 2015)

When - or if - potential customers find your location on their smartphones via a local search (73 percent of all searches on Google are local), it’s alongside online reviews and commentary that makes it sound like your store is a horrible place. It’s not fair. Brick-and-mortar still matters, and its future as a digital asset - not a liability - is here today.”

Meaning the in-store experience is what will drive your store or brand’s online or social perception, making it more critical than ever.

A.T. Kearney released the 2015 Global Retail E-Commerce Index16, a study designed to help retailers devise successful global online retail strategies and identify market investment. Mike Moriarty, A.T. Kearney partner and co-author of the study says: “The boom in ecommerce has brought challenges—both brick-and-mortar leaders and major pure-play online retailers are learning that the future of the industry is not merely online, but rather in creative omnichannel offerings that link online and physical shopping. ”

This comment validates that the notion of retail convergence, the converging of web and physical retailing is very real and important.

“The boom in ecommerce has brought challenges both brick-and-mortar leaders and major pure-play online retailers are learning that the future  of the industry is not merely online,  but rather in creative omnichannel offerings that link online and  physical shopping.” Mike Moriarty, A.T. Kearney

Natasha Baker of Forbes recently wrote an article “5 Tech Trends That Will Hit Every Retail Store By 2020 (Forbes.com, April 3, 2015)”. The following is a summary of the technologies and trends that Baker lists:

Stores will use devices that can determine the demographic information of customers as they walk by, and target ads to them through a video console, similar to smart shelves being developed by Mondelēz International.

Beacons. Sensors placed around stores that communicate information to smartphones - will track information such as which products customers linger around.  The beacons can then push information on those products to customers’ mobile devices, allowing them to order from their devices and have merchandise shipped to their homes.

More Intelligent Devices. Stores will use devices that can determine the demographic information of customers as they walk by, and target ads to them through a video console, similar to smart shelves being developed by  Mondelēz International.

Store Associates Can Focus On Customers. Retailers will be able to take advantage of managed infrastructure at the edge. This is a vitally important enabler because having to add relatively expensive IT staff can make deploying new technologies in retail environments cost prohibitive. Of course, sales associates will not disappear. Rather, with many of their routine tasks automated, they will be able to focus more on building relationships with customers while increasing sales and affinity for their employers.

Analytics. Brick-and-mortar stores will use analytics to map where people walk and what the pickup so they can better position products in the store or track shoppers at the device level to target promotions to them. This data will be used to understand customers and increase sales.

Technology as a Sales Assistant. Technology will increasingly automate a lot of routine and mundane processes that happen in retail stores. Whether it is more self-service check-outs, in-store mapping to make it easier for customers to self-navigate around stores, or beacon and NFC technology for greater self-education on products, technology will play a greater role in automating the retail experience.

Baker writes: “E-commerce has certainly revolutionized the way we shop, but brick-and-mortar stores are far from dead. Increasingly, online retailers have begun opening physical stores for the first time, which signals that there may be a return to real world shopping – only this time, reinvented for the digital age.”

The following experts are from Research’s Spotlight report The New Digital Divide Blurs Lines Between Digital and In-Store written by Sheryl Kingstone, Director of Research.

In summarizing issues that fundamentally must be addressed to meet the new mobile consumer mindset Kingstone notes: “The industry needs to transition from a merchandising point of view to a customer-centric point of view. The shopping journey has changed more in the last 5 years than it did over the past 150 years. As a result, there can no longer be a divide between digital and brick-and-mortar. It’s important to meet the new consumer behaviors and expectations that doesn’t think among organization silos still rampant in today’s retail industry. Hudson Bay agreed that it’s essential to break down barriers across e-commerce, m-commerce and instore across the mobile journey. It’s not about channel, but content; whether that be an app, mobile web, e-commerce or store. The entire company owns the customer journey, not the channel.”

In referencing “What’s Hot for 2015” Kingstone writes: “Clienteling is a sales strategy for increasing the volume or frequency potential of the in-store shopping experience by delivering 360-degree customer views and sales tools to associates. Mobile CRM platforms have become the center of many mobile engagement strategies, especially as they relate to sales enablement. Consumers have more information at their fingertips than the sales associates. Retail stores must empower front-line associates with the right information at the right time. Location technologies have also increased the value by enabling door triggers to know when VIP customers enter the store. The tablet can be the window to everything from past purchases to detailed product information along with guidance for selling. American Eagle empowered their lingerie departments with guidance for selling vs. traditional printed material. Many luxury brands have also invested in tablets for sales associates. The future is also about enabling consumer to request help based on location such as a dressing room or clothing rack. Next-gen solutions will provide unique approach to empower the sales associate.  Mobile apps puts critical customer intelligence into retail associates’ hands to raise the level of personal experience for the consumer. Benefits include inventory knowledge, cross selling suggestions along with potential special pricing. The goal is to enable real-time intelligence and location information, as well as personalized offers based on historical patterns and profile data.”

Kingstone notes the bottom line is: “With these exponential adoption rates of mobile devices, harnessing the opportunity across the customer journey will be the ultimate game changer. Retailers need to bridge the digital interactions with brick-and-mortar interactions with new innovative technologies along business process changes.”

Conclusion

Retailers must keep in mind that through the digital first touch all the way to the in-store purchase, it is all about the customer’s path and how to provide the best service across all these touch points. Creating a high-value, personalized interaction will lead to a more satisfying experience for the customer.

The TimeTrade survey has revealed that various demographics have different shopping habits. Millennials are looking for products and service that is very focused on the individual, while Baby Boomers and Gen Xers have done much research and want purchase validation from an honest and transparent retailer. Though all have different shopping habits, what they all have in common is disposable income as retail sales continue to grow.

In order for retailers to survive and retain market share, they must be progressive in how they create the in-store experience, using modern-day technology while providing prompt service, all the while knowing a customer’s needs before they even enter the store. Though this seems like a tall order, leading retailers are doing all of the above and are aware of consumers ever changing needs.

The full State of Retail Report 2015 can be accessed here.

“When asked if they would shop at an Amazon store, 71% of TimeTrade survey respondents reported they would prefer to shop in Amazon’s physical store versus Amazon.com”

About us

Garden Europe is one of the leading European Garden business Web site. Our mission is to be one of the primary sources of information about garden events, products, best practices, social media, trade shows and the latest garden trends.

Garden Europe is a platform to inspire Garden members providing information, ideas and solutions for profitable business.

© Copyright bohero bvba.  Privacy Policy  |  Terms of use  |  Disclaimer  |  Cookies  |  Website by Webatvantage

This website uses cookies! For more information regarding our cookies, please read our cookie policy