…It’s the retail mantra – “focus on the customer.” But do you know your customer? There is plenty of research describing what the customer wants this year. Some of it conflicting, some focused on your business model, some not relevant. Let’s take a look at an aggregation of research across a number of sources to find out what typical customers expect and how retailers are trying to meet these expectations.
What the Customer Expects
Over 50% of customers expect you to support omnichannel. Over 70% expect to view in-store inventory online and will visit your store if the product they are looking for is in-stock. Customers expect speedy and free shipping – over 75% will buy if you have free shipping online, and over half expect you to tell them the day it will arrive. Over 70% of all customers expect your in-store associates to be quick, have a mobile device to lookup product availability and then use that mobile device to support their personalized experience. Over two-thirds expect to buy online and return to store, while less than half expect to buy online and pickup in your store. And as rating and reviews are becoming increasingly more influential, customers also expect their friends to help them make shopping decisions.
What Retailers Are Doing
In the store, two thirds of retailers are designing and testing new store formats. Over 80% of retailers are embracing showrooming and employing competitive pricing policies. To improve the ability to “save the sale,” over two-thirds of retailers are implementing tablet programs that empower store staff to increase customer personalization by giving them immediate access to customer data. With respect to store level training, retailers are focusing on two key areas: how store employees interact with customers (69%) and improving staff product knowledge (63%).
And 75% of customers are happy to have the sale saved as long as there is free shipping. While anywhere from 15% to a third of retailers claim they offer a seamless omnichannel experience, another third to 50% are working towards a seamless experience. Also, many retailers are implementing “ship-from-store” processes and technology to reduce customer fulfillment lead times and reduce markdowns. Over half of retailers who offer store-based fulfillment options are focused on changing and adding responsibilities to existing store roles, implementing new technology and updating training.
Sounds Like Progress (BUT…)
A new report from Starmount and Retail Systems Research (RSR), indicates that many retailers are only about halfway in their journey to omnichannel nirvana. (Click here to read the report.) This assessment is based on survey results from a wide range of retailers that rated themselves on six dimensions of omnichannel maturity: Customer, Product, Inventory, Order/Fulfillment, Locus (the ability to synchronize digital and physical selling environments to create a consistent brand experience) and Technology. Key findings include:
• With respect to integrating in-store and digital experiences, 67% of retailers assessed themselves as “inefficient” or worse. While consumers expect a seamless shopping experience, retailers fall far short in providing this, especially at the store level. In Parker Avery’s recent New Roles for Retail Research Study, we found that 65% of retailers ranked customer experience as the top driver for making changes in how they manage their store staff, indicating a clear understanding and desire to improve in this area.
• Retailers ranked weakest in order/fulfillment capabilities. The lowest overall rankings were in omnichannel order and fulfillment capabilities, highlighting the retail industry’s struggle to reorganize supply chains for more flexibility and a lack of focus on delivering the services their customers expect. A key to effective and efficient order fulfillment is inventory accuracy, and – despite advances in technologies that support this objective – many retailers continue to struggle with having a solid understanding of their inventory positions. Additionally, these struggles lead to lack of confidence in inventory accuracy for both customers and store staff. Parker Avery discusses this issue and ways to combat it in a recent point of view: Inventory Accuracy – Fundamental Strategies for Getting It Right.
• Underpinning the inventory challenge, half of all respondents in the Starmount / RSR study were “inefficient” or worse at responsibility and ownership of omnichannel inventory. Moreover, 60% said they were “inefficient” or worse at maintaining inventory visibility across channels, and 44% of respondents report “no capability” when it comes to measuring inventory performance.
Meeting Your Customers’ Great Expectations
All of these survey and study numbers are indeed interesting, and they may help you understand where your company is on the omnichannel maturity path, but these are for typical customers and retailers in aggregate, so at best they provide a singular view of trends. You must recognize your customers’ unique expectations and find ways to clearly understand how they want to interact with your business. As an example, all retail formats may not be suitable for new fulfillment options such as ship-to-store. Or it may be necessary to make adjustments in staff responsibilities and store layouts to accommodate new customer service needs.
Using this understanding as the basis for decision-making in the areas of process improvement, technology, organizational alignment, product development, merchandising, etc. will help you to better define how to deliver against your customer experience value proposition and then allocate resources to supporting initiatives.
Note: In addition to the information provided from Starmount and RSR, data points in this post were gathered from a variety of sources including: The Parker Avery Institute research, Forrester, Multichannelmerchant.com, vendhq.com and Future Stores 2014 State of Brick and Mortar Report.