Australian data from IBM’s 2015 Global Smarter Consumer study reveals that while Australia’s affinity for online shopping is growing, so too is the expectation gap between consumers and their primary retailers.
The study shows that consumer confidence and their willingness to spend more have significantly increased. However, the lack of personalised service offerings across a number of consumer touch points is driving a decline in engagement and loyalty to a retailer.
Of the 1,800 Australians surveyed, the empowered consumer now expects digital solutions that enhance service, more flexibility in areas such as returns, and digital loyalty programs. This means shoppers today are leaving retailers who fall short on delivering a seamless, in-store and online experience. A summary of the key findings shows:
• Consumer confidence has increased to 63 per cent in 2015, up from 58 per cent in 2014
• Twenty-five per cent of consumers surveyed are ready to spend more, up from 19 per cent
• Brand advocacy in Australia remains lower than the global average, declining from 13 per cent in 2014 to 10 per cent in 2015 (compared to a global drop from 21 per cent to 15 per cent) while unengaged consumers has increased from 24 per cent to 37 per cent, illustrating brand loyalty is suffering.
Anna McPhee, Retail Council CEO says that all signs point to Australians embracing all aspects of digital.
“This presents great opportunities and mounting pressure for retailers to deliver a revolution in the shopping experience, rather than incremental change,” she says. “The convergence of digital and physical retail channels is being driven by consumer desire for more convenience, and it’s up to retailers to deliver a seamless service. Doing things smarter and faster requires agile thinking and organisations are working to improve mobile, online and in-store fulfilment.”
This ability to see if an item is in stock before a shopper goes to the store was among the most appealing capabilities that would drive a consumer to switch. Fifty-seven per cent of consumers agreed they would switch to a retailer who could provide this information. This signals a huge opportunity for retailers to synchronise online and offline offerings for an enhanced shopping experience.
Consumers also expect retail assistants to be able to resolve inventory issues, with more than 50 per cent of Australian respondents citing this capability as a differentiator in the selection of a retailer. Additionally, 25 per cent of Australian respondents cited the importance for store staff to be able to offer personalised promotions based on purchase history or preferences as a differentiated and unique experience.
“This year’s survey indicates Australian retailers need to be more agile and adopt continuous change quickly to meet and exceed consumer expectations,” Ian Wong, partner, Interactive Experience, IBM Australia and New Zealand says. “It’s no coincidence that low advocacy ratings locally reflect a growing awareness among Australian shoppers for alternate channels available through retailers in the US, UK and elsewhere. This indicates an opportunity for growth for local retailers who can meet these consumer expectations. ”
The survey confirmed Australian shoppers are increasingly comfortable with sharing their location, social media habits, mobile number and email information with a trusted retailer. The proportion of consumers willing to share location information in particular has grown substantially from just 14 per cent a year ago to 24 per cent in 2015. An even greater number of respondents (28 per cent) see the benefit in the exchange of personal information for things like customised offers and better services.
“Today, delivering targeted, contextual conversations to build relationships with customers is more achievable than ever. With easy to use tools like the IBM Sales Assist app, this puts important customer information into the hands of a retailer’s store assistant, empowering staff to deliver a more personalised, in-store experience for shoppers. Leveraging insights from customer data merged with Social, Location and Mobile (SoLoMo) to personalise interactions, ensures relevancy and builds trust with each shopper,” Wong adds.
Looking to the future, 30 per cent of respondents indicated they would like to see the introduction of home sensors which could generate shopping lists automatically based on low stock, and 25 per cent were interested in the ability to upload wardrobe pictures to receive purchase recommendations. Other popular concepts included 3D shopping environments at home (25 per cent), and subscription offerings to ship frequently purchased products automatically (24 per cent).