How Real-Time Data is Redefining the Future of Retail
In this age of technology, when eCommerce is rapidly evolving, consumer behavior too has seen a dramatic change. Today, eCommerce success is defined by seamless customer experience.
Retail, in earlier years, relied heavily on age-old systems and primitive analytics methods to operate. In this online age, where digital experiences are imperative to success, retails have realised the need for change.
Data is at the forefront and e-Commerce and retail is being driven by data in understanding customers’ shopping behaviour.
An issue that many retailers have openly acknowledged is that they do not have access to suitable data and relevant insights to operate stores successfully.
eCommerce leaders and retailers must embrace in-store analytics to bridge the gap between online stores and their physical counterparts. Getting access to real-time consumer behavioral data will result in enhanced in-store customer experiences. Stores will also see an improvement in operational capabilities.
Forrester Consulting conducted extensive surveys in 2015 to analyze in-store customer experience and digital retail opportunities among 500 customers and 150 retail leaders across the United States and United Kingdom.
The surveys deduced that customer and retail expectations were misaligned with many stores found lacking the appropriate technology to measure and access customer data across sales channels.
The Future of Retail
The study found retail stores of the future will be backed by real-time analytics technologies that analyze consumer behavior across the entire shopping experience. With access to real-time customer data stores will be equipped to offer superior in-store experiences that are highly relevant for the store format and target market.
Let’s look four important findings from Forrester’s study.
- Physical retail is increasingly influenced by digital experiences
It has become a norm for shoppers to look for products online before making purchases. However, even though potential customers may search for products online, many still prefer to visit physical retail stores to make purchases.
Even though eCommerce players such as Amazon and Walmart may offer attractive discounts on several products across different categories, buyers are still willing to visit brick-and-mortar stores to experience or see the products before making the final transaction.
This trend results in customers expecting superior, interactive experiences in-store from sales representatives in physical stores.
By going to a physical retail store, customers can experience first-hand, the merchandise they are buying. In this age when online shopping is rapidly gaining popularity, customer service is a key factor that decides the ultimate success of a retail store.
Forrester’s research found that only 49% of consumers are confident of receiving a consistent experience across diverse retail channels.
- Retailers fail to comprehend the customer’s priorities
Several retailers fail to make the customer’s needs top priority. These priorities include consistent pricing and easy online returns, both online and in-store.
79% of consumers surveyed in Forrester’s study insisted that offering similar prices online and in-store is a critical or important requirement to customer engagement. Only 52% of retailers agreed with this.
Retailers are instead focused more on offering synchronised wish lists and shopping channels across retail channels. These ranked the lowest among consumers.
- The role of the sales associate is dynamic and constantly evolving
The role of the sales associate is rapidly evolving in this digitally empowered age. It is important for the sales representative to be knowledgeable and approachable. Retailers should be able to effectively cater to shoppers’ needs without delay. They must strive towards achieving more relevant, data-centric customer service.
- Retailers fail to measure shoppers’ in-store behavior
It was found that 69% of retailers agree that in-store technology impacts operational excellence, while 60% agree that it plays a role in determining the overall digital customer experience. It was also found that 62% of retailers agreed that understanding the in-store customer experience was important to offer effective customer experience. However, retailers still struggle to assess shopper behavior as very few reporting that they regularly use KPIs or metrics in-store.
It is not surprising that only 45% of retailers are able to understand the relation between online experiences and in-store customer behavior.
As the role of the sales representative continues to change and consumers’ expectations continue to grow, it is increasingly important for retail stores to openly adopt in-store technologies and real-time analytics.
Physical Retail is an Important Factor in the Buyer Journey
Consumers today have come to expect seamless interactive shopping experiences across channels. Many retailers are quickly adapting to the need for a unified customer experience. This way, they achieve an all-round understanding of customer expectations in the shopping journey.
Customers engage with different channels at various stages of the buying journey. The study reveals that 57% of consumers choose to research products online, while only 15% will exclusively make purchases online. The study also found that 60% prefer to interact with customer service representatives or in-store staff.
Forrester’s study also concluded that
- Consumers prefer to experience the touch and feel of merchandise before making a purchase . . .
71% of consumers in the survey indicated that they would rather visit the physical store to make purchases. One of the top three reasons for visiting the physical store was that they would be able to experience the product or apparel in person. 41% selected this as the primary reason.
- . . . but prefer browsing online to compare products and prices easily
While only 15% of consumers prefer to make online purchases, 47% were of the opinion that one of the top three reasons for shopping online – on both desktop and mobile – was the ability to easily compare products and prices.
- Digital channels have an influence on more than half of all in-store sales
Forrester’s research found that digital channels influenced more than half of all sales in physical retail stores. Online sales, with web-influenced sales – the purchases that occur in a physical store after a consumer has engaged with the brand online – exceeded exclusively in-store sales.
Forrester expects that, by 2018, 53% of in-store sales will be heavily influenced by the internet during the customer’s buying journey.
Customers now have come to expect the retailer to understand their needs and shopping expectations more deeply, on an increasingly personal level. Yet, the study finds that only 49% of consumers have reported that they receive a consistent experience across retail channels.
Shoppers have a holistic view of the retailer and expect the retailer to understand and serve them the same way. Yet according to our study, companies are falling short, with only 49% of consumers reporting that they receive a consistent experience across retail channels.
According to the study, 62% of retailers recognize and agree that they must strive to understand the in-store customer experience, because this is critical to a well developed, complete customer experience.
It is clear that analytics must be an important factor in the digital store ecosystem. Retailers must capture consumer information and attempt to leverage it in real-time, if they wish to optimize the buying experience.
Retail stores must evolve rapidly to stay in touch with empowered, digitally savvy consumers. Essentially, they must strive to find meaningful ways to integrate technology into the shopping experience.
Retailers who want to position themselves as digital stores of the future should be able to integrate a wide range of data sources to create real-time actionable insights.
Dheeraj, a content writer at IQLECT is passionate about writing content for blogs, website and e-mail channels, with almost 3 years experience in the field. He is an alumni of Christ University with an Honours Degree in English Studies. Dheeraj is a voracious reader, and also enjoys writing fiction and poetry.