A quarter of Irish shoppers are planning to spend more than they did last year during the post-Christmas sales season, while almost a third will spend less. That’s according to recent research carried out by Accenture.
“Our research looks at changes in the customer experience and what this means for the retail sector,” says Hugh-John O’Reilly, managing director - customer, sales and service at Accenture. “It also identifies the opportunities for retailers and other service providers arising from those changes.”
The survey of over 1,000 Irish consumers found that one-third (33 per cent) say they are optimistic about their financial situation coming into the sales shopping period. However, 21 per cent of consumers say that the pandemic has impacted their financial security and they will need to think more carefully about what they spend.
“We have been looking closely at consumer trends and behaviours since the start of the pandemic and this report is coming at a time when the retail sector has been hugely impacted by the necessary restrictions. However, it points to the opportunities that exist for retailers as they move into the new year,” O’Reilly adds.
The results show a significant change in attitude on the part of Irish shoppers. For example, shoppers now consider sanitation displays (75 per cent), availability of hygiene products such as masks and hand sanitiser (77 per cent) and strict social distancing (74 per cent) to be essential features of the ‘ideal’ January sales experience.
In-store incentives (42 per cent) and attentive staff (36 per cent) are still popular demands with customers, but they are very much behind health and safety standards in the order of importance.
All through the pandemic we have seen how brands are winning and losing in terms of how well they support their customers
Unsurprisingly, the increase in online shopping is highlighted in the Accenture survey results with 61 per cent of respondents saying they will do most, if not all, of their shopping online and have it delivered to their home. Over a third of those shopping online in the run up to the festive season, and during the January sales, expect to have two-to-three deliveries a week. They cite ‘fast and free delivery’ as their number one expectation (33 per cent) when it comes to online shopping in January, while 21 per cent say they expect a range of product diversity at reasonable costs. Fifteen percent would like to have their items delivered for free where there is a longer wait for their arrival.
“A seamless e-commerce experience is seen as a given by consumers now,” says O’Reilly. “We are seeing the in-store and online shopping experience coming together like never before. Customer expectations are very high. They expect click and collect orders to be ready on the day, while they also expect deliveries to arrive on time and at a specific time of the day. Retailers should look to embrace technologies like Artificial Intelligence and cloud to manage that customer journey.”
Emma Sharkey, chief strategy officer with Rothco, part of Accenture Interactive, points to change at a deeper level. “Online shopping used to be functional, but now people want the customer experience to be the same as it is in store,” she says. “A percentage of people were forced to go online over the last year but as they purchase goods and services and see the benefits, they will continue to make that choice. Shopping has fundamentally changed and become an omnichannel experience. The default won’t be the high street or a website anymore. People have a multitude of channels available to them and they expect to be able to start the journey on any of them. They might research in the store and purchase online. There might be a “showrooming” factor for physical stores where people visit them for pre-purchase research.”
These changes will see some quite fundamental changes to the retailing business model. “We are quite excited about that challenge,” says Sharkey. “We have an opportunity to redesign the entire consumer experience instead of being tied to the way things have always been done. There is a lot of scope for innovation to make people feel the same about the shopping experience whether they are shopping online or offline. Shopping is an emotional activity and that needs to be replicated online. We need to bridge the gap between the online and offline experience and give customers a seamless journey as they move through their engagement with the retailer.”
That omnichannel experience means having as near identical experiences as possible regardless of the channels used. This will lead to changes to traditional online search processes to allow consumers explore virtual stores in an experiential way, much as they might browse and impulse buy in a physical store.
“It is interesting to see how brands are using channels differently now,” Sharkey notes. “Social media has started to evolve, and it is not just about community building anymore but is about driving sales as well.”
Companies that put consumers first will succeed
This increased number of channels may offer more sales opportunities, but it also brings its own challenges. “It’s really important to give customers a joined-up experience,” says O’Reilly. “Consumers are giving retailers little room for error when it comes to things like fulfilment delays. Where errors or delays arise, loyalty can be preserved by proactive, personalised communication over phone or email. Don’t wait for the customer to call – understand the customer’s context and be transparent on the resolution. With e-commerce purchasing volumes set to remain high into 2021, successful retailers will be those that think beyond the checkout and create a seamless personalised experience to the door – and back if required.”
Other factors are coming into play as well. “Sustainability is a major factor with consumers, and we are seeing some retailers move to bicycle deliveries in urban areas and taking steps to reduce packaging. This is something Irish retailers will have to be conscious of.” continued O’Reilly.
“Sustainability was important before the pandemic, but people have become more conscious of it since,” explained Sharkey. “They understand it’s about more than carbon footprint, it’s about the impact on society generally. Twelve per cent of the respondents expect to continue to shop local and they want to look for brands that make a social contribution. Consumers are taking a holistic view of sustainability and looking at all aspects including climate impact, packing, community contribution, employment standards and so on.”
The overall message from the research is simple, and not necessarily that new, she adds. “Companies that put consumers first will succeed. All through the pandemic we have seen how brands are winning and losing in terms of how well they support their customers. And that means supporting them at every touchpoint on the customer journey. It means not breaking the magic spell as the customer moves from channel to channel.”
The prize for retailers who respond to these changes and successfully redesign the consumer experience is customer longevity, according to O’Reilly. “A lot of our clients are appointing chief customer officers who are responsible for the end-to-end customer journey,” he says. “That will help them get it right and build long-term customer loyalty.”
This content is provided for general information purposes and is not intended to be used in place of consultation with our professional advisors.