Digital Personalization

Personalization: Retailers and consumers are on very different pages?

A global study of 1,200 consumers and 400 retail executives across the US, UK and Australia, found that there is a huge disconnect between customer demands and what retailers deliver in areas spanning the overall retail environment, social media, personalization and the use of advanced technologies such as chatbots, artificial intelligence (AI), and virtual reality (VR).

Conducted by Oracle NetSuite in partnership with Wakefield Research and The Retail Doctor, the study also found Australians do not want to speak with robots while shopping in-store or online.

“The results of this survey show that current approaches to personalizing the shopping experience are not working and those emerging technologies are not yet the silver bullet. Instead, Australian retailers need to focus on gaining the visibility and control required to deliver a simple and streamlined shopping experience, both online and in-store, that aligns with consumer expectations,” said David De Laine, GM ANZ, Oracle NetSuite.

Retailers and consumer are on very different pages

Despite significant investments in enhancing the customer experience online and in-store, Australian retailers are not able to keep up with rapidly changing customer expectations and this is creating a huge disconnect.

  • More than half (54 percent) of Australian retail executives believe that Australia consumers will plan to do more in-store shopping in 2019, whereas just 33 percent of consumers agreed, with 14 percent stating they plan to do less shopping in-store.
  • 87 percent of Australian retail executives believe that consumers would feel more welcome if in-store staff interacted with them more. Less than half (46 percent) of Australian consumers agree, with 29 percent noting they would feel more annoyed.
  • 100 percent of Australian retail executives think that engaging with customers on social media is important to building stronger relationships with them. Only 10 percent of Australian consumers think it has a significant impact on the way they think or feel about a brand.

Personalization is proving a problem

Despite almost half of the Australian consumers (40 percent) noting that they would pay more for improved personalization, only 3 percent of Australian retail executives fully believe that their staff has the tools and information needed to give consumers a personalized experience. The gap between consumer demand for improved personalization and retailers’ ability to deliver is damaging the customer experience.

  • 85 percent of Australian consumers do not feel they are provided with a personalized shopping experience both in-store and online.
  • More than half (58 percent) of Australian consumers are uncomfortable with the way retailers use technology to improve personalization in-store, while 53 percent feel negative emotions when they receive personal offers online.

Emerging technology not yet the answer

While Australian retailers are aware that they don’t have the tools and information needed to meet rapidly changing customer expectations, the study found that hyped technologies such as AI and VR are not yet the answer.

  • 79 percent of Australian retail executives agree that the use of advanced technologies to customize the shopping experience is meeting customer’s needs.
  • 78 percent of Australian retailer executives believe having AI and VR in stores will increase sales; only 14 percent of Australian consumers believe the technologies will have a significant impact on their purchase decisions.
  • 48 percent of Australian consumers never use AI-assisted chat windows, whilst only 4 percent opt to use them all the time.

A simple and streamlined future

Despite the popularity of online shopping, physical stores aren’t going anywhere. As long as Australian retailers keep the experience easy and seamless, consumers will keep shopping in-store.

  • Nearly all (97 percent) of Australian consumers agree that there is a need to go into a physical store to purchase items and the majority (67 percent) believe the most appealing retail stores have features that simplify and streamline the shopping experience.
  • The top features attracting Australian consumers to physical stores are simpler store layouts (41 percent), staff orders on a mobile device (36 percent), and options consistent with online (33 percent).
  • The top technology advancements that Australian consumers want to utilize when shopping in-store or online are self-checkout kiosks (30 percent), VR try-on (26 percent) and mobile payments (14 percent). Only 1 percent of Australian consumers want to utilize robots and chatbots while shopping.

“These findings point to a clear and urgent need for better customer service,” said Bob Phibbs, CEO, The Retail Doctor. “No retailer wants their customers to be confused or anxious, yet more than half of global respondents have felt that way while shopping. Customers will feel confident when they develop an emotional connection to the brand. This happens when retailers foster positive, helpful in-store interactions; contrary to popular belief, millennials want to store employees to help them. With nearly every respondent reporting that they value brick-and-mortar stores, now is the time to craft every in-store interaction to keep shoppers coming back.”

To read more about NetSuite’s insights into the report’s findings visit the NetSuite blog.

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