The availability of multiple channels is empowering consumers to call for a more personalised retail experience – and is pushing retailers to work harder to innovate in order to keep pace with customer demands.
If they want to maintain competitive edge in a market undergoing rapid revolution, retailers cannot afford to ignore the demands of smart, ‘omni-channel’ consumers. The Economist Intelligence Unit (EIU), which carried out a study among 300 leading European retailers on behalf of Mastercard ahead of this week’s World Retail Congress in London, has dubbed these newly-empowered, self-centred customers ‘I-Cons’. Over a third of the retailers polled in the survey felt that a main driver in changing customer expectations by 2020 would be the growing use of technology such as smartphones, tablet computers and other mobile Internet-linked devices, or even new, still-to-be-invented equipment. The EIU points out however that connected customers are already having a direct impact on the retail world. While 37% of those surveyed cite wider customer choice provided by competition from other retailers as the major cause of change in their sector over the last five years, one retailer in three is already pointing to a ‘more empowered customer’ as the main change driver.
The empowered consumer
As the I-Cons increasingly demand a personalised service, available data on consumer habits is becoming the key to customer-oriented innovation. The retailers polled identified data capture and processing as the second most important area for near-term investment to retain customer loyalty and grow market share, 41% of them saying they would use such data to deliver an improved customer experience in the coming year, while 39% state that they are already delivering personalised customer experiences across multiple channels.
New technologies transforming the sector
The survey reveals the general view that mobile channels will become the major ‘shop window’ by 2020, whether based on the burgeoning use of near field communication (contactless) technology or by using geographical positioning capabilities to offer targeted discounts. Retailers are accordingly stepping up their investment in mobile technology solutions in order to keep pace with customer expectations. Some 44% of the European retailers quizzed by the EIU say they will be offering in-store contactless payment systems over the coming year, making this the single most important area for short-term investment. Longer term, 41% of those quizzed said they plan to provide mobile points-of-sale in-store by 2020, 33% will set up self-service kiosks and 35% expect to introduce location-based technologies to attract new sales.