Transactions are up more than 14 percent over the last two years while baskets remain flat. Rather than customers spending more dollars per trip, industry acceleration is being driven by more trips overall. And those trips are spread out across a wider selection of retailers. More than $123 billion of market share is being exchanged among 78 percent of retailers; a rate that is only picking up over time. In order to survive and thrive in this new environment, retailers need to understand and embrace this acceleration and make the active choice to embrace their overall digital presence as part of a comprehensive consumer experience rather than simply a separate online-only sales silo. John McAteer, VP of US Sales and Operations at Google stated, “Retailers have always differentiated with price, convenience, assortment, brand, and service. What’s changed is digital, which has elevated consumer expectations dramatically across all these levers."
With technology at one’s fingertips, today’s customer has almost unlimited choices from retailers who have proven themselves capable of delivering products when, where, and how they are most needed. “The need-driven customer is driving the industry. They’re leaving a digital trail for retailers to follow,” stated Jeff Simpson, Principal at Deloitte Consulting LLP, shouting to retailers that, for them, it’s all about meeting the need. When retailers understand and deliver on that need, they are rewarded with a trip and bigger baskets.
Your customers are practically shouting to you that, for them, it’s all about meeting the need:
- Seventy-seven percent of shopping trips are driven by a specific need
- Eighty-eight percent of customers buy immediately or as soon as possible rather than wait for the next trip
- Need-driven trips have 29 percent higher purchase value
And when you can be in a position to understand and deliver on that need, the need-driven shopper is more valuable to you than any other.
The data is telling us a story about customers. Retailers need to play a role in the entire customer journey from inspiration to research to making the purchase to the satisfying experience of receiving the product in-hand. We see four specific ways to play a role in that journey:
- Understand them early: Shoppers leave a clear digital trail behind that provides signals across their entire customer journey. Retailers should lean into those signals to meet their expectations—before someone else does.
- Strive for a frictionless experience: When retailers remove friction from the shopping process—like a slow page loading experience or too many suggestions—the shopping experience is simpler, more satisfying, and better meets the customer’s needs.
- Making the brand personal: Because shoppers expect retailers to deliver on their needs, a brand’s story needs to connect to shoppers on a personal level.
- Make the most of what you know: When retailers embrace all the data that’s available, retailers develop a clear understanding of how consumers shop, and a clearer picture of their overall shopping preferences and behavior.
The retail industry is accelerating, and digital’s influence on consumers fuels it. In order to survive and grow when expectations for a speedy, satisfying experience that delivers a personal need are so important, retailers need to lean into creating omnichannel shopping experiences that create inspiration and empower decision making—experiences that make customers think to shop from them, want to pick up from them, and need to engage with them throughout their entire shopping journey.