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Sydney, NSW, Australia - 07 Aug 2014: IBM (NYSE: IBM) today released the Australian findings of a global consumer study. The study reveals a downward trend in consumer advocacy, falling significantly from 32 percent in 2013 to 13 percent in 2014. At the same time, there is a surge in antagonists from 5 percent in 2013 to 24 percent in 2014. These trends indicate a marked decrease in customer loyalty amongst Australian consumers. The impact for retailers is significant as advocates have the biggest influence on friends and family, have bigger basket size and spend more.
Key findings from Australian shoppers in 2014:
- More consumers shopping online – in 2014 15 percent said their last purchase was online compared to 5 percent in 2013
- Seamless omnichannel is essential to drive shopper loyalty and business performance
- Consumers are more willing to provide all types of information in return for personalised service
- 34 percent of consumers will share location based information, 18 percent in 2012
- 32 percent of consumers posted about a retailer they had shopped with
- Friend’s posts or pins about items purchased (51 percent) are the most influential
Margy Osmond, CEO of Australian National Retailers Association said, “Consumers are entering stores with more information about the type of product they want to purchase than ever before. Aussie retailers have been vigorously investing in capabilities that will fundamentally change the customer experience over the next decade. These trends will enhance the shopping experience helping build long-term customer loyalty and attract new clients".
Consumer expectations outpacing retailers
The disconnect between shoppers and retailers on what is an acceptable experience is widening. Consumers expect seamless capabilities across all channels of engagement. They are choosing where to shop based on consistent pricing and product offerings across all channels; in-store location of out-of-stock items and shipping home; loyalty programmes with benefits both on-line and in-store and in-store returns policy for online purchases.
Consumers have taken the lead on technology adoption
Consumer concerns around technology are rapidly declining. With increased appetites for consumer empowerment, shoppers are embracing new technologies and innovation in retail, including mobile shopping and social networking. This presents a unique opportunity for retailers to get closer to its customers and interact with them 24/7 across multiple channels and touch points. Customers are now more comfortable than ever to hand over information; with 34 percent of Australians now willing to share location information versus 18 percent two years ago, and 31 percent willing to share their mobile numbers with retailers. Additionally 48 percent of Australian are visiting social networks multiple times a day, which gives them ample opportunities to comment on and advocate about the positive (or negative) retail experiences they enjoy.
Trailblazer customer setting the benchmark
The study identified four consumer groups based on their shopping expectations: traditional (38 percent), transitioning (39 percent), tech-intrigued (18 percent) and trailblazers (5 percent). While today they represent a small proportion of consumers, trailblazers are the most vocal both on and off line, they are early adopters of technology, have greater spending power and place greater emphasis on seamless omnichannel. Their social proclivities and systems of engagement make them extremely influential to other consumers. For retailers who convert trailblazers into advocates they will reap the rewards across all consumers groups.
Invest now to close the gap and keep pace with customers
The pace of change is rapid. Retailers need to actively embrace and continuously invest in new technologies such as mobile to connect anytime, anywhere; social to engage with and listen to their customers; and analytics to truly personalise the shopping experience. Retailers that provide a superior customer experience will be rewarded with customer loyalty and will be industry leaders.
Ian Wong, A/NZ Retail Industry Leader, IBM Global Business Services said, “Customers want superior customer service, and retailers who deliver this through an integrated omnichannel experience are set to win customer loyalty and wallets. With customer’s rapid adoption of technology, and the use of this technology to engage, endorse and buy with retailers, the need for retailers to invest has never been so vital to their survival.
Retailers need to focus their investment on energising the store experience using mobile and social combined with location based technologies; deliver on the promise of omnichannel - a seamless and consistent offering across in-store and online; and finally act quickly to meet the expectations of customers, benchmarking against the trailblazer shopper.”
Margy Osmond added, “We are time poor and technologically rich and as consumers we are looking for experiences and conveniences. There’s no doubt the internet has changed the way consumers shop and communicate with retailers. As retailers gain a greater understanding of the value and power these technologies bring to the shopping experience, they will be able to offer an even more individualised shopping experience. This is a must for building stronger relationships with consumers keeping spending onshore.”
For further information and to download the full 2014 IBM Smarter Consumer Study ‘Great Expectations: Consumer are asking for tomorrow, today’: http://ibm.co/1nKb1Q0
Twitter hashtag: #IBMConsumerStudyAU
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