NEW YORK: Digital interactions influence 56 cents of every dollar spent in retail stores, amounting to $2.1tr in 2016, yet brick-and-mortar retailers still lag when it comes to creating digital experiences that consumers actually want.
That is according to new research from Deloitte, the professional services firm, which polled more than 5,000 US consumers for its report, "The New Digital Divide: The future of digital influence in retail".
Now in its fourth year, the report stated that even as digital influence has grown, the ability of retailers to influence the consumer purchase journey has decreased.
This, Deloitte argues, is because major e-commerce players, as well as digital platforms, such as Facebook and Pinterest, are now operating at such scale – and frequently connecting with users in real time – so that they are shaping definitions of what a great customer experience is.
"Any retailer who thinks they can build their own personalised experience to interact with customers anywhere near the extent of major digital platforms and find success may be disappointed with their results," said Jeff Simpson, a partner at Deloitte Consulting.
"Their limited interaction with customers – about six to eight transactions per year – limits their understanding of the 'moments that matter' in a personalised experience such as purchase intent and preference," he added.
The problem, according to the report, is that retailers have been relying on traditional KPIs rather than evolving a new definition about how to define success to keep up with changing consumer desires.
For example, retailers too often overstate certain metrics, such as audience size and engagement, and also have been slow at moving from a legacy "campaign" mindset, where everything is planned around a sales event, to a "customer" mindset, where planning is based around the needs of different consumer segments.
"Don't try to build everything yourself," the report advised. "Retailers should embrace the native capabilities of their digital touchpoints and integrate with platforms where their customers are already interacting at scale rather than trying to build such platforms themselves."
And in another key takeaway for retailers, they are advised to take a hard look at their organisational and financial structures to ensure they can better anticipate and respond to the needs of today's digitally connected consumer.
That is according to new research from Deloitte, the professional services firm, which polled more than 5,000 US consumers for its report, "The New Digital Divide: The future of digital influence in retail".
Now in its fourth year, the report stated that even as digital influence has grown, the ability of retailers to influence the consumer purchase journey has decreased.
This, Deloitte argues, is because major e-commerce players, as well as digital platforms, such as Facebook and Pinterest, are now operating at such scale – and frequently connecting with users in real time – so that they are shaping definitions of what a great customer experience is.
"Any retailer who thinks they can build their own personalised experience to interact with customers anywhere near the extent of major digital platforms and find success may be disappointed with their results," said Jeff Simpson, a partner at Deloitte Consulting.
"Their limited interaction with customers – about six to eight transactions per year – limits their understanding of the 'moments that matter' in a personalised experience such as purchase intent and preference," he added.
The problem, according to the report, is that retailers have been relying on traditional KPIs rather than evolving a new definition about how to define success to keep up with changing consumer desires.
For example, retailers too often overstate certain metrics, such as audience size and engagement, and also have been slow at moving from a legacy "campaign" mindset, where everything is planned around a sales event, to a "customer" mindset, where planning is based around the needs of different consumer segments.
"Don't try to build everything yourself," the report advised. "Retailers should embrace the native capabilities of their digital touchpoints and integrate with platforms where their customers are already interacting at scale rather than trying to build such platforms themselves."
And in another key takeaway for retailers, they are advised to take a hard look at their organisational and financial structures to ensure they can better anticipate and respond to the needs of today's digitally connected consumer.
Data sourced from Deloitte; additional content by Warc staff
