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GUEST OPINION Are retailers doing enough to engage with customers?

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Consumers want apps, AI, VR, chatbots and all the latest ways to make interaction with retailers slick and easy. But it’s a real challenge for the retailers to deliver. Nick Black, CEO of Apadmi, looks at what consumers want and how retailers might start to meet these demands

At the end of 2016, online retail sales had increased by a huge 21.3% year-on-year. And the emergence of mobile shopping – and retail apps in particular – has begun to completely transform the industry. More than ever, retailers are now expected to offer an exceptional omnichannel shopping experience, as younger shoppers continue to move towards mobile e-commerce, and retail apps.

But, with such a large proportion of consumers demanding platforms that allow them to browse and shop anytime, anywhere, are retailers taking notice of this? And are they doing enough to develop the kind of experience their customers now expect?

The current state of retail

Our recent Future of Retail report found that online shopping is now on a similar level with in-store as the most preferred form of shopping among all UK consumers. Almost two thirds of customers would shop via a desktop device, and 68% would shop in store.

But, today, there are even more ways to shop, and it’s no longer about just going online to purchase goods via a laptop. Alongside having a well-built website, it’s essential that retailers now provide an online platform that can be accessed by consumers on the go.

Every shopping website must be mobile friendly, especially given that 70% to 80% of website browsing now occurs using a mobile device. And in the UK, almost three in 10 consumers now spend online using mobile apps, one of the highest rates in Europe.

Amongst the younger consumers, a quarter of millennials say they prefer to shop using a retail app, as they particularly value being able to browse at their own convenience, at any time and from wherever they are.

It’s clear that retail apps are growing in popularity, as a third (34%) of consumers have downloaded more retail apps in the last 12 months than in the previous year. Fashion retailer, ASOS, now reports to have 10 million active downloads of its app to date, with 7.5 million new downloads having taken place during the last financial year.

It’s also predicted that by 2019, mobile sales will be worth nearly £40 billion, making up about 43.7% of total retail e-commerce. Amazon, a huge international retailer, has actually taken the use of shopping apps to the next level with the idea of Amazon Go, a physical shop that allows consumers to ‘just walk out’ and pay for their items using an app, rather than having to wait in a queue in-store. With huge players in the sector already exploring ways to offer new experiences to their customers, other retailers need to be keeping their eyes on how the industry is shaping up and the fast rate at which it is changing.

What do consumers want to see in the future?

Given the evidence that younger shoppers are beginning to favour apps – even above shopping via a laptop – it’s highly likely that retail apps will continue to become more popular in the future and will become more advanced. From our report, we can see that consumer expectations are beginning to stretch even further than the apps available today, the majority of which allow users to make simple, straightforward purchases.

As technology becomes more revolutionary, customers are increasingly expecting retailers to invest in new phenomena, such as artificial intelligence (AI) and virtual reality (VR), so they can enjoy a more personalised shopping experience. More than a quarter would like to see retailers incorporate AI into shopping apps that could remember previous purchases and recommend products and deals based on their shopping history.

For retailers, this tech could present a wealth of opportunities to maximise sales thanks to the mass of insightful information that would be collected. Chatbots, for example, could tailor online shopping experiences by alerting shoppers to upcoming offers, or sale items or purchases they might be interested in. This would likely encourage more people to start using retail apps.

Alongside AI, consumers would also like to see retailers investing in augmented reality (AR) and VR. Implementing such technology into apps would allow customers to preview purchases and visualise what products would look like – whether virtually trying on clothes or placing furniture in their home – before they spend any money. This technology could also allow them to see how products worked up close before they bought them, and would be useful to preview product customisations – like different colours and designs. This has the potential to be huge in the interior design sector and fashion sector.

Are retailers stepping up to the mark?

While more consumers are beginning to turn to retail apps and a mobile shopping experience, many shoppers still feel that current apps are not fulfilling their full potential as a shopping aid or tool. Six out of 10 customers are not satisfied with the current apps that are available, while nearly a fifth believe that retailers need to be investing more in improving current and new apps.

Consumer expectations are changing and so are their shopping habits, particularly with the ‘on the go’ lifestyle now becoming the norm for many. Therefore, in order to keep up with the needs of the consumer, retailers need to be taking these figures and the opinions of customers into account. Many people currently feel as though they haven’t noticed any improvement in the apps they’ve already downloaded. And, in our previous Retail App Report, we actually found that the majority of people would delete an app if they came across problems. This should serve as a warning to the sector, and should encourage retailers to step up their game and new find ways to enhance the experience they are offering.

Looking to the future, it’s vital that retailers start investing more in the innovation of retail apps, particularly with online shopping becoming the preferred way to shop for most shoppers. It is clear that consumers are willing to download retail apps, but they want to see retailers working to improve the shopping experience to offer them something new and immersive, such as AR and AI. Mobile apps will play a major role in retail’s future, and those retailers that realise this sooner than their competitors will inevitably have more say over how the technology develops in the future.

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