Close this search box.

3 reasons that closing the customer experience gap is a top retail priority

What is the top driver for Peak 2017?

As we approach Peak 2017, competition between retailers is fierce in a battleground where customer loyalty is dwindling. There is no doubt that retailers and marketers alike are at the mercy of consumer expectation, and this is influenced by one key driver: experience.

Looking into 2017, delivering the ultimate customer experience at the right time, in the right channel, to the right person in the right context, is crucial to meeting rising expectations and fosters not only brand loyalty, but advocacy too.

Are retailers not meeting customers’ expectations?

A striking finding of a recent Econsultancy report states that over 80% of companies think that they have a holistic view of their customers, but little over 30% of consumers claim that their favourite retailer understands them. This stark difference shows that experience could stand to be a key competitive differentiator.

The key to this is a full, 360 degree profile not only of an individual consumer but also their context, their ecosystem and their customer journey at any given time. To understand abandoned purchases, or conversely to increase conversion, retailers need to be able to decipher rafts of customer-generated data in context. We’re not just talking transactional information here, or even interactional, but beyond that. We want to know sentiment, intent, behaviour and emotion in order to understand the emotional drivers behind each customers’ decision-making process.

Why has the customer experience gap developed?

There are three key reasons why the customer experience gap has developed: hyperabandonment, breaking the brand promise and customer experience disillusionment. Their importance to the customer experience make them top priorities for retailers to address.

1. Hyperabandonment: Forrester stated this year that a significant hype factor is hyperadoption, which basically means that today’s digital-savvy consumers are fast to adopt new technologies like apps or other kinds of tools that offer digital experiences. However, since they carry no or little cost to the consumer they do not feel beholden or loyal to the associated business. This leads to hyperabandonment whereby consumers are only too ready to drop a piece of technology or stage of their transactional journey if it is not working in the way that they desire.

Brands with a strong ability to understand customer journeys have a 104% higher conversion rate compared to other brands according to a recent Econsultancy report. Delivering the right customer experience means that retailers need to tackle every touchpoint and develop a truly insightful understanding of where a consumer may struggle. Imagine being able to understand the end-to-end view of a customer’s journey with contextual and actionable intelligence at every level – from company-wide aggregates all the way down to a single user’s experience. What happens to the struggle points then?

2. Breaking the brand promise: A key facet to customer engagement is trust and the ‘last mile’ is debatably the most important in terms of its impact on conversion. Everything from providing transparency in the payment process to easing security concerns foster loyalty and return visits as does delivering on the brand promise when goods and services arrive on time. According to our studies, 59% of consumers actually choose a retailer because of their omnichannel delivery and returns capabilities. With shopping figures forecast to rise by 10% this year, retailers need to streamline their order management process to achieve omnichannel growth, but in an environment of eroding margins, this needs to be done in an economically viable way too.

At London Fashion Week, brands such as Burberry made it possible for consumers to buy almost as soon as the model had left the runway. With the right data, leading retailers are now able to consolidate their inventory, maximise efficiency, minimise their cost to serve and balance their fulfilment capacity to profitably fulfil across channels.

When brands can combine historical business metrics with external data, they can derive insight from a predictive environment, allowing more effective forecasting. Teams can optimise based on cost of shipping, capacity and inventory to make more informed fulfilment decisions and drive down costs. External sources could include the weather, global events, economic conditions and breaking news to maximise order fulfilment whilst reducing shipping costs, thereby boosting profit. Cognitive capabilities are equally powerful in this ‘last mile’, continually learning and honing decisions made about how to fulfil orders to meet customer delivery expectations in an economically sustainable way.

3. Customer experience disillusionment: There are almost as many analogies of the amount of data being created today as there is data itself, but this only goes to demonstrate the importance of the resource. Successful retailers are embracing the notion that although customers are offering up a wealth of information, in terms of social media and ecommerce interactions, deciphering it is a formidable task.

Further, it is a matter of value exchange. Consumers need to perceive a benefit in offering up their information. There are also the dark data channels to consider. Often, the most valuable forms of data are unstructured and so to develop a completely contextual understanding of consumer preference it can serve to be the most disruptive differentiator.

On the flipside, consumers are easily deterred and often irritated by irrelevant or misinformed communications and so retailers must focus on optimising every touchpoint to truly foster brand engagement. This requires the ability to visualise marketing channels across the entire journey and understand how activity in one channel impacts conversion in another. And to the first point, to identify where customers struggle.

Customer case study

Founded in 1982, US multichannel retailer Performance Bicycle operates over 100 stores across 20 states, as well as an ecommerce website with over 10,000 cycling products. When customers visit Performance Bicycle stores, they are welcomed by a staff comprised of avid cyclists who help guide their shopping experiences. Unfortunately, visitors to the Performance Bicycle website weren’t getting the same experience and online sales were suffering as a result. Visitors complained that the site was difficult to navigate, and too many were abandoning their carts before completing their purchases. The business wanted to improve its approach to ecommerce by finding ways to make the online experience just as welcoming as its physical shops and make the online store mirror its retail stores.

The retailer adopted IBM Customer Experience Analytics software to analyse its ecommerce website, scrutinising the places where visitors pause or abandon their carts to obtain a single view of customer journeys across multiple experiences and channels. The new insights were used to guide a website redesign and to formulate a plan for optimising the online experience. The newly redesigned website now guides customers through the shopping experience much as employees in the physical shops guide customers through the store. The website’s Learning Center provides detailed information about products and repairs attracting more customers because the content is customised with insights gained from visual paths of activity.

Within four months of launching the redesigned site, web traffic tripled and visitors to its Learning Center are now 20% more likely to make a purchase than visitors referred from elsewhere. Performance Bicycle is now referring more than 40% of its sales to direct online sales.

“This solution is enabling us to share information inside and outside of the business more easily than ever before. We can deliver positive social experiences that convert casual visitors into committed customers,” says Mike Starkey, VP of Information Systems, Performance Bicycle.

What would you recommend as key to success?

Retailers need to be able to tell a story in the space of a swipe on an informed and seamless basis to truly foster a personalised and memorable buying experience. Practitioners must be armed with true insights from customer experience analytics – not just heaps of data and reports – to design effective omnichannel interactions. Individual insight is not enough here – retailers are sitting on a goldmine of information waiting to be understood and built into campaigns. Beyond this, retailers also need to be able to link the operational silos that most businesses struggle to connect – from marketing to merchandising, to fulfilment, in a store, in the field, or in a call centre.

Successful brands will find that it is the combination of tapping into trends and behaviours, executing with speed and flexibility and delivering powerful omnichannel customer experiences that will ultimately drive long-term success.

How to contact me

For further information see or contact me via email or via twitter @toni_rossetti

Read More

Register for Newsletter

Group 4 Copy 3Created with Sketch.

Receive 3 newsletters per week

Group 3Created with Sketch.

Gain access to all Top500 research

Group 4Created with Sketch.

Personalise your experience on