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Constant Customer Engagement Will Shape the Future of Retail

The shift to the connected consumer shows no signs of slowing down, and buying habits are transforming, according to the 2017 Walker Sands Future of Retail study.

“Retail isn’t just about when customers are ready to buy anymore– it’s a constant engagement with technology and experiences that drive the future of commerce,” the report says.

Based on the study findings, these three trends will shape the future of retail:

As consumers become even more connected, they will demand a more transparent and continuous commerce experience from retailers. The walls between channels will continue to fall as connectively becomes ubiquitous, and consumers fluidly move from one medium to another.
Voice ordering will drive a new era of commerce, and brands will have to learn how to navigate a landscape that doesn’t have a traditional user interface. “Zero UI” will transform the customer experience and further heighten customer expectations.

The in-store experience won’t go away, but it will shift as retailers blur the lines between physical and digital stores. The two worlds will be linked by authentic brand experiences that allow customers to move seamlessly between e-commerce and brick-and-mortar shopping.

“While the future of retail was once all about the e-commerce experience, online shopping has become so commonplace that it’s now an assumed retailer capability,” the report says. “The future is now being shaped by the connected consumer and the increasingly ubiquitous nature of technology. In this always-on environment, brands must themselves be always on – not just online, but everywhere their customers go.”

Here are some of the key study findings:

The Connected Consumer Smartphone penetration has reached 78 percent of U.S. consumers, and more than half own a tablet (55 percent).

Emerging device ownership includes wearable fitness trackers (18 percent), smartwatches (13 percent), virtual reality headsets (9 percent) and personal drones (7 percent).

More than a quarter of consumers (27 percent) own some kind of in-home smart device, including smart appliances (16 percent), thermostats (14 percent) and lights (13 percent).

More consumers now pay for at least one digital TV service (68 percent) than a traditional cable subscription (52 percent).

Nearly a quarter of consumers (24 percent) own a voice-controlled device like Amazon Echo (16 percent) or Google Home (6 percent). Another 20 percent plan to purchase one in the next year.

Almost a third of consumers (29 percent) shop online at least weekly, a number that jumps to 37 percent for Millennials. Only 4 percent of consumers don’t shop online at all. The majority of consumers (65 percent) have mobile shopping apps on their phones, and two-thirds have made a purchase through a mobile app (66 percent). More than one in four consumers (29 percent) report that they always or often shop via mobile app, and 38 percent regularly shop on mobile websites. One in five consumers (19 percent) have made a voice purchase through Amazon Echo or another digital home assistant, and another third (33 percent) plan to do so in the next year.

The Changing Customer Experience
The vast majority of consumers (84 percent) have made a purchase on Amazon in the past year, but they’re also actively using Amazon services, including Amazon Prime (55 percent), Amazon Pantry (14 percent), AmazonFresh (10 percent), and Amazon Dash buttons (5 percent).

Free shipping (80 percent) and fast shipping (54 percent) are still the top incentives for consumers to purchase more online.

In the past year, 13 percent of consumers have ordered something for same-day delivery, up from 9 percent in 2016.

Despite the fact that 54 percent of consumers still prefer to shop in store, more than three-quarters of shoppers (77 percent) think the online customer experience will eventually surpass the brick-and-mortar customer experience.

In-store shopping seems to be making a comeback among younger shoppers: Among 18- to 25-year-old consumers, 58 percent prefer to shop in a physical store, compared to less than half (46 percent) of 26- to 45-year-old shoppers.

In addition to discounts, consumers say unique experiences will cause them to shop more in physical stores, including food and beverage offerings (30 percent), a more personalized experience (18 percent), live product demonstrations (18 percent) and entertainment (17 percent). Technology like smart dressing rooms (15 percent), virtual reality experiences (13 percent) and a better mobile experience (12 percent) are less of a draw.

Connected Commerce:
Nearly half of consumers (46 percent) now prefer to shop via a non-traditional channel, such as mobile, desktop, or voice-controlled device, compared to 54 percent who still prefer the traditional in-store experience.

Almost all consumers (96 percent) shop online at least occasionally, with almost a third (29 percent) making purchases at least weekly.

The majority of consumers (61 percent) now shop online at least once a month. But more than half of shoppers still visit physical stores at least weekly, demonstrating the ongoing importance of the brick-and-mortar experience.

The study surveyed more than 1,600 U.S. consumers, uncovering how technology is changing consumer behaviors, and how consumer behaviors are transforming the customer experience for retail brands in 2017. 

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