The Future of Retail is More Personalized and More Digital, According to Appnovation Research

Consumer expectations of retailers and the shopping experience have dramatically shifted, altering the digital landscape for the post-COVID future of retail brands.

According to Appnovation’s latest consumer research, Digital Innovation for the Experience Economy: Retail, over 70% of North American consumers agree that digital technologies have made their shopping experiences more convenient, but only 1 in 5 rate the current experience offered by retailers as ‘Excellent’. This suggests that the majority of people believe there is room for retailers to improve the customer experience (CX), particularly as it relates to ecommerce.

Appnovation’s research measured US and Canadian consumers’ values and expectations as they relate to digital experiences with retailers.

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Key findings from the research include:

  • Over half of North American consumers say they make an online purchase at least once per week. This is especially true among US consumers (58%) compared to Canadian consumers (43%). In looking at all consumers, Gen Z outpaces other generations in online shopping, with 63% indicating they shop online at least once per week, compared to 53% of Millennials and only 36% of Gen X. Though the pandemic drove consumers online at rates not previously seen, this digital-first behavior is not expected to go away.
  • Only one in five consumers rate the current experiences offered by retailers as ‘Excellent’, indicating that there’s room for improvement. This is especially true for Canadian consumers, who rate only 15% of digital experiences as ‘Excellent’. In fact, one in four Canadian consumers stopped using a retailer because they didn’t like the digital experience that was offered.
    • One quarter (25%) of US consumers rate their online shopping experiences as ‘Excellent’, with only 18% switching retailers because they didn’t like the digital experience that was offered.
  • What’s important in a digital retail experience varies among generations. Gen Z consumers value ease of experience above all else (34%), whereas Millennials and Gen X value things like price and value (35% and 48% respectively). However, many features that customers love – like price and value – are arguably table stakes. Where a brand can truly differentiate is in the value-added experience that they provide to shoppers.
  • Consumers expect that the future of retail is more digital and more personalized. Eighty five per cent of consumers believe that new features will be added to the retail digital experience and 72% believe that experiences will become more personalized thanks to data collected by retailers. This presents enormous opportunity for retailers who move fast to meet consumer expectations.

“Brands need to understand that their consumer experience is going to be compared to other digital experiences outside of their vertical on a regular basis,” said Scott Wassmer, General Manager of the Americas at Appnovation. “The digital world has become the great equalizer of brand experience and that means that your retail experience will regularly be judged against those created by greats like Apple, Google and Facebook.”

A Values-Driven CX is the True Differentiator for Brands

When asked to rank the importance of aspects that make up the online retail experience, price and value emerged as the most valuable across all generations (39%). Ease of usage, including things like easy navigation (13%) and user friendly design (12%), also emerged as top factors of a memorable online experience.

On the other hand, customers’ biggest frustrations in their digital experiences are out-of-date inventory (14%), difficult navigation (11%) and a poorly designed interface (9%).

Many features related to digital interactions have become table stakes. Consumers expect that retailers

will offer competitive pricing and that quality of the product will meet a certain threshold. What is coming through as a differentiator is how easy and convenient the retailers make the digital experience.

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