Providing better customer experience could increase revenue by at least 5 percent.
Retailers missed out on $150 billion in revenue in 2016 because they failed to provide shoppers with personalized service, according to a new survey by TimeTrade. Providing shoppers with better customer experience could increase revenue by at least 5 percent, while millennials say they would pay up to 20 percent more for better retail experiences.
“Just imagine the positive financial impact on brick-and-mortar retailers if revenue jumped by 5 percent,” said Gary Ambrosino, CEO of TimeTrade. “Right now, retailers’ revenue projections and stock prices are under pressure as the landscape continues to change. A renewed focus on providing shoppers with a better, more personal in-store experience would go a long way toward stemming the tide of defection to competitors and online sellers.
The State of Retail 2017 survey found that disappointing shopping experiences are costing brick-and-mortar retailers some serious cash, and the additional revenue that would result from better customer experiences could help those who are struggling to meet revenue, profit and stock valuation goals.
While previous TimeTrade surveys of retail executives have found that they consistently believe their stores do provide customers with personalized shopping experiences, the consumers tell a different story. Of this year’s survey participants, 49 percent said they “never” or just “sometimes” receive personalized service while shopping, while 70 percent of the time they shop they “never” or “sometimes” can even find a sales associate when they need assistance in the store.
This creates a disparity that is financially damaging for retailers, resulting in abandoned merchandise, dressing rooms, and even stores when customers cannot find help from store associates. On the flip side, 88 percent of respondents said that when knowledgeable associates assist them with purchases, they are either “somewhat likely” or “extremely likely” to complete the transaction.
Shoppers also put prompt service, personalized experiences, and smart recommendations at the top of their list of things they value most about shopping in a brick-and-mortar retail store. One way to improve service, for 64 percent of respondents, would be to have the ability to schedule a convenient in-store appointment with a retail associate from their mobile devices .
“In store shopping is far from dead—but it does have to change to keep up with the trends. These survey results show that people definitely like shopping in stores so they can touch and feel products, and because they enjoy receiving prompt, personalized service. The key to success for brick-and-mortar retailers is to fully utilize their existing staff and relentlessly focus on providing personalized service to every customer. We know consumers are willing to pay for better service. It’s a big opportunity for traditional retailers to up their game across the board and capture that additional revenue, instead of letting those dollars go elsewhere,” Ambrosino said.
The study also produced some surprising findings about Millennial shoppers. While may assume that they shop mostly online, the survey found that they actually prefer shopping in stores, with 47 percent reporting that they do 75 percent of their shopping in brick-and-mortar retailers. They also reported that, when helped by a knowledgeable associate, 58 percent are extremely likely to make a purchase, and 29 percent reported that they start shopping online but go in-store to complete their purchases.