RSR Report Finds Retailers More Focused On Competition Than

By Christine Kern, contributing writer

Retailers misread or ignore consumers’ desires in order to best their competitors.

When it comes to home delivery strategies, retailers are more focused on the competition than on what their own customers want from them, according to new research from RSR. According to the report, “Home deliver, long a dormant and specialized activity for retailers selling large durable goods like furniture and appliances, is experiencing a renaissance, driven increasingly by consumers’ expectations for a seamless cross-channel experience.” That means, as customers demand faster, cheaper delivery of the products they desire, retailers have to “figure out how to enable home delivery capabilities that will enable them to meet consumers’ near-unrealistic expectations.” It turns out, retailers are feeling pressure and not delivering as well as they could on consumer demands.

Home Delivery: Retailers' Brave New World contains analysis of the business drivers, opportunities, and organizational constraints surrounding retailers' home delivery strategies. It also features the results of a consumer survey, demonstrating where retailers' and consumers' expectations match and where they diverge. The report also offers baseline recommendations for navigating the future of home delivery, particularly as retailers struggle with fast, free delivery from the competition.

Among the findings of the report:

• While retailers get that customers want their products quickly, they also do not necessarily understand what their customers want from home delivery services.
• Consumers report being most motivated by convenience, and retailers are responding by upping their home delivery game, but the challenge remains finding ways to get the consumers to pay for these services so retailers can see positive returns.
• All retailers, whether they use in-house or outside providers for home delivery services, need to institute systems and professionals in place to manage those services effectively.
• Technology enablers for home delivery are a case of haves and have-nots: the Retail Winners have made substantial investments, while their less successful peers must play catch up over the next 12 to 18 months. Significant gaps exist between the capabilities retailers value and the technology solutions they need to support them.

According to RSR, a majority of retailers (especially the better-performing Retail Winners) rightfully recognize consumers’ desire for the need for speed, but beyond that concerns diverge. Winners particularly are most likely to cite the need for faster delivery in what RSR calls “The Amazon Effect,” but while retailers think that consumers want more services, consumers are less enthusiastic. In reality, customers want ways to get their items cheaper, and they think that if a retailer can get the product to their home from a local store, it must mean a lower delivery costs than from an online-only retailers with distribution centers somewhere across the country.

 RSR asserts that  “Winners are missing the boat, while others get it. Fifty-four percent on non-winners cite a need to find other ways to compete with on-line marketplaces and pure plays as a top-three business challenge.”