Canadians already take a multi-channel approach to shopping, often conducting research online or downloading apps onto their mobile devices before entering a store – and if retailers fail to accommodate them, they’ll take their business elsewhere, according to a new report by international consultation firm PricewaterhouseCoopers (PwC) LLP.
“Regardless of the challenges Canadian retailers face, the status quo isn’t an option,” the 2016 edition of the company’s Total Retail Report says. “As global retailers make inroads into the Canadian market and digital technology influence grows, Canadian retailers must innovate to enhance [the] customer experience.”
While some retailers have already taken steps to create a personalized, omni-channel experience for consumers, the report’s authors say that as a whole, the Canadian industry lags behind its global competition. To catch up, the company suggests focusing on four primary elements: engagement, offerings, channels and support, which it refers to as the “total retail solution” framework.
You can read the full report here.
Step 1: Engage customers on their terms
Customers see little difference between browsing a company’s website, using its mobile app, and visiting its store, PwC says. Consequently, retailers must be prepared to approach them on whichever channel they happen to choose, in a way that feels tailored to them.
“When it comes to engagement, whether online or in a store, customers want more than products,” the report says. “They want communities they can feel they’re a part of—reinforced by brands they trust to support the lifestyle and experiences they’re looking for.”
One way that Canadian retailers have become adept at creating communities for their members, of course, is through loyalty programs – and they work, PwC said, with 95 per cent of Canadian consumers members of one loyalty or reward program or another. The problem, the researchers note, is that having so many loyalty programs competing for consumer attention makes it difficult for individual retailers to stand out from the pack.
That’s where social media can come in: according to the report, 40 per cent of Canadians said that reading product reviews, peer reviews, and feedback on social media influenced their shopping behaviour, while for consumers between 18 and 24, the number influenced by social media alone was 84 per cent.
As an example of a Canadian retailer that got social media right, the report cites Canadian Tire’s apparel and equipment subsidiary Sport Chek, which shot nine basketball mini-documentaries in nine different parts of Greater Toronto for its #MyNorth campaign (below), which generated 8,500 social media mentions and around 38.1 million social media impressions.
Step 2: Offer a curated solution addressing their individual needs
What entices customers to approach a store, whether online or off? Having a great loyalty program (according to 29 per cent), trusted brand (30 per cent), or desired item in stock (43 per cent) can be important, but the overwhelming reason, the report found, remains the most obvious: price.
Two-thirds of Canadians – 66 per cent – cited “their prices are good” as the reason they shop at their favourite retailers, with 63 per cent of millennials (which the report defined as between the ages of 18 and 34) adding that despite current exchange rates, they were likely to buy online from a foreign retailer over the next 12 months because they could receive better prices.
“To be able to compete, it’s necessary for retailers to balance consumer demand for good prices with their ability to provide tailored and personalized experiences,” the report says.
That said, not every innovation needs be tech-oriented: 40 per cent of the survey’s respondents said that merely employing a knowledgeable sales associate would make the shopping experience better; and when asked which factors would encourage them to buy from a local retailer, 36 per cent mentioned that a clear boost to local employment could be an incentive, while 34 per cent cited the benefits of buying locally produced goods.
“Retailers can gain consumer interest by showcasing how their organization benefits the community,” the researchers note.
Step 3: Create an omni-channel experience
Canadian consumers are ahead of retailers when it comes to multi-channel shopping, the report says: For example, 53 per cent of Canadians research household appliances online, while 71 per cent buy them in-store.
“Store traffic matters. Online matters. Mobile matters,” the report says. “By ignoring any particular channel, retailers are missing the potential that channel offers within a customer’s unique shopping journey.”
Addressing the problem requires that retailers do more than simply design an inviting store, an attractive website, and engaging mobile app, however: they need to establish, collect, measure, and apply consumer data to their efforts to ensure their initiatives have the appropriate impact.
“When it comes to social media and digital engagement, retailers can be swamped with information, and coordinating, analyzing and responding to it in a holistic and meaningful way can become a constant challenge,” the report says, noting that any data collected is only as valuable as its ability to help retailers tailor products and services to customers.
“Retailers… need to first determine what type of customer behaviours they desire from each segment before determining where best to start,” the report says.
Step 4: Provide consumer-centric support
Central to creating an omni-channel retail experience is following through with – and maintaining – the steps needed to make it a reality.
Too many retailers are bogged down by outdated channels, technology and organizational structures, the report says, and while it often seems that technology is changing too quickly for retailers to keep up, the key is to create a customer-centric, technology-friendly approach that can easily adapt to new behaviours and potentially groundbreaking ways to improve the customer experience.
“Just when retailers think they have it right, it’ll be time to shift their thinking again,” the report says. “By thinking forward and starting to develop a model where the customer is the main focus, retailers will be more likely to succeed in this ever-changing industry.”