When retailers are recovering from a tumultuous fiscal year, they often look to innovation, since making shopping easier or more enjoyable for their customers is common sense in a competitive market. Consumers shopping in-store now expect the latest digital conveniences, however, pressing retailers to introduce innovations simply to retain their existing customers. For example, PYMNTS’ data finds that 81% of retailers now see mobile app access as table stakes for customer loyalty.
In Big Retail’s Innovation Mandate: Convenience And Personalization, a PYMNTS and ACI Worldwide collaboration, we look at the way global retailers are leveraging digital innovation as a way to retain customers and amplify their loyalty. These findings are based on a survey of retailers located in the United States or the United Kingdom with at least 50 store locations and annual revenues of at least $1 billion for U.S.-based companies or £100 million ($127 million USD) for those based in the U.K. Respondents were asked about the digital tools and technologies they currently use, the challenges they perceive in maintaining customer loyalty and their plans for future innovation. The survey was conducted from June 1 to June 21.
Retailers see innovation as essential to their success
The report reveals that retailers have found their customer base profoundly impacted by the digital shift: Innovative features are now the foundation of customer engagement. Losing the ability to provide features like mobile apps and digital coupons, according to our survey, means losing customers. Yet we also found differences in the way some merchants prioritized specific digital features.
For example, general retailers saw barcode and QR code scanner apps as most important for customer retention, as did convenience stores and pharmacy retailers. Grocery retailers, however, saw mobile apps as equally critical to customer loyalty as barcode and QR scanner apps.
Convenience alone is not enough — personalization is key
Many retailers are not satisfied with the digital tools they currently have at hand, and we found that many retailers are not confident in their ability to deliver engaging customer experiences or in the power of their digital tools to help them do so. Our research revealed that only around half of retailers in the U.S. and the U.K. believe that they have the right mix of digital tools to serve their customers well.
This discomfort has led to retailers not only implementing consumer-facing innovations but also hunting thoroughly for insights on what consumers really want by collecting and analyzing consumer data. For many merchants, this type of personalization is critical to making convenience features useful for their unique customer base.
To learn more about how retailers are addressing their dissatisfaction with their existing technology stacks preparing for a radically transformed retail future, download the report.