J.P. Morgan Weighs In on Retail’s Three Big Moments of Truth

We all heard the saying as kids when parents and teachers offered up these words of wisdom: You only get one chance to make a first impression.

The aphorism holds true in retail, where merchants vie for the attention, and the dollars, of consumers day in and day out. The promotions, the emails, the texts all are meant to lead to the impulse buy — which, for an unfamiliar brand, just may get someone to click through, find what they want, load up the promo at checkout … and hit the buy button.

That’s the hope, anyway. More often than not, as Head of Commercial Bank Merchant Services, Client Management at JPMorgan Teresa Walker told Karen Webster, the moment of truth, at the point of sale, is so clunky that a would-be loyalist is turned off, and they move on over to a competing site instead, looking for comparable products and 5-star reviews.

The middle-market retailers, said Walker, have spent time and money on developing their niche brands and sites, only to lose out to the eCommerce juggernaut.

“There’s so much energy and resources that go into acquiring a first-time or repeat customer,” she said. “The initial experience has to be really good.” Promotions need to be easy to redeem. Checkout needs to be smooth. Otherwise, the cart will be abandoned.

“Time is precious,” Walker said, “and so we want to go the easy route.” Hence, retailers are under threat of abandonment in favor of an easier experience, unless mid-market firms take a magnifying glass to the frictions that are inherent in their checkout flow, redemption processes and even in their omnichannel efforts.

The point of sale, she said, is the single most important interaction that a merchant has with a customer, because right then and there, they’re either making the purchase, or choosing not to.

Agile tech stacks and robust fraud fighting tools are a given, Walker said, and strong partnerships with outside providers can help make sure those two must-haves are in place. Working with financial institutions or other acquirers, as these middle-market clients grow, can help retailers partner on content creation, inventory management and shipping.

“Wherever you can engage, that’s where you can build the relationship,” Walker said.

The problem is that many of these mid-market retailers, Walker said, have been growing so quickly that they have not thought like shoppers, or put themselves in their customers’ proverbial shoes — and so their shopping experiences have given rise to three consumer pet peeves.

Love Isn’t Unconditional

Webster and Walker delved into their key pet peeves in terms of interacting with merchants online. The affection and loyalty a consumer might feel for a brand can be and often is sorely tested amid a clunky payment experience.

“Some merchants have blinders on when it comes to this,” Walker said, adding that there may be some goodwill extended in the event that a consumer is browsing and shopping for something unique or that’s an occasional purchase.

But from her own point of view, Walker said, “where I’m not patient is for what I call everyday shopping … I want to get in, get out of there, and get on with my day.”

Any friction, she said, means the sale will fall by the wayside. That’s especially true with recurring items, where the ability to “tweak” an order — say for dog food — should be intuitive, even if the intent is to skip an order or pause it entirely. The fault lies in the fact that many mid-market retailers have not invested in the consumer-facing technology (and back-office operations) that make it easy to integrate those features into the process, so a modification can be done with a few taps of the mouse or the mobile device screen rather than having to go and email customer service to get some changes made.

The Disjointed In-Store Experience

The post-pandemic age has blurred the lines between digital and physical commerce — or it should, anyway. Walker noted that the same disjointed technology that’s the legacy technical debt carried by some retailers has made it impossible to engage the consumer in the aisles, where the salesperson should be able to pull up the individual consumer’s online history to see what might be in stock and on hand to satisfy the shopping needs at that moment.

“If they do it right,” said Walker, “they’ll build loyalty.” While the larger retailers have done a good job bridging the channels, the mid-market retailers have come up short, and the experience is inconsistent at best.

“This is my biggest pet peeve,” said Walker, who added that when visiting a brick-and-mortar location, whether for purchasing, returning or exchanging an item — no matter the touch point — the retailer should be able to tie the history and the purchases together to make the commerce journey as efficient as possible.

Promo Rope a Dope

Promotional activity is a double-edged sword. We’ve all been inundated with text messages or emails loaded with offers and promo codes, only to find out that, at checkout, you have to rummage back into your emails and find the code, copy and paste the data or … actually write it down with paper and pen.

“We’re all getting ready for the holiday season, and we’re all getting ready to shop,” Walker said. The 20% promotional codes mysteriously disappear at checkout, and the chasing down of the original code begins. “I find myself getting irritated,” she added.

All of this runs counter to the intent of the discount, which is meant to make the consumer feel good about the purchase. The ideal experience is to offer up the discount at checkout, in clear terms, without the fuss of emails and texts — making it easy to redeem the offer means the customer is likely to come back to shop with that merchant.

What Merchants Can Do

The merchants saddled with the technical debt, Walker noted, can find strategies through partnering with firms such as JPMorgan, where a good strategy is to “act like a secret shopper,” examining each and every touch point in stores and online. Mapping those touch points out, she said, offers an examination of friction and where the retailer needs to invest new efforts.

“Being a secret shopper is one of the most important things you can do — and it costs almost no money,” Walker said. The digital wallet remains an important way to streamline customer interaction, and, after all, no one really leaves the house without their phones.

“I would also think about shopper personas,” Walker said, “and the segmentation of data to create custom marketing and product offerings.”

As she told Webster, “when you get these things right — the consumers come back and they continue shopping.”