There are five distinct stages of shopper behaviour in today’s omnichannel environment – a world defined by continuous customer-retailer interaction across multiple channels.
Customers no longer start and end their relationship with a retailer in a linear way; the new relationship is typically cyclical and comprises exploration, decision, transaction, consideration and revision.
But what do each of these stages entail? Our latest research insight into how retailers can optimise shopper experiences, nurture their interest and build customer relationships for life.
Exploration forms the first step in the new consumer experience cycle, but the key challenge retailers face is that not all shoppers conduct this research process in the same way.
For many retailers, such as those selling big ticket items like furniture, there is a drive to hook customers online but, ultimately, complete the sale in-store. In fact, 75% of consumers find it clearer to compare prices online than in-store and 69% prefer to compare product specifications digitally.
To tempt shoppers into buying, retailers must ensure their online platforms are as informative as their stores, while reflecting the personality and emotional connection between the customer and store associates.
Decision and Transaction
When shoppers have made their purchasing decision they may be encouraged to spend more but they can just as quickly change their minds entirely if retailers haven’t implemented the right tools and processes.
This conversion point is crucial, and our research indicates that shoppers want options and flexibility when it comes to making a payment. The concept of the ‘customer service last mile’ is particularly important in a physical retail environment, with 48% of shoppers upgrading a purchase based on in-store advice – either supported by technology or not.
It’s crucial when a customer is ready to convert that retailers strive to provide a frictionless experience in every channel because even the smallest frustrations can prevent a sale and negatively affect customer loyalty to the brand.
Historically, receiving payment marked the end of the consumer-retailer relationship, but with the competition for spending across Europe retailing so fierce it is vital businesses form post-purchase processes and nurturing too.
One reason is that return rates are rising. Shoppers are increasingly analysing and judging their retail experience after making payment, meaning flexible fulfilment and after-sales service must be in place to support new behaviours and ensure that customers receive a positive experience, even when things go wrong.
More than half (51%) of shoppers said they will not order from a retailer that doesn’t have a free returns policy, while 63% demand the option to return an item to any channel if they decide not to keep it. The consideration stage allows retailers to think about their wider value proposition and how to use modern fulfilment services like click & collect to upsell and strengthen relationships with customers.
Often overlooked by retailers, the revision stage provides an opportunity for shops and brands to encourage repeat business.
Much of this process is centred around loyalty schemes and post-purchase communication with shoppers. Each individual transaction can be used to drive long-term value – the better retailers get at understanding their customers individually, the more incentivised these shoppers will be to shop again as communications are relevant to their needs and interests.
This stage is a nurturing process based on information retailers already know about their customers. By putting the right processes in place to keep track of individual shopper preferences, isolated encounters can turn into long-lasting relationships.
Understanding the new modern shopping journey, and thinking about the five stages of exploration, decision, transaction, consideration and revision, that we’ve identified, can help retailers shape the relevant processes as the battle for consumer spending intensifies.
By Frank Lochbaum, Managing Partner, KPS