2023: The Year to Truly Put the Shopper First
Today’s shoppers expect retailers and brands to understand and meet their needs with seamless omnichannel experiences. In a recent survey, we found that about 75 percent of consumers are not fully satisfied with their shopping experiences. Thanks to a shifting, unpredictable economy and the evolving consumer journey, the average person has become more selective — and retailers and brands should provide a better, more seamless experience to earn retailer loyalty.
As if that wasn’t complex enough already, brands are exhausted with the relentless line item expenses being brought to them from retailers (paying for data, paying for RMN, paying for buy backs, paying for supply chain fines when they can’t fulfill orders). This doesn’t create an environment that’s conducive to collaboration or ‘doing what’s right for the customer.’ Instead, it drives up the cost of goods sold (COGS), lowers margins and increases MSRPs.
Shopper loyalty will become even more important to both brands and retailers.
To maintain share of wallet, brands and retailers will need to focus on the shopper experience to drive shopper loyalty and revenue. Due to the pandemic and inflation, shoppers have been switching brands and switching retailer preferences with increased frequency and we don’t expect that to change in 2023. In fact, our recent study showed 84 percent of shoppers are actively switching brands due to price increases from inflation. However, by prioritizing personalization (in the experiential options for purchasing, as well as, the awareness of products that align with their preferences), brands and retailers can foster a more meaningful connection to shoppers.
Digital will become even more important for driving share-of-wallet.
A primary area of opportunity for digital advancement in 2023 will be with mobile app experiences. Shoppers are using apps for more than ever before (and for more than simply buying food). First and foremost, they use store apps to search for deals/rewards (44 percent) and 32 percent report they are using apps to look for weekly sales ads.
Retailers also shouldn't be afraid to leverage offsite personalization to drive their customers onsite for conversion. This can drive awareness for additional services retailers offer which support alternate revenue priorities. For retailers with pharmacy operations, keeping the pharmacy top-of-mind for consumers is a key component of loyalty that should be prioritized and leveraging digital tactics to drive pharmacy adoption will pay off for retailers and health and beauty brands in the long run.
However, with budgets tightening it will be critical to effectively measure the success of digital initiatives to show ROI and maintain support of these programs.
Amidst the complexity, retailers that keep the shopper as the North Star will continue to win. This is a timeless truth and one that must be combined with the confidence to think big, test fast and scale.
Think Big but Keep it Simple
The retail industry ecosystem is one that quickly gets complex as a result of the many hands in the cookie jar. Through this complexity, the businesses that keep the shopper as the North Star will continue to win. This is a timeless truth and one that must be combined with the confidence to think big, test fast and scale to the level that data justifies. It will be imperative to think independently and not only look at what others in the marketplace are doing to ensure future success. Clear definitions of what that success looks like for tests that align with the shopper to earn their loyalty & spend will be key in this endeavor. Once that framework is in place, be decisive on scaling a solution that supports earning your shoppers trust and collaborating with strategic partners to deliver on big opportunities.