Coles, Priceline, Target, Bunnings and Dick Smith are the country's top rated retailers, all coming in first place within their respected sectors, a survey conducted on 16,000 digital shoppers has revealed.
These findings were revealed by global management consultancy firm Capgemini in its latest report examining the changing nature of shoppers' retail preferences as they continue to tap into the rapid innovation of traditional and digital channels.
The report, entitled "Digital Shopper Relevancy", surveyed 16,000 digital shoppers across 16 developing and mature markets* and demonstrated that shoppers are not loyal to one channel but expect a seamless integration across online, social media, mobile and physical stores.
Covering 16 developing and mature markets, the report explores the importance of various channels for the shopping experience. The findings are broken down against age and gender, providing an interesting insight into different shopping habits.
Capgemini, one of the world's foremost providers of consulting, technology and outsourcing services, said 60% of respondents declared they expect the convergence of retail channels to be the norm by 2014, when a unified shopping experience is expected to become commonplace.
However, achieving this will be a challenge, as more than half of shoppers said that most retailers currently are not consistent in the way they present themselves across channels.
Multi-Channel Approach to Retail, Going Online and Offline-Physical Sales Matter Most
"In recent years, the retail industry has undergone considerable transformation across both developing and mature markets. In Australia specifically, we've seen significant declines in retailer revenue as consumers increasingly turn to on-line sites, both in Australia and overseas, for every aspect of the shopping journey from researching and comparing products through to purchasing," said Mr. Ben Gilchriest, Digital Transformation lead for Capgemini Australia.
He added that "digital is now a fundamental part of consumers' expectations of retail - they want to be able to use digital at each step in their shopping journey. To ensure future success it is essential that businesses adapt to customers' existing digital habits, building in flexibility and agility so that they can respond as customer expectations of digital evolve."
However, Mr. Gilchriest doesn't mean moving everything on-line; the report reveals that a multi-channel approach that includes the integration of online and offline channels is integral to this success since 52 per cent of Australians are likely to spend more money at the physical store if they have used digital channels to research its products beforehand."
Key findings from the study include:
- The Internet remains the dominant channel. Websites are the most important for digital shoppers across the end-to-end shopping journey in developing and mature countries, with 80 per cent of respondents in developing markets stating the internet was important or very important and with 63 per cent in mature markets. This is closely followed by e-mail interaction. However, channels such as social media, mobile apps and in-store kiosks are growing in popularity as alternative retail channels.
- Significant differences exist between mature and developing markets. The number of digital-savvy shoppers increases considerably in developing markets and they tend to "leapfrog" the traditional retail infrastructure adopted by mature markets. 72 per cent of respondents from India and 69 per cent from China state that they purchase more products in a single transaction online than in a physical store, compared with just 31 per cent from Australia and the US.
- The retail landscape as we know it is set to change. More than half of the respondents from both developing and mature markets said they expect physical stores for increasing numbers of categories will simply become showrooms to select and order products by 2020.
- Digital-savvy shoppers will spend more. The study highlighted that 56 per cent of respondents are likely to spend more money at a physical store if they had used digital channels to research the product prior to purchase, however 73 per cent of respondents also expect online prices to be lower than those in physical stores.
- There is no "one" digital shopper profile, although women are more engaged when using digital channels. Varied behavioral patterns appear across a number of factors, including age, gender, product category, journey stage and market maturity. The study highlighted that 55 per cent of women shoppers are more engaged when using digital channels compared with 44 per cent of men.
- Personalised experiences can deliver for retailers, but not too personalised. 61 per cent of respondents said they want online stores to remember their personal shopper history to speed up shopping, however only 41 per cent would want to be identified through smartphones when entering a physical store.
Capgemini's research highlighted that six distinct segments, or faces, of shoppers are emerging who use digital channels in different ways during their shopping journey:
- Social Digital Shoppers (25 per cent of total respondent base): The majority of these shoppers are under 35, are heavy users of social media and want to share opinions and experiences through digital channels. They are also active users of mobile applications and trust mobile devices for paying for products, locating items and identifying themselves.
- Digital Shopaholics (18 per cent of total respondent base): Early adopters and experimenters; they are the heaviest buyers out of the six segments through the active use of digital channels and devices like smartphone apps and in-store technology. Although men in this segment shop heavily via digital channels, they are less interested than women are in conducting any kind of two-way dialogue with companies.
- Occasional Online Shoppers (16 per cent of total respondent base): 56 per cent of these shoppers are older than 45 and infrequently shop online. When they do, these shoppers use digital channels primarily for choosing and comparing products and tracking deliveries.
- Rational Online Shoppers (15 per cent of total respondent base): Overall, these shoppers are the second most active online shopper segment and the Internet is the preferred channel throughout the shopping journey. However, these respondents have little interest in social media and mobile apps for shopping.
- Value Seekers (13 per cent of total respondent base): These shoppers are price-sensitive with little interest in digital shopping and new technologies and are more likely to be women (63 per cent). They shop online primarily to find the best deals on products they know they want.
- Techno-Shy Shoppers (13 per cent of total respondent base): This segment does not feel confident in using digital channels and devices and do not see these as important during any phase of the shopping journey. These shoppers include both young and older consumers, with many living in Continental Europe.
"That e-commerce is continuing to secure its position as a key part of any developed economy is already understood, but its role in developing economies is probably less well known. From our own extensive international research we see the remarkable opportunities for cross-border growth in regions such as Asia and South America, where e-commerce is experiencing a different evolution to that in Europe and North America. As the traditional IT infrastructure was not necessarily there, digital commerce in these regions tends to be going straight onto the mobile platform.," notes Mr. James Roper, CEO of IMRG (Interactive Media In Retail Group), the UK's industry association for e-retail commented:
According to analyst firm Forrester: "Whereas retailers have survived in the past with superior merchandising or premium retail locations, companies now realise that significant investment in agile, multichannel technologies such as mobile solutions in stores and greater resources toward IT organisations is critical."*
"In today's complex marketplace shoppers are in control and retailers need to remain relevant to the digital consumer across the all-channel journey." said Bernard Helders, Capgemini Global Consumer Products & Retail Sector Leader. "The industry should not only seek to understand the technology, they must separate hype from reality and, crucially, commit to cross-channel collaboration to stay profitable in today's tough economic climate. This is critical for retailers to identify who is really using these channels and essential in determining where to make digital investments and how to monetise them. The findings of the report are a call to action for retailers and consumer goods companies to adopt a new approach and harness the technology that's now available."
*The research was conducted in Australia, Brazil, Canada, China, Finland, France, Germany, India, Italy, Mexico, Russia, Spain, Sweden, Turkey, the United Kingdom and the United States.
With around 120,000 people in 40 countries, Capgemini is one of the world's foremost providers of consulting, technology and outsourcing services. The Group reported 2011 global revenues of EUR 9.7 billion. Together with its clients, Capgemini creates and delivers business and technology solutions that fit their needs and drive the results they want. A deeply multicultural organisation, Capgemini has developed its own way of working, the Collaborative Business ExperienceTM, and draws on Rightshore®, its worldwide delivery model.
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