The home improvement chain also said the malware responsible for the breach has been removed from all stores.
Retail consultant Lauren Freedman warns that while consumers are demanding one thing, merchants often deliver something else.
As consultants, we hear from the merchant community routinely, but rarely are we fortunate to find out the customer’s perspective. As e-commerce garners a greater share of the retail dollar, it will be imperative that we listen to and learn from the customer.
In 2006 the e-tailing group, in partnership with J.C. Williams Group and Start Sampling, surveyed 2,472 online shoppers to better understand their multi-channel shopping behavior. Just slightly under 2,000 participants had purchased online in the past six months, spending an average of $488. 70% made two to 10 purchases in that period.
Consumers vs. merchants
As the e-tailing group prides itself on being a merchandising-centric consultancy, we were excited about the possibility of a side-by-side comparison of responses from this consumer study with the results of the e-tailing group’s 5th Annual Merchant Survey. For the first time, this would give us a chance to see how consumer needs stacked up directly with the merchant’s perspective.
While many of the findings were consistent with industry data, there were also some surprising variances. Merchants who fail to take notice of these evolving consumer directives will find their bottom line impacted.
This article is about the variances and the interesting revelations and implications of these findings for merchants. With that in mind I will highlight key findings while suggesting broader merchant opportunities. The accompanying table details the side-by-side chart that will serve as our guide to explore the customer and merchant input.
Numerous research firms and studies have confirmed that free shipping is a customer favorite and we would not expect to see any change in this area. Thus it’s no surprise that 89% of shoppers found free shipping very to extremely helpful. While this has been widely reported and many merchants offer it at one time or another, the percentage of merchants who find it valuable (76%) is significantly lower than the percentage of consumers because of its effect on profitability. Promotional discounts, in a similar vein, also found strong acceptance among consumers (86%). The biggest challenge faced by merchants is making these tactics a profitable part of their overall business model.
Though there are limited “a-hahs” in the area of traditional merchandising, I found it surprising that the customer is not nearly as enthusiastic as the merchant when it comes to traditional tactics as indicated by the consumer/merchant valuations for What’s New (51% vs. 73%), Top Sellers (39% vs. 74%), and Gift Suggestions (35% vs. 63%).
While they certainly help shoppers understand what’s available and what’s being touted from the merchant point of view, the results suggest that the online shopper is seeking more specific information and hunting for product in a non-traditional fashion. It is imperative that merchants understand that today’s surgical shoppers will not likely fall prey to merchant-generated promotions in the same way they do at retail stores. Acknowledging the online shopper’s interest in a more interactive experience will go farther toward addressing customer needs.
Information is king
Customers are looking to quickly find what they need but at the same time they are investing time on sites to learn more about three distinct areas: the channel, the category and products of interest. This is an area where merchants are investing significant resources and one that should be top of mind for those who aren’t listening.
With 68% of shoppers finding the store locator very to extremely helpful, we believe this is an underrated tool given the lower merchant ranking of 45%. Merchants have an opportunity to connect with the many shoppers who stop at the locator to check store hours, locations, get directions and learn what events are taking place in store. It would be our recommendation that merchants model their efforts against stores like Borders. The well executed store locator includes store locations, map, directions, phone number, hours, a photo of the store and store events. Shoppers have the ability to save a preferred store to a “my store” list and most importantly they can check store inventory for the ultimate in convenience.
Many shoppers when beginning to shop for complex products in consumer electronics, technology, home improvement, furniture and other information-intensive categories seek out customized content in the form of how-to guides and glossaries and tips which are integrated throughout the merchant’s site. While custom content was found to be very to extremely helpful by 45% of consumers, merchants ranked its value at 58%, which leads me to believe consumers are seeking more action-oriented tools.
In this area the most interesting findings were the fact that 64% of shoppers noted the importance of product comparison yet only 33% of merchants gave this tool a very to somewhat valuable ranking. This disparity suggests that more merchants should consider integrating this capability on their sites. My only speculation as to why they have not is that they lack the data to line up products side by side for shopper review, though workarounds can certainly be embraced.
This tool is critical for consumer decision-making where a clear product comparison grid simplifies a consumer’s side-by-side evaluation. Tech Depot by Office Depot takes it one step further with a Product Comparison Center on its site dedicated to customers looking to get the details on products. While dedicated real estate is not essential for all sites, testing of this tool should certainly be a consideration on a category-by-category basis.
A favorite of consumers across categories is customer reviews, rated very to extremely helpful by 60% of shoppers surveyed. Merchants scored the reviews at 39%, though I believe there will be significant growth this year as BazaarVoice Inc. and PowerReviews Inc. bring two technology models to bear on this space. Customers care about what other knowledgeable customers have to say and this is one clear way for shoppers to sort through the hype.