Bloomberg’s Francine Lacqua speaks with Chris Donnelly, global managing director at Accenture Retail, about the balance between expanding online and building more stores to spur sales growth
“What the customer really wants is a seamless experience,” reports Chris Donnelly, global managing director at Accenture Retail. “They want to be able to buy on their terms, whether that is instore, whether that is online, if they want to return something instore or online, they like options. It is the customer who creates his or her own experience now. Far be it for retailers to dictate how that is to pan out.”
As retail rents reach all new highs in shopping hotspots like London, Hong Kong and New York, brands and retailers are increasingly turning to eCommerce to achieve global distribution and provide heightened convenience for customers.
Yet in new and emerging markets, where brand awareness may be low or non-existent, brick-and-mortar stores play a huge role in developing a familiarity with and understanding of a brand and its products. So how should expansion be balanced going forward? Where should brands be investing?
“ They buy it online and take it back to the store, they buy it in store & have it sent back to the warehouse ”
“You have to have both,” believes Mark Neale, founder & CEO at Mountain Warehouse, an expanding travel and outdoor retailer with 150 stores in the United Kingdom.
“At the end of the day I think consumers are looking for a good quality product at a good price, which they can buy in well located stores or online, and they do both. They buy it online and take it back to the store, they buy it in store and have it sent back to the warehouse. People are doing whatever is most convenient.”
Indeed, patience is waning in instore high street environments. The average shopper aged between 16 and 24 will wait in line at a checkout for just six minutes before giving up and leaving, according to research by omnichannel retail experts Omnico. Among older shoppers that wait time tolerance drops to under five minutes.
“ The average shopper will wait in line at a checkout for just six minutes before giving up & leaving ”
In high street retailers, one in 10 shoppers has made a purchase, via mobile, from another retailer’s website while standing in a checkout queue. Among younger age groups, that figure rises to 15%. When we can access information or order products with just one click, time is becoming the most precious commodity for shoppers.
The implications for luxury are undoubtedly different. Purchasing necessity products is far removed from the purchase of unique items at high price points where brand equity is a key driver. Clients are less likely to purchase a Gucci handbag on their mobile whilst waiting to check out at Louis Vuitton, if they have already decided on a specific Louis Vuitton product.
But luxury brands should be thinking about ways to create truly omnichannel experiences, to meet all consumer expectations when it comes to convenience. One of the very reasons consumers shop for luxury, with luxury brands, is to experience superior levels of customer service. Yet how many luxury brands can accommodate purchases online and returns in store, or vice versa?
“Unfortunately customers want it all” concludes Mark Neale, “they really do expect to be able to buy and be served on their terms.”
To further investigate the retail experience on Luxury Society, we invite your to explore the related materials as follows:
- Luxury Retail: Big Data is Watching
- Omni-Channel Retail: A Roadmap to Execution
- The Future of Showrooming & New Consumer Behaviours