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Retailers struggle to keep up with generational shoppers

03
Jul '19
Pic: Oracle
Pic: Oracle
Despite differences in expectations among shoppers of different generations, almost half of retailers have made no progress in tailoring the in-store shopping experience according to a recent study conducted by Oracle NetSuite, Wakefield Research and The Retail Doctor. Both retailers and consumers were surveyed from 3 global markets like US, UK and Australia.

The global study of 1,200 consumers and 400 retail executives representing organisations between $10-100 million in annual sales across the 3 global markets, dispelled stereotypes around generations and found big differences in generational expectations across baby boomers, Gen X, millennials and Gen Z.

“We have seen decades of diminishing experiences in brick and mortar stores, and the differences identified in these results point to its impact on consumers over the years,” said Bob Phibbs, CEO, The Retail Doctor. “Retailers have fallen behind in offering in-store experiences that balance personalisation and customer service but there’s an opportunity to take the reins back. The expectation from consumers is clear and it’s up to retailers to offer engaging and custom experiences that will cater to shoppers across a diverse group of generations.”

Despite the stereotypes of ‘digital natives’, Gen Z and millennials (43 per cent) are most likely to do more in-store shopping this year followed by Gen X (29 per cent) and baby boomers (13 per cent), says the study.

Gen Z and millennials (57 per cent) had the most positive view of the current retail environment feeling it was more inviting, followed by Gen X (40 per cent). Baby boomers (27 per cent) were more likely to find the current retail environment less inviting than consumers overall.

Gen Z valued in-store interaction the least with 42 per cent feeling more annoyed from increased interaction with retail associates. In contrast, millennials (56 per cent), Gen X (44 per cent) and baby boomer (43 per cent) generations all noted they would feel more welcomed by more in-store interactions.

While more than three quarters of retail executives (79 per cent) believe having AI and VR in stores will increase sales, the study found that these technologies are not yet widely accepted by any generation. Overall, only 14 per cent of consumers believe that emerging technologies like AI and VR will have a significant impact on their purchase decisions.

Emerging tech in retail stores is most attractive to millennials (50 per cent) followed by Gen Z (38 per cent), Gen X (35 per cent) and baby boomers (20 per cent).

Perceptions of VR varied widely across different generations. Fifty-eight per cent of Gen Z said VR would have some influence on their purchase decisions, while 59 per cent of baby boomers said VR would have no influence on their purchase decision.

While almost all retail executives (98 per cent) think that engaging customers on social media is important to building stronger relationships with them, the study found a big disconnect with consumers across all generations. Overall, only 12 per cent of consumers think their engagement with brands on social media has a significant impact on the way they think or feel about a brand.

Among those who engage with brands on social media, Gen Z (38 per cent) consumers are much more likely than other generations to engage with retailers on social to get to know the brand compared to millennials (25 per cent) and baby boomers (21 per cent). Gen Z (65 per cent) consumers and millennials (63 per cent) believe their engagement with brands on social media platforms have an impact on their relationship with brands.  More than half of baby boomers (53 per cent) and 29 per cent of Gen X consumers do not engage with brands on social media.

“After all the talk about brick and mortar stores being dead, it’s interesting to see that ‘digital natives’ are more likely to increase their shopping in physical stores this year than any other generation,” said Greg Zakowicz, senior commerce marketing analyst, Oracle NetSuite. “Stepping back, these findings fit with broader trends we have been seeing around the importance of immediacy and underlines why retailers cannot afford to make assumptions about the needs and expectations of different generations. It really is a complex puzzle and as this study clearly shows, retailers need to think carefully about how they meet the needs of different generations.” (PC)

Fibre2Fashion News Desk – India


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