UK retailers invest in AI, payments innovation to raise loyalty: Study

Eighty-seven per cent of UK retailers are funnelling investment into initiatives to power consumer loyalty and drive sales, it found.

The percentage of respondents aiming at growing their business this year increased by 10 percentage points year on year (YoY) to 82 per cent.

The annual study surveyed 500 senior executives from a range of UK retailers of all sizes.

Respondents see ramping up loyalty as integral to driving that momentum, with 45 per cent of them planning to either launch or enhance an existing loyalty programme this year. This is in response to customer demand, with 64 per cent of them believing customers now expect to be rewarded for shopping with them.

Of the UK retailers already using AI, 46 per cent highlighted improving customer experience as their primary focus. Leveraging generative AI, such as conversational chatbots, topped the list for tech investment, while 43 per cent of them said they are using generative AI to enhance online product search; and the same proportion are using it to help resolve customer queries or complaints.

By contrast, last year’s study pointed to more cautious adoption, with just 14 per cent applying the technology to improve the online customer experience.

Retailers are not just focused on digital engagement strategies; 38 per cent of them said they are planning to open new stores in the coming year, with beauty and fashion among the top sectors planning bricks and mortar investment.

When asked about motivations, 88 per cent said experiential retail is the key to driving footfall.

Almost three quarters of UK retailers surveyed agreeing customers now have increased expectations when it comes to the checkout experience. Three-fifths believe they would generate higher sales if they offered more payment options, with 32 per cent of them describing their current payment experience as ‘outdated’.

Fibre2Fashion News Desk (DS)