International retailers are increasingly investing in frictionless shopping initiatives and loyalty programs to attract customers, according to new findings by industry analysis firm Globaldata.
The findings show that convenience and experience have emerged as differentiating factors in a dynamic retail environment, prompting a trend towards frictionless shopping – a method of using data, technology, and devices to integrate buying opportunities as seamlessly as possible into the shopper’s journey. The goal is to reduce the amount of time and inconvenience involved in the steps between the desire for a product and receiving it.
“For retailers, the broad benefit of investing in frictionless shopping is that consumers are more willing to make a purchase if there is minimal ‘friction’ when progressing through different stages of the buying journey,” said Globaldata retail market analyst Vijay Bhupathiraju. “However, the concept of friction differs not only across the variety of individual shopper journeys, but is also a subjective ideal that varies from shopper to shopper.”
In Asia-Pacific countries, where convenient and technologically advanced retail has shaped retail competition in the region for some time already, this shift has been to such an extent that 46 per cent of Globaldata’s surveyed consumers were making purchases through their smartphones, surpassing laptop/desktop users at 44 per cent, highlighting the shift in shopping preferences in the region towards mobile.
A shift in consumer preferences to shopping frequently at local convenience stores has encouraged retailers to open smaller format stores that incorporate the latest in technology. Factors of convenience such as frictionless shopping payments, personalisation, relevant offers and delivery-and-fulfilment services all play an equally important role.
The firm’s data showed that consumers are well aware that they can always switch to another retailer for buying goods if their expectations are not met.
“All frictionless shopping services and loyalty programs being launched by retailers are aiming for a better connection with consumers during their retail journeys and meaningful insights must be drawn from the data collected at each retail touchpoint,” said Bhupathiraju. “Consistent innovation and optimising the retail channel by leveraging digital capabilities to enhance the overall customer experience must be at the forefront of a plan of action by retailers and brands. However, one-size-fits-all won’t work as convenience and experience are purely subjective and a careful balance must be retained.”