IBM Predicts More Personalised Shopping Experience

Darryl K. Taft covers IBM, big data and a number of other topics for TechWeekEurope and eWeek

A survey has predicted that future consumers will be seeking self-service opportunities and increased personalisation

IBM has offered up some interesting insights to our potential shopping habits in the future.

Big Blue has predicted that consumers of the future will be more mobile, social and self-sufficient, and will be willing to share details on themselves and their preferences in exchange for highly personalised relationships with their favourite stores.

This all comes from the results of a recent consumer survey conducted by IBM. The study also found that consumers’ willingness to advocate for a particular retailer is becoming multifaceted, with consumers looking for a flawless experience, whether it is when they are researching, purchasing or receiving delivery.

Digital Natives

The findings of the survey of 1,200 US men and women aged 13 to 60 provide insights into the demands of the next-generation buying audience and highlight the areas where retailers could influence brand advocacy.

“The next generation of shoppers – the digital natives – view brand interaction in a different way, expecting retailers to deliver a seamless, omni-channel brand experience across all touch-points,” John Stelzer, worldwide industry lead for Retail Smarter Commerce at IBM, said in a statement.

According to IBM, today’s teenagers say they spend their time shopping on their mobile devices whether they are at home, on the move or in-store. They also prefer to use more self-service features than today’s consumers and participate in communities and forums via social networks with consumers with similar interests. Teens expect their retailers to know them and all their transactions and deliver ads and promotions to them through social networking sites.

The study compared consumers aged 13 to 19, or “digital natives,” with today’s current shoppers, respondents in the 40- to 49-year-old group.

The IBM survey found the digital natives to be:

  • almost four times as likely to consider it important for a retailer to provide a mobile app to use on their smartphone or tablet (52 versus 14 percent);
  • twice as likely to consider it important for a retailer to establish a forum for like-minded consumers to share ideas with each other (54 versus 26 percent);
  • twice as likely to be comfortable receiving ads and promotions from a retailer through a social networking site (64 versus 37 percent);
  • nearly 1.5 times as likely to consider it important for a retailer to keep track of all that they’ve purchased from the retailer (regardless of whether it was in the store, online, via the call center, etc.) (67 versus 48 percent); and
  • nearly 1.5 times as likely to consider it important to provide self-service tools they can use in the store (80 versus 63 percent).

This study, part of IBM’s Smarter Commerce initiative, examined what components of the commerce process have the greatest potential to strengthen or undermine a consumer’s inclination to advocate a particular retailer to others. Smarter Commerce helps companies transform their business processes to deliver a complete, meaningful brand experience that deepens the relationship between retailer and consumer and increases customer satisfaction, trust and loyalty to create brand advocates.

Smarter Commerce

IBM launched its Smarter Commerce initiative in March 2011 to help companies respond to shifting customer buying patterns. IBM has estimated that the Smarter Commerce initiative is a $20 billion (£12.4bn) market opportunity in software alone. Smarter Commerce helps organisations that are struggling to meet the demands of rapidly shifting customer buying patterns in the era of mobile and social networks. This new digital marketplace requires companies to respond rapidly to customer demands by automating their buying, marketing, selling and service processes.

Meanwhile, the study found that consumers are looking for a consistent brand experience, from start to finish, across all brand touch-points. Cost and quality prevailed, where the two most important considerations for recommending a retailer were “sells quality merchandise” (94 percent) and “offers fair/competitive prices” (93 percent). However, three of the next most important criteria were the items they want to buy are in stock (91 percent); the retailer delivers a positive overall experience, whether it’s in the store, over the Web or via any combination of channels (90 percent); and that the retailer provides a convenient return process (85 percent).

In the study, IBM asked a series of questions about the three phases of the brand experience: pre-purchase, purchase (checkout/payment) and post-purchase.

Moreover, a surprise in the findings was the importance of the post-purchase process in molding the brand relationship and influencing brand advocacy. This phase includes product shipment, delivery, installation, customer support, problem resolution and returns. For example, the survey found the following:

  • Nearly three-quarters of the respondents cited a retailer’s ability to deliver a positive post-purchase experience as important to very important for them to recommend a retailer to others.
  • Nearly double the respondents chose the post-purchase experience as more important than the pre-purchase experience in forming a lasting opinion of a retailer (64 versus 36 percent).
  • The post-purchase phase has the greatest potential to damage the brand relationship (46 percent), compared with the purchase and pre-purchase phases (38 and 16 percent, respectively).
  • The post-purchase phase even has the ability to help a retailer recover from a poor pre-purchase experience, with 52 percent of respondents indicating that a positive post-purchase experience is likely to very likely to overcome a poor pre-purchase experience. For those aged 13 to 19, 67 percent consider it likely to very likely to save the day.

“In general, the post-purchase experience has been taken for granted by too many retailers, and this study confirms that retailers will need to focus on delivering heightened post-purchase capabilities, such as omni-channel in-store pickup or return of online or mobile orders to win over tomorrow’s consumer,” IBM’s Stelzer said in a statement.

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Originally published on eWeek.