Key reflections:
- Despite cost pressures, loyalty is up for grabs. There still remains a demand for quality – provided the price is right, and your company can craft an experience to match across every channel in today’s age of connected commerce.
- UK consumers are becoming more cautious about their spending, whilst for some products there may be a race to the bottom with price. If your business can enhance the customer experience and provide a quality product/service, you can build your sales.
- Customer experience is key, driving repeat purchases and using these customers as your mouthpiece. Word of mouth is still the most important form of product discovery within the UK.
Shoppers are being discretionary with their purchases. They’re willing to hold back to make purposeful purchases where they count, be that on more sustainable goods, or meaningful experiences with friends and family. - Where consumers make their purchases is no longer clear cut. The borders between online and offline commerce have blurred; UK customers now expect the same convenient shopping experience in person as well as online.
- The companies that stand to benefit in this new environment are the ones that can establish a seamless buying experience and a personalised customer view across all channels.
Shopify’s report provides a detailed analysis of consumer and retailer sentiment drawn from a survey of 1,000 retailers and over 7,000 consumers, highlighting areas of consensus and, crucially, conflict. The report reveals the gaps between consumer expectations and retail experiences and provides businesses with actionable findings that will help them grow with a unified commerce approach.
Cracking the code on customer loyalty:
- Consumer outlook is cautious: Just 16% of UK shoppers say they are optimistic about both the national economy and their own financial situation, the least of all the nations surveyed.
- The value equation is changing: 50% of those who have cut discretionary spending now place more importance on spending time with friends and family. Food security is a core driver of this as 37% of UK consumers are worried about higher prices of groceries and essentials. British consumers are now being more purposeful with how they spend their money and time. Women in particular are being more measured in their purchases (36%) compared to 27% of men.
- 34% of Brits have stopped/reduced dining out to save money over the past 12 months – the most of any item. What appears to be more resilient is: groceries (4% have reduced), Home cleaning services (13%) and beauty and personal care products (13%).
- Even though half (49%) of consumers say they’re after the best value they can find (up to 57% for 55-64s), 81% of businesses surveyed said they were passing some or all of their increased costs onto consumers. This could potentially cause a greater impact on consumer spending.
- Its imperative that, if your business raises prices, it finds a way to offer additional value. If consumers don’t find this value, they’ll change allegiance – over half of UK consumers (55%) said that a better price/value of a product was one reason they’ve previously bought a brand different to their usual choice.
- Just 36% of conscious consumers said a better price was a reason to switch brands, compared to the average of 53%. Businesses should be targeting these consumers in hopes for increased loyalty.
- 82% of consumers would become more loyal if brands were to offer them something. But just 6% of UK businesses plan to invest more than 20% of revenue into their customer experience. Opportunity here for those that do invest to outshine their competitors and build a competitive advantage.
- Customer experience is ever evolving and your business must evolve with it. With 30% of businesses having recently implemented new customer service channels, there remains a danger that businesses feel they have done enough to hone customer experience and may rest on their laurels all too easily.
Bridging the gap on cross-channel expectations
- Integrate offline and online: The split of consumers shopping preferences is fairly even, with most preferring a blended approach of shopping online and in store equally. 74% of consumers who have increased their spend in the last 12-months speak of the importance that businesses offer a good integrated experience between offline and online.
- Consumers just want to shop and they’re not thinking about how they do it, they just do! As such your business should offer equally brilliant customer experiences across all channels. 68% of retailers say they are not focused on integrating online and offline shopping. A huge opportunity is being missed, but where others fall – you may rise. Don’t get left behind.
- Product discovery, word of mouth is still key. 78% of British shoppers say word of mouth is one of the most important forms of product discovery. from ages 25 and above word of mouth is the most important form of product discovery, however between 18-24, this is Instagram (77%), followed by word of mouth.