To Thrive In Retail, Obsess About Your Customers And ......Source: Forrester Analytics Customer...

CX NYC 2018

Fiona Swerdlow, VP, Research Director

Michelle Yaiser, Principal Analyst, CX Index

Jennifer Wise, Senior Analyst

To Thrive In Retail, Obsess About Your Customers And Invest In Your Associates

2© 2018 Forrester Research, Inc. Reproduction Prohibited

• Retailers: You need to be fast, fearless, flexible

• The Retail CX Index 2018

• The state of US retail

• How are retailers’ digital experiences today?

• The Forrester Retail Wave™ results

• Conclusion

Agenda







• Conclusion

Agenda


Technology changes everything.


Fast. Fearless. Flexible.


Technology doesn’t matter…

… It’s what we do with the

technology that’s important.


Bolt-on (= Optimization)


Bolt-on > Transformation (= Cross-

Functional, Enterprise-Wide, Learning

to Do Fundamentally New Things in

New Ways)


Bolt-on > Transformation > Disruption

(= State of Dynamic Operations,

Constantly Challenging the Status

Quo)


Willingness to

Experiment

Digital/Physical Integration

Information

Savviness

Device Usage

Self-Efficacy

Meet your empowered customer


Customers are increasingly willing to experiment

Source: Forrester’s Consumer Technographics 2002 North American Benchmark Study and Forrester’s North American Technographics Retail Online Survey, Q2 2012 (US)

*Source: Forrester’s Consumer Technographics 2004 North American Benchmark Study and Forrester’s North American Technographics Retail Online Survey, Q2 2012 (US)†Source: Forrester’s Consumer Technographics 2005 North American Benchmark Study and Forrester’s North American Consumer Technographics Consumer Technology Survey, 2014


Forrester’s

Empowered Customer Segmentation

Progressive

Pioneers

Savvy

Seekers

Convenience

Conformers

Settled

Survivors

Reserved

Resisters

#ForresterData

Most Empowered Least Empowered

Least Forgiving Most Forgiving

Highest Churn More Loyal

19© 2018 FORRESTER. REPRODUCTION PROHIBITED.

Base: 58,000 US online adults; Source: Forrester Data Consumer Technographics® Online Benchmark Survey, 2017

The empowered customer segmentation in the US:

23%16%

32%

12% 16%

Progressive

Pioneers

Savvy

Seekers

Convenience

Conformers

Settled

Survivors

Reserved

Resisters


US empowered consumers blend digital and physical experiences, touchpoints







• Conclusion

Agenda


The 2018 CX Index Results –

Retail

Michelle Yaiser


Base: 175,421 (2018) to 171,857 (2017) to 161,332 (2016) US online consumers (18+) who interacted with a specific brand within the past 12 months

Source: Forrester Analytics Customer Experience Index Online Survey, US Consumers 2016, 2017, 2018

2016-2018 Loyalty trends

55% 55%

63%

57% 57%

64%

60%

56%

64%

AdvocacyEnrichmentRetention


Base: 31,620 (2018) to 27,236 (2017) to 28,704 (2016) US online consumers (18+) who interacted with a specific multichannel retailer within the past 12 months


2016-2018 Multichannel Retailers Loyalty Trends

67%

63% 63%

70%

66%65%

69%

66%65%



Base: 8,148 (2018) to 10,275 (2017) to 10,519 (2016) US online consumers (18+) who interacted with a specific digital only retailer within the past 12 months


2016-2018 Digital Only Retailers Loyalty trends

70%

68%

70%70% 70% 70%70%

68% 68%



Base: 39,768 US online consumers (18+) who interacted with a specific retailer within the past 12 months

Source: Forrester Analytics Customer Experience Index Online Survey, US Consumers 2018

86% will stay

When customers have good experiences…

96% will stay when they have excellent experiences




81% will spend more


92% will spend more when they have excellent experiences




84% will recommend


95% will recommend when they have excellent experiences


Base: 39,768 (2018) to 37,511 (2017) to 39,223 (2016) US online consumers (18+) who interacted with a specific retailer within the past 12 months


›CX Index scores have slightly declined each year

but not significantly

›Effectiveness and Ease have remained fairly

static

›Emotion has declined each year

2016-2018 Retail website trends


Base: 39,768 (2018) to 37,511 (2017) to 39,223 (2016) US online consumers (18+) who interacted with a specific retailer within the past 12 months


›CX Index scores have declined each year with a

statistically significant drop from 2017-2018

›Effectiveness and Ease slightly increased from

2016 to 2017 but in 2018 fell to just below 2016

levels

›Emotion has declined each year

2016-2018 Retail mobile app trends



›Provides enough info to make a decision

›Makes information easy to understand

›Makes it easy to find things

›Makes it easy to complete tasks

›Finding which stores have products in stock and

buying online to pick up in store

Aspects of the digital experience




…at least 1.5 to 2.5x more likely

to stay, spend more and

recommend



›Making it easy to find an employee to assist them

›Having knowledgeable store employees

›Having store employees who answer all of their

questions

they are…

When customers positively rate a store on


Base: 31,620 US online consumers (18+) who interacted with a specific multichannel retailer within the past 12 months


…at least 2x more likely to stay,

spend more and recommend




…at least 54% have an overall

Excellent customer experience

and less than 14% have a Very

Poor experience



›Having knowledgeable customer service reps

›Having customer service reps who answer all of

their questions

›Communicating clearly

they are…

When customers positively rate a retailer on




…at least 2.2x more likely to stay,

spend more and recommend




…at least 50% have an overall

Excellent customer experience

and less than 15% have a Very

Poor experience




Hybrid experience of digital and

human interactions has the

highest CX Index and positive

Emotion scores for the past three

years.







• Conclusion

Agenda


It’s NOT a “Retail Apocalypse” – majority of retailers (across categories) are experiencing positive growth


Some sectors are experiencing double-digit year-over-year growth


US shoppers buy a diverse range of products from Amazon


The digital distinction has

dissolved.


Today’s customers interact with brands through a vast and growing constellation of touchpoints

Source: Adapted from B2B Stories (http://b2bstories.com/wp-content/uploads/2010/03/Touchpoints.png)

Offline touchpoints

Online touchpoints

Word of mouthRadio

TV

Print

Outdoor

PR

Sales associate

Retail store

Call center

Kiosk

Mobile appIM/chat

Call center/IVR

Promotion on receipt

Blog

EmailNewsletter

3rd party sites

Landing page

Search

Digital

billboard

Viral email

Online ads

Twitter

Awareness Consideration Purchase / Use Service Loyalty

Reviews

Facebook

Packaging

FAQ

Service technician

Receipt

Shipper

Loyalty card

Website

YouTube video


The expectation that

I can get what I want

in my immediate context

and moments of need.


Mobile as a percent of total online commerce appears to be stabilizing

21%

28%

31%

28%

43%

37% 36%

33%

2013 2014 2015 Q4 2015 2016 Q4 2016 2017 Q4 2017

Source: Forrester/Shop.org State of Retailing Online Studies; Adobe Holiday Digital Index

Percent of total online retail sales revenue that were purchased on mobile devices


51% of US consumers tell

us it’s easier to make a

purchase on a computer than

on a mobile phone.


Source: Forrester Data: Digital-Influenced Retail Sales Forecast, 2017 To 2022 (US)

The big news? Mobile = influence

31.9%

2017 US retail sales

via mobile phones

2017 US mobile-

phone-influenced

offline retail sales

2017 total US retail sales

(online and offline)

$3.56 trillion

2.2%







• Conclusion

Agenda


The Forrester Retail Industry

Wave™

Jennifer Wise


Customers are

more willing to

take risks

Customers rely on a

multitude of devices

The gap between

physical and digital

experience narrows

Consumers are

comfortable

navigating complex

information

Consumers prefer

emotionally satisfying

experiences


So….how are retailers doing?


The Forrester Industry Wave is Forrester’s

expert review evaluation of brands and the

digital experiences they deliver to consumers.

Two components:

✓ Feature and functionality

✓ User experience

What is a Forrester Industry Wave™?


We know that consumers don’t love all websites

Base: Forrester’s Website User Experience Reviews, 2012 to 2017

Note: Not all common errors are shown.


We are not our users.


Source: Pixabay

Meet

Samantha


Source: Pixabay

Purchase an item….

….for rush delivery

…using guest

checkout

…using an account

…using a digital

wallet

…using a discount


Functionality

›Checkout

›Shopping and product merchandising

›Payments

›Customer support/relationship

›Omnichannel influence


User Experience

›Search and navigation

›Content

›Progress and workflow

›Error avoidance and recovery

›Privacy and trust


Source: The Forrester Retail Wave™: US Mobile Web, Q4 2017 Forrester report

Average score

58

How did companies do?

Checkout

Shopping and

product

merchandising

Payments

Customer

support/

relationship

Omnichannel

influence

42 71 65 59 55

Search and

navigationContent

Progress and

workflow

Error avoidance

and recovery

Privacy and

trust

48 49 54 53 76

…with a range

from

30 to 76


›Sites are hard to navigate.

›Supporting content is low-quality or missing.

›Customer support lacks at critical moments.

›Omnichannel integrations try – but fail.

› Lengthy, unnecessary checkout experiences are

burdensome.

Some common misses for retailers:


There were some highlights


Wayfair lets the shopper know where they are — and where they are going


Wayfair’s predictive text aids product search


Best Buy’s appliance selection tool speaks the user’s language


QVC helps customers explore products and make decisions digitally


Apple and Best Buy provide in-context help for complex terminology


The Home Depot showcases an effective integration with in-store inventory


The Home Depot’s checkout task flow only requires 10 steps

1

2

3

4

5

6

7

8

9

10

1

2

3

4

5

6

7

8

9

10

1 2


Wayfair’s billing page provides clear options


Apple has integrated chat into the checkout workflow


Several retailers proactively help shoppers avoid errors in the first place


1. Fix the design basics.

2. Optimize the website with a customer-first

approach to content.

3. …then optimize that content.

4. Guide customers from digital touchpoints to offline

channels.

5. Add personalization for better usability.

Prioritize your next steps effectively


Q&A With Industry Expert Anne

Bridges


Build and learn from your

customer insights organization.


“Retail executives need to recognize that the skills

and know-how that got them where they are today no

longer apply . . . the consumer has changed, and their

expectations continue to change, rapidly.”

US fashion executive — 2017


Warby Parker invests in stores to engage with and learn from customers

Image source: Warby Parker (https://www.warbyparker.com/)


Why customers use in-store technology:

52%: It saves me time.

39%: It helps me find what I’m looking for.

© 2018 Forrester Research, Inc. Reproduction Prohibited 80

Seamless and consistent customer

experiences

The

Goal

Image Source: https://i.ytimg.com/vi/izZAdaYbZIM/hqdefault.jpg

© 2018 Forrester Research, Inc. Reproduction Prohibited 81

Coordination of channels using tech

AND people AND processes AND metrics

The

Path

Image Source: https://pixabay.com/static/uploads/photo/2016/02/12/11/28/panorama-1195898_960_720.jpg


“Digital leaders have to constantly look at where the

industry is going . . . [and] plan for roles and

positions that don’t exist. I look at my talent pool

and consciously assign project assignments to give

them exposure to build extra skills.”

Ivy Chin, former Divisional SVP, Digital,

PetSmartSource: The Four Facets Of Adaptable Digital Commerce Teams Forrester report

https://www.forrester.com/report/The+Four+Facets+Of+Adaptable+Digital+Commerce+Teams/-/E-RES91741


Fast: Test and Learn with Velocity to

Drive Innovation

Flexible: Value Customer Experience

Obsession

Fearless: Embrace a Learning

Culture







• Conclusion

Agenda


Fast. Fearless. Flexible.


How did you do on the CX Index?

See the results…

Talk to Forrester experts…

…All at The Hub

Thank you

Fiona Swerdlow

[email protected]

For further reference

The Forrester Retail Wave™:

US Mobile Web, Q4 2017

Forrester CX Index reports

2018:

• US Digital Retailers

• US Multichannel Retailers

Michelle Yaiser

[email protected]

Jennifer Wise

[email protected]

To Thrive In Retail, Obsess About Your Customers And ......Source: Forrester Analytics Customer...

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