Retailers have been engaging digitally with their customers for several years, but many may be underestimating the power of digital influence on Australian’s shopping behaviour – and the speed with which this influence is growing, according to consulting firm, Deloitte.
In its inaugural report, Navigating the new digital divide – digital influence in Australian retail, the company found that digital interactions influenced 40 per cent of in-store retail visits in Australia in 2014.
The report examined the influence of digital devices on Australian consumers’ shopping journey and how the ‘digital influence factor’ is changing how they shop and make decisions in-store.
Deloitte defines ‘digital influence’ as the percentage of traditional bricks-and-mortar retail visits affected by shoppers’ use of digital devices before or during the shopping trip.
According to the report, in terms of digitally-influenced retail sales, Australia comes in third (40 per cent) behind the US (49 per cent) and Canada (41 per cent), but ahead of Germany (30 per cent), The Netherlands (30 per cent) and the UK (27 per cent).
Deloitte partner and retail industry leader, David White, said should Australia follow the same trend as the US – where such behaviour has multiplied four times over the last three years – we can expect digital to influence a majority of retail in-store visits in Australia within the next few years.
Deloitte has also identified a growing digital divide where consumers’ digital behaviours and retailers’ ability to deliver on those consumer expectations continue to diverge.
“Just a third of Australian retailers cited omni-channel as their number one strategic priority. The findings should be a wake-up call for the retail sector which is at risk of underestimating local consumer appetite for digital engagement,” White said.
“Global brands have educated Australian consumers to expect internationally competitive pricing, an endless aisle and greater shopping convenience. Digital will soon be the deciding success factor in retail.”
In addition, it found two in three customers use a digital device before their shopping trip and nearly a third (31 per cent) use it while shopping. Additionally, 47 per cent use their device to compare products, 42 per cent to access product information and 33 per cent to check product availability.
“Online shopping used to be considered as distinct to bricks-and-mortar stores. Digital and traditional shopping channels are blending and complementing each other along the end-to-end customer journey. It will be critical to the future of the store – not the cause of its demise,” White added.
To adapt to this new reality, he suggested Australian retailers may need to offer customers a relevant and personalised experience throughout the customer journey through a deep understanding of customer preferences and shopping behaviours; reset their pricing strategy; redefine the role of the store to blend the physical and digital experience; reinvent the in-store employee experience; and rethink the supply chain to expand ranges.
Other key findings from the study include:
- 65 per cent of customers use a digital device before shopping and 31 per cent do so while shopping
- Using digital devices to research, find and compare products boosts conversion to sales by 25 per cent
- The use of digital devices increases shoppers' order sizes by 21 per cent in average.