Retailers could be facing a perfect storm: not only do consumers want a personalised and engaging experience, they also go for the lowest price – something that could cost retailers dear.
A new study by Mirakl finds that, while consumers across Western Europe are shopping more than ever, they are increasingly looking for bargains – and their first port of call is Amazon.
According to the research, 85% of 25-34 year olds say they often check the price of an item on Amazon before completing their purchase elsewhere, and 71% of shoppers admit they have stopped shopping with a retailer because another website offered a better price.
Young professionals were the most demanding shoppers, with 32% saying they shop with more than 5 retailers a month on average (compared to 20% of Gen Z saying the same and 21% of shoppers aged 55 and over). And if a retailer fails to deliver, they aren’t afraid to talk with their feet; 89% of consumers say they have experienced an out-of-stock product with 73% completing the purchase at another retailer website. One third vocalised that this makes them less likely to shop with that retailer again in the future.
With the increase of the on-demand and platform economy, more and more customers are looking for retailers to offer complimentary services alongside their products. Sixty-four percent of 25-34 year olds said they would be interested in purchasing services alongside their goods, such as installation for a washing machine, tennis lessons alongside new rackets or beauty services alongside make-up items.
“It’s clear that even in the experience-led world of modern shopping, consumers still seek a bargain. And with Amazon increasingly becoming the first destination for product searches, the risk to UK retailers is that they never get the chance to win the sale. The good news is that when offering choice and competitive prices, the research suggests consumers will remain loyal to a handful of sites – suggesting it’s not too late. Retailers should focus on delivering value for their customers, going stock-less can eradicate those out-of-stocks which result in a poor customer experience and if they aren’t already, consider offering services alongside their products to upsell customers at the crucial time.”
– Nick Bareham, UK Country Manager, Mirakl
The research is a stark indication that not only now do consumers demand engaging experiences and personalisation around their shopping experience, they also want low prices.
How to deliver this is going to increasingly sort those retailers that have mastered costs and those that haven’t. While consumers are using Amazon to check out the bargains, retailers need to look closely at how they can be the provider of those bargains and work at creating a marketplace strategy.
This echoes the warning by M&S ex-boss Marc Bolland, who last week urged ailing High Street retailers to partner with Amazon rather than trying to fight against it for precisely this reason.