EBOOK

5 DIGITAL MISTAKES RETAILERS

CONTINUE TO MAKE
 IN THE WORDS OF VENTURE CAPITALIST MARC
ANDREESSEN, SOFTWARE IS EATING THE WORLD.
DIGITAL INTERACTIONS ARE BECOMING THE NORM
IN EVERY INDUSTRY, AND RETAIL IS NO EXCEPTION.

Forrester predicts that e-commerce will account for 17% of retail sales by 2022, up from a projected 12.9% in 2017.
Conversely, brick-and-mortar retail continues to fall victim to the Retail Apocalypse with physical store closings
anticipated to jump 33% in 2018.

The reality is that the average consumer is constantly influenced by digital, no matter when and how they choose
to make a purchase. Digital and digital-enabled experiences will be the primary growth driver for retailers. A study
by Deloitte Consulting pegs digital devices influencing $.56 of every $1 currently spent in physical stores.

Retailers know digital is important, but don’t fully understand why or how to best utilize it. Many are not adapting
quickly enough to the latest trends and technologies. Further complicating matters, every customer’s buying
journey is different and they frequently bounce between the physical and digital worlds.

Consumers want control over when and how they interact with a brand. And, they expect perfection each time.

These are the top 5 digital mistakes retailers continue to make.

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 1. CONSUMERS DON’T LIKE USING RETAIL MOBILE APPS

A study by UPS and comScore found that 53% of shoppers who don’t use retailers’ mobile apps state it’s because they like using
the website better. These shoppers see no benefit from installing these apps, as they provide an inferior experience with no added
benefits. Looking at the Apple and Google Play App Stores, a large amount of retailers have apps with very few reviews, and some
don’t even have a mobile app.

Another problem is the performance of retail apps. 61% consumers expect an app to load in under 4 seconds according to research by
Dynatrace. In its study, only one retailer made it under that threshold.

And that is just purely opening the app. What is the experience once consumers get past that point?

REVIEWS

2.8
Mary Smith Amanda Gold
M M
5
Horrible. I hate it. This is the Waste of space. Don't even
4
worst website ever. Fix this ... download it, so frustrating ...
3

2
Sam Connelly Dan Bay
573 total 1 S Slow! I cross my fingers D The app needs some serious
every time in hope that it gets improvement. The wish list ...
better ...

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 What is the damage from offering a poor mobile experience just to WHY IT’S IMPORTANT
check ‘mobile app’ off the “digital presence” list? A survey by LogMeIn
and Vanson Bourne found that 85% of respondents said they were Having your app installed on
unlikely to continue doing business with a company after having a bad a device is an opportunity to
mobile experience.
constantly remind consumers of
Retailers need to step up their mobile app game. A bad mobile app
your presence. Be it with push
drives customers away and a merely adequate app fails to engage them.
notifications, or just your icon
Mobile apps must offer a rewarding experience constantly in view when they open
and go beyond purely attempting to replicate the
website. These apps should offer features that take their phone. It is also yet another
advantage of mobile device capabilities and provide available touchpoint, which as
added value. For example, barcode scanning, deal we’ll see later, drives additional
notifications, and nearby store locators.
purchases.

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 2. THINKING IN INDIVIDUAL JUST ONE CUSTOMER’S JOURNEY
ACROSS CHANNELS ...
CHANNELS WHEN SHOPPERS THINK
IN TOTAL BRAND EXPERIENCE

Omnichannel is how consumers think, but retailers often fall into the trap that
omnichannel means connecting a single digital experience to a physical one
(e.g. buy online, pickup in store).

Individual channels don’t exist in the mind of the consumer - it’s just interacting
with your brand.

Omni means all - as in all channels. It means delivering a unified and consistent
experience every time in every way a consumer interacts with your brand. And
these experience journeys are not unidirectional, nor can they be predicted.
Consumers bounce around channels and touchpoints at will - and expect all of
them to be consistent and integrated.

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WHY IT’S IMPORTANT
High-value customers use more
channels. Brands that offer a
unified experience across as
many channels as possible
are able to tap into these loyal
shoppers that spend more.
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In the Deloitte study, two-thirds of consumers stated that they prefer a self-directed
shopping journey. In other words, consumers want to pick the ways and times in
which they engage retailers, not follow a defined path that the retailer dictates. Two
years ago, only a third of consumers had this preference.
Think of it this way. If two people are talking on the phone or via chat app and then
run into each other, what happens? They seamlessly put their phones away and
continue the conversation in person, right where they left off. They don’t start at the
beginning of the conversation or start speaking a different language.
Too often, interacting with a retailer provides this disjointed
experience. Are you focused on single channels, or creating
a cohesive brand experience?
Single-channel shoppers are a dying breed and multi-channel shoppers are more
valuable. A Harvard Business Review study of 46,000 consumers determined that
omnichannel shoppers spend 4% more in-store and 10% more online compared to
single-channel shoppers.
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3. FORGETTING WHY BRICK AND
MORTAR IS IMPORTANT

Brick-and-Mortar retail is changing, but it’s not going away. An IBM survey of Gen Z shoppers (age
13-21) found that 74% of respondents said they like the spend their free time online. However, 67% said
they shop in-store most of the time, compared to 22% who shop primarily via web browser and 13%
via mobile apps.

Web and mobile are where the growth is, but brick-and-mortar still provides that largest share of
revenue. In-store purchases made up more than 90% of US total retail sales in Q3 2017 according to
the US Census Bureau.

Physical interactions offer benefits that digital-only can’t provide. According to Retail Dive, 62%
of shoppers shop in-store because they like to see, feel, and touch items and 49% like the instant
gratification of taking something home.

But digital plays a large role in these physical interactions. Shoppers are using digital before, during,
and after these in-store visits.

And it doesn’t just apply to younger generations.

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WHY IT’S IMPORTANT
Physical locations should
be used as a competitive
differentiator. It’s not purely
about convenience and speed
- its an opportunity to provide
experiences that reaffirm that
your brand “gets” the customer.
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In the Deloitte study, 71% of both millennials and non-
millennials used digital before their shopping trip. 55% of
millennials and 44% of non-millennials used digital during
their trip. And 16% and 12% respectively, after the trip.
Many retailers fear “showrooming” where consumers go to a store to touch/feel,
etc. and then go home to buy elsewhere online. However, “webrooming,” where the
opposite is true, is a more common occurrence for shoppers. A Harris poll in the US
showed 69% of respondents have webroomed (i.e. browse online then buy in store),
whereas only 49% showroomed.
If you have a physical presence, use digital to drive people to stores and keep them
engaged during their visits. Even something negative on the surface, like product
returns, can turn positive. 70% of respondents in the UPS/comScore study have
made an additional purchase when returning an item in store. Utilize digital-enabled
experiences like buy online / pickup in store, beacons, and augmented reality that
offer a unique experience and are a true value-add.
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 4. FAILING TO BE EVERYWHERE
CUSTOMERS ARE

How can consumers buy on their terms, when and where

they want, if you’re not where they are?
Awareness and a compelling value prop are the first steps to driving increased
revenue. Yet, in a report from Market Force, when asked “does your favorite fashion
retailer provide a mobile app?” 64% of US consumers responded “I don’t know.”

Furthermore, “digital” doesn’t only mean having a website and a mobile app.

According to the UPS/comScore Study, 77% of online shoppers use social media.
Among that group, 39% follow retailers on social media, 34% state social media
influences their purchases, and 23% have purchased a product on a social media
network. Beyond social media, users have nine daily sessions in a chat app
compared to two in a traditional app, according to Flurry Analytics.

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 Does your digital strategy account for these usage
patterns and customer habits?
The data shows that the more ways a consumer has to interact with WHY IT’S IMPORTANT
your brand, the more often that they will make purchases. According to Customers can only make a
a survey by Fluent, nearly 50% of customers who engage with retailers
through 10+ channels say they make a purchase at their favorite retailer purchase and develop a
at least once a week. Only 21% of consumers who engage across 1-4 connection with your brand if
channels make purchases at the same rate.
you have a presence where they
This is why more and more companies are trying to capture mindshare
with tools like augmented/virtual reality, chat bots, and social media.
spend their time. People who see
Dominos allows customers to purchase through more than 15 different you and interact with you more
platforms (and growing). Ensure you have a strong digital presence
buy from you more often.
wherever your target markets are, and deftly utilize ads and retargeting.

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 5. MAKING IT DIFFICULT FOR
PEOPLE TO SPEND THEIR MONEY

The rate of online shopping cart abandonment sits at 70% according

to data compiled from multiple sources by Baymard Institute. Business
Insider estimated the rate to be 73.4% in 2016, which was actually an
increase from around 65% in 2010.

There are a number of factors driving this high rate.

Internet Retailer listed lengthy/complicated checkout processes as

the top reason consumers abandoned their cart, with 39.1% of survey
respondents citing this reason. 21.7% also said they abandoned a
transaction due to a lack of acceptable payment options.

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 In a separate study by Jumio, 36% of respondents WHY IT’S IMPORTANT
have abandoned a transaction due to performance
This is the last step of the buying
issues, 31% due to ease-of-use, and 22% due to a
complicated payment process. process and the most important.
You’ve already done the most
This final point doesn’t require more explanation. Retailers are
leaving money on the table that could have easily been captured by difficult and costly part - getting
understanding customer needs and usability expectations, and better
the consumer to this point.
testing of payment flows.
Customers can’t/won’t pay if you
don’t offer the right payment
options, or if you provide a
checkout process that makes
them second-guess their decision.

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 CONCLUSION − UNDERSTAND YOUR CUSTOMERS

Digital has shifted the power to the customer. Retail technology, which has traditionally
been internal-focused to help scale, must become customer-focused.
In the JDA and PwC CEO Viewpoint 2017 report, 69% of retail CEOs said they plan to increase their investment in
digital transformation over the next year. However, 52% said they haven’t defined or started implementing a digital
transformation strategy. Mobile-enabled applications and data are the top technologies respondents are investing
or plan to invest in.

Customer experience, across and between every channel, is now the glue that binds consumers to your
brand. Each customer’s unique search- to-purchase process must be flexible, seamless, and rewarding. Smart
investments in digital are the only way to offer these experiences.

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 DID YOU KNOW?
Applause can give you
access to consumer feedback
from real people using your
digital properties and in-store
experiences. Get the insight
you need to deliver great digital
experiences that drive customer
engagement, decrease brand
Brands must understand and predict intent, learning
from past customer experiences. Retailers need
insight from actual customers and this means
observation, conversations, and data analysis. You
must know your customer and understand their
journey. You must understand how it varies by age,
location, devices, etc…
Consumers are demanding and their loyalty needs to be constantly
re-earned. However, the formula is fairly straightforward. Give them the
experiences they want, where and when they want them, and make sure
they work.

risk and increase sales.

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ABOUT APPLAUSE

Applause empowers leading brands to deliver flawless digital experiences for their customers on any device, in every location.
The company’s market insights, user feedback and digital testing solutions enable businesses to delight customers, drive topline
revenue and innovate faster.

Applause ensures digital experience quality for websites, mobile apps, IoT products and in-store interactions in a way no other
approach can – through its technology platform and managed global community of over 300,000 professional and on-demand
testers. Only real people on real devices in real locations can provide the real issues and feedback that brands need to deliver great
digital customer experiences. You can’t hire, outsource or automate the increasingly converged digital-physical experience that
defines real customer interaction, but you can replicate it with the crowdsourced approach provided by Applause.

Thousands of companies of every size – including Google, FOX, Nike, BMW, PayPal and Slack – rely on Applause to dramatically
decrease both the time and the costs of delivering great digital experiences for their customers. Learn more at www.applause.com

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