Poor retailing drives consumers online instead

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By: Wise Marketer Staff |

Posted on February 27, 2008

Poor customer service and out-of-stock products are driving shoppers out of High Street stores and into internet stores instead, according to a survey of nearly 1,000 British consumers by Accenture.

The research into consumer attitudes found that 55% said that shops often did not have enough check-outs open, and nearly half (49%) said that stores are frequently out of stock of the products they want to buy.

Driven away from stores
Worryingly for retailers, if consumers do not find what they are looking for in one store, they do not hesitate to go to competing stores to find what they need. This was particularly true of those who were shopping for entertainment equipment and devices (91%) and furniture (90%).

"Retailers know that issues such as poor customer service and out-of-stock products frustrate their customers, but what is shocking is that only a small number of successful retailers translate this insight into actual customer service improvements throughout their retail and product channels," said Richard Wildman, head of Accenture's retail practice in the UK.

Internet influence grows
Internet-savvy retailers appear to be benefiting from these unhappy consumers. The survey found that more than half of male shoppers (56%) said they prefer to buy via the internet than in traditional bricks-and-mortar stores, and 44% of all respondents (both men and women) expressed a preference for online shopping over in-store shopping.

The internet is also becoming an integral part of the shopping experience for those visiting traditional High Street stores. Almost three-quarters (71%) of respondents said they use the internet to compare prices and then go to the store with the lowest price, while nearly half (44%) said they go online to find out if a product is actually in stock before starting their shopping trip. In addition, two-thirds (67%) said they research products on the internet before shopping in a physical store.

"The internet has become an extension of the in-store shopping experience," explained Wildman. "Consumers are making wide use of it not only to buy products but also to check availability and find the best price. Retailers need to make sure that, when their web site says they have a product in stock, it really is on their shelves when the consumer arrives at the store."

New products not working
New products appear to be having a very limited impact on consumers, the survey found. More than one-third (36%) of respondents said that new products introduced were not what they needed, while half (51%) said that new products were introduced long before consumers realised they needed them.

"It's critical to understand customers' wants and needs so that new product launches can be as effective as possible," noted Keith Barringer, managing director for Accenture's consumer goods & services practice. "A keener understanding of the customer can help manufacturers time product launches for maximum impact and help retailers know when to offer promotions."

Other loyalty drivers
When asked to identify the factors that have the strongest influence on purchase decisions, the greatest number of respondents (48%) cited word-of-mouth, followed by traditional advertising (31%). Nearly half (47%) said special promotions were the best way to retain their business, while 40% said improved customer service was the key to making them more loyal.

Among the survey's other findings:

  • The main criteria cited for deciding where to shop were price (87%), product selection (62%), and proximity to home or office (53%);
  • The top three places or ways that consumers said they would like to learn about new products were TV (59%), word-of-mouth (55%), and internet search engines (44%). The Wise Marketer notes that these are all channels in which the consumer has a great degree of control over what they hear, who from, and when;
  • Women are more likely than men to shop at five or more stores for clothing (46% compared to 37%), while men are more likely than women to shop at five or more stores for consumer electronics (38% compared to 27%).

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