Retailers and customers have differing views on returns and in-store service

According to a global Oracle Retail study, customers believe brands are not meeting their delivery and convenience expectations, meaning they are not making the most of all opportunities

According to a new consumer study covering 15,800 respondents, retailers are not meeting customer expectations and, in many cases, are not even getting the basics right. A perfect example is that the two sides completely disagree on how easy it is to return purchased products. While 57% of the 210 retailers surveyed said that returning products is "very easy", the same proportion of consumers disagreed and rated the returns process as "extremely cumbersome" or said it could be easier.

Customers and retailers also disagree on what matters most when shopping in a physical store. Convenience, such as having the right size available, is considered most important by more than half (56%) of consumers, but only 34% of retailers. Customers also cited discovery as important, including space to experiment and try new products (36%), and expert advice (22%), while among retailers only 18% and 6% of respondents considered these features important.

Fast delivery is not enough

When asked how retailers are preparing to meet customers' constantly evolving demands, the vast majority pointed to "faster delivery." Customers agree. What is more, they are also open to new delivery methods, as long as they are cheap and fast. 92% of consumers said they would like the option of "free next-day delivery by the fastest available method — drone, autonomous car, courier company, etc." This represents a much more positive attitude toward new delivery models compared with the previous study.

With one caveat — the product they order should reach them on time. According to 13% of consumers, a delayed delivery will mean they will never shop with that retailer again.

The free version of the report is available at: http://oracle.com/goto/settingthebar

"Consumer expectations are constantly evolving, and every positive experience raises the bar for retailers,"said Bartosz Kubicki of Oracle Retail Global Business Unit. "When customers use convenient ridesharing, browse products in an app or walk into a physical store, they expect the same level of service across all interactions. This increases the pressure on retailers, who must compete with their rivals and with new business models."

Hassle-free and convenient shopping with technology

Technology in the service of convenience

Today's customers do not see physical and online stores as separate channels and want the same convenience regardless of where they buy. 51% of consumers associate convenience with a good shopping process, regardless of channel. In North America, convenience has become even more important — 57% of respondents value convenience above all, compared with 50% in Europe.
There is no doubt that customers are open to new technologies that will make shopping more convenient. More than half (54%) of respondents like the idea of "internet technology that shows the customer a digital version of themselves and enables them to try on products (such as clothes or sunglasses)."

Delivery on demand

Customers are increasingly open to new delivery methods that will get their order to them as quickly as possible. More than 90% would like the option of free next-day delivery by the fastest possible method, such as a drone, autonomous car or courier. This represents more than a twofold increase compared with the number of customers who said such delivery methods would be "great" in last year's study (43% of respondents then).

Consumers also value choice — most of them (86%) agree that when placing an order, retailers should let them choose the most convenient delivery option. While 87% of retailers understand that choice is important to customers, this need is still not fully met — 47% of customers say the delivery option they are interested in is available sometimes or rarely, or is never available at all.

Online-only retailers are winning on this front, as 61% of customers believe that "the delivery option they are interested in is always available," while for traditional retailers only 52% of customers say so.

Rewards for loyalty

The growing role of loyalty

Creating personalized experiences is no longer limited to dynamic content or "special offers." Customers expect preferential treatment based on their relationship with the brand. Around half (48%) believe that receiving offers or discounts better than those other customers get as a reward for loyalty is "absolutely essential." To earn customer loyalty, retailers also need to provide transparency: around half (52%) of customers trust retailers more when they respond immediately to problems or product recalls, and 47% of respondents would be more willing to trust new brands if they are "honest and authentic."

Customers say, however, that loyalty is hard to earn — only one in five (21%) representatives of Generation Y and Z fully believe what retailers tell them. When problems arise with purchased products, 66% of consumers expect to be notified immediately, and among baby boomers this figure is as high as 72%.

Methodology

The Oracle Retail "Setting The Bar" study was conducted in 2019 and covered more than 15,800 consumers and 210 retailers from five key regions: EMEA (France, Spain, Germany, Sweden, Italy, the United Kingdom and the United Arab Emirates), JAPAC (Australia, China, India, Japan), LATAM (Brazil, Chile, Mexico), North America (Canada, United States).

 

Summary

The global Oracle Retail study reveals significant gaps between customer expectations and retailers' assessment of their own actions. As many as 57% of retailers consider returns "very easy," while the same proportion of consumers rate them as cumbersome. Customers value convenience and the ability to discover products, which retailers do not appreciate.

At the same time, consumers are open to innovation — more than 90% want free next-day delivery, and 54% are interested in digital clothes try-on. Loyalty turns out to be hard to earn, especially among younger generations, and as many as 13% of customers stop shopping with a retailer after a delivery delay.