DisplayData + PlanetRetail RNG Report - Analogue to Automated: Retail in the Connected Age
65% of shoppers welcome agile pricing in-store, 57% of customers losing faith over pricing inconsistencies and inaccuracies caused by manual price and promo changes
New research launched today by Displaydata and Planet Retail RNG reveals that inaccurate, inconsistent pricing – and a lack of digital technology in-store – is costing retailers in lost sales and consumer trust, as price-conscious shoppers seek out the best deal and better experiences online.
The research report, Analogue to Automated: Retail in the Connected Age – which surveyed 5000 consumers and 1000 retailers – sought to understand what consumers want from physical stores, and how retailers are responding. The findings clearly show that retailers are failing to keep up with shifting consumer attitudes towards price and promotion and are unable to engage with shoppers digitally, in real-time, when they are on the shop floor.
Consumers welcome agile pricing
The positive news for retailers struggling with rising rents, squeezed margins and online competition, is that shoppers are decidedly tolerant of ‘agile’ or ‘dynamic’ pricing if it saves them money and reduces waste. In fact, contrary to recent speculation, the research found:
- Nearly two thirds (65%) of consumers would welcome price changes throughout the day if a product is approaching its sell-by date. However, a quarter of retailers are not convinced of customer acceptance if they were to change prices more frequently, highlighting a barrier to agile pricing that doesn’t exist in consumers’ minds.
- With price and promotion labelling still managed manually, 65% of retailers are unable to make the amount of changes they want to. The process is expensive, too: 67% of retailers spend up to 4.99% of average monthly store turnover making price and promo changes. That’s equivalent to approximately $104 billion in sales – based on 2017 retail sales – across the 10 markets surveyed.[i] This emphasises how compromised physical stores are when it comes to agile pricing compared to online stores that can update millions of prices throughout the day.
- The majority of retailers (84%) agree that the ability to price with speed and agility can help improve margins and store efficiencies; 78% of retailers want the ability to make more changes to offer customers better prices and deals.
Shoppers’ desire for digital technologies
The research also strongly points to increased consumer desire for a more digital and connected shopping experience that meets their expectations around pricing, promotions and availability, and matches the information shoppers can get online, such as competitors’ prices, stock levels and more:
- Over two thirds of shoppers want technologies that enhance their experiences in stores. 33% want promotions sent direct to their mobile devices; 31% want Electronic Shelf Labels (ESLs) to show accurate, real-time prices, promotions, and detailed product information; and 27% want to be identified as a loyal customer.
- The desire for digital services correlates with the poor experiences that almost half of shoppers (42%) claim to have had in store due to a lack of Wi-Fi, a lack of information at the shelf edge, and differences in product availability in store and online.
“Our research shows that despite the huge changes retail has undergone in recent years, a fair and accurate price, consistent across channels, remains the key purchasing factor for the vast majority of shoppers, said Andrew Dark, CEO, Displaydata. “However, to effectively harness the power of price, thrive against online competitors and retain shoppers’ trust, retailers must create a digitally connected environment to meet the high customer expectations that are being shaped by online experiences.”
“Consumers today are digitally empowered with access to real time information on products, and they are more price sensitive than ever,” said Sarah Herrlein, senior retail analyst, Planet Retail. “Our research shows they expect a more consistent, automated experience, but their trust and faith in the store is lessening due to basic technological inefficiencies.” With retailers spending billions on things like manual price changes, the case for deploying digital technologies that optimise efficiencies, deliver the customer a better experience AND better value in-store, has never been greater.”
Download a copy of the full report here
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