Over the past 17 months, organizations have quickly adapted to pandemic retailing, and customer behavior has changed just as swiftly. Beyond the logistical hurdles of reduced in-store capacities, proper safety guidelines, and alternative fulfillment options, retailers had to rethink assortments to meet the needs of shoppers spending more time at home. The dramatic uptick in online grocery shopping has also been a force to contend with – two years ago, 11% of customers said they bought groceries online once a month, compared to 51% who shopped online in the four weeks following the initial COVID-19 emergency declaration.
As we advise clients with their long-term growth goals in mind, we will continue to come back to the importance of making data-driven decisions. In working with hundreds of CPG manufacturers and global retailers, we have the opportunity to analyze tens of millions of households every week. However, we know that simply looking at purchase behavior isn’t enough. We must drill down even deeper to ignite customer-centricity by understanding how they shop and what motivates them.
To take our customer-centric efforts to the next level, we’re pleased to have Charisse Jacques take ownership of our global Customer-Centric Retailing (CCR) team.
Charisse, tell us about your background and the role you’ve stepped into with your recent promotion.
I joined Symphony RetailAI in 2018 as SVP Client Partner, with more than 20 years of experience. My background includes positions at McKinsey & Company and A.T. Kearney, as well as with boutique consulting firms. I’ve also held industry roles in operations, merchandising and category management, retail strategy, and innovation. My new role brings together many aspects of my previous experience.
At Symphony RetailAI, it has been a joy to champion our commitment to customer-centricity. Having been promoted to the newly created role of SVP Global Customer-Centric Retailing, I now have expanded responsibility to oversee all CCR client teams in the U.S. and Europe, along with leading the shared global analytics service that supports them.
Achieving customer-centricity within a retail organization is somewhat of an ongoing journey. Being hyper-focused on shoppers means constantly seeking out the right actionable insight to inform your next steps. Then, you can build confidence as you make decisions based on what you learn through that shopper insight and how intimately you understand your shopper.
To that end, I know that leveraging shared learnings and best practices, across clients and geographies, will lead to even more actionable insights that will empower our clients to better understand their customers. Unifying our CCR teams in a single, aligned organization will enable us to accelerate our efforts to drive even more success for clients – that’s really exciting.
On the topic of data, tell us more about your team’s ongoing research to support our clients.
Our client-success teams are aggregating shopper data across our clients in an effort to shine a light on key trends and uncover insights. What’s powerful is that this is real shopper purchase data and not a self-reported perspective of what shoppers say they will do or did. We’ve built a number of benchmarks to provide glimpses of how shopper behavior is evolving and how retailers ought to respond. At a high level, we can use these insights to make informed recommendations for the most promising customer-centric strategies. At the same time, we can work with clients on an individual level, helping them track progress against their peers.
Can you share the most meaningful takeaways from the latest e-commerce research?
The trends we’re tracking most closely right now have to do with the role of e-commerce in grocery, and therefore the value of nurturing customers as they increasingly become omnichannel shoppers.
In 2020, many consumers increased their online spending because of health and safety concerns. What we’re seeing is that omnichannel shoppers – those who shop online to complement their in-store shop – tend to be more loyal. And with retailers looking to build loyalty more than ever before, we’re emphasizing how important omnichannel is in that equation.
Our most recent report “E-commerce today, the customer point of view” looked at over 400 million baskets in the U.S. and Europe. We found that while half of the shoppers abandoned an online channel after just one purchase, those who continued to engage online increased their frequency and spend across the board. As evidence of this, we’ve seen incremental spending increase up to 20% compared to what customers spent when shopping only in stores. In the first quarter of 2021, omnichannel shoppers grew their basket size by 9% compared to the previous quarter, while at the same time shopping more frequently – we observed a 6% increase in the number of shopping trips versus the previous quarter.
How are we advising our clients in light of what our data is showing?
If grocers want loyal customers, and we know that the adoption of some online grocery shopping increases customer engagement and builds loyalty over time, then our clients must push for omnichannel excellence. That starts by de-averaging your customer base, looking more closely at the behaviors of long-term engaged omnichannel shoppers versus new omnichannel shoppers, and then investing accordingly. In analyzing these customer segments, you’ll learn what holds their attention, what motivates them to purchase, and how they’re driven by price or quality.
Let’s look again at our recent research to drive this home. We found that long-term engaged customers are nearly four times more valuable than those not considered long-term. On average, this segment is only one-third of a retailer’s online customer base, but they represent more than half of the channel’s revenue. Therefore, it pays to invest in them, and ultimately, retain them.
Our data also shows that if new online customers return to the channel 6 to 8 times in the first three months of joining, they are more than three times more likely to become long-term engaged customers. We’re advising retailers to look at their new online shopper segment and build campaigns to ensure they hit the “magic number” of 6 to 8 visits in those initial months of engagement. If they can reach that tipping point and become a long-term engaged omnichannel shopper, they’re more likely to remain loyal.
What is a retailer’s next step to embrace customer-centric retailing?
We’ve put together some helpful resources, the first being a recent webinar I hosted, “E-commerce today, the customer point of view”. You can also download the companion PDF report “E-commerce today, the customer point of view“.
Those interested can learn more about our Customer-Centric Retail solutions. We also welcome the opportunity for a conversation with one of our CCR team members to advise on which Symphony RetailAI’s solutions can help to meet customer-centric objectives.