A balance of in-store and e-commerce improvements is key to happier customers

What it means: Increasing dissatisfaction with the retail experience has created a strained relationship between retailers and consumers that challenges long-term loyalty and brand perception. The retail industry has an optics problem, and this year retailers must contend with both declining consumer satisfaction and economic uncertainty. Consumers have come to expect poor service, unsatisfactory shopping occasions, out of stocks and longer wait times. That fact, coupled with the sheer volumes of retail options available to the consumer, leads to lower brand loyalty and affinity over time. Retail’s growth overall — and the exponential growth of e-commerce during the COVID-19 pandemic combined with labor shortages — created issues that have yet to be resolved. In other words, retail’s growth has outpaced its ability to maintain the same level of customer experience. But, the structural challenges retailers face today aren’t all easily fixable, especially as businesses scale up store counts and productivity. Almost 75% of consumers had an issue with a retail product or experience during the last year, a figure that has grown steadily during the past few years, Retail Leader reported. Naturally, this makes sense as retailers expand fulfillment offerings and continue to become more complex operationally. Trying to satisfy the needs of many in a 360-degree retail environment is no easy task for retailers. But, as organizations scale in complexity, the outcome for consumers often is a worse experience across channels. Consumers often rank essential retailers worst when it comes to shopping experiences, and in-store experiences are often the culprits in poor brand perception, according to Retail Leader Pro. As the industry continues to shift sales online, neglecting in-store hurdles is a costly mistake. Labor shortages for front line retail workers are not going to resolve this year, and with many poor customer experiences stemming from stores, creative measures are needed, including technology that empowers consumers to support themselves, like smart carts or digital signage that can accurately display product information. Long checkout lines may continue to be an eyesore, but incentivising online click-and-collect during peak store hours could relieve some of the pressure. E-commerce channels still face the highest level of product dissatisfaction with errors in sizing, products or item defects. As retailers invest in e-commerce infrastructure to keep up with the growth in demand, combined with smarter solutions for human error in online fulfillment, these pressures may dissipate over time. Overall, loyalty hinges on positive retail experiences, and the industry stands at a crossroads of increasing consumer unease and higher expectations of retailers themselves. Retailers must confront the day-to-day challenges in order to mitigate risks to their long-term brand viability and image. What’s next: Retailers must consider the entire retail ecosystem when creating solutions to address declining satisfaction; online channels need less error in supply chains and product selection and stores need to solve labor shortages and long wait times.

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