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Frustrating Online Experiences Driving Consumers to Shop In-Store in Canada: Report

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Disruptions to the global supply chain, which were hastened by the negative impacts associated with the spread of the COVID-19 virus, persist without any signs of easing. Highlighted by supply shortages, port congestion and price inflation, the current situation around the retail supply network is uncertain, to say the least, perpetually threatening merchants’ ability to provide their customers with accessibility to the products they seek. These disruptions and uncertainties often result in a disjointed and dissatisfying online experience for the customer and a loss of their trust in the brands they shop with. In fact, according to recent KPMG research, nearly two-thirds (64%) of Canadians have grown frustrated by the online experiences currently offered and express a desire to return to in-person shopping. It’s a sentiment that retailers ought to pay attention to, says Katie Bolla, Partner, GTA Consumer and Retail Industry Lead, KPMG in Canada, lest they lose the trust and loyalty of their customers.

“Many Canadians have embraced online shopping over the course of the past year-and-a-half, particularly in new categories like grocery,” says Bolla. “Generally speaking, consumers were patient at the start of the pandemic when they were receiving less than ideal experiences because online shopping was satisfying that base need of providing access to goods. As COVID has prolonged, however, and consumers have increased their adoption of digital channels, they’re now expecting experiences that are similar, if not better, than those that they are used to receiving in-store. But, inconsistencies around products that did not meet the consumer’s needs or expectations, including things like clothes that didn’t fit, replacement items on grocery orders or product that showed up damaged, resulted in frustration. And, many returns policies offered by retailers are seen by the consumer as inconvenient or complicated, adding further friction to their experience.”

Integrity

As a result, Bolla explains, many Canadians are increasingly yearning for the in-store experience, to be immersed in the brand, touching and interacting with the product or service, and receiving tailored advice from knowledgeable and experienced associates. In addition, the simple sense of discovery that the physical brick-and-mortar retail experience elicits in visitors is something that most utilitarian websites just can’t replicate. In fact, 65 percent of Canadians say that they “really miss the in-store shopping experience”, with 69 percent believing that retailers need to think differently about the online experience in order to mimic that of the in-store encounter, leveraging things like virtual reality dressing rooms powered by augmented reality and artificial intelligence that can allow consumers to see how clothes might look on them without physically trying them on.

They are insights from KPMG’s new 2021 Customer Experience Excellence report which goes a long way toward highlighting some of the opportunities that a pent-up demand among consumers to return to the physical retail store environment presents to brands. Its analysis also recognizes the increased pressure that’s been placed on retail organizations to deliver the experiences consumers are looking for. With the challenges involved in satisfying today’s consumer needs in mind, the report also presents six pillars of customer experience. Based on more than 11 years of research, the pillars provide retailers with a foundation from which to strengthen their customer engagement and support. And, as Bolla points out, much of what the customer is looking for is rooted in the integrity of the brands they shop with.

“What we noticed even before the pandemic was the inclusion, for the first time ever, of values as a top three purchase consideration for consumers,” she says. “And this sentiment has only heightened during the past 18 months or so. The vast majority of Canadians prefer to buy from brands whose actions align with their values. They’re also showing more of a willingness to pay for green and ethically-made products, presenting a number of ways by which retailers can satisfy these desires and strengthen their relationships with customers. Providing transparency concerning the source of products, including where it was made, how it got here, and the communities that were supported through ethical manufacturing, is critical. There are also rising trends around support for local and small businesses. Retailers that celebrate their communities and support the growth of local artisans will really resonate with consumers. And, consumers today want transparency into the way organizations treat their people and what their policies are, seeking brands that focus on things like fairness, inclusion, diversity and mental health.”

Expectations and resolution

Indeed, the actions, or inaction, of retailers around environmental, social and governance issues have certainly intensified over the course of the past year-and-a-half as Canadians took the opportunity to reassess their own values and the things that matter to them most. They want retailers to place greater focus on initiatives like reducing waste, with 90 percent believing that brands should start leveraging technology to do so by limiting the amount of product returns that occur. In fact, as a result of the pandemic and the subsequent accelerated digitization of the retail environment and world around us, retailers also have the opportunity to leverage technology to properly and effectively communicate with their customers. And, according to Bolla, it can help them satisfy two more of the report’s pillars.

“Managing customer expectations and resolution have always been two of the core foundational elements of customer excellence,” she asserts. “Prior to the pandemic it was important to address these pillars. But, over the course of the past 18 months, when many retailers have not had the same opportunity to have the high frequency interaction with consumers, communication and effective care have become essential. As a result, companies have been establishing new channels of communication. And, even more significantly, they’ve been demonstrating empathy through the communications and channels used to maintain or, in some cases, even strengthen their relationships. As part of this communication, many retailers have been trying to figure out the most effective ways to do so with their audiences, presenting them with ways by which they can be engaged and how their services can be used most effectively. Providing clarity around membership or loyalty programs during the pandemic period and developing more favourable return policies are some of the things that retailers have done to establish this communication, becoming proactive to address customer challenges and, at times, preventing them before they occur.”

Personalization and empathy

Bolla goes on to explain that a critical layer of communication and customer care involves a deep understanding of the consumer based on their behaviour. This understanding might allow brands to pre-populate online baskets for their customers or send them notifications regarding sales on items that they frequently purchase. It enables retailers to anticipate consumer needs and challenges and address them effectively. In fact, according to KPMG’s report, 41 percent of Canadian consumers like the idea of retailers predicting what they want when they want it and delivering it to their home. It empowers retailers with the ability to personalize their engagement with consumers, conveying to them a sense of consideration and compassion concerning their needs.

“Personalization and empathy are two key pillars of differentiation,” says Bolla. “Personalization is most highly linked to customer loyalty. It’s about data and knowing their customer better than they know themselves. An empathetic approach involves them using that information and equipping their employees with it so they can better understand the customer and enhance their experience through personalized service. It allows the retailer to make consistent improvements to product creation and recommendations, the channels leveraged, the experiences designed, pricing and offers and, of course, communication. And, based on some of the enhancements that have been made by brands over the course of the past year-and-a-half, many consumers are now expecting retailers to be able to predict what they want, when they want it and deliver it to their homes. And the best brands are leveraging digital to really listen to their customers, understanding them at a deeper level, figuring out what’s working and what’s not working, and continuing to tailor their service to them.”

Time and effort

In addition to the pillars of integrity, expectations, resolution, personalization and empathy, extensive KPMG research also suggests time and effort as a vital component of an excellent customer experience. In other words, the ease with which consumers can interact with brands, and the convenience of doing so, are still major considerations within the minds of consumers, perhaps increasingly so in lockstep with the digitization of the retail environment. For retailers, this often means being accessible and offering a frictionless omnichannel experience, providing the information and product that consumers are looking for. In fact, according to KPMG research, 78 percent of Canadian consumers say they will switch brands if they can’t get what they want when they want it. It’s an alarming statistic, and one that Bolla says speaks to the importance of reducing the time and effort a consumer needs to spend in order to receive the experience they seek.

“The retailers and brands that can create a seamless, integrated experience for their customers will be those who differentiate themselves from competitors going forward,” she says. “It shouldn’t matter where a consumer starts their connection with a brand. They should be able to pick up exactly where they left off in another channel without the need to start over, repeat themselves and re-enter information. This experience needs to be uninterrupted across all channels. Some of the ways retailers have been addressing this need is by experimenting with pop-up stores, bringing their products and experiences to their customers. Others have launched digital waiting lines so customers don’t have to physically stand in a line to wait for service. The offering of easy self-serve options has also reaped rewards for retailers. And, ensuring that returns are not forgotten, providing an easy and convenient resolution path for consumers, is key in providing that seamless engagement.”

Achieving customer experience excellence

In light of the six pillars that KPMG put forward as fundamental requirements in meeting the needs and desires of today’s consumer, there are a number of opportunities that arise for retailers to deliver the excellent experiences that they’re increasingly expecting. They are requirements, says Bolla, that are inextricably intertwined and, in combination, provide a powerful mechanism to help organizations understand how well their customer experience is delivered across channels, industries and company types. And, she adds, they also help provide insights into the ways in which they can leverage the tools at their disposal to seize the opportunities in front of them.

“For retailers to enjoy success going forward, they can’t forget about the basics. Personalization and empathy are differentiators. But you can’t get the true value out of those qualities if you neglect the basics. Brands have got to ensure their integrity with respect to customer safety and trust, providing transparency into their operations. They’ve got to focus on customer resolution, being clear around managing expectations, and create an easy and convenient experience. Understanding the customer through data and information is also critical in informing improvements to the products that are created and sold, the channels through which we engage, the service that’s offered and experiences that are created for customers. All of this, needless to say, has got to be designed and organized with the six pillars of customer experience excellence in mind, creating a culture within the organization that’s aligned to them. And, to support all of this, retailers have got to make sure that they continue to innovate and digitally transform their businesses. By continuously improving their experiences across digital channels, allowing a seamless engagement with ease, personalization, empathy and clear expectations, retailers will engender increased trust and loyalty among their customers and achieve growth for their brands.”

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Article Author

Sean Tarry
Sean Tarry is an experienced writer who leverages his unique storytelling abilities to bring retail industry news and analysis to life. With 25 years of learning, including over a decade as Editor-In-Chief of Canadian Retailer magazine, he’s equipped with a deep understanding of the unique world of retail and the issues, trends, and innovators that continue to influence its evolution and shape its landscape.

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