Consumers Return to Physical Stores for Personal Touch
“In response to this emerging trend, consumer companies must reevaluate their strategies for engaging with consumers, particularly the younger demographic. As consumers are less willing to pay for digital conveniences, businesses will need to recalibrate the role that digital channels play in driving revenue and profit margins and prioritize physical distribution outlets," observed Kristina Rogers, a global consumer leader at EY.
“The key lies in recognizing that fulfilling physical and digital desires is not an either-or proposition," she continued. "Companies must create value by adeptly navigating the digital landscape to streamline consumer experiences while also cultivating a physical presence that fosters deeper connections. Achieving this balance will require new value propositions to seamlessly address both digital convenience and the craving for immediate, tangible experiences. For instance, a consumer who lacks the time to prepare a meal from scratch may still seek an engaging and inspiring culinary experience rather than simply ordering takeout.”
The EY Future Consumer Index revealed further attitudes towards technology. For example, while 68% of consumers are happy to receive offers and promotions that have been personalized by AI, 49% are frustrated by smart chatbots that are not effective in resolving their queries. An additional 33% are concerned that AI-generated recommendations are biased toward products or brands that may not be in their best interest.
Such results reinforce the notion that companies should leverage data to address consumer needs and also uncover points of friction, Rogers noted. “Striking the right balance between using technology to spot and resolve these challenges early, along with customer service training that is responsive, empathetic and creates value for the consumer, is key. AI-led product recommendations can deliver incremental sales, but they won’t resolve more complex, service-oriented customer needs. Investing in people, both in terms of experience and knowledge, is equally as important as investing in technology, and they must go hand in hand,” she remarked.
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