American consumers want a more personalized retail experience but are divided on retailers’ tactics and the types of personal information they feel comfortable disclosing, according to results from a new survey from Accenture. Nearly 60 percent of consumers want real-time promotions and offers, yet only 20 percent want retailers to know their current location and only 14 percent want to share their browsing history.
The Accenture Personalization Survey examined customer expectations around a personalized shopping experience with retailers, including social channels, and explored the issue of digital trust. Accenture defines digital trust as the confidence placed in an organization to collect, store and use the digital information of others in a manner that benefits and protects the consumer.
The research found that while many consumers are willing to share some personal details with retailers, nearly all (90 percent) of the respondents said if the option was available they would limit access to certain types of personal data and would stop retailers from selling their information to third parties. In addition, 88 percent would prefer to determine how the data can be used and 84 percent want to review and correct information.
“Personalization is a critical capability for retailers to master, but as our survey shows, addressing the complex requirements of U.S. consumers is challenging because they are conflicted on the issue,” said Dave Richards, global managing director of Accenture’s Retail practice. “If retailers approach and market personalization as a value exchange, and are transparent in how the data will be used, consumers will likely be more willing to engage and trade their personal data.”
Automatic Discounts, Real-time Promos Score Big
The survey explored and identified the types of online and offline retail technologies, tailored customer experiences and communications that consumers may experience. According to the survey, the most welcome in-store retailer communications and offerings include automatic discounts at checkout for loyalty points or coupons (82 percent) and real-time promotions (57 percent). When it comes to personalized online experiences, the most popular choices were website optimized by device (desktop, tablet, mobile) (64 percent) and promotional offers for items the customer is strongly considering (59 percent).
Other notable findings include:
Almost half (48 percent) of those surveyed are receptive to getting reminders online to order items that they might have run out of and need to be refilled (from mass retailers, drug stores and grocery stores) and 51 percent like the idea of “one-click” checkout retailers who know how consumers want to pay and have items shipped.
At the same time, consumers want to be active in making purchases, with 48 percent saying they don’t like the idea of in-store purchases being charged automatically to their account without them taking out their wallet or mobile phone.
As part of the information exchange for a more personalized retail experience, consumers also expect to get something in return. The key benefits cited include: access to exclusive deals (64 percent), automatic crediting for coupons and loyalty points (64 percent), a one-time discount (61 percent) or special offers (61 percent).
Consumers are more willing to share certain personal details with retailers, including demographic information such as gender (65 percent), age (53 percent) and contact information (52 percent), although a significantly smaller percentage (24 percent) would share their contact information on social media. Financial (credit score), medical and social media contacts details are deemed the most sensitive, with 13, 8 and 5 percent, respectively, willing to share this information with retailers.
“At the end of the day, it’s all about the customer, his or her data, and the obligations retailers have to create and maintain digital trust with those customers,” said Richards. “It is important to recognize that the line for what’s acceptable versus inappropriate is different for every customer, that the customer often doesn’t know where the line is and that the line is fluid and evolves over time as new, innovative, personalized experiences are created and become mainstream. The customer remains in control over where the line of digital trust is drawn, requiring retailers to be agile and flexible in their approach to personalization.”
Key demographic differences depict generational conflict
More than half of all consumers (51 percent) and 68 percent of Millennials would be receptive if a drug store tells them to stop buying items online that could react negatively with other medicines; however, a significantly lower percentage (30 percent) of Baby Boomers were comfortable with this personalization tactic.
Millennials are more likely than Baby Boomers to look for advice on in-store purchases. Forty-five percent like the idea of a personal shopper who can pull items according to the customer’s style, fit or wardrobe, versus 28 percent of Baby Boomers.
Baby Boomers are more demanding than Millennials when it comes to receiving benefits in exchange for their data. Almost three-quarters (74 percent) expect to get automatic crediting for coupons and loyalty points, and 70 percent expect special offers for items they are interested in, versus 58 percent and 61 percent of Millennials, respectively.
“Leading retailers understand that every shopper is different and look for insight in terms of what works best across product and service lines or with high-value customers,” said Chris Donnelly, global managing director for Retail, Accenture Strategy. “It is critical to test how customers might respond to a particular personalization strategy. Data-driven testing should include the behavior of individual customers, demographic indicators and factors relating to the item itself. For instance, while some people may want to be told they are out of milk, they may not feel the same way about personal care products.”
Consumers Want to Get Personal, But Not Too Personal
While the survey results indicate that consumers want retailers to know them enough to provide relevant offers, some potential tactics such as a retailer making sure the customer is buying the right item based on their personal demographics are considered too personal. According to the survey, consumers are less comfortable with the following personalization tactics:
Retailers suggesting not to buy items online outside their budget at big-ticket destinations such as home improvement and electronics stores (46 percent).
Mass retailers and grocery stores advising them not to buy items online outside of their dietary restrictions (40 percent).
For additional findings, click here.
“Personalization can be a powerful method for retailers to differentiate from competitors, increase basket size and build customer loyalty,” said Richards. “To effectively implement personalization across all channels, retailers would benefit from understanding customers at a broad level as well as individually – determining where personalization strategies can best drive business results, and giving key subsets of customers the choice on how they wish to participate.”
The key technology enablers of a personalized experience that places the consumer at the center of every digital experience—what Accenture refers to as the “Internet of Me”—are explored further in the Accenture Technology Vision 2015.