Our partner Shopgate has carried out its second annual Retail Reality Study. Unlike other studies, Shopgate surveys both merchants and consumers, highlighting common ground and differences in the way the two parties view the retail scene. Find out how the market has changed since last year, what role omnichannel has played in those changes, and how merchants’ and customers’ views differ.
Retail Reality round two
Just as they did in 2022, the team at Shopgate has published a study examining and comparing merchants’ and consumers’ points of view. The focus was on the most important changes and trends, from shopping habits to sector-based differences and technical innovations.
The aim was to investigate the dynamics of the retail market in order to understand how the DACH region is changing and what role omnichannel is playing in that process. Over 2,000 consumers and 300 merchants from Germany, Austria, and Switzerland were surveyed. To ensure a broad, representative spectrum, the team deliberately chose a diverse selection of participants: The merchants surveyed represent a range of different sectors and sizes of company.
Below, we discuss the key findings and how the situation compares with last year.
Online or offline? When it comes to where consumers prefer to shop, there’s not always a clear answer
Overall, the online store emerged as the consumers’ number one choice of shopping channel. Brick-and-mortar stores came second, followed by social media, apps, and catalogs/magazines. However, if we take a closer look, the order varies from sector to sector. For example, consumers prefer to buy beauty products in brick-and-mortar stores (55%) rather than online (48%). The picture is similar with homeware. Here, 60% prefer brick-and-mortar. This may be down to the inherent advantages and disadvantages of the individual shopping channels – for example, the inability to inspect and handle the products in an online store. The online store is the most popular choice when shopping for consumer electronics (63%). This could be the result of product availability and selection.
As we can see, combining the advantages and disadvantages of the different shopping channels and offering omnichannel services can be a worthwhile move. As the quote above demonstrates, customers appreciate this convenience.
Some merchants are dragging their feet when it comes to going digital
The majority of those surveyed (65%) feel that an associated online store is an important and desirable addition to the brick-and-mortar store. Yet just under 20% of the merchants surveyed do not have an online store. The most important steps merchants can take to go digital are therefore setting up an online store and offering a dedicated app for each brand or trading company.
Merchants’ interest in omnichannel is growing
Merchants who already have omnichannel measures in place are a little further ahead. But this is only the case for half of the merchants surveyed, despite the fact that overall, merchants’ use of omnichannel has increased by 19% since last year. 85% are interested in omnichannel solutions (6% more than last year). However, the majority (58%) are still uncertain what omnichannel means in concrete terms (omnichannel vs. multichannel).
Basically, omnichannel involves bringing information, inquiries, orders, and everything else from a range of different channels together in one place. Seamless integration of the different channels creates a uniform and enhanced shopping experience for customers
Both merchants and consumers were asked which omnichannel services they were familiar with and which they already used.
Click & Collect and Click & Reserve are the best-known omnichannel services
Click & Collect (order and pay online, collect in-store) is familiar to 74% of consumers, making it the best-known service in the omnichannel concept. Around a third of consumers had already used it. Click & Reserve (reserve online, collect and pay in store) followed in second place.
There is definitely room for improvement where awareness of other omnichannel services is concerned. Only 20%, for example, were familiar with live shopping. There are missed opportunities here, as users who have already tried omnichannel services tend to rate them very positively overall (4.2 out of 5 or higher).
Return in Store is on the increase
The ability to return goods in store is another service that is considered important. 36% of consumers and 49% of merchants feel it is significant and have already implemented it. Awareness of Return in Store underwent the biggest increase since last year, even more than Click & Reserve or Click & Collect.
Differing perceptions of merchants and consumers
The graphic below shows that merchants underestimate how important an associated online store and the option of returning goods in store are to consumers.
There is also a clear difference concerning what is considered important when buying goods.
Merchants aren’t taking sustainability and green retail seriously enough
Consumers were asked which of the aspects below were important to them when purchasing products. Merchants also estimated their relevance. There were marked differences in some areas. Fair working conditions, sustainable packaging, and the avoidance of animal testing are much more important to consumers than merchants assume.
Merchants were also asked to state how important they thought sustainability and green retail were to consumers. (Green retail includes measures such as carbon offsetting, avoidance of animal testing, sustainable packaging and production, etc.) Incredibly, 40% of retailers believe that these issues are just a trend.
Technical innovations are interesting but haven’t yet made their mark
The metaverse, virtual and augmented reality, and artificial intelligence have put the digital realm on the map. Around half of customers (53%) would make more intensive use of the metaverse if there were more opportunities. However, almost 20% of retailers have not even considered this option, meaning that the risk of a lack of technological expertise continues to grow. There is some solace, though, in the fact that over 70% of merchants find these new trends very interesting.
The deepening fusion of online and brick-and-mortar retail is a trend that is gathering pace and is increasingly in demand by customers. More and more consumers want to shop online from the comfort of their homes while also retaining the option of inspecting or collecting products in a brick-and-mortar store. This opens up a range of opportunities for merchants, particularly with the use of omnichannel services such as Click & Collect or Return in Store.
The study shines a light on other trends and values where there is room for improvement in the commerce sector. The challenge lies in recognizing these trends and innovations while also setting the right priorities to ensure your business is not overstretched.
Merchants should also be guided by the needs and expectations of their customers. The study shows that the perceptions of merchants and consumers sometimes diverge significantly. How do you picture your customers – and is that picture accurate?
“One positive takeaway from this fascinating examination of 2022 to 2023 trends is that retail in the DACH region has learned a lot. A lot of highlights in this in-depth study indicate that omnichannel is no longer just a nice-to-have – it’s a must.”
– Ralf Haberich, CEO Shopgate
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