In a new report published today by Experian, the global information services company suggests that retail and home shopping brands need to adapt in order to connect online with ‘the empowered consumer’.
The report, titled ‘Engaging online with the Empowered Consumer’, highlights that the rise of web 2.0 and social networking, price comparison sites and online discount codes have all led to consumers expecting greater value and service levels. According to Experian’s report, the reality is that many retailers and home shopping companies are failing to live up consumers’ multi-channel expectations.
Using the home shopping sector as an example, Experian’s analysis reveals the harsh reality of customer engagement:
- 45% of customers are single purchasers, with figures rising as high as 75% in some cases.
- 60-70% of ‘best’ customers have not purchased in the last 12 months, signifying that companies are taking one or two seasons to recognise that high value customers have lapsed.
- 30% of customers generate nearly 70% of revenues.
Experian’s report suggests that brands need to encourage repeat purchasing and loyalty by blending offline and online insights to dictate precisely how and when a company engages with today’s increasingly-savvy customers. For example, insight from Hitwise, an Experian company, found that online shoppers are evolving - with 27% of online shoppers over 55 years old in 2008 compared to just 12% in 2005.
According to the report’s authors, the biggest problem is that whilst many companies have a multi-channel marketing strategy in place, more often than not it operates in isolation of the rest of the brand portfolio. The result for the consumer is a fragmented experience with inconsistent service levels and value propositions.
Online consumer behaviour is changing rapidly and while online fashion retailers have embraced online strategies such as expanding e-mail marketing and search strategies, and targeting lifestyle and social networking sites, traditional catalogue retailers have generally not been as quick to adapt. As a result, online fashion retailers have seen a 31% increase in UK Internet traffic over the last 12 months compared to just 1% for traditional catalogue companies according to Hitwise.
Marie Myles, Director of Marketing Consulting for Experian’s Integrated Marketing division, commented: “Our new report lifts the lid on why engaging online with the empowered consumer is a business imperative in today’s tough economic climate. The fact that online retailing has grown by 40% in the last 12 months underlines why brands must change the way they communicate. While ‘wow’ factors will be memorable and generate conversations, innovations in marketing and brand loyalty will be lost if the basics continue to be ignored. Greater emphasis needs to be placed on the exploitation and application of existing data assets. The enhanced insight derived from this approach and the move to a coordinated customer contact strategy will lead to more profitable and longer relationships between brands and consumers.”
To download a free copy of ‘Engaging online with the empowered consumer’ visit www.experianim.com
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