Verint Research Reveals What Really Matters to Consumers in their Physical and Digital Shopping Experiences

Women checking clothes item on mobile phone in store

Over the past two years, retailers have invested a significant amount of time and money to create exceptional digital experiences as consumers embraced a new way of interacting with their favorite brands.

While customers are returning to physical shopping in the post-Covid economy, digital engagement strategies are still vital to retain customers and keep them satisfied.

Verint conducted a survey of 6,648 respondents — the basis of our Verint Experience Index™ benchmark research of consumer satisfaction with leading retailers. Generational differences and channel preferences persist in this most recent report. And as a result, it’s important for retailers to recognize generational shopping preferences to drive customer satisfaction and brand loyalty, and to take a united view of both in-person and digital experiences to satisfy all consumers.

Generational Differences in Shopping Preferences

The role and relevance of physical brick and mortar locations has been debated ever since the advent of ecommerce. While physical retail will probably never go away entirely because for many shoppers it is highly experiential, we do see younger consumers demonstrating a preference for leveraging digital channels for a significant portion of the buyer journey.

Understanding these channel-shifting shopping habits of younger consumers is vital for retailers as they refactor their customer engagement strategies in the post-pandemic era. Digital experience is very important to this group and rates second only to price as the biggest driver of customer satisfaction. As a result, if retailers want to engage and connect on their needs, it is critical that they provide a wide range of support for rich and rewarding digital experiences. This includes seamless purchase processes.

For Gen Z, price and digital experience are the biggest drivers of customer satisfaction. For older generations, appeal, quality, and variety of merchandise are more important.

Key Drivers of Customer Satisfaction

With the world’s supply chains facing unprecedented strain, we see an almost universal shift in the biggest driver of customer satisfaction being “merchandise” – specifically, merchandise appeal, availability, quality, and variety. Merchandise ranked as the highest driver across the top 25 U.S. retailers that we evaluated. At a time when many items are more difficult to find, access to high quality and a large variety of items to buy clearly matters most to shoppers.

Digital experience – specifically responsiveness, ease of finding products, and the ability to provide needed information – was the second biggest driver of customer satisfaction.

Price – specifically, value, competitiveness, and clarity, was the third biggest driver of customer satisfaction – not unsurprising in an era of inflation.

Service representative – specifically their availability, responsiveness, and ability to answer questions –was the fourth biggest driver of customer satisfaction. This aligns with other research that we, at Verint, have done, that indicates that while many consumers value self-serve service channels, they also value human assistance, especially when they have an urgent question, problem, or complaint, or when the purchase has a high dollar value.

While there are myriad factors that make or break a retail experience, prioritizing and increasing customer satisfaction will positively impact desirable customer behavior. And understanding those factors that wield the greatest influence enables retailers to lean in and prioritize their focus.

Customer Journeys: More Complex Than Ever

Online retail has grown, with e-commerce spending in the U.S. predicted to jump by 13 percent to $1 trillion in 2022, but consumers have increasingly complex purchase journeys that often involve both in-store and digital steps.

Overall, 47 percent of consumers prefer to engage with a retailer by visiting a store, which is true across grocery, mass merchant, and specialty retailers. But there are clear differences across generations. Two-thirds of customers over 56 prefer to visit a store; for much of their lives, visiting a store was the only option for the Silent Generation and Baby Boomers and its familiarity is likely why it remains their preferred way to engage.

However, if we look at shoppers under 40, that number drops below 36 percent. Gen Z sees utility in the retail store as a convenient click-and-collect depot for merchandise. While 28 percent are making purchases via the retailer’s website or app, 51 percent either collect in-store or via curbside pick-up.

In addition, our research found that Gen Z and Millennials have more complex purchase journeys, with over 75 percent using at least one other digital resource – such as ratings websites, recommendations from influencers, and social media content – to help inform their purchasing decisions.

Respondents under 40 are also more concerned with retailers’ environmental practices than respondents in other age groups, rating the value of eco-friendly packaging at least 15 percentage points higher than Gen X and Boomer respondents.

What Does This Mean for Retailers?

Our research has found that digital interactions, whether on public social or private messaging channels, are the most effective way for retailers to turn customer communications into sales and do so in an agile manner. While marketing emails can easily get lost in an inbox, sending the right mobile message at the right time to the right customer can turn automated interactions into purchases.

Retailers can send timely reminders based on past activity or appointment requests which encourage customers to rebook or refill their regular purchases. They can also be useful in cart abandonment situations, where retailers can reach out to existing customers who haven’t completed a sale on their website or app with a reminder, or discount code, to encourage them to finish their purchase. Click-to-Messenger advertisements, or targeted advertising on Facebook or Instagram alongside purpose-built bot flow, can create a seamless browsing and payment sequence for a personalized shopping experience without leaving a private messaging conversation.

Gen Z and Millennials will continue to push the envelope on digital experiences, a shift that has been going on for years. To accommodate these groups, brands will need to establish continuous feedback loops, optimize digital communications to boost revenue, and ensure they are providing optimal customer experience to strike a balance between digital and traditional channels.

Leaning into digital solutions that help both online and in-store experiences as well as tailoring specific services to the correct demographics can help ensure consistent and enjoyable experiences across all kinds of journeys and channels.

The best strategy to improve customer experience is to ultimately connect every customer touchpoint and surface information from traditionally siloed departments. By collecting regular feedback around factors such as merchandise, pricing and loyalty programs, retailers can continually enhance and improve shopping experiences.

Click the link for more information and to download a copy of the report, Verint Experience Index Retail Report 2022.

 About the Author

Jenni Palocsik is vice president, marketing insights, experience and enablement at Verint.

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