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A growing number of customers are experimenting with online shopping at an unprecedented pace, backed by rapid strides made by technology in the digital era. As per a Deloitte study, the number of online shoppers in India is estimated to grow from 100 Mn in FY 20 to 350 mn by FY25. Amid evolving customer demands, e-commerce players, m-commerce operators, and retailers are constantly adopting innovative strategies to retain existing customers and win new customers. With shopping largely having moved to digital platforms, without any boundaries of time and place, merchants are opening up customer engagement channels across platforms- digital, social media, website, and even virtual technology that offers immersive experiences.
We shall look at some of the ways in which technology is reimagining the retail experience for customers.
1. Digital payments
The payments stage is similar to the finishing line in a race, which decides the winner. After customers enter the digital store or e-commerce portal, they should be able to conveniently navigate through the website to the payments page. Often offering payment options with interest-free credit can positively impact the buying decision. Lack of secure payment options may even lead to cart abandonment.
Simpl offers a secure payment feature with just 2 -clicks and an OTP authentication process.
• Benefits for buyers: The best part is that customers can buy products without the hassles of an immediate cash outflow and avail an interest-free credit period on their online purchases.
• Benefits for merchants: Realising the potential of a higher value of sales conversions and basket size, many leading merchants have partnered with Simpl to offer BNPL payment options to their loyal customers.
2. Virtual reality gets augmented
India is home to multiple start-ups and technology companies that have innovatively embraced immersive technology like Augmented Reality, Virtual reality and the likes to deliver unique experiences that resemble real-life scenarios. Studies indicate that companies using AR as a key marketing tool have realized a whopping 40% jump in conversions. As per a 2018 report by India Mobile Congress (IMC), the AR and Virtual Reality (VR) market in India is expected to touch US$ 234.4 million by 2023.
3. 24*7 shopping
Gone are the days when customers would be expected to shop at physical stores only during ‘business hours. In fact, online shopping is anchored inconvenience. The customer can visit the digital store or e-commerce portal, conveniently browse categories and even compare product specifications and pricing on aggregator apps. In certain cases, it is possible to virtually try the product, for example, clothing or spectacles prior to adding items to the cart, make the payment for the transaction and check out. Neighbourhood Kirana shops are adopting digital subscription services whereby regularly purchased items are delivered to the doorstep at a certain frequency, without any reminder from the customer’s end. The multitude of steps is possible in a few seconds through the digital mode, from anywhere and at any time, contributing to the growth of Indian retail and e-commerce sectors.
4. Higher awareness levels
Technology has enabled customers to proactively seek information related to product quality, online research, reviews, alternatives, pricing, and other options, prior to buying. Merchants are investing in including valuable inputs related to the products and their utility on their websites. Through cutting-edge technology, retailers are able to obtain consumer insights, frequency, and shopping patterns based on data analytics, social media, AI, ML, and chatbots. Some are even offering hyper-personalized web pages based on past purchases and browsing preferences. A Deloitte study reveals the journey of a standard customer household on an average, over the years:
° In the 1990s: Own 5-6 appliances
° Currently: Own 12-15 appliances
° In the next 10 years: Are envisioned owning multiple inter-connected and integrated devices that would include smart homes with ultra-secure devices, AR/VR, and AI options with customized designs.
5. Superior aftersales service to win loyalty
It would be imperative for retailers to offer real-time, uninterrupted support even post the sales to drive returning customers. Merchants are experimenting with chatbots and robot-managed digital stores that provide answers to customer queries and are available to engage with the customers 24*7.
6. Diverse customer segments
Due to easy Internet accessibility, high mobile usage and social media activity, customer profiles have assumed a broad range. It is estimated that India’s internet user base would grow to over 1 billion by 2025. A Deloitte study categories customers into the following broad categories:
• Brand aficionado: Displays loyalty to certain brands. This trend is gaining popularity since the onset of home-grown D2C brands
• Experimental: Are open to trying new brands if price and quality considerations are met
• Gift lover: Prefers some freebie in order to make a purchase
• Impulsive shopper: No clear brand preference. Might be influenced by social media trends and popular advertising while buying
• M-shopper: A study indicates that the number of smartphone users would jump to 820 Mn by 2022. This is expected to fuel purchases through mobile apps.
• Researcher: Makes an informed purchase after thorough research and comparison with alternatives available in the market
• Social butterfly: Would prefer to buy what peer groups or those in similar age groups are buying. For example, certain brands position themselves as ‘millennial brands’ based on a predominant customer base.
• Value seeker: Would prefer to buy if discounts or loyalty offers are offered. Is a price-conscious buyer.
7. Influenced by popular opinion, customer reviews, and loyalty programs
Technology is shaping the brand perception of customers. With online shopping turning into a battlefield of sorts, given the high number of retail presence, happy customer reviews and offering shopping points with loyalty cards are playing a key role. A fence-sitter buyer could be influenced into buying based on positive customer reviews. To win customer loyalty, it would be prudent for retailers to offer redemption of accumulated points as discounts on purchases or a free product.
8. User-friendly websites and apps
An intuitive website that offers a superior shopping experience with pop-up messages that guide the customer on the entire purchase journey from entering the site to the final checkout process can aid in higher customer retention levels. Technology has enabled the replication of a digital store with multiple web pages and app features covering multiple facets of buyer requirements.
Beyond the pandemic, alongside brick-and-mortar stores, online product discovery and digital shopping experience would continue to hold sway. A frictionless, secure payment experience, omnichannel service channels, and contactless delivery would continue to be key focus areas for retailers, merchants, and buyers.
In the next article, we shall look at how multiple factors namely cutting edge technologies like the Internet of Things(IoT), Artificial intelligence, Machine Learning, videos and vernacular content, sustainable practices, and digital supply chain are impacting the buyer decisions and the shopping experience.