Top UK retailers could be missing out on up to £66 million per year in lost revenue by failing to deliver better personalised experiences, according to a new report from retail research agencies, Conlumino and Webloyalty.
Based on analysis related to the current Retail Week Knowledge Bank Top 50 UK Retailers and a survey of over 1,000 UK consumers, the report calculated that more effective on and offline personalisation strategies could enhance sales by 7.8%, for retailers with an average turnover of £850m or more.
It also found that over half of UK consumers state they would be more likely to buy from a retailer if it offered more of a personalised experience, yet one in four say they have never once received a personalised deal from any.
A large proportion of consumers believe new technology is the secret to improving the experience both online and in store, with 51.8% of those surveyed stating that technology will allow the shopping experience to be better tailored to their needs in the future, and a further one in three (30.7%) thinking that it will make bricks-and-mortar shopping a more personal experience.
“Personalisation is the future of online shopping,” says Guy Chiswick, managing director for Webloyalty Northern Europe. “Retailers need to be aware of the appetite within the consumer community and respond to it, if they are to reap the rewards.
“One retailer taking advantage of online personalisation is Westfield…the app creates a shopping profile for each user and then generates offers based on location and preferences.”
Westfield’s app relates to a form of location-based tracking technology currently seen as a potential game-changer for bricks-and-mortar retail outlets, thanks to its ability to offer rewards and coupons to shoppers based on their geographical relevance to a store.
However, the reality of the technology’s adoption rates is very different – according to Adobe’s latest Digital Trends 2015 report, just 8% of retailers currently use location-based technologies, compared with 23% of telecoms providers, 18% of financial services, 18% of consumer goods suppliers and 10% of travel and hospitality providers.
And while geo-targeting technology is clearly on the radar for many retail businesses, as two out of every five (40%) of Adobe’s retail respondents are currently exploring the technology, questions remain as to why geo-targeting hasn’t experienced more of a propagative effect in the sector.
In contrast, the majority of global retail marketers see the future of personalisation focused predominantly through email communications. A recent study from Mailjet found that 76% of American marketers stating their email use will increase or stay the same in the next five years, while 82% of French and German marketers state similar.
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