Connected Retail: Exploring the Interplay Between Digital and Physical Experiences (volume 1)

February 6, 2024

In an era where the digital realm seamlessly intertwines with physical shopping experiences, Salesforce's 5th edition of the Connected Shoppers Report serves as a compass guiding retailers through the evolving landscape of consumer preferences. The fusion of digital channels with in-store interactions is more prevalent than ever, with 60% of shoppers acknowledging the use of their mobile devices within brick-and-mortar establishments. This report not only unveils such pivotal statistics but also unveils the transformative trends that are shaping the future of retail. From the emergence of stores as experience differentiators to the increasing reliance on intelligent insights for personalized engagement, each facet contributes to the modern shopping journey. As we dive into the report's key revelations, we unravel the threads that bind excellent customer service to brand loyalty and explore how retailers are leveraging loyalty program data to forge lasting connections with their audience. Join us on a journey through the interconnected world of retail, where digital elevation meets the tactile reality of the shopping experience.

Synergy between digital and physical shopping

It's evident that the seismic shift towards digital channels, triggered by the heart of the pandemic, has redefined the balance between online and in-store shopping. Remarkably, in 2023, shoppers found themselves evenly splitting their purchases between physical stores and online platforms. However, the trajectory reveals a fascinating projection – in just two years, shoppers anticipate completing a mere 44% of transactions in traditional brick-and-mortar establishments. 

The question that arises is, where will this digitally inclined consumer base direct their purchasing power? Beyond conventional websites and apps, shoppers are increasingly exploring alternative digital avenues such as social media platforms and voice assistants for both inspiration and transactions. This dynamic shift underscores the need for retailers to not only adapt to the evolving online landscape but also to strategically engage with emerging digital channels to stay connected with their audience. In this context, the first chapters of Salesforce's 5th Connected Shoppers Report provide invaluable insights into the unfolding trends that shape the future of retail.

Concurrently, the concept of "shopping at the edge" has emerged as a defining trend, reshaping the dynamics of retail engagement. Modern shoppers now expect retailers to seamlessly integrate into the platforms where they naturally engage, such as social media, messaging apps, and live streaming services. 

This transformative shift signals a departure from the traditional confines of a retailer's physical and digital space. Today, the journey often commences on social media, acting as a catalyst for discovery, with 50% of shoppers citing it as a primary source for exploring new products. What makes this trend particularly noteworthy is the substantial increase in actual transactions taking place on social media. This unprecedented trend underscores the imperative for retailers to embrace a diversified approach, meeting shoppers at the edge of their digital exploration. 

Moreover, the integration of digital elements into the physical retail space has become a pervasive and integral aspect of the modern shopping experience. A staggering 60% of shoppers acknowledge the seamless fusion of their mobile devices within brick-and-mortar establishments, utilizing them for various purposes. From conducting research and price comparisons to scanning QR codes and opting for convenient scan-and-go checkouts, these digital tools empower shoppers with real-time information at their fingertips. The interaction extends beyond personal devices, as associates themselves leverage mobile devices to enhance customer service. Whether it's checking product availability, completing transactions, or providing instant answers to queries, these mobile-enabled interactions redefine the traditional role of store associates. 

Simultaneously, in the pursuit of refining and personalizing the customer journey, retailers are increasingly turning to the promises of generative AI to revolutionize shopping experiences both online and in physical stores. The commitment to harnessing the power of AI is evident, with a remarkable 92% of retailers expressing a heightened investment in AI technologies to elevate the shopping experience. Additionally, in the realm of online experiences, 55% of retailers are either exploring or actively using generative AI to develop conversational digital assistants, aimed at aiding online shoppers in their quest to find the perfect products. 

Strategic Data Insights Ignite Personalized Connections

Recognizing the paramount importance of catering to individual customer preferences, retailers emphasize personalizing customer communications as a top-tier priority. This focus stems from a clear understanding of customer expectations, with nearly 3/4 of customers anticipating companies to comprehend their unique needs and expectations. To overcome the challenges posed by a saturated market, where generic communications fall short in capturing attention, an overwhelming 93% of retailers express a heightened commitment to investing in personalization, marking a significant increase from previous efforts. The dedication to this endeavor is evident in the substantial progress made by retailers in just two years. The percentage of retailers claiming a full ability to utilize customer data for personalized shopper engagement has nearly doubled, rising from 32% in 2021 to an impressive 57% in 2023. 

Generative AI emerges as a pivotal tool poised to enhance marketers' efficiency in capturing shopper attention. Retailers envision a realm of possibilities for generative AI, especially in jumpstarting content creation for diverse channels, including display ads, social media, and email campaigns. Moreover, there is a prevailing belief that generative AI will play a key role in automating the development of personalized marketing emails and promotional offers. This not only streamlines marketing processes but also promises substantial savings in both time and financial resources. 

Conclusion 

The seamless integration of mobile devices, the strategic use of generative AI, and the emphasis on personalized connections underscore retailers' commitment to meeting evolving consumer needs. Notably, the importance of retail media emerges as a vital component in this dynamic equation.

Stay tuned for Part 2, where we'll dissect the remaining three chapters, unraveling the threads that bind excellent customer service to brand loyalty and examining how retailers leverage loyalty program data to forge lasting connections with their audience

To explore these trends further and discover how Shalion can elevate your retail media strategy, we invite you to book a demo with us. Embrace the future of retail with insights that matter. Connect with Shalion today!

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